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Exhibit 4.2
SECURITIES PURCHASE AGREEMENT, dated as of October 28, 1996 (the
"Agreement"), by and between UNISON HEALTHCARE CORPORATION, a Delaware
corporation (the "Company"), and CIBC WOOD GUNDY SECURITIES CORP., CRUTTENDEN
XXXX INCORPORATED and WHEAT, FIRST SECURITIES, INC. (the "Initial Purchasers").
In consideration of the mutual covenants and agreements set forth
herein and for good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement, and
unless the context requires a different meaning, the following terms have the
meanings indicated:
"Accountants" has the meaning provided therefor in Section
3.1(b) of this Agreement.
"Accredited Investor" has the meaning provided therefor in
Section 3.2 of this Agreement.
"Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder.
"Affiliate" means, with respect to any Person, any other
Person which directly or indirectly through one or more intermediaries controls,
or is controlled by, or is under common control with, the Person in question.
For purposes of this definition, "control" (including, with correlative
meanings, the terms "controlling", "controlled by" and "under common control
with"), as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided, however, that beneficial ownership of at least
10% of the voting securities of a Person shall be deemed to be control.
"Agreement" or "Purchase Agreement" means this Agreement, as
the same may be amended, supplemented or modified in accordance with the terms
hereof.
"Basic Documents" means, collectively, the Indenture, the
Senior Notes, the Senior Note Registration Rights Agreement and this Agreement.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking institutions in the City of New
York are authorized or obligated by law to close.
"Closing" has the meaning provided therefor in Section 2.2(b)
of this Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission or
any similar agency then having jurisdiction to enforce the Act.
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"Common Stock" means, collectively, the Common Stock of the
Company, each share with a par value of $.001.
"Default" means any event, act or condition which, with notice
or lapse of time or both, would constitute an Event of Default.
"Dispositions" has the meaning provided therefor in the Final
Memorandum.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"Event of Default" means any event defined as an Event of
Default in the Indenture.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"Exchange Notes" shall have the meaning provided therefor in
the Senior Note Registration Rights Agreement.
"Facility" has the meaning provided therefor in Section 3.1(z)
of this Agreement.
"Final Memorandum" has the meaning provided therefor in
Section 2.1 of this Agreement.
"Guarantee" means, as the context may require, individually, a
guarantee, or collectively, any and all guarantees, of the obligations of the
Company with respect to the Senior Notes by each Guarantor pursuant to the terms
of the Indenture.
"Guarantors" means each of the Subsidiaries listed on Schedule
II hereto.
"Indemnified Party" has the meaning provided therefor in
Section 7.1(c) of this Agreement.
"Indemnifying Party" has the meaning provided therefor in
Section 7.1(c) of this Agreement.
"Indenture" means the indenture dated as of October 31, 1996
by and between the Company and the Trustee under which the Senior Notes will be
issued.
"Initial Purchasers" has the meaning provided therefor in the
introductory paragraph of this Agreement.
"Lien" means, with respect to any property or assets of any
Person, any mortgage or deed of trust, pledge, hypothecation, assignment,
deposit arrangement, security interest, lien, charge, easement, encumbrance,
preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever on or with respect to such property or assets
(including without limitation, any Capitalized Lease Obligation (as defined in
the Indenture), conditional sales, or other title retention agreement having
substantially the same economic effect as any of the foregoing).
"Losses" has the meaning provided therefor in Section 7.1(a)
of this Agreement.
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"Material Adverse Effect" means, with respect to the Company
and its Subsidiaries, a material adverse effect on the business, condition
(financial or otherwise), results of operations, properties or prospects of the
Company and its Subsidiaries, taken as a whole. "Material Adverse Effect" shall
also mean a material adverse effect on the ability of the Company or any
Guarantor to perform its obligations under this Agreement or any of the Basic
Documents.
"Memorandum" has the meaning provided therefor in Section 2.1
of this Agreement.
"Offering Materials" has the meaning provided therefor in
Section 7.1(a) of this Agreement.
"Permits" has the meaning provided therefor in Section 3.1(ii)
of this Agreement.
"Person" means any individual, corporation, partnership,
limited liability company or partnership, association, joint venture,
joint-stock company, trust, unincorporated organization, government (including
any agency or political subdivision thereof) or entity of any kind.
"PORTAL" means the Private Offerings, Resales and Trading
through Automated Linkages Market.
"Preliminary Memorandum" has the meaning provided therefor in
Section 2.1 of this Agreement.
"Private Exchange Notes" shall have the meaning provided
therefor in the Senior Note Registration Rights Agreement.
"Proceeding" has the meaning provided therefor in Section
7.1(c) of this Agreement.
"QIB" has the meaning provided therefor in Section 3.2 of this
Agreement.
"Senior Note Registration Rights Agreement" means the
registration rights agreement among the Company, the Guarantors and the Initial
Purchasers relating to the Senior Notes.
"Senior Notes" means the 12 1/4% Senior Notes due 2006 of the
Company and the Guarantees.
"Signature" has the meaning provided therefor in the Final
Memorandum.
"State" means each of the states of the United States, the
District of Columbia and the Commonwealth of Puerto Rico.
"State Commission" means any agency of any State having
jurisdiction to enforce such State's securities laws.
