EXHIBIT 2.6
STOCK PURCHASE AGREEMENT
BY
AND
AMONG
AMEDISYS ALTERNATE-SITE INFUSION THERAPY SERVICES, INC.,
A LOUISIANA CORPORATION
AND
PRN, INC.
D/B/A
HOME IV THERAPY
AND
XXXXXX X. XXXXXXX
AND
XXXXX X. XXXXXXX
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement') is made effective as of
________, 1998, by and between AMEDISYS ALTERNATE-SITE INFUSION THERAPY
SERVICES, INC., a Louisiana corporation, with its principal place of business at
0000 Xxxxx Xxxxxxxx Xxxxxx Xxxx., Xxxxx 000, Xxxxx Xxxxx, Xxxxxxxxx 00000
("AMED") and PRN, INC. D/B/A/ HOME IV THERAPY, a Texas corporation with its
principal place of business at 0000 Xxxxxxx Xxxxx, Xxxxx 000, Xxx Xxxxxxx, Xxxxx
00000 (The "Company"), Xxxxxx X. Xxxxxxx and Xxxxx X. Xxxxxxx (collectively, the
"Stockholders"). AMED, the Company and the Stockholders are sometimes referred
to collectively as the "Parties."
RECITALS
WHEREAS, AMED desires to purchase 100% of the issued and outstanding
capital stock of the Company ("Company Stock") from the Stockholders as
hereinafter provided and the Stockholders desires to effect such purchase; and
NOW, THEREFORE, in consideration of the premises and the mutual promises
made herein, and in consideration of the representations, warranties, and
covenants contained herein, the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
meanings indicated:
1.01. Closing: The consummation of the transactions contemplated by
this Agreement.
1.02. GAAP: Generally accepted accounting principles.
1.03. Health Care Laws: All federal, state and local laws, regulations
and ordinances related to the business of the Company including but not
limited to Medicaid, Medicare and regulations of the Health Care Finance
Administration.
1.04. Knowledge: means actual knowledge after reasonable investigation.
1.05. Material Adverse Effect: Any change in the financial condition or
operation of the business that would materially affect the Company's
business adversely, including, but not limited to, material changes to
management, business conditions, or financial condition.
1.07. Operating Licenses: Licenses, permits and registrations issued by
the appropriate state and federal agencies, which are necessary to the
operation of the Company's business. Such Operating Licenses are more
fully described in Schedule 3.11 hereto.
2. Terms of Purchase. On the basis of the representations, warranties,
covenants, and agreements contained in this Agreement and subject to the terms
and conditions of this Agreement:
2.01. Transfer. The Stockholders shall assign, transfer and convey at
the Closing the Company Stock, representing 100% of the issued and outstanding
capital stock of the Company, to AMED. The Stockholders shall deliver at
Closing a Stock Power in the form attached hereto as Schedule 2.01, and any
other documents required by this Agreement.
2.02. Purchase Price. At Closing AMED shall deliver and the
Stockholders shall be entitled to receive FOUR HUNDRED THIRTY THOUSAND AND
NO/100 ($430,000.00) DOLLARS, by wire transfer of immediately available funds,
the receipt and adequacy of which are hereby acknowledged by the Stockholders.
2.03. Additional Consideration. AMED will pay additional consideration
in the amount of ONE HUNDRED FIFTY THOUSAND AND NO/100 ($150,000.00) DOLLARS,
subject to the terms and conditions of Appendix "A", which is incorporated
herein by this reference. Amedisys, Inc. agrees to guarantee this payment.
2.04. The Company Stock referred to in Section 2.01. and the
consideration to be paid by AMED referred to in Section 2.02. and 2.03. shall
constitute all of the consideration to be paid in connection with the
transactions contemplated by this Agreement.
2.05. The Closing. The Closing of the transactions contemplated by
this Agreement shall be on or before February 27, 1998, at the AMED offices,
0000 X. Xxxxxxxx Xxxxxx Xxxx., Xxxxx 000, Xxxxx Xxxxx, Xxxxxxxxx.
3. Representations and Warranties of the Company and the
Stockholders. The Company and the Stockholders hereby agree, represent, and
warrant to AMED, on the date of this Agreement and on the Closing Date, as
follows:
3.01. Organization and Qualification. The Company does not own any
interest in any other business enterprise or legal entity, except as disclosed
in Schedule 3.01. Schedule 3.01 also correctly sets forth as to the Company its
state of incorporation, principal place of business, and jurisdictions in which
it is qualified to do business. The Company is a Texas corporation duly
organized, validly existing, and in good standing under the laws of its
jurisdiction of incorporation, with all requisite power and authority to conduct
its business and is not in breach of, or in default with respect to, any term of
its Certificate of Incorporation, Bylaws or other organizational documents,
except where such breach would not have a Material Adverse Effect. The Company
has obtained all necessary consents, authorizations, approvals, orders,
licenses, certificates, and permits of and from, and declarations and filings
with, all federal, state, local, and other governmental authorities and all
courts and other tribunals, to own, lease, license, and use its properties and
assets and to carry on the business in which it is now engaged, except where the
failure to do so would not have a Material Adverse Effect. The Company is
duly qualified to transact the business in which it is engaged in every
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of its business makes such qualification necessary, except
where the failure to do so would not have a Material Adverse Effect.
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3.02. Capitalization. The Stockholders own one hundred (100%) percent
of the issued and outstanding shares of Common Stock of the Company, which
constitutes all of the outstanding capital stock of Company. Except as set
forth in Schedule 3.02, The Company Stock is not owned or held in violation of
any preemptive right of any other person or entity, is validly authorized,
validly issued, fully paid and non-assessable, and is owned of record and
beneficially by the Stockholders. The shares of Company Stock held by the
Stockholders are free and clear of all liens, security interests, pledges,
charges, encumbrances, voting agreements, and voting trusts. There is no
commitment, plan, or arrangement to issue, and no outstanding option, warrant,
or other right calling for the issuance of, any shares of capital stock of the
Company or any security or other instrument convertible into, exercisable for,
or exchangeable for capital stock of the Company. There is outstanding no
security or other instrument convertible into or exchangeable for capital stock
of the Company.
3.03. Due Authorization; Third Party Consents. The Company has the
right, power, legal capacity, and authority to enter into and perform its
obligations under this Agreement and, except as set forth on Schedule 3.03 to
this Agreement, no approval or consent of any person other than the Company is
necessary in connection with the execution, delivery, or performance of this
Agreement. The execution, delivery, and performance of this Agreement by the
Company has been duly authorized by its board of directors and no other
corporate proceedings on the part of the Company are necessary to authorize this
Agreement or the consummation of the transactions contemplated hereby. This
Agreement constitutes a legal and binding obligation of the Company, and is
valid and enforceable against the Company in accordance with its terms except
that (i) the enforcement of certain rights and remedies created by this
Agreement is subject to bankruptcy, insolvency, reorganization, and similar laws
of general application affecting the rights and remedies of parties, (ii) the
enforceability of any particular provision of this Agreement under principles of
equity or the availability of equitable remedies, such as specific performance,
injunctive relief, waiver or other equitable remedies, is subject to the
discretion of courts of competent jurisdiction, and (iii) any court or
administrative body may refuse to enforce the choice of law provision of Section
9.11 of this Agreement.
