EXHIBIT 99.1
SECOND AMENDMENT TO STOCK PURCHASE AGREEMENT
THIS SECOND AMENDMENT dated as of February 29, 2000 (this "Second
Amendment"), by and among HealthStar Corp., a Delaware corporation ("SELLER"),
HealthStar, Inc., an Illinois corporation ("HSI"), and Beyond Benefits, Inc., a
Delaware corporation ("PURCHASER"), is made to that certain Stock Purchase
Agreement (the "Agreement") dated as of September 23, 1999 by and among Seller,
HSI and Purchaser as amended by an amendment dated December 16, 1999 (the
"Amendment"). All capitalized terms not defined herein shall have the meaning
provided in the Agreement.
WHEREAS, Section 9.1(b) of the Agreement provided that either party may
terminate the Agreement if the transactions contemplated by the Agreement are
not closed within ninety days of the date of the Agreement;
WHEREAS, the parties, pursuant to the Amendment, extended the
ninety-day period to consummate the transactions contemplated under the
Agreement until February 20, 2000;
WHEREAS, the parties wish to extend the period provided in Section
9.1(b) until April 30, 2000, change the Purchase Price, eliminate the Earnout
and make certain other amendments;
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants and agreements as set forth herein, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties, intending to be legally bound, hereby agree as
follows:
1. Article I of the Agreement, as amended, is hereby amended in its
entirety as follows:
ARTICLE I
PURCHASE AND SALE
SECTION 1.1 PURCHASE AND SALE. Upon the terms and subject to the
conditions set forth in this Agreement, at the Closing (as hereinafter defined),
Seller shall sell, assign, transfer and deliver to Purchaser, and Purchaser
shall purchase from Seller, the Shares, free and clear of all options, pledges,
security interests, liens, claims, preemptive rights, imperfections of title,
conditions or restrictions of any nature, or other encumbrances, or restrictions
on voting or transfer ("ENCUMBRANCES"), other than restrictions imposed by
Federal or state securities laws.
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SECTION 1.2 PURCHASE PRICE. On the Closing Date (as hereinafter
defined) and subject to the terms and conditions set forth in this Agreement, in
consideration of the sale, assignment, transfer and delivery of the Shares,
Purchaser shall pay Seller Eight Million Eight Hundred and Eighty Thousand
Dollars ($8,880,000) in cash (the "PURCHASE PRICE").
SECTION 1.3 CLOSING. The sale and purchase of the Shares contemplated
by this Agreement shall take place at a closing (the "CLOSING") to be held on or
before April 30, 2000 at the offices of Xxxxxxxx & Xxxxxxxx LLP, Twelfth Floor,
00000 XxxXxxxxx Xxxxxxxxx, Xxxxxx, Xxxxxxxxxx 00000-0000, at 10:00 a.m. Pacific
Time or such other place, time or date on which Seller and Purchaser may
mutually agree in writing (the date on which the Closing takes place being the
"CLOSING DATE"), and effective as of 12:01 a.m. on the Closing Date.
(a) At the Closing, Seller shall deliver or cause to be delivered to
Purchaser (i) stock certificates evidencing the Shares, duly endorsed in blank
or accompanied by stock powers duly executed in blank, and (ii) all other
previously undelivered certificates and other documents required to be delivered
by Seller to Purchaser at or prior to the Closing Date in connection with the
transactions contemplated hereby including those documents and certificates
required to be delivered by ARTICLE 8 hereof.
(b) At the Closing, Purchaser shall deliver to Seller (i) the Purchase
Price by wire transfer of immediately available funds to an account or accounts
designated by Seller, and (ii) all other previously undelivered certificates and
other documents required to be delivered by Purchaser to Seller at or prior to
the Closing Date in connection with the transactions contemplated hereby
including those documents and certificates required to be delivered by ARTICLE 8
hereof.