"Subsidiaries" means, with respect to any Person, any
corporation, partnership, joint venture, association or other business entity,
whether now existing or hereafter organized or acquired, (1) in the case of a
corporation, of which more than 50% of the total voting power of the capital
stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, officers or trustees thereof is held by such
first-named Person or any of its Subsidiaries; or (ii) in the case of a
partnership, joint venture, association or other business entity, with respect
to which such first-named Person or any of its
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Subsidiaries has the power to direct or cause the direction of the management
and policies of such entity by contract or otherwise or if in accordance with
generally accepted accounting principles such entity is consolidated with the
first-named Person for financial statement purposes.
"Taxes" has the meaning provided therefor in Section 3.1(v) of
this Agreement.
"Time of Purchase" has the meaning provided therefor in
Section 2.2(b) of this Agreement.
"Transactions" has the meaning provided therefor in the Final
Memorandum.
"Trustee" means First Bank National Association, as trustee
under the Indenture.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended, and the rules and regulations of the Commission thereunder.
Section 1.2. Accounting Terms; Financial Statements. All
accounting terms used herein not expressly defined in this Agreement shall have
the respective meanings given to them in accordance with generally accepted
accounting principles in the United States as the same may be in effect from
time to time.
ARTICLE II
ISSUE OF SENIOR NOTES; PURCHASE AND SALE
OF SENIOR NOTES; RIGHTS OF HOLDERS OF SENIOR
NOTES; OFFERING BY INITIAL PURCHASERS
Section 2.1. Issue of Senior Notes and Guarantees. The Company
and the Guarantors have authorized the issuance of $100,000,000 aggregate
principal amount of the Senior Notes, unconditionally guaranteed by the
Guarantors, which are to be issued pursuant to the Indenture. Each Senior Note
will be substantially in the form of the Senior Note set forth as Exhibit A to
the Indenture.
The Senior Notes will be offered and sold to the Initial
Purchasers without being registered under the Act, in reliance on exemptions
therefrom.
In connection with the sale of the Senior Notes, the Company
has prepared a preliminary offering memorandum dated October 10, 1996 (the
"Preliminary Memorandum") and prepared a final offering memorandum dated October
28, 1996 (the "Final Memorandum" and, together with the Preliminary Memorandum,
the "Memorandum") setting forth or including a description of the terms of the
Senior Notes, the terms of the offering, a description of the Company and the
Guarantors and any material developments relating to the Company and the
Guarantors occurring after the date of the most recent financial statements
included therein.
Section 2.2. Purchase, Sale and Delivery of Senior Notes. (a)
On the basis of the representations, warranties, agreements and covenants herein
contained and subject to the terms and conditions herein set forth, the Company
and the Guarantors agree that they will sell to the Initial Purchasers, and the
Initial Purchasers severally agree that they will purchase from the Company and
the Guarantors at the Time of Purchase, the aggregate principal amount of the
Senior Notes set forth opposite the name
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of each Initial Purchaser on Schedule I attached hereto at a price equal to
97.0% of the principal amount thereof.
(b) The purchase, sale and delivery of the Senior Notes will
take place at a closing (the "Closing") at the offices of Xxxxxxx & Xxxxx, One
East Camelback Avenue, Phoenix, Arizona, at 8:30 A.M., Phoenix time, on October
31, 1996, or such other date and time, if any, as the Initial Purchasers and the
Company shall agree. The time at which such Closing is concluded is herein
called the "Time of Purchase."
(c) One or more certificates in definitive form for the Senior
Notes that the Initial Purchasers agreed to purchase hereunder, and in such
denomination or denominations and registered in such name or names as the
Initial Purchasers request upon notice to the Company at least 48 hours prior to
the Closing, shall be delivered by or on behalf of the Company and the
Guarantors to the Initial Purchasers, against payment by or on behalf of the
Initial Purchasers of the purchase price therefor by wire transfer of
immediately available funds wired in accordance with the written instructions of
the Company. The Company will make such certificate or certificates for the
Senior Notes available for checking and packaging by the Initial Purchasers at
the offices of CIBC Wood Gundy Securities Corp., or such other place as the
Initial Purchasers may designate, at least 24 hours prior to the Closing.
Section 2.3. Registration Rights of Holders of Senior Notes.
The Initial Purchasers and their direct and indirect transferees of the Senior
Notes will have such rights with respect to the registration thereof under the
Act and qualification of the Indenture under the Trust Indenture Act as are set
forth in the Senior Note Registration Rights Agreement.
Section 2.4. Offering by the Initial Purchasers. The Initial
Purchasers propose to make an offering of the Senior Notes at the price and upon
the terms set forth in the Final Memorandum, as soon as practicable after this
Agreement is entered into and as in the judgment of the Initial Purchasers is
advisable.
ARTICLE III
REPRESENTATIONS AND WARRANTIES; RESALE OF SENIOR NOTES
Section 3.1. Representations and Warranties of the Company and
the Guarantors. The Company and the Guarantors jointly and severally represent
and warrant to and agree with each of the Initial Purchasers as follows:
(a) The Final Memorandum, as of its date and at the Time of
Purchase, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this Section 3.1(a) do not apply to
statements or omissions made in reliance upon and in conformity with information
relating to the Initial Purchasers or to the manner of sale of the Senior Notes
by the Initial Purchasers which is furnished to the Company in writing by the
Initial Purchasers expressly for use in the Final Memorandum or any amendment or
supplement thereto.