3.04. Litigation. Except as set forth in Schedule 3.04, there is not
any suit, action, arbitration, or legal, administrative, or other proceeding or
governmental investigation (formal or informal), pending or to the best of
Company's or Stockholders's Knowledge threatened (or any basis therefor known to
the Company or the Stockholders), with respect to the Company or the
Stockholders (as it relates to the business of the Company), including but not
limited to any action or claim under any federal, state, local or other
governmental act, rule, regulation, or any interpretations thereof, relating to
environmental matters or the protection of the safety and health of persons
connected with the Company's business (including but not limited to the
transportation, treatment, storage, recycling, disposal, or release into the
environment of hazardous or toxic materials or waste), or any basis on which any
proceeding or investigation against the Company or the Stockholders might
reasonably be undertaken or brought. The Company and the Stockholders have
informed AMED of, and upon request have furnished or made available to AMED
copies of all relevant court papers and other documents relating to, the matters
set forth in Schedule 3.04. Included in Schedule 3.04 is a list of all suits,
actions, arbitrations, or other proceedings or
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investigations in which the Company has been involved during the five year
period immediately preceding the Closing. The Company is not presently engaged
in any legal action to recover monies due to the Company, for damages sustained
by the Company, or amounts owed to the Company, except as set forth on Schedule
3.04. During the five year period immediately preceding the Closing, the Company
has neither received nor been a party to any written notice of violations,
orders, claims, citations, complaints, penalties, assessments, court, or other
proceedings, administrative, civil or criminal, at law or in equity, with
respect to any Health Care Law. In addition, to the Company's and Stockholders's
Knowledge, the Company has neither received nor been party to any written notice
of violations, orders, claims, citations, complaints, penalties, assessments,
court, or other proceedings, administrative, civil or criminal, at law or in
equity, with respect to any alleged violations of any other federal, state, or
local environmental law, regulation, ordinance, standard, permit, or order in
connection with the conduct of its business or otherwise during the past five
years.
3.05. Employees. The Company does not have, or contribute to, any
pension, profit-sharing, option, other incentive plan, or other Employee Benefit
Plan (as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974), or have any obligation to or customary arrangement with employees for
bonuses, incentive compensation, vacations, severance pay, insurance, or other
benefits, except as set forth in Schedule 3.05. Schedule 3.05. contains a true
and correct statement of the names, relationship with the Company, present rates
of compensation (whether in the form of salary, bonuses, commissions, or other
supplemental compensation now or hereafter payable), and aggregate compensation
for the calendar year ended December 31, 1997 of each Stockholders, and the
three highest paid employees of the Company. Since December 31, 1997, the
Company has not changed the rate of compensation of any of its Stockholders,
employees, agents, dealers or distributors, except as disclosed in Schedule
3.05.
3.06. No Violation of Employee Contracts. No current or prior employee
or Stockholder of the Company has any employment agreement with the Company. To
the knowledge of the Company and the Stockholders, no employee of the Company is
in violation of any term of any employment contract, non-competition agreement,
or any other contract or agreement or any restrictive covenant with, or any
other common law obligation to, a former employer relating to the right of any
such employee to be employed by the Company because of the nature of the
business conducted by the Company or of the use of trade secrets or proprietary
information of others. There is neither pending nor, to the Knowledge of the
Company or the Stockholders, threatened, any actions, suits, proceedings, or
claims with respect to any contract, agreement, covenant, or obligation referred
to in the preceding sentence, except as listed in Schedule 3.04.
3.07. Insurance. Schedule 3.07 sets forth an accurate and complete
list and brief description of all policies of fire and extended coverage,
liability, and the forms of similar insurance or indemnity bonds held by the
Company. The Company is not in default with respect to any provisions of any
such policy or indemnity bond and has not failed to give any notice or present
any claim thereunder in due and timely fashion, which failure or failures to
give such notice or present such claim, individually or in the aggregate, could
have a Material Adverse Effect on the business
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of the Company. All such policies and bonds (i) are in full force and effect,
(ii) are with insurance companies believed by the Company and the Stockholders
to be financially sound and reputable, (iii) are sufficient for compliance by
the Company with all requirements of law and of all material agreements and
instruments to which the Company is a party, (iv) provide that they will remain
in full force and effect through the respective dates set forth in Schedule
3.07, and (v) will not in any significant respect be affected by, and will not
terminate or lapse by reason of, the transactions contemplated by this
Agreement. Schedule 3.07 sets forth an accurate and complete list of all
accident or other liability claims received by or known by the Company and the
Stockholders for the three year period immediately preceding the Closing, as
well as a description of the status of each such claim. Such claims are covered
by one or more insurance policies set forth in Schedule 3.07.
3.08. Contracts, Agreements and Instruments. Schedule 3.08 accurately
and completely sets forth the information required to be contained therein. The
Company has furnished to AMED:
3.08.01. The Certificate of Incorporation, Bylaws and other
organizational documents of the Company and all amendments thereto, as
presently in effect, certified by the president of the Company;
3.08.02. True and correct copies of all material contracts,
agreements and other instruments referred to in Schedule 3.08;
3.08.03. True and correct written descriptions of all material
service, supply, distribution, agency, financing or other arrangements
or understandings referred to in Schedule 3.08 involving an obligation
on the part of the Company in excess of $5,000 per year.
Except for matters which, in the aggregate, would not have a Material Adverse
Effect or are otherwise disclosed in the Schedules attached hereto or in the
Agreement, to the Knowledge of the Company and the Stockholders, no other party
to any such contract, agreement, instrument, leases, or license is now in
violation or breach of, or in default with respect to complying with, any
material provision thereof, and each such contract, agreement, instrument,
lease, or license contained in the Schedules hereto is in full force and effect
and is the legal, valid, and binding obligation of the Company and to the
Knowledge of the Stockholders the other parties thereto and is enforceable as to
them in accordance with its terms. Neither the Company, the Stockholders, nor
to the knowledge of the Stockholders has any other party to any such contract
listed in Schedule 3.08 given notice of termination or taken any action
inconsistent with the continuance of such contract, agreement, instrument,
lease, or license, except for matters which, in the aggregate, would not have a
Material Adverse Effect; and the Company's execution, delivery, and performance
of this Agreement will not violate any such contract, agreement, instrument,
lease, or license in any way contained in the Schedules hereto, except for
matters which, in the aggregate, would not have a Material Adverse Effect. The
Company is not a member of a customer or user organization or of a trade
association which relationship would be materially affected by the execution and
performance of this Agreement.
