EXHIBIT 10.12
AMENDMENT TO PURCHASE AND SALE AGREEMENT
THIS AMENDMENT TO PURCHASE AND SALE AGREEMENT (the "Amendment") is made
and entered into effective as of December 31, 1996, (the "Effective Date of the
Amendment"), by and between United Wisconsin Services, Inc., a Wisconsin
business corporation ("UWS") and Midelfort Clinic, Ltd., Mayo Health System, a
Wisconsin corporation ("Clinic") (Individually, a "Party", and collectively the
"Parties").
RECITALS
A. UWS and Clinic (or its affiliate or successor) are parties to that
certain purchase and sale agreement dated January 1, 1992, (the "Agreement"),
pursuant to which Clinic sold all the outstanding shares of Midelfort Health
Plan, Inc. ("MHP").
B. UWS and Clinic (or its affiliate or successor) are also parties to
that certain joint venture agreement dated January 1, 1992, which was superseded
by an Amended and Restated Joint Venture Agreement of even date herewith (the
Amended and Restated "Joint Venture Agreement").
X. Xxxxxxxxx Health Plan, Inc. (MHP) has changed its name to Valley
Health Plan, Inc. (VHF)
D. In consideration for extending the term of the Joint Venture
Agreement and amending the Joint Venture Agreement in other respects, the
Parties desire to extend the term of the Agreement and amend the Agreement in
certain respects as set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
promises set forth in this Amendment, and other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties hereby
agree as follows:
1. ASSIGNMENT. The Parties hereby acknowledge that Midelfort Clinic,
Ltd. has been acquired by Mayo Foundation for Medical Education and Research
("Mayo"), and hereby consents to the assignment by Midelfort Clinic, Ltd. to
Midelfort Clinic, Ltd., Mayo Health System, of all of its right, title and
interest in, to and under the Agreement.
2 . MODIFICATION OF AGREEMENT. The Parties hereby agree that the
Clinic's option to repurchase shall be in effect for the Initial Term of the
Amended and Restated Joint Venture Agreement, and may be exercised effective as
of December 31, 1999, subject to the modifications set forth in this Amendment,
and that Section 10.1 and Section 10.4 are hereby amended to read in its
entirety as follows:
October 25, 1996 Page 1
10.1 Either at the end of the Initial Term of the Joint
Venture, as defined in Section 7.1 of the Amended and Restated Joint
Venture Agreement, or termination of the Joint Venture whichever occurs
earlier, the Clinic shall have the option to repurchase one hundred
percent of the outstanding shares of VHP stock
10.4 The Clinic shall exercise this option to repurchase by
giving written notice to Xxxxxx X. Xxxxx as president of UWS at least
One Hundred and Eighty (180) days but no more than Two Hundred and
Seventy (270) days in advance of the effective date (the "Exercise
Date"). The repurchase shall be effective on December 31, 1999, or the
date of termination of the Joint Venture Agreement, whichever occurs
earlier. (the "Repurchase Date").
3. ADDITIONS TO AGREEMENT. The Parties hereby add the following
provisions to the Agreement.
10.5 In the event that the Clinic exercises its option to
repurchase, UWS shall, within Forty-five (45) business days after the
end of the month in which the Exercise Date occurs, provide Clinic with
the following: (i) statement of all assets held by VHP and all
liabilities of VHP as of the end of the month in which the Exercise
Date occurs and (ii) balance sheet and statements of income and
expenditures for-VHP as of the end of the month in which the Exercise
Date occurs.
10.6 From the Exercise Date through the closing date of such
repurchase (the "Interim Period"), UWS shall not, in connection
with-VHP, without the prior written consent of Clinic, (a) enter into
any contract or commitment with respect to VHP extending beyond the
closing date, other than sales or purchases made in the ordinary course
of its business; (b) waive any rights of any substantial value or sell,
assign or transfer any of the assets of VHP other than in the ordinary
course of business; (c) incur any obligations or liabilities (absolute
or contingent) other than current liabilities incurred and obligations
under contracts entered into in the ordinary course of business; (d)
encumbrance any assets, tangible or intangible, other than the lien of
current property taxes not due and payable; (e) sell, assign or
transfer any of the assets of VHP or cancel any debts or claims; (f)
increase the salaries or other fringe benefits made available to the
employees of VHP, institute any bonus, benefit, profit sharing, stock
option, pension, retirement plan or similar arrangements for the
benefit of the employees of VHP, or make any changes in any such plans
or arrangements presently existing; or (g) enter into any other
transactions or series of transactions other than in the ordinary
course of business.
October 25, 1996 Page 2
10.7 UWS shall, within Ninety (90) business days after the
Repurchase Date, provide Clinic with the following: (i) statement of
all assets held by VHP and all liabilities of VHP as of the Repurchase
Date; and (ii) balance sheet and statements of income and expenditures
for VHP as of the current calendar year to the Repurchase Date.
10.8 UWS represents and warrants that the financial statements
provided to Clinic pursuant to Sections 10.5 and 10.7 hereof (i) will
be in accordance with the books and records of VHP which books and
records are complete and accurate in all material respects, (ii) will
present fairly and accurately in all material respects the financial
condition of VHP as of the dates of the balance sheets, (iii) present
or will present fairly and accurately in all material respects the
results of operations of VHP for the periods covered by such
statements, and (iv) have been or will be prepared in all material
respects on a basis consistent with the preparations of VIII's prior
years' financial statements.
4. REFERENCES. All references in this Amendment to the Agreement shall
mean and include, as appropriate, both the original Agreement between the
Parties, and all amendments which are in writing and have been executed by the
Parties. All references in this Amendment to the Agreement or the Agreement to
Midelfort Health Plan, Inc. shall also include reference to Valley Health Plan,
Inc.
5. CONTINUED EFFECT. Except as otherwise provided in this Agreement,
but subject to any other amendments to the Agreement which are in writing and
have been executed by the Parties, the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the Parties have caused this Amendment to be
executed as of the Effective Date by their respective representatives.
Attest: UNITED WISCONSIN SERVICES, INC.
/s/ Xxxx X. Xxxxx BY /s/ Xxxxxx X. Xxxxx
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TITLE
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Attest: MIDELFORT CLINIC, LTD., MAYO
HEALTH SYSTEM
/s/ Xxxx X. Xxxxx BY /s/ Xxxxxxx X. Xxxx, M.D.
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TITLE
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October 25, 1996 Page 3