(b) The audited consolidated financial statements of the
Company; Britwill Healthcare Company; American Professional Holding, Inc.;
Memphis Clinical Laboratory, Inc.; Signature Health Care Corporation; Arkansas,
Inc., Cornerstone Care, Inc., Xxxxxxx Xxxxx, Inc. and Xxxxxxx Care, Inc.;
RehabWest, Inc.; The Oaks of Boise; Nightingale West, Inc.; Xxxxxxxxx
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and Associates Rehabilitation and Sunbelt Therapy Management Services, Inc.; and
Franciscan Health Care Center at Enumclaw and Walla Walla included in the Final
Memorandum fairly present the financial position, results of operations and cash
flows of the Company and the other Persons to which they relate at the dates and
for the periods to which they relate and have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis. The
summary and selected financial data in the Final Memorandum present fairly in
all material respects the financial information shown therein and have been
prepared and compiled on a basis consistent with the audited financial
statements included therein, except as otherwise stated therein. Ernst & Young
LLP, Price Waterhouse, LLP, Xxxxxx X. Xxxxxxx, P.C., Xxxxxx Xxxxxxxx LLP,
Xxxxxxxx & Xxxxxxx, P.C. and Xxxxxxx & Xxxxxxx P.C. (the "Accountants") are
independent public accounting firms within the meaning of the Act and the rules
and regulations promulgated thereunder. The pro forma financial statements
(including the notes thereto) and the other pro forma financial information
included in the Final Memorandum have been prepared using reasonable assumptions
and in accordance with the applicable requirements of the Act and include all
adjustments necessary to present fairly the pro forma financial information
included within the Final Memorandum at the respective dates and for the
respective periods indicated.
(c) (i) The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
filed all reports with the Secretary of State of Delaware required to obtain a
certificate with respect to continued subsistence in good standing from that
office. Each Subsidiary of the Company is a corporation duly incorporated or
organized, validly existing and in good standing under the laws of the state or
other jurisdiction of its incorporation or organization. Each of the Company and
its Subsidiaries is duly qualified and in good standing as a foreign corporation
or partnership, as the case may be, and is authorized to do business, in each
jurisdiction in which the ownership or leasing of any property or the character
of its operations makes such qualification necessary and in which the failure so
to qualify is reasonably likely to have a Material Adverse Effect; and (ii)
Schedule U attached hereto contains a complete and correct list of all of the
Subsidiaries of the Company, as of the completion of the Transaction. The
Company and its Subsidiaries do not own more than 5% of the equity interest in
any other business entity.
(d) As of the Time of Purchase (after giving pro forma effect
to the Transactions), the Company will have the authorized, issued and
outstanding capitalization as set forth in the Final Memorandum. All of the
issued and outstanding shares of capital of the Company and its Subsidiaries are
validly issued, all of such capital stock is fully paid and nonassessable and
none of such shares or interests were issued in violation of any preemptive or
similar rights. Except as set forth in the Final Memorandum, all outstanding
shares of capital stock of each of the Subsidiaries of the Company are owned by
the Company, either directly or through wholly-owned subsidiaries, free and
clear of any perfected security interest and any other security interest, claim,
lien or encumbrance except for "permitted liens" (as defined in the Final
Memorandum) or as otherwise set forth in the Final Memorandum. Except as set
forth in the Final Memorandum, (i) there are no outstanding subscriptions,
options, warrants, rights, convertible securities or other binding agreements or
commitments of any character obligating any Subsidiary of the Company to issue
any securities, (ii) there is no agreement, understanding or arrangement among
any such Subsidiaries and their respective stockholders or any other Person
relating to the acquisition, ownership or disposition of any capital stock in
such Subsidiaries, the election of directors of any of such Subsidiaries or the
governance of such Subsidiaries' affairs, and (iii) there is no agreement,
understanding or arrangement among the Company, any Subsidiary and any other
person that may result in a change of control of the Company, and such
agreements,
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arrangements or understandings will not be breached or violated as a result of
the consummation of the Transactions or the execution, delivery or performance
of, this Agreement and the other Basic Documents.
(e) This Agreement has been duly authorized, executed and
delivered by the Company and the Guarantors and (assuming the due authorization,
execution and delivery by the Initial Purchasers) is a valid and legally binding
agreement of the Company and the Guarantors, enforceable against the Company and
each Guarantor in accordance with its terms except (i) that the enforcement
hereof may be subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally, and to general principles of equity and the
discretion of the court before which any proceeding therefor may be brought and
(ii) as any rights to indemnity or contribution hereunder may be limited by
federal or state securities laws and public policy considerations.
(f) The Indenture has been duly authorized by the Company and
the Guarantors, and, when executed and delivered by the Company and the
Guarantors (assuming the due authorization, execution and delivery by the
Trustee), will constitute a valid and legally binding agreement of the Company
and the Guarantors, enforceable against the Company and each Guarantor in
accordance with its terms except (i) that the enforcement thereof may be subject
to bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar laws now or hereafter in effect relating to creditors' rights
generally, and to general principles of equity and the discretion of the court
before which any proceeding therefor may be brought and (ii) as any rights to
indemnity or contribution thereunder may be limited by federal or state
securities laws and public policy considerations.