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3.09. Compliance With Laws. The Company has complied with, and is not
in violation of any (i) term or provision of its Certificate of Incorporation or
Bylaws; or (ii) to the Company's and the Stockholders's Knowledge term or
provision of any applicable judgment, decree, order, statute, injunction, rule,
ordinance; (iii) to the Company's and the Stockholders's Knowledge any Health
Care Law; or (iv) or the Company's and the Stockholders's Knowledge, foreign,
United States, state or local statutes, laws, rules, or regulations, except for
violations which would not have a Material Adverse Effect.
3.10. Financial Condition. The Company has delivered to AMED true and
correct copies of the following: the balance sheet ("the Company's Last Balance
Sheet") dated as of December 31, 1997 as supplemented in Schedule 3.10, and an
income statement and consolidated statement of the Company for the twelve month
period ended June 30, 1997, 1996 and 1995. Except for the absence of notes and
subject to normal year-end adjustments, in the case of interim statements, which
adjustments will not result in any Material Adverse Effects, such balance sheet
presents fairly the financial condition, assets and liabilities of the Company
as of its date; each such statement of income presents fairly the results of
operations of the Company for the period indicated; and each statement of cash
flows presents fairly the information purported to be shown therein. The
financial statements referred to in this Section 3.10, fairly present the
financial condition of the Company for the periods indicated in all material
respects, and are in accordance with the books and records of the Company.
3.11. Permits and Licenses. The Company has all permits, licenses, and
other similar authorizations necessary for the conduct of its business as now
being conducted by it, and it is not in default in any respect under any such
permits, licenses, or authorizations, except for the absence of which would not
have a Material Adverse Effect. Such permits, licenses, and other similar
authorizations of the Company are as set forth in Schedule 3.11. Except as set
forth in Schedule 3.11, no royalties, commissions, or fees are payable by the
Company to any person by reason of the ownership or use of any intangible
property. The Company is the sole and exclusive owner of all of its assets,
does not use any of its assets by the consent of any other person and is not
required to and does not make any payments to others with respect thereto.
Except as set forth in Schedule 3.11, there are no material licenses, sub-
licenses, or agreements relating to the use of any intangible property of the
Company now in effect, and the Company and the Stockholders have no Knowledge
that, any intangible property of the Company is being infringed by others.
Except as listed in Schedule 3.04, no claim that would have a Material Adverse
Effect on the business of the Company is pending or, to the Knowledge of the
Company, threatened, or has been made since the Company's inception to the
effect that, nor does the Company have any Knowledge that, the operation of the
Company's business or any method, process, part, or material that the Company
employs, conflicts in any material way with, or infringes in any material way
upon any rights of the type enumerated above, owned by others.
3.12. Properties. The Company has good and valid title to all
properties and assets used in its business or owned by it (except such real and
other property and assets as are held pursuant to leases or licenses described
in Schedule 3.12), free and clear of all liens, mortgages, security
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interests, pledges, charges, and encumbrances (except for liens for current
taxes not yet due and except such as are disclosed in Schedule 3.12 or disclosed
on the Company's Last Balance Sheet).
3.12.01. Attached as Schedule 3.12 is a true and complete list of all
properties and assets owned, leased, or licensed by the Company having an
individual value of $5,000 or more, including with respect to such
properties and assets leased or licensed by the Company, a description of
such lease or license. All such properties and assets owned by the Company
are reflected on the Company Last Balance Sheet. All properties and assets
owned, leased, or licensed by the Company are in good and usable condition
(reasonable wear and tear, which is not such as to have a Material Adverse
Effect on the operation of the business of the Company, excepted);
3.12.02. The properties and assets owned, leased, or licensed by the
Company constitute all such properties and assets which are necessary to
the business of the Company as presently conducted.
3.12.03. All accounts and notes receivable reflected on the Company Last
Balance Sheet, and arising since the Company's Last Balance Sheet Date,
have been collected, or are and will be good and valid, in each case at the
aggregate recorded amounts thereof without right of recourse, defense,
deduction, return of goods, counterclaim, offset, or setoff on the part of
the obligor, and, if not collected, can reasonably be anticipated to be
paid within 120 days of the date incurred.
3.13. Hazardous Materials. Except as disclosed on Schedule 3.13, the
Company is not in the business of possession, transportation, or disposal of
hazardous materials. If and to the extent that the Company's business has
involved the possession, transportation, or disposal of hazardous materials, to
the best of the Company's and the Stockholders' Knowledge, the Company has
complied with any and all applicable laws, ordinances, rules, and regulations.
To the Knowledge of the Company and the Stockholders, no employee of the Company
has been exposed to hazardous materials such that exposure could cause damage to
such employee.
3.14. Interest in Competitors. Except as set forth in Schedule 3.14
to this Agreement, no shareholder, officer or director of the Company, nor any
spouse or child of any shareholder, officer or director with authority to enter
into contracts on behalf of the Company, has any direct or indirect interest
(excepting stockholdings of securities of publicly held and traded companies) in
any competitor, supplier, or customer of the Company or in any person from whom
or to whom the Company leases any real or personal property, or in any other
person with whom the Company is doing business.
3.15. Tax and Other Liabilities. The Company does not have any present
liability of any nature, accrued or contingent, of the type required to be
reflected on a balance sheet or in appropriate footnotes prepared in accordance
with GAAP, including, without limitation, liabilities for federal,
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state, local, or foreign taxes and liabilities to customers or suppliers, which
could have a Material Adverse Effect upon the Company, other than the following:
i. Liabilities for which full provision has been made on the Company
Last Balance Sheet as of the Company Last Balance Sheet Date; and
ii. Other liabilities arising since the Company Last Balance Sheet
Date and prior to the Closing in the ordinary course of business
which are not inconsistent with the representations and
warranties of the Company or any other provision of this
Agreement.
Without limiting the generality of the foregoing, the amounts set forth as
provisions for taxes on the Company Last Balance Sheet are sufficient for all
accrued and unpaid taxes of the Company, whether or not due and payable and
whether or not disputed, under tax laws, as in effect on the Company Last
Balance Sheet Date or now in effect, for the period ended on such date and for
all fiscal years prior thereto. The Company has filed all applicable tax
returns required to be filed by it or has obtained applicable extensions and are
not delinquent with respect to such extensions; have paid (or have established
on the Company Last Balance Sheet a reserve for) all taxes, assessments, and
other governmental charges payable or remittable by it or levied upon it or its
properties, assets, income, or franchises, which are due and payable and have
delivered to AMED a true and correct copy of any report as to adjustments
received by the Company from any taxing authority during the past five years and
a statement as to any litigation, governmental or other proceeding (formal or
informal), or investigation pending.
