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Memphis Orthopedic, Inc.
0000 Xxx Xxxxxxxxxx Xxxx
Xxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
March 17, 1995
Xx. Xxxxxx Xxxxx, President
Gulf Coast Orthopaedic Supply, Inc.
0000 Xxxxxxx Xxxxxx, Xxxxx 0
Xxxx Xxxxx, XX 00000
Re: Purchase of Business Assets
Dear Xx. Xxxxx:
This letter will memorialize the agreement by Memphis
Orthopedic, Inc. (the "Company"), a wholly-owned subsidiary of Hanger
Orthopedic Group, Inc., to purchase from Gulf coast Orthopaedic Supply, Inc.
(the "Seller") and you, as the sole owner of the stock of the Seller (the
"Shareholder"), the business inventory, machinery, equipment, business name,
customer lists, customer records, furniture, fixtures, signs and telephone
numbers of the Seller as set forth on Exhibit A hereto, together with the
execution by the Seller and Shareholder of a covenant not to compete with the
Company and the separate execution by Xxxx Xxxxxx of an employment and
non-competition agreement with the Company (such items are collectively
referred to hereinafter as the "Assets"). The Company will not assume the
existing lease ("the Lease") of the Seller relating to the business premises
located at 0000 Xxxxxxx Xxxxxx, Xxxxx 0, Xxxx Xxxxx, Xxxxxxx 00000. The
Company will not assume any liabilities whatsoever of the Seller or
Shareholder, including, but not limited to, any liability of the Seller or
Shareholder under the Lease.
The form of convenant not to compete to be executed by the
Seller and Shareholder is attached hereto as Exhibit B. The form of employment
and non-competition agreement to be executed by Xxxx Xxxxxx is attached hereto
as Exhibit C.
The purchase price for the Assets, which is based on the
current valuation of the Assets, will be $35,000.00, all of which shall be paid
in cash at a closing that shall occur on or before March 17, 1995.
The closing shall take place at the offices of the Company.
(The Seller and Shareholder shall provide to the Company, prior to the closing,
with an updated accounting and valuation of the Assets which, if necessary, may
result in an appropriate adjustment in the purchase price for the Assets.)
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the Company (i) all documents necessary to vest the company with the
unencumbered ownership of the Assets, (ii) the covenant not to compete as
executed by the Seller and Shareholder, (iii) the employment and
non-competition agreement as executed by Xxxx Xxxxxx and (iv) a Xxxx of Sale,
substantially in the form of Exhibit D hereto. At the closing, the Company
shall deliver to the Seller a check for $35,000. Furthermore, from and after
the closing, the Seller and Shareholder shall make the Assets available for
transport by the Company.
Indemnification of Seller appears in Exhibit E.
From and after the closing, the Seller and Shareholder consent
to the exclusive ownership and use by the Company or the Company's designee of
the business name of "Gulf Coast Orthopaedic Supply."