(g) The Senior Note Registration Rights Agreement has been
duly authorized by the Company and the Guarantors and, when executed and
delivered by the Company and the Guarantors (assuming the due authorization,
execution and delivery by the Initial Purchasers), will constitute a valid and
legally binding agreement of the Company and the Guarantors, enforceable against
the Company and each Guarantor in accordance with its terms except (i) that the
enforcement thereof may be subject to bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally, and to general principles of
equity and the discretion of the court before which any proceeding therefor may
be brought and (ii) as any rights to indemnity or contribution thereunder may be
limited by federal or state securities laws and public policy considerations.
(h) The Senior Notes, the Exchange Notes and the Private
Exchange Notes have each been duly authorized by the Company and the Guarantors
and, when executed by the Company and the Guarantors and authenticated by the
Trustee in accordance with the provisions of the Indenture and, in the case of
the Senior Notes, delivered to and paid for by the Initial Purchasers in
accordance with the terms of this Agreement, will be entitled to the benefits of
the Indenture and will constitute valid and legally binding obligations of the
Company and the Guarantors enforceable against the Company and each Guarantor in
accordance with their terms, except that the enforcement thereof may be subject
to (i) bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
generally, and (ii) general principles of equity and the discretion of the court
before which any proceeding therefor may be brought. The ranking of the Senior
Notes is as set forth in the Final Memorandum.
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(i) Each of the Guarantees has been duly authorized by the
Guarantors and each Guarantor has all requisite corporate power and authority to
execute, issue and deliver its respective Guarantee and to incur and perform its
respective obligations provided for therein. The Guarantees, upon execution and
delivery of the Indenture and upon the due execution, authentication and
delivery of the Senior Notes to the Initial Purchasers will constitute valid and
legally binding obligations of the Guarantors enforceable against each of them
in accordance with their terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be brought. The
ranking of the Guarantees is as set forth in the Final Memorandum.
(j) Immediately after the consummation of the Transactions and
the consummation of this Agreement (including the use of proceeds from the sale
of Senior Notes at the Time of Purchase), the fair value and present fair
saleable value of the assets of the Company (on a consolidated basis) and each
of the Guarantors will exceed the sum of its stated liabilities and identified
contingent liabilities; the Company (on a consolidated basis) and each of the
Guarantors will not be, after giving effect to the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated hereby (including the use of proceeds from the sale of Senior Notes
at the Time of Purchase), (i) left with unreasonably small capital with which to
carry on its business as it is proposed to be conducted, (ii) unable to pay its
debts (contingent or otherwise) as they mature or (iii) otherwise insolvent.
(k) Each of the Company and the Guarantors has all requisite
corporate power and authority to (i) execute, deliver and perform its
obligations under each of the Basic Documents, (ii) execute, deliver and perform
its obligations under all other agreements and instruments to be executed and
delivered by it pursuant to or in connection with each of the Basic Documents
and the Transactions, (iii) issue the Senior Notes in the manner and for the
purpose contemplated by this Agreement and (iv) consummate each of the
Transactions.
(l) Subsequent to the date as of which information is given in
the Final Memorandum to the date hereof, except as contemplated in the
Memorandum, there has not been (i) any event or condition that has had or that
could reasonably be expected to have a Material Adverse Effect, (ii) any
transaction entered into by the Company or any of its Subsidiaries, other than
in the ordinary course of business, that is material to the Company and its
Subsidiaries, taken as a whole, or (iii) any dividend or distribution of any
kind declared, paid or made by the Company on its Common Stock.
(m) Except as set forth in the Final Memorandum, there is no
action, suit, investigation or proceeding, governmental or otherwise, pending
or, to the best knowledge of the Company, threatened to which the Company or any
of the Guarantors is or would be a party or of which the properties or assets of
the Company or any of the Guarantors are or may be subject, that (i) seeks to
restrain, enjoin, prevent the consummation of or otherwise challenge the
issuance and sale of the Senior Notes by the Company, the Transactions or any of
the other transactions contemplated hereby, (ii) questions the legality or
validity of any such transactions or seeks to recover damages or obtain other
relief in connection with any such transactions or (iii) could reasonably be
expected to have a Material Adverse Effect.
(n) The execution, delivery and performance by the Company and
the Guarantors of the Basic Documents, the issuance and sale by the Company
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and the Guarantors of the Senior Notes, and the execution, delivery and
performance by the Company and the Guarantors of all other agreements and
instruments to be executed and delivered by the Company and the Guarantors
pursuant hereto or thereto or in connection herewith or therewith or in
connection with any of the Transactions, and compliance by the Company and the
Guarantors with the terms and provisions hereof and thereof, do not and will not
(i) violate any provision of any law, rule or regulation (including, without
limitation, Regulation G, T, U or X of the Board of Governors of the Federal
Reserve System), order, writ, judgment, decree, determination or award presently
in effect or in effect at the Time of Purchase having applicability to the
Company or any of its Subsidiaries, (ii) conflict with or result in a breach of
or constitute a default (or give rise to any right to accelerate the maturity or
require the prepayment of any obligation) under the certificate of incorporation
or by-laws (or similar organizational document) of the Company, any of the
Guarantors or any of their Subsidiaries, or, as of the Time of Purchase, any
indenture or loan or credit agreement, lease, or any other agreement or
instrument, to which the Company or any of the Guarantors is a party or by which
the Company or any of the Guarantors or any of their respective properties or
assets may be bound or affected, or (iii) result in, or require the creation or
imposition of, any Lien upon or with respect to any of the properties or assets
now owned or hereafter acquired by the Company or any of its Subsidiaries.