SECTION 1.4 TRANSFER TAXES. All transfer taxes, fees and duties under
applicable law incurred in connection with the sale and transfer of the Shares
under this Agreement will be borne and paid by Seller and Seller shall promptly
reimburse Purchaser for any such tax, fee or duty which Purchaser is required to
pay under applicable law.
SECTION 1.5 FURTHER ASSURANCES. From time to time after the Closing,
Seller, at the request of Purchaser, and Purchaser, at the request of Seller,
shall without further consideration execute and deliver further instruments of
transfer and assignment and take such other action as the requesting party may
reasonably require to more effectively transfer and assign to, and vest in,
Purchaser the Shares, to be sold hereunder and all rights thereto, respectively,
and to fully implement the provisions of this Agreement.
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SECTION 1.6 STOCKHOLDER DISTRIBUTIONS. HSI has not, since June 30,
1999, and shall not, from June 30, 1999 through the Closing, (a) declare, set
aside or pay any dividend or other distribution, whether payable in cash, stock
or other property, in respect of its capital stock, (b) directly or indirectly
redeem, purchase or otherwise acquire any shares of its capital stock or other
securities or shares of capital stock or other securities of any of its
subsidiaries, or (c) pay any principal or interest on any debts owed by HIS to
Seller.
2. Section 9.1(b) is amended to read in its entirety as follows:
"by either Seller or Purchaser if the transactions contemplated hereby
shall not have been consummated by April 30, 2000;"
3. Section 4.10 of the Agreement shall be deleted in its entirety.
4. The phrase "including, but not limited to any amount payable as an Earnout
Payment" shall be deleted at the end of Section 5.10.
5. Each reference to Xxxxx Xxxx, LLP, shall be deemed to be a reference to
Xxxxx & Xxxxxxx. The address for notices to Xxxxx & Xxxxxxx as provided in
Section 10.4 shall be Xxxxx & Xxxxxxx, 0000 X Xxxxxx, Xxxxxxxxx, Xxxxx 000,
Xxxxxxxxxx, XX 00000 at the fax number of (000) 000-0000.
6. Pursuant to Section 8.2(j), the parties understand and agree that such
condition may be satisfied through use of the Purchase Price payable to
Seller by Purchaser at Closing through an agreeable escrow with appropriate
escrow instruction; provided, however, that if the amount of Indebtedness
to be paid exceeds the Purchase Price, then Seller shall pay such funds at
closing through escrow as a condition to Closing of this transaction.
7. Seller shall consult with and coordinate with Purchaser regarding
operations and management of HSI from the date of this Second Amendment,
until the Closing. From and after the date of this Second Amendment, (i)
any management or operations decision in which Purchaser has advised HSI,
after the date of this Second Amendment and Purchaser's advice has been
timely implemented by HSI shall not be deemed to be an event described in
Sections 2.8(a) , 2.8(b), 2.8(h) or 2.8(n) of the Agreement; (ii) any
capital expenditure described in Section 2.8(g) of the Agreement must first
be approved by Purchaser; and (iii) Section 2.10 is amended by adding the
following sentence at the end of said section: Notwithstanding the
foregoing, if a customer listed on Schedule 2.10 determines to terminate
the services of HSI, such event shall not be considered to have a Material
Adverse Effect if HSI enters into an agreement (prior to the termination
date of the canceled arrangement) with another company of similar size in a
geographic region served by Purchaser or HSI that produces the same or
greater revenue for a similar period of time as the customer arrangement
that has been cancelled.
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8. Nothing in this Second Amendment shall be construed as a waiver of, or
amendment to, any term or condition of the Agreement other than as
expressly set forth herein.
9. This Second Amendment may be executed in multiple counterparts, all of
which shall together be considered one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
signed by their respective officers thereunto duly authorized as of the date
first written above.
HealthStar Corp.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxx X. Xxxxx
Title: President
HealthStar Inc.,
an Illinois corporation
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxx
Title: President
Beyond Benefits, Inc.,
a Delaware corporation
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxx
Title: President
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