3.16. Changes or Events. Except as set forth in Schedule 3.16, since
the Company's Last Balance Sheet Date, none of the following has occurred:
3.16.01. Any material transaction by the Company not in the ordinary
course of business involving amounts in excess of $5,000;
3.16.02. Any material capital expenditure by the Company.
3.16.03. Other than in the ordinary course of business, any changes in
the condition (financial or otherwise), liabilities, assets, or business
or in any business relationships of the Company, including relationships
with suppliers or customers, that, when considered individually or in
the aggregate, might reasonably be expected to have a Material Adverse
Effect;
3.16.04. The destruction of, damage to, or loss of any asset of the
Company (regardless of whether covered by insurance) that, when
considered individually or in the aggregate, might reasonably be
expected to have a Material Adverse Effect;
3.16.05. Any labor disputes that, when considered individually or in
the aggregate, might reasonably be expected to have a Material Adverse
Effect;
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3.16.06. Except as listed on Schedule 3.16.06, there have been no
changes in accounting methods or practices (including, without
limitation, any change in depreciation or amortization policies or
rates) by the Company, except for any such changes as were required by
law;
3.16.07. Other than in the ordinary course of business, any increase in
the salary or other compensation payable or to become payable by the
Company to any employee, or the declaration, payment, or commitment or
obligation of any kind for the payment by the Company of a bonus or
other additional salary or compensation to any such person;
3.16.08. The material amendment or termination of any material
contract, agreement, or license to which the Company is a party, except
in the ordinary course of business;
3.16.09. Any loan by the Company to any person or entity, or the
guaranteeing by the Company of any loan other than loans made in the
ordinary course of business;
3.16.10. Any mortgage, pledge, or other encumbrance of any asset of the
Company except in the ordinary course of business;
3.16.11. The waiver or release of any right or claim of the Company,
except in the ordinary course of business;
3.16.12. Any other events or conditions of any character within the
Knowledge of the Company and the Stockholders that, when considered
individually or in the aggregate, have or might reasonably be expected
to have a Material Adverse Effect;
3.16.13. Any loss or, to the Knowledge of the Company or the
Stockholders, any threatened loss of any permit, license, qualification,
special charter or certificate of authority held or enjoyed or formerly
held or enjoyed by the Company which loss has had or upon occurrence
might reasonably be expected to have a Material Adverse Effect;
3.16.14. To the Knowledge of the Company and the Stockholders, since
December 31, 1997, no statute, regulation, order, ordinance or other law
has been adopted or rescinded which is reasonably expected to have a
Material Adverse Effect;
3.16.15. Any material failure on the part of the Company to operate its
business in the ordinary course and consistent with past practices so
as to preserve its business organization intact, to retain the services
of its employees and to preserve its goodwill and relationships with
suppliers, creditors, customers, and others having business
relationships with it;
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3.16.16. Any action taken or omitted to be taken by the Company which
would cause (after lapse of time, notice or both) the breach, default,
or acceleration of any right, contract, commitment, or other obligation
of the Company which would have a Material Adverse Effect; or
3.16.17. Any agreement by the Company to do any of the things described
in the preceding clauses 3.16.01 through 3.16.16.
3.17. No Defaults. Except as set forth in Schedule 3.17, the
consummation of the transactions contemplated by this Agreement will not result
in or constitute any of the following: (i) a breach of any term or provision of
any other agreement of the Company that will not be waived or released at
Closing; (ii) a default or an event that will not be waived or released at
Closing, and that, with notice or lapse of time or both, would be a default,
breach, or violation of the Certificate of Incorporation or Bylaws of the
Company or of any lease, license, promissory note, conditional sales contract,
commitment, indenture, mortgage, deed of trust, or other agreement, instrument,
or arrangement to which the Company is a party or by which the Company or its
assets are bound; (iii) an event that will not be waived or released at Closing
and that would permit any party to terminate any agreement or to accelerate the
maturity of any indebtedness or other obligation of the Company; (iv) the
creation or imposition of any lien, charge, or encumbrance on any of the
Company's assets; or (v) a violation of any law or any rule or regulation of any
administrative agency or governmental body unrelated to the business or
profession of health care and any profession related to health care, or any
order, writ, injunction or decree of any court, administrative agency or
governmental body to which the Company is subject.
3.18. No Prohibited Payments. Neither the Company nor any employee, or
agent of the Company, has made or authorized any payment of funds of the Company
or on behalf of the Company prohibited by law and no funds of the Company have
been set aside to be used for any payment prohibited by law.
3.19. Completeness of Disclosure. No representation or warranty in this
Agreement and no Appendix, Schedule, Exhibit, or certificate prepared by the
Company pursuant hereto and no statement made or other document prepared by the
Company and furnished to AMED by the Company contains any untrue statement of a
material fact or omits or will omit any material fact necessary in order to make
the statements contained therein not misleading.
4. Representations and Warranties of AMED. AMED hereby agrees,
represents, and warrants to the Stockholders, on the date of this Agreement and
on the Closing Date, as follows:
4.01. Organization. AMED is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Louisiana and
authorized to carry on business in the State of Texas and in every other
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of it business makes such qualification necessary, except
where the failure to do so would not have a Material Adverse Effect.
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4.02. Due Authorization; Third Party Consents. AMED has the right, power,
legal capacity, and authority to enter into and perform its obligations under
this Agreement and no approval or consent of any person other than AMED is
necessary in connection with the execution, delivery, or performance of this
Agreement. The execution, delivery, and performance of this Agreement by AMED
has been duly authorized by its board of directors and no other corporate
proceedings on the part of AMED are necessary to authorize this Agreement or the
consummation of the transactions contemplated hereby. This Agreement
constitutes a legal and binding obligation of AMED, and is valid and enforceable
against AMED in accordance with its terms except that (i) the enforcement of
certain rights and remedies created by this Agreement is subject to bankruptcy,
insolvency, reorganization, and similar laws of general application affecting
the rights and remedies of parties, (ii) the enforceability of any particular
provision of this Agreement under principles of equity or the availability of
equitable remedies, such as specific performance, injunctive relief, waiver or
other equitable remedies, is subject to the discretion of courts of competent
jurisdiction, and (iii) any court or administrative body may refuse to enforce
the choice of law provision of Section 9.11 of this Agreement.
4.03. No Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following: (i) a
breach of any term or provision of any other agreement of AMED that will not be
waived or released at Closing; (ii) a default or an event that will not be
waived or released at Closing and that, with notice or lapse of time or both,
would be a default, breach, or violation of the Certificate of Incorporation or
Bylaws of AMED or of any lease, license, promissory note, conditional sales
contract, commitment, indenture, mortgage, deed of trust, or other agreement,
instrument, or arrangement to which AMED is a party or by which AMED or the
property of AMED is bound; or (iii) a violation of any law or any rule or
regulation of any administrative agency or governmental body or any order, writ,
injunction, or decree of any court, administrative agency or governmental body
to which AMED is subject.