(o) Each agreement or instrument (other than the Basic
Documents) executed and delivered by the Company or any of the Guarantors in
connection with the Basic Documents and the Transactions has been duly and
validly authorized, and, when executed and delivered by the Company or any of
the Guarantors, will constitute a valid and legally binding obligation of the
Company or such Guarantors, enforceable against the Company or such Guarantor in
accordance with its terms, except (i) that the enforcement thereof may be
subject to bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, and to general principles of equity and the
discretion of the court before which any proceeding therefor may be brought and
(ii) as any rights to indemnity and contribution hereunder and thereunder may be
limited by applicable law.
(p) None of the Company, the Guarantors or any of their
Subsidiaries is currently or, after giving effect to the execution, delivery and
performance of this Agreement, the other Basic Documents and the consummation of
the Transactions, will be (i) in violation of its respective certificate of
incorporation or by-laws (or similar organizational document), (ii) in default
(nor will an event occur which with notice or passage of time or both would
constitute such a default) under or in violation of any indenture or loan or
credit agreement or any other material lease, agreement or instrument to which
it is a party or by which it or any of its properties or assets may be bound or
affected, (iii) in violation of any order of any court, arbitrator or
governmental body, or (iv) in violation of or will have violated any statute,
rule or regulation of any governmental authority, except in each case, which
default or violation (individually or in the aggregate) could reasonably be
expected to (y) affect the legality, validity or enforceability of any of the
Basic Documents in any material respect or (z) have a Material Adverse Effect.
(q) Except as set forth in the Final Memorandum, and assuming
the accuracy of the Initial Purchasers' representations and warranties set forth
in Section 3.2 hereof, and the due performance by the Initial Purchasers of the
covenants and agreements set forth in Section 3.2 hereof, no authorization,
consent, approval, license, qualification or formal exemption from, nor any
filing, declaration or registration with, any court, governmental agency or
regulatory authority or any securities exchange is required in connection with
(a) the execution, delivery or performance by the
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Company or the Guarantors (to the extent they are a party thereto) of any of the
Basic Documents or any of the Transactions or (b) to permit the Company and the
Guarantors to effect payments of principal of, premium and interest on the
Senior Notes, except (i) as may be required under state securities or "Blue Sky"
laws or the laws of any foreign jurisdiction in connection with the offer and
sale of the Senior Notes or (ii) as would not (individually or in the aggregate)
be reasonably likely to have a Material Adverse Effect. All such authorizations,
consents, approvals, licenses, qualifications, exemptions, filings, declarations
and registrations set forth in the Final Memorandum (other than as disclosed
therein) which are required to have been obtained by the date hereof have been
obtained or made, as the case may be, and are in full force and effect and not
the subject of any pending or, to the knowledge of the Company and the
Guarantors, threatened attack by appeal or direct proceeding or otherwise.
(r) None of the Company and the Guarantors is, and immediately
after the Time of Purchase will not be, an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
(s) The execution and delivery of this Agreement and the other
Basic Documents and the sale of the Senior Notes to the Initial Purchasers will
not involve any non-exempt prohibited transaction within the meaning of Section
406 of ERISA, or Section 4975 of the Code on the part of the Company, any of the
Guarantors or any of their Subsidiaries. No Reportable Event (as defined in
Section 4043 of ERISA) has occurred during the five-year period prior to the
date on which this representation is made or deemed made with respect to any
Employee Benefit Plan (as defined in Section 3(3) of ERISA), and the Company and
its Subsidiaries have complied in all material respects with the applicable
provisions of ERISA and the Code in connection with each Employee Benefit Plan.
The present value of all benefits vested under each Employee Benefit Plan
maintained by the Company or any person or entity treated with the Company as a
single employer under Section 414 of ERISA (a "Commonly Controlled Entity")
(based on the current liability, interest rate and other assumptions used in
preparation of the plan's Form 5500 Annual Report) did not, as of the last
annual valuation date prior to the date on which this representation is made or
deemed made, exceed the value of the assets of such plan allocable to such
accrued benefits. Neither the Company nor any Commonly Controlled Entity has had
a complete or partial withdrawal from any Multiemployer Plan (as defined in
ERISA), and neither the Company nor any Commonly Controlled Entity would become
subject to any liability under ERISA if the Company or any such Commonly
Controlled Entity were to withdraw completely from all Multiemployer Plans as of
the valuation date most closely preceding the date on which such representation
is made or deemed made. No such Multiemployer Plan is in reorganization or
insolvent. There are no material liabilities of the Company or any Commonly
Controlled Entity for post-retirement benefits to be provided to their current
and former employees under Plans which are welfare benefit plans (as described
in Section 3(1) of ERISA). To the best of the Company's knowledge, the Company
and its Subsidiaries are substantially and in all material respects in
compliance with all applicable laws with respect to all employee benefit plans
maintained or contributed to in respect of employees other than those employed
in the United States ("Foreign Plans"). There are no material unfunded
liabilities in respect of the Foreign Plans.