The Seller and Shareholder represent and warrant to the
Company as follows: (a) the Seller is, and at the closing shall be, duly
organized and validly existing as a corporation under the laws of the State of
Florida with all requisite power and authority to enter into the transactions
described in this letter and to perform its obligations hereunder; (b) neither
the Seller nor the Shareholder knows or has any reasonable ground to know of
any basis for the assertion against the Seller or Shareholder, as of the date
of their signing of this letter agreement, of any claim or liability of any
nature against either of them which could have an affect on the Assets or their
ownership interest in the Assets; (c) as of the date of their signing of this
letter agreement, neither the Seller nor the Shareholder knows of any damage,
destruction or loss to any of the Assets, whether or not covered by insurance,
which has adversely effected or impaired or which may adversely effect or
impair the Assets or the ability of the Seller to conduct its business with the
Assets; (d) the Seller and Shareholder have filed all required federal, state
and local tax returns and reports and have duly paid all taxes which are due,
and will pay those taxes that will be due when they become due; (e) the Seller
has good title, free and clear of all liens, claims, encumbrances, charges,
easements and restrictions of any nature whatsoever, to the Assets; (f) the
Assets are in good operating and/or marketable condition and repair and, in the
specific case of the customer lists and customer records, such lists and
records are current, up-to-date and have never been licensed, sold,
disseminated or loaned to any other person or entity; (g) there is no suit,
action, proceeding, inquiry or any change in the laws effecting the Assets
which, to the knowledge of the Seller or the Shareholder,
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might, severally or in the aggregate, adversely effect the Assets, the Seller
or the Shareholder; (h) the Seller and the Shareholder have action to approve
the transactions described in this letter agreement and the performance of the
obligations of the Seller and Shareholder hereunder; (i) no consents of any
federal, state or local governmental body are necessary in connection with the
sale of the Assets by the Seller and Shareholder to the Company; (j) the Seller
and the Shareholder have no knowledge of any claim or reason to believe that
they are or may be infringing on or otherwise acting adversely to the rights of
any other person under or in respect of the business name of "Gulf Coast
Orthopaedic Supply," nor is the Seller or the Shareholder under any obligation
or under any liability to make any payments by way of royalties, fees or
otherwise to any owner or licensee or other claimant to the business name of
"Gulf Coast Orthopaedic Supply;" (k) neither the Seller nor the Shareholder are
a party to any agreement or instrument or subject to any restriction which
would materially and adversely effect the Assets; and (l) no representation or
warranty by the Seller or the Shareholder herein contains or will contain any
untrue statement of material fact or omit to state any material fact required
to make the information herein not misleading.
All negotiations relating to the transactions contemplated by
this letter agreement have been carried on without the intervention of any
other person in any such manner so as to give rise to any valid claim against
the Seller, the Shareholder or the company for a finder's fee, brokerage
commission or other like payment. The Seller and Shareholder agree to
indemnify the Company from any claims for finder's fees, brokerage commissions
or other like payments.
The Seller assumes all risk of destruction, loss or damage due
to fire or other casualty up through the time of the closing hereunder. Upon
the destruction, loss or damage due to fire or other casualty of any part of
the Assets prior to the closing, the Company shall have the option to either
terminate its obligation to purchase the Assets or to offer to the Seller and
the Shareholder an appropriate adjustment in the purchase price. The Seller
and the Shareholder agree to comply with all applicable provisions of the
Uniform Commercial Code - Bulk Transfers provisions and to indemnify the
Company against and save the Company harmless from all liabilities and
obligations arising from the failure of the Seller and the Shareholder to
comply with the Uniform Commercial Code - Bulk Transfers provisions.
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The Company, the Seller and the Shareholder shall each pay all
of their own respective costs and expenses incurred with respect to the
transactions contemplated under this letter agreement, including without
limitation, legal, accounting and other professional fees incurred or to be
incurred by such party in negotiating and carrying out the transactions
contemplated under this letter agreement.
The provisions of this letter agreement can only be amended by
a written instrument signed by both the Company and the Seller. This letter
agreement shall be governed by the laws of the State of Florida.
Please sign and date this letter agreement where indicated
below and return this document to me as promptly as possible.
Sincerely,
MEMPHIS ORTHOPEDIC, INC.
/s/ XXXX X. XXXXX
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Xxxx X. Xxxxx
President
SEEN AND AGREED TO:
GULF COAST ORTHOPAEDIC SUPPLY, INC.
By: /s/ XXXXXX XXXXX Dated: March 17, 1995
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Xxxxxx Xxxxx
President
ATTEST:
By: /s/ XXXXX X. XXXXXX Dated: March 17, 1995
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Name: Xxxxx X. Xxxxxx
Secretary
N0TARY PUBLIC, STATE OF FLORIDA AT LARGE
[SEAL] MY COMMISSION EXPIRES APRIL 24, 1995
BONDED THRU ASHTON AGENCY INC.
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