4.04. Completeness of Disclosure. No representation or warranty in this
Agreement and no Schedule, Exhibit, or certificate prepared by AMED pursuant
hereto and no statement made or other document prepared by AMED and furnished to
the Company by AMED contains any untrue statement of a material fact or omits
or will omit any material fact necessary in order to make the statements
contained therein not misleading.
4.05 Investment Intent. AMED is acquiring the Company Stock for its own
account and not with a view to distribution within the meaning of Section 2(11)
of the Securities Act of 1933, as amended. AMED confirms that the Company and
the Stockholders have made available to AMED and its representatives and agents
the opportunity to ask questions of the officers and management employees of the
Company and to acquire such additional information about the business and
financial condition of the Company as AMED has requested, and all such
information has been received, or represented to have been received.
5. Conditions to Obligations of AMED. The obligations of AMED under this
Agreement are subject, at the option of AMED, to the following conditions:
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5.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of Company or the Stockholders contained in this
Agreement shall be accurate when made and, in addition, shall be materially
accurate as of the Closing as though such representations and warranties were
then made by Company or such Stockholders on the part of Company or any
Stockholders. As of the Closing, the Company and the Stockholders shall have
performed and complied with all covenants and agreements and satisfied all
conditions required to be performed and complied with by any of them at or
before such time by this Agreement and AMED shall have received certificates
signed by the Stockholders dated the date of the Closing to that effect,
substantially in the form of Schedule 5.01.
5.02. Other Closing Documents. Company and the Stockholders shall have
delivered to AMED at or prior to the Closing such other documents as AMED may
reasonably request in order to enable AMED to determine whether the conditions
to their obligations under this Agreement have been met and otherwise to carry
out the provisions of this Agreement.
5.03. Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement incidental
thereto and all other related legal matters shall be subject to the reasonable
approval of counsel to AMED, and the Company shall have furnished such counsel
for AMED such documents as such counsel may have reasonably requested for the
purpose of enabling them to pass upon such matters.
5.04. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements or to obtain substantial damages with respect thereto, except as
listed in Schedule 3.04.
5.05. No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of AMED:
5.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
5.05.02. Results in a delay which affects the ability of AMED to
consummate any of the transactions contemplated by this Agreement;
5.05.03. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the contemplated
benefits to AMED of the transactions contemplated by this Agreement.
5.06. Contractual Consents Needed. The parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement,
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or understanding to which any of them or any subsidiary is a party, or to which
any of their respective businesses, properties, or assets are subject, except
where the failure would not have a Material Adverse Effect.
5.07. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
parties thereto at or prior to the Closing, shall be in full force and effect,
valid and binding upon the parties thereto, and enforceable by them in
accordance with their terms at the Closing, and no party thereto at any time
from the execution thereof until immediately after the Closing shall have been
in violation of or in default in complying with any material provision thereof.
5.08. Non-Competition and Non-Solicitation Agreement. Xxxxxx X. Xxxxxxx and
Xxxxx X. Xxxxxxx shall have entered into the non-competition and non-
solicitation agreement in the form attached hereto as Schedule 5.08.
5.09. Board and Shareholder Approval. The Board of Directors and
shareholders of the Company shall have approved the transactions contemplated
herein.
5.10. Legal Opinion. AMED shall have received the opinion of Xxx & Xxxxx,
Incorporated, dated the Closing Date, in the form of Schedule 5.10 attached
hereto.
5.11. Releases. AMED shall have received the releases from the Stockholders
and employees in the form set forth in Schedule 5.11
6. Conditions to Obligations of The Company and the Stockholders. The
obligations of the Company and the Stockholders under this Agreement are
subject, at the option of the Company and the Stockholders, to the following
conditions:
6.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of AMED contained in this Agreement shall be
accurate when made and, in addition, shall be materially accurate as of the
Closing as though such representations and warranties were then made by AMED on
the part of AMED. As of the Closing, AMED shall have performed and complied
with all covenants and agreements and satisfied all conditions required to be
performed and complied with at or before such time by this Agreement and the
Company shall have received certificates signed by the officers of AMED dated
the date of the Closing to that effect, substantially in the form of Schedule
6.01.
6.02. Other Closing Documents. AMED shall have delivered to the Company, at
or prior to the Closing, such other documents as the Company may reasonably
request in order to enable the Company to determine whether the conditions to
its obligations under this Agreement have been met and otherwise to carry out
the provisions of this Agreement.
6.03. Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement incidental
thereto and all other related legal
-13-
matters shall be subject to the reasonable approval of counsel to the Company
and AMED shall have furnished such counsel such documents as such counsel may
have reasonably requested for the purpose of enabling them to pass upon such
matters.
6.04. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements set forth as an exhibit hereto, or to obtain substantial damages with
respect thereto.
6.05. No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of the Company:
6.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
6.05.02. Results in a delay which affects the ability of the Company to
consummate any of the transactions contemplated by this Agreement;
6.05.03. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the contemplated
benefits to the Company or the Stockholders of the transactions contemplated
by this Agreement.
6.06. Contractual Consents Needed. The Parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or understanding
to which any of them or any subsidiary is a party, or to which any of their
respective businesses, properties, or assets are subject, except where the
failure would not have a Material Adverse Effect.
6.07. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
Parties thereto at or prior to the Closing, shall be in full force, valid and
binding upon the Parties thereto, and enforceable by them in accordance with
their terms at the Closing, and no party thereto at any time from the execution
thereof until immediately after the Closing shall have been in violation of or
in default in complying with any material provision thereof.
6.08. Board Approval. The Board of Directors of AMED shall have approved
the transactions contemplated herein.
6.09 Bank Debt Release. At Closing, AMED will satisfy the Company debt to
Frost National Bank, thereby releasing the Stockholders of their personal
guarantee of said debt.
-14-
7. Covenants and Agreements of the Company. The Company covenants and
agrees as follows:
7.01. Public Statements. Before the Company shall release any information
concerning this Agreement or the transactions contemplated by this Agreement
which is intended for or may result in public dissemination thereof, the Company
shall cooperate with AMED, shall furnish drafts of all documents or proposed
oral statements to AMED for comment, and shall not release any such information
without the written consent of AMED. Nothing contained herein shall prevent the
Company from furnishing any information to any governmental authority if
required to do so by law.
7.02. Consents Without any Condition. The Company shall not make any
agreement or understanding with a third party not in the ordinary course of
business without approval in writing by AMED.