(t) The Company and each of its Subsidiaries have good and
valid title to, or valid and enforceable leasehold interests in, all properties
and assets identified in the Final Memorandum as owned or leased, respectively,
by each of them which are material to the business of the Company and its
Subsidiaries, taken as a whole, free and clear of all material Liens, except (i)
such Liens as are described in the Final Memorandum or (ii) Liens created in the
ordinary course of business which are Permitted Liens (as defined in
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the Indenture). All of the leases material to the business of the Company or any
of its Subsidiaries and under which the Company or any of its Subsidiaries, as
the case may be, holds properties described in the Final Memorandum, are valid
and binding as leased by them, with such exceptions as are not material and do
not interfere with the use made and proposed to be made of such properties by
the Company or any of its Subsidiaries, as the case may be. All agreements under
which the Company or any of its Subsidiaries manages healthcare facilities are
valid and binding and in full force and effect and neither the Company nor any
of its Subsidiaries is in default (nor has any event occurred which with notice
or the passaged of time or both would constitute a default) under or in
violation of such agreement.
(u) No form of general solicitation or general advertising was
used by the Company, any of the Guarantors or any of their respective Affiliates
and representatives in connection with the offer and sale of the Senior Notes.
None of the Company, any of the Guarantors, their respective Affiliates or any
Person authorized to act for any of them has, either directly or indirectly,
sold or offered for sale any of the Senior Notes or any other similar security
of the Company or the Guarantors to, or solicited any offers to buy any thereof
from, or has otherwise approached or negotiated in respect thereof with, any
Person or Persons other than with or through the Initial Purchaser; and the
Company and the Guarantors agree that neither they, any of their Subsidiaries or
Affiliates nor any Person acting on their behalf has sold or offered for sale or
will sell or offer for sale any Senior Notes to, or has solicited or will
solicit any offers to buy any Senior Notes from, or otherwise approach or
negotiate in respect thereof with, any Person or Persons so as thereby to bring
the issuance or sale of any of the Senior Notes within the provisions of Section
5 of the Act.
(v) All tax returns required to be filed by the Company or any
of its Subsidiaries in any jurisdiction (including foreign jurisdictions) have
been duly filed and all taxes, assessments, fees and other charges including,
without limitation, withholding taxes, penalties, and interest ("Taxes") due or
claimed to be due have been paid, other than those Taxes being contested in good
faith and for which adequate reserves or accruals have been established in
accordance with generally accepted accounting principles, except where the
failure to file such returns or to pay such Taxes is not reasonably likely to
have, singly or in the aggregate, a Material Adverse Effect. The Company knows
of no actual or proposed additional tax assessments for any fiscal period
against the Company or any of its Subsidiaries that, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect.
(w) The Company and its Subsidiaries are the owners or
licensees of all trade names, unregistered trademarks and service marks, brand
names, patents, registered and unregistered copyrights, registered trademarks
and service marks, and all applications for any of the foregoing, and all
permits, grants and licenses or other rights with respect thereto, the absence
of which could reasonably be expected to have a Material Adverse Effect. Neither
the Company nor any of its Subsidiaries has been charged with any material
infringement of any intangible property of the character described above or been
notified or advised of any material claim of any other Person relating to any of
the intangible property, which infringements or claims (individually or in the
aggregate) would be reasonably likely to have a Material Adverse Effect.
(x) The Senior Notes, the Indenture, the Senior Note
Registration Rights Agreement and this Agreement conform to the descriptions
thereof in the Final Memorandum.
(y) Assuming the accuracy of the Initial Purchasers'
representations and warranties set forth in Section 3.2 hereof, and the due
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performance by the Initial Purchasers of the covenants and agreements set forth
in Section 3.2 hereof, the offer and sale of the Senior Notes to the Initial
Purchasers in the manner contemplated by this Agreement and the Memorandum does
not require registration under the Act and the Indenture does not require
qualification under the Trust Indenture Act of 1939, as amended.
(z) Except as described in the Final Memorandum, the Company,
and its Subsidiaries and each long-term care, assisted living or other facility
owned, leased, operated or managed by the Company or any of its Subsidiaries
before giving effect to the Dispositions and after giving effect to the
Transactions (each a "Facility") is in material compliance with the common law
and all federal, state, and local laws, and any rules, regulations, orders,
decrees, judgments or injunctions issued or promulgated thereunder relating to
pollution and protection of public and employee health and the environment
("Environmental Law") and with the terms and conditions of any permit, license
or approval required under any Environmental Law in connection with the
ownership, operation or use of its business, property and assets where the
failure to be in such compliance could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect; except as disclosed
in the Final Memorandum, and to the knowledge of the Company, none of the
Company or any of its Subsidiaries or any Facility is subject to any liability,
absolute or contingent, under any Environmental Law which liability would,
individually or in the aggregate, be reasonably likely to result in a Material
Adverse Effect; except as disclosed in the Final Memorandum, there is no civil,
criminal or administrative action, suit, demand, hearing, notice of violation or
deficiency, investigation, proceeding or notice of potential responsibility or
liability or demand letter or request for information pending or, to the
knowledge of the Company, threatened against the Company, any of its
Subsidiaries or any Facility under any Environmental Law which, if determined
adversely to the Company or any such Subsidiary, would, individually or in the
aggregate, be reasonably likely to result in a Material Adverse Effect.
(aa) Except as set forth in the Final Memorandum, there is no
strike, labor dispute, slowdown or work stoppage with the employees of the
Company or any of its Subsidiaries which is pending or, to the best knowledge of
the Company or any of its Subsidiaries, threatened, which would be reasonably
likely to result in a Material Adverse Effect.
(bb) Each of the Company and its Subsidiaries carries
insurance (including self insurance) in such amounts and covering such risks as
is adequate for the conduct of its business and the value of its properties.
(cc) No securities of the Company, any of the Guarantors or
their Subsidiaries are of the same class (within the meaning of Rule 144A under
the Act) as the Senior Notes and listed on a national securities exchange
registered under Section 6 of the Exchange Act, or quoted in a U.S. automated
inter-dealer quotation system.
(dd) None of the Company, the Guarantors or their Subsidiaries
has taken, nor will any of them take, directly or indirectly, any action
designed to, or that might be reasonably expected to, cause or result in
stabilization or manipulation of the price of the Senior Notes.
(ee) None of the Company, the Guarantors, their Subsidiaries,
any of their respective Affiliates or any person acting on its or their behalf
(other than the Initial Purchasers) has engaged in any directed selling efforts
(as that term is defined in Regulation S under the Act ("Regulation S") with
respect to the Senior Notes and the Company, the Guarantors, their Subsidiaries
and their respective Affiliates and any person acting on its or their behalf
(other than the Initial Purchasers) have acted in accordance with the offering
restrictions requirement of Regulation S.
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(ff) The statistical and market-related data included in the
Final Memorandum are based on or derived from sources which the Company believes
to be reliable and accurate or represents the Company's good faith estimates
that are made on the basis of data derived from such sources.
(gg) Except as stated in the Final Memorandum, the Company
does not know of any claims for services, either in the nature of a finder's fee
or financial advisory fee, with respect to the offering of the Senior Notes and
the transactions contemplated by the Final Memorandum.
(hh) Except as described in the Final Memorandum there exists
no relationship, direct or indirect, between or among the Company or any of its
Subsidiaries, on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company, any of its Subsidiaries or any of the
Facilities on the other hand, of a kind described in Item 404 of Xxxxxxxxxx X-X,
00 XXX 229.404.
(ii) The Company, and each of its Subsidiaries and Facilities
have such pen-nits, licenses, certificates and authorizations and governmental
or regulatory authorities, including but not limited to, such permits, licenses,
certificates and authorizations ("Permits"), as are necessary to own, lease or
manage their respective properties (including, without limitation, the
Facilities) and to conduct their respective businesses in the manner now being
conducted and as described in the Final Memorandum, subject to such
qualifications as may be set forth in the Final Memorandum, except where the
failure to have any such Permit would not have a Material Adverse Effect; the
Company, and each of its Subsidiaries and Facilities have each fulfilled and
performed all of their respective material obligations with respect to such
Permits, and no event has occurred which allows, or after notice of lapse of
time would allow, revocation or termination thereof or results in any other
material impairment of the rights of the holder of any such permit, subject in
each case to such qualification as may be set forth in the Final Memorandum;
and, except as described in the Final Memorandum, such Permits contain no
restrictions that are materially burdensome to the Company, or any of the
Subsidiaries or Facilities.
(jj) Neither the Company nor any of the Subsidiaries nor any
employee or agent of the company or the subsidiaries has made any payment of
funds of the Company or any of the Subsidiaries or received or retained any
funds in violation of any law, rule or regulation, which payment, receipt or
retention of funds is of a character required to be disclosed in the Final
Memorandum.
(kk) The Company, each Subsidiary and each Facility that the
Final Memorandum indicates is participating in the medicare or medicaid
programs, upon consummation of the transactions contemplated by this Agreement
and after giving effect to the Transactions, has the requisite provider
agreement, provider number or other authorization to xxxx the Medicare program
and the respective Medicaid program in the state or states in which each
Facility is located. The number of units or licensed beds and the number of
Medicare certified beds at each of the Facilities are as indicted in the Final
Memorandum. Except as set forth in the Final Memorandum, there is no action
threatened or pending which could reasonably be expected to result in a
revocation of any such provider number or authorization or the Company's, or any
Subsidiary's or Facility's exclusion from the Medicare or any state Medicaid
programs and no individual with an ownership or control interest, as defined in
42 U.S.C. Section 1320a-3(a)(3), in the Company or any Subsidiary, or who is an
officer, director, or managing employee as defined in 42 U.S.C. Section
1320a-5(b), of the Company or any Subsidiary is a person described in 42 U.S.C.
Section 1320a-7(b)(8)(B). The Company's and each Subsidiary's business practices
do not violate any federal or state laws regarding physician ownership of (or
financial relationship
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with) and referral to entities providing health care related goods or services,
or laws requiring disclosure of financial interests held by physicians in
entities to which they may refer patients for the provisions of health care
related goods or services. None of the Company or any of its Subsidiaries is
subject to settlements or other adjustments by third party payors (including
Medicare and Medicaid) which could reasonably be expected to have a Material
Adverse Effect.
(ll) The statements regarding regulation of the Company and
its Subsidiaries under the captions "Business -- Government Regulation," "Risk
Factors -Extensive Government Regulations," "-- Healthcare Reform" and
"--Reimbursement by Third-Party Payors" (collectively, the "Regulatory
Sections ") in the Final Memorandum are correct in all material respects and
fairly describe the applicability of regulations to the operations of the
Company and its Subsidiaries as described in the Final Memorandum. The
statements regarding regulation of the Company and its Subsidiaries in the
Regulatory Sections in the Final Memorandum do not contain any untrue statement
of a material fact or omitted to state a material fact necessary to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading.