7.03. Access. With reasonable prior notice, the Company will afford the
officers, counsel, agents, investment bankers, accountants, and other
representatives of AMED, free and full access to the plans, properties, books,
and records of the Company; will permit them to make, at AMED's expense,
extracts from and copies of such books and records; and will from time to time
furnish AMED with such additional financial and operating data and other
information as to the financial condition, results of operations, business,
properties, assets, liabilities, or future prospects of the Company as AMED from
time to time may reasonably request. The Company will also cause the public
accountants of the Company to make available to AMED and its public accountants
the work papers relating to the audits of the Company.
7.04. Conduct of Business. The Company will use its reasonable best efforts
to conduct its affairs so that at the Closing, no representation or warranty of
the Company will be inaccurate, no covenant or agreement of the Company will be
breached, and no condition in this Agreement will remain unfulfilled by reason
of the actions or omissions of the Company.
7.05. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, the Company will immediately advise AMED in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which any of them obtains knowledge and which (if existing and
known at the date of the execution of this Agreement) would have been required
to be set forth or disclosed in or pursuant to this Agreement or an exhibit or
schedule hereto, which (if existing and known at any time prior to or at the
Closing) would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more difficult than in
the absence of such fact or occurrence, or which (if existing and known at the
time of the Closing) would cause a condition to any party's obligations under
this Agreement not to be fully satisfied.
8. Covenants and Agreements of AMED. AMED covenants and agrees as
follows:
8.01. Public Statements. Before AMED shall release any information
concerning this Agreement or the transactions contemplated by this Agreement
which is intended for or may result
-15-
in public dissemination thereof, AMED shall cooperate with the Company, shall
furnish drafts of all documents or proposed oral statements to the Company for
comments, and shall not release any such information without the written consent
of the Company. Nothing contained herein shall prevent AMED from furnishing any
information to any governmental authority if required to do so by law.
8.02. Consents Without any Condition. AMED shall not make any agreement or
understanding with a third party not in the ordinary course of business not
approved in writing by the Company.
8.03. Conduct of Business. AMED will conduct its affairs so that at the
Closing no representation or warranty of AMED will be inaccurate, no covenant or
agreement of AMED will be breached, and no condition in this Agreement will
remain unfulfilled by reason of the actions or omissions of AMED.
8.04. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, AMED will immediately advise the Company in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which it obtains knowledge and which (if existing and known at the
date of the execution of this Agreement) would have been required to be set
forth or disclosed in or pursuant to this Agreement or an exhibit or schedule
hereto, which (if existing and known at any time prior to or at the Closing)
would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more difficult than in
the absence of such fact or occurrence, or which (if existing and known at the
time of the Closing) would cause a condition to any party's obligations under
this Agreement not to be fully satisfied.
9. Miscellaneous.
9.01. Brokerage and Other Fees. Each party shall be responsible for the
fees of their respective brokers and/or professionals (including, without
limitation, legal and accounting fees) engaged to assist in the preparation,
negotiation and counseling with respect, and relating, to this Agreement and
consummation of the transactions contemplated herein, as well as their
respective out-of-pocket expenses, except AMED agrees to pay for the
preparation of the necessary transfer documents to accomplish the transactions
herein.
9.02. Further Actions. At any time and from time to time, the parties
agree, at their expense, to take such actions and to execute and deliver such
documents as may be reasonably necessary to effectuate the purposes of this
Agreement.
9.03. Availability of Equitable Remedies. Without limiting the terms and
provisions of Section 10 hereof, since a breach of the provisions of this
Agreement could not adequately be compensated by money damages, the parties
shall be entitled before, and only before, Closing, in addition to any other
right or remedy available to them, to an injunction restraining such breach or
-16-
a threatened breach and to specific performance of any such provision of this
Agreement; and in either case, no bond or other security shall be required in
connection therewith, and the parties hereby consent to the issuance of such an
injunction and to the ordering of specific performance.
9.04. Modification. The Agreement and the schedules and exhibits hereto set
forth the entire understanding of the parties with respect to the subject matter
hereof supersede all existing agreements among them concerning such subject
matter, and may be modified only by a written instrument duly executed by the
Parties.
9.05. Notices. Any notice or other communication required or permitted to
be given hereunder shall be in writing and shall be delivered by personal
delivery or by overnight delivery or mailed by certified mail, return receipt
requested (or by the most nearly comparable method if mailed from or to a
location outside of the United States), or delivered against receipt to the
party to whom it is to be given at the address of such party set forth in the
preamble or signature pages to this Agreement. Any notice or other
communication given by certified mail (or by such comparable method) shall be
deemed given at the time of mailing (or comparable act), except for a notice
changing a party's address, which will be deemed given at the time of receipt
thereof.
9.06. Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of that provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term
of this Agreement on one or more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing
and, in the case of a corporate party, be authorized by a resolution of the
Board of Directors or by an officer of the waiving party.
9.07. Binding Effect. The provisions of this Agreement shall be binding
upon and inure to the benefit of each party's respective successors, assigns,
heirs, and personal representatives.
9.08. No Third-Party Beneficiaries. This Agreement does not create, and
shall not be construed as creating, any rights enforceable by any person not a
party to this Agreement.
9.09. Separability. If any provision of this Agreement is invalid, illegal,
or unenforceable, the balance of this Agreement shall remain in effect, and if
any provision is inapplicable to any person or circumstance, it shall
nevertheless remain applicable to all other persons and circumstances.
9.10. Headings. The headings of this Agreement are solely for convenience
of reference and shall be given no effect in the construction or interpretation
of this Agreement.
9.11. Counterparts, Governing Law. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. It shall be
governed by and construed in accordance with the laws of the State of Texas
without giving effect to conflict of laws.
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9.12. Indemnification by the Stockholders. The Stockholders shall,
indemnify, defend and hold harmless AMED and each of its officers, directors,
agents and affiliates from and against any damage, loss, claim, liability, cost
or expense, including reasonable fees and disbursements of counsel, accountants,
experts and other consultants (collectively, "Damages"), resulting from, arising
out of, or based upon any misstatement or omission from any representation by,
or any breach of warranty, covenant or agreement of the Company or the
Stockholders contained herein ("Other Liabilities") in excess of $12,500;
provided, however, notwithstanding anything contained herein to the contrary,
the term "Damages" shall not include expenses, losses, costs, deficiencies,
liabilities, taxes, penalties, fines, liens and damages (i) to the extent of any
proceeds received by such party from any insurance policies with respect
thereto, (ii) to the extent of any net tax benefits realized by such party and
(iii) to the extent of any indemnities or recoveries from third parties.
9.13. Indemnification by AMED. AMED shall indemnify, defend and hold
harmless the Stockholders, the Company, and each of its officers, directors,
agents and affiliates from and against any Damages resulting from, arising out
of, based upon or occasioned by any misstatement or omission from any
representations by, or any breach of warranty, covenant or agreement of, AMED
contained herein.
9.14. Indemnification Procedures. Promptly after receipt by the party
seeking indemnification hereunder (the "Indemnitee"), of notice of any action,
suit, proceeding, audit, claim or potential claim (any of which is hereinafter
individually referred to as a "Circumstance"), which could give rise to a right
to indemnification for damages pursuant to Section 9.12 or 9.13, the Indemnitee
shall give the party who may become obligated to provide indemnification
hereunder (the "Indemnitor") written notice describing the Circumstance in
reasonable detail; provided, that failure of an Indemnitee to give such notice
to the Indemnitor shall not relieve the Indemnitor from any of its
indemnification obligations hereunder unless (and then only to the extent) that
the failure to give such notice prejudices the defense of the Circumstance by
the Indemnitee. Such Indemnitor shall have the right, at its option to
compromise or defend, at its own expense and by counsel approved by Indemnitee
(which approval shall not be unreasonably withheld), any such matter involving
the asserted liability of the Indemnitee; provided, that any compromise entered
into without the consent of Indemnitee (i) shall include as an unconditional
term thereof, the giving by the claimant or the plaintiff to such Indemnitee of
a release from all liability in respect of such claim and (ii) shall not result
in the imposition on the Indemnitee of any remedy other than monetary damages to
be paid in full by the Indemnitor pursuant to this Section 9.14. If any
indemnitor shall undertake to compromise or defend any such asserted liability,
it shall promptly notify the Indemnitee of its intention to do so, and the
Indemnitee agrees to, and to cause its own independent counsel to, cooperate
fully with the Indemnitor and its counsel in the compromise of, or defense
against, any such asserted liability. All reasonable out-of-pocket costs and
expenses incurred by the Indemnitee in connection with such cooperation
(excluding the fees and expenses of the Indemnitee's own independent counsel)
shall be borne by the Indemnitor. In any event, the Indemnitee shall have the
right to participate with its own counsel in the defense of such asserted
liability; provided that Indemnitor shall not be obligated to indemnify
Indemnitee for the cost of Indemnitee's participation in such defense, including
Indemnitee's attorney's fees, unless both the Indemnitee and the Indemnitor are
named as parties and the Indemnitee shall in good faith determine the
representation
-18-
of both parties by the same counsel would be inappropriate due to actual or
potential conflicting interest between them; provided, however, that in no event
shall the Indemnitor be obligated to assume the expense of more than one such
separate counsel in connection with Damages arising out of the same claim or
cause of action. Under no circumstances shall the Indemnitee compromise any such
asserted liability without the written consent of the Indemnitor (which consent
shall not be unreasonably withheld), unless the Indemnitor shall have failed or
refused to undertake the defense of any such asserted liability after a
reasonable period of time has elapsed following the notice of a Circumstance
received by such Indemnitor pursuant to this Section 9.14.
9.15. Exclusivity. Except for the injunctive relief provided in Schedule
5.08 and off-set provision of Section 9.18 the indemnification provisions of
this Section 9 shall be the exclusive remedy for claims by AMED or its
representatives under this Agreement. Neither AMED or its representatives shall
be able to avoid the limitations expressly set forth in this Section 9 by
electing to pursue another remedy (other than claims based upon actual fraud).
The parties hereto hereby waive any provision of law to the extent it would
limit or restrict their agreement set forth in this section 9.15.
9.16. Survival of Representations and Warranties. Except as set forth in
the second sentence of this Section 9.16, each of the representations and
warranties made by the Company and the Stockholders pursuant to this Agreement
shall survive for a period of twelve (12) months after the Closing, and upon
expiration of such period, such representations and warranties shall expire. The
representations and warranties made by the Company and the Stockholders to the
extent relating to (i) Medicaid and Medicare shall survive for a period of
twenty-four (24) months after the Closing and (ii) taxes and the Company's
Defined Benefit Pension Plans shall survive for the applicable statute of
limitations period, and shall thereafter expire. No claim for the recovery of
Damages may be asserted by AMED or any of its representatives against the
Stockholders after such representation and warranty shall expire.
9.17. Limitations on Indemnification. The aggregate liability of the
Stockholders for indemnification claims under Section 9.12 shall not exceed
$430,000.
9.18. Right of Off-Set. If AMED reasonably believes it is entitled to
indemnification under this Agreement, the amount of such Damages shall first be
credited and off-set against the last amount to be repaid which are due and
owing to the Stockholders pursuant to the terms of Section 2.03 and Appendix A
hereto and written notice of such off-set shall be given to the Stockholders. In
the event the off-set is disputed by the Stockholders, such dispute shall be
governed by the provisions of Section 10. If it is ultimately determined that
such off-set was improper, AMED shall immediately pay the Stockholders the
amount due and owing plus interest of 15% on such amount from the date such
payment was originally due until the date payment is made.
10. Arbitration
10.1 Arbitration Procedures. Any and every dispute of any nature
whatsoever that may arise between the parties hereto, whether sounding in
contract, statute, tort, fraud, misrepresentation,
-19-
discrimination or any other legal theory, or breach of this Agreement, or any
schedule, certificate or other document delivered by any party hereto or
thereto, or those arising under any federal, state or local law, regulation or
ordinance, shall be determined by binding arbitration in accordance with the
then-current commercial arbitration rules of the American Arbitration
Association ("AAA"), to the extent such rules do no conflict with the provision
of this Section 10. The arbitration shall be conducted by a single neutral
arbitrator. The parties shall endeavor to select neutral arbitrators by mutual
agreement. If such agreement cannot be reached within thirty (30) calendar days
after a dispute has arisen which is to be decided by arbitration, any party of
the parties jointly shall request AAA to submit to each party an identical panel
of fifteen (15) persons. Alternate strikes shall be made to the panel,
commencing with the party bringing the claim, until the name of one (1) person
remains. The parties may, however, by mutual agreement, request AAA to submit
additional panels of possible arbitrators. The arbitrator shall have the power
to determine all matters incident to the conduct of the arbitration, including
without limitation all procedural and evidentiary matters and the scheduling of
any hearing. The award made by the arbitrator shall be governed by the United
States Arbitration Act, 9 U.S.C. (S)(S) 1-16, and judgment upon the award
rendered by the arbitrator(s) may be entered by any court having jurisdiction
thereof. Unless otherwise agreed by the parties, the arbitration shall be held
in San Antonio, Texas.
10.2 Provision applicable to claims for injunctive relief. Except as set
forth in Section 9.18 and Schedule 5.08, the agreement of the parties hereto is
to submit all disputes to binding arbitration. In the event injunctive relief
is sought, the parties agree that Commercial Arbitration Rule 13 (as amended
November 1, 1993, or its subsequent equivalent) shall not apply, and instead, a
single arbitrator shall be appointed within one business day after the filing of
the demand or submission. Such arbitrator shall then preside over the
application for injunctive relief and all other disputes then arising under this
agreement. The arbitrator appointed under this paragraph 10.2 shall be
appointed by JAMS Endispute, San Antonio, Texas ("JAMS"), in the following
manner: the case administrator for the AAA shall contact JAMS immediately on
receipt of the demand for arbitration containing the claim for injunctive
relief. The case administrator shall provider JAMS with the names of the parties
to, and a copy of, this agreement. From its then current list of qualified,
licensed, but non-practicing attorneys who are former, sitting trial judges, the
San Antonio national account manager (or equivalent position) of JAMS shall
appoint one such individual as the arbitrator to preside over the application
for injunctive relief and all other disputes between the parties. Except in the
unlikely event of an actual conflict of interest under the Rules of Professional
Conduct or Code of Judicial Conduct, neither party shall have any right to
strike or object to the appointment of any person so selected. The parties
expressly agree and desire that the selection of an arbitrator hereunder shall
be effected within one business day of any application for injunctive relief and
agree that such application shall then be considered at least as expeditiously
as would be the case in the District Courts for Bexar County. The parties
further agree that any injunctive relief granted by the arbitrator shall be
separately enforceable in the District Court for Bexar County, to the same
extent as would be the case for a final award of the arbitrator.
10.3 EACH OF THE PARTIES TO THIS AGREEMENT WAIVES ANY RIGHT TO TRIAL BY
JURY OF ANY DISPUTE OF ANY NATURE WHATSOEVER THAT MAY ARISE BETWEEN THEM,
RELATING TO OR INVOLVING, IN ANY WAY THE CONSTRUCTION,
-20-
PERFORMANCE OR BREACH OF THIS AGREEMENT OR ANY OTHER AGREEMENT BETWEEN THE
PARTIES CONTEMPLATED HEREBY, THE PROVISIONS OF ANY FEDERAL, STATE OR LOCAL LAW,
REGULATION OR ORDINANCE NOTWITHSTANDING. By execution of this Agreement, each of
the parties hereto acknowledges and agrees that such party has had an
opportunity to consult with legal counsel and that such party knowingly and
voluntarily waives any right to a trial by jury of any dispute pertaining to or
relating in any way to the transactions contemplated by this Agreement, the
provisions of any federal, state or local law, regulation or ordinance
notwithstanding.
-21-
IN WITNESS WHEREOF, the parties have duly executed this Agreement effective
as of the date written in the preamble of this Agreement.
AMEDISYS Alternate Site Infusion Therapy
Services, Inc.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
PRN, Inc.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
Stockholders:
---------------------------------------------
Name:
----------------------------------------
Address:
-------------------------------------
---------------------------------------------
Name:
----------------------------------------
Address:
-------------------------------------
The undersigned hereby exercutes this Agreement solely for purposes of
guaranteeing the obligation of AMED under Section 2.03 and Appendix A.
AMEDISYS, INC.
By:
---------------------------------------
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APPENDIX "A"
AMED will pay to the Stockholders as additional consideration ONE HUNDRED FIFTY
THOUSAND AND NO/100 DOLLARS ($150,000.00), subject to adjustment as hereinafter
provided, plus interest as described herein. The payments due hereunder shall
bear interest at a rate of 9.5% per annum, and shall be calculated based upon
the remaining principal due, or which could become due, hereunder. There shall
be eight installment payments of principal plus accrued interest, such payments
being made on or before the thirtieth day following the end of each calendar
quarter beginning March 31, 1998 and ending December 31, 1999. The calendar
quarters are March 31/st/, June 30/th/, September 30/th/ and December 31/st/ and
each installment payment shall relate to the ended quarter immediately preceding
such payment.
The principal portion of each installment payment to be made hereunder shall be
equal to $150,000.00 multiplied by the Percentage (as hereinafter defined) for
the calendar quarter to which such payment relates. The Percentage for a
calendar quarter shall be equal to (i) the PRN Quarterly Revenue (as hereinafter
defined) for such quarter (ii) divided by $1,062,500 ($625,000 x 2 years x 85%).
In no event shall the aggregate principal paid with respect to all installment
payments made hereunder exceed $150,000.00.
Interest shall be computed on the basis of a 365 day year and the interest due
shall be calculated based upon the outstanding principal balance as of the date
of such payment (i.e., $150,000.00 minus the aggregate principal portions of all
previous installment payments made hereunder).
Privilege is reserved to prepay, all, or any portion of the unpaid principal
balance, at any time, without penalty; provided, however, that any partial
prepayment shall be applied first to accrued and unpaid interest and then to the
principal balance.
Matured unpaid principal and interest shall bear interest at a rate equal to the
lesser of (i) 18% per annum, or (ii) the maximum rate allowed by applicable
statute. In the event that default be made in the payment of principal or
interest, or otherwise, hereunder, and the amount owed hereunder is not subject
to a bonafide dispute between AMED and the Stockholders, the Stockholders may at
their option declare the entire principal balance (i.e., $150,000 minus the
aggregate principal portions of all previous installment payments made
hereunder) and accrued interest owing heron immediately due and payable.
Failure to exercise this option shall not constitute a waiver of the right to
exercise the same the same in the even of any subsequent default.
For purposes of this Appendix A, the term Quarterly PRN Revenue shall mean all
PRN Revenue relating to such calendar quarter. The term PRN Revenue shall mean
the aggregate amount of gross revenue (adjusted for contractual allowances)
calculated in accordance with GAAP of the Company, AMED or any other affiliate
or subsidiary or AMED to the extent such revenue relates to (i) operations of
the Company from January 1, 1998 to the Closing Date (ii) patients of the
Company as of or after the Closing Date or (iii) any of the referral sources of
the Company set forth on Exhibit A-1 attached hereto.
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On or before thirty days after the end of each calendar quarter during the term
hereof, AMED shall deliver to the Stockholders a report calculating the
Quarterly PRN Revenue for the immediately preceding quarter. Upon reasonable
notice, the Stockholders shall have the right to examine the books and records
of the Company and AMED or any other affiliate or subsidiary of AMED (to the
extent such company generates revenues properly included in PRN Revenue) for the
purpose of confirming the calculation of the Quarterly PRN Revenue amount
reported by AMED and AMED shall cooperate in such review.
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LIST OF SCHEDULES
Schedule No. Schedule Description
------------ --------------------
2.01 Stock Power
3.01 Organization and Qualification
3.03 Authorizations and Third Party Consents
3.04 Litigation
3.05 Employees and Compensation
3.07 Insurance
3.08 Contracts, Agreements and Instruments
3.10 Financial Condition
3.11 Permits and Licenses
3.12 Properties
3.13 Hazardous Materials
3.14 Interest in Competitors
3.16 Changes or Events
3.17 Defaults
5.08 Non-Compete and Non-Solicitation Agreement
5.10 Legal Opinion of Xxx & Xxxxx, Incorporated
5.11 Releases
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