(mm) Subsequent to the respective dates as of which
information is given in the Final Memorandum and except as set forth in the
Final Memorandum, no acquisition of any material Business (whether by way of
merger, asset acquisition or stock acquisition), by the Company or any of its
Subsidiaries is Probable, with the terms "Business" and "Probable" defined and
interpreted in the manner described in Regulation S-X under the Act; and
(nn) The Company and each of its Subsidiaries maintain systems
of internal accounting controls sufficient to provide reasonable assurances that
(I) transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain accountability for assets; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(oo) The Company, the Guarantors and each of their
Subsidiaries has complied and is continuing compliance with all provisions of
Florida Statutes, Section 517.075, relating to issuers doing business with Cuba.
Section 3.2. Resale of Senior Notes. The Initial Purchasers
represent and warrant that they are "qualified institutional buyers" as defined
in Rule 144A under the Act ("QIB"). The Initial Purchasers agree with the
Company that (a) they have not and will not, directly or indirectly, solicit
offers for, or offer or sell, the Senior Notes by any form of general
solicitation or general advertising (as those terms are used in Regulation D
under the Act) or in any manner involving a public offering within the meaning
of Section 4(2) of the Act; and (b) they have and will solicit offers for the
Senior Notes only from, and will offer the Senior Notes only to (i) Persons whom
the Initial Purchasers reasonably believe to be QIBs or, if any such Person is
buying for one or more institutional accounts for which such Person is acting as
fiduciary or agent, only when such Person has represented lo the Initial
Purchasers that each such account is a QIB, to whom notice has been given that
such sale or delivery is being made in reliance on Rule 144A, and, in each case,
in transactions under Rule 144A or (ii) a limited number of other institutional
investors reasonably believed by the Initial Purchasers to be "Accredited
Investors" (as defined in Rule 501(a)(1), (2), (3) or (7) of the Act) that,
prior to their purchase of the Senior Notes,
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deliver to the Initial Purchasers a letter containing the representations and
agreements set forth in Annex A to the Final Memorandum.
ARTICLE IV
CONDITIONS PRECEDENT TO CLOSING
Section 4.1. Conditions Precedent to Obligations of the
Initial Purchasers. The obligation of the Initial Purchasers to purchase the
Senior Notes to be purchased by them hereunder is subject to the satisfaction of
the following conditions:
(a) The Initial Purchasers shall have received an opinion,
addressed to the Initial Purchasers in form and substance reasonably
satisfactory to counsel to the Initial Purchasers and dated the Time of
Purchase, from Xxxxxxx & Xxxxx, counsel to the Company and the Guarantors,
covering the matters set forth in Exhibit 1 hereto.
(b) The Initial Purchasers shall have received an opinion,
addressed to the Initial Purchasers in form and substance reasonably
satisfactory to counsel to the Initial Purchasers and dated the Time of
Purchase, from Xxxxxxx & Xxxxx, healthcare counsel to the Company covering the
matters set forth in Exhibit 2 hereto.
(c) The Initial Purchasers shall have received an opinion,
addressed to the Initial Purchasers in form and substance satisfactory to the
Initial Purchasers and dated the Time of Purchase, of Xxxx, Weiss, Rifkind,
Xxxxxxx & Xxxxxxxx, counsel to the Initial Purchasers, substantially in the form
of Exhibit 3 hereto.
In rendering such opinions in accordance with Sections 4.1(a),
(b) and (c), each such counsel may rely as to factual matters upon
representations of, and certificates or other documents furnished by the
Company, the Guarantors and their respective officers and directors, the Initial
Purchasers and government officials, and upon such other documents as such
counsel deem appropriate as a basis for their opinion. Each such counsel may
specify the jurisdictions in which it is admitted to practice and that it is not
admitted to practice in any other jurisdiction or an expert in the law of any
other jurisdiction. To the extent such opinion concerns the laws of any other
such jurisdiction such counsel may rely upon the opinion of counsel
(satisfactory to the Initial Purchasers) admitted to practice in such
jurisdiction.
(d) The Initial Purchasers shall have received from each of
the Accountants a comfort letter or letters dated as of the date hereof and as
of the Closing in form and substance reasonably satisfactory to counsel to the
Initial Purchasers.
(e) The representations and warranties made by the Company and
the Guarantors herein shall be true and correct in all material respects (except
for changes expressly provided for in this Agreement) on and as of the Time of
Purchase with the same effect as though such representations and warranties had
been made on and as of the Time of Purchase, the Company and the Guarantors
shall have complied in all material respects with all agreements as set forth in
or contemplated hereunder and in the other Basic Documents required to be
performed by them at or prior to the Time of Purchase.
(f) Subsequent to the date of the Final Memorandum, (i) there
shall not have been any change, or any development involving a prospective
change, which has had or could be reasonably likely to have a Material
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Adverse Effect, and (ii) the Company and its Subsidiaries shall have conducted
their respective businesses only in the ordinary course.
(g) At the Time of Purchase and after giving effect to the
consummation of this Agreement, the other Basic Documents and the Transactions,
there shall exist no Default or Event of Default.
(h) The purchase of and payment for the Senior Notes by the
Initial Purchasers hereunder shall not be prohibited or enjoined (temporarily or
permanently) by any applicable law or governmental regulation (including,
without limitation, Regulation G, T, U or X of the Board of Governors of the
Federal Reserve System).
(i) At the Time of Purchase, the Initial Purchasers shall have
received a certificate, executed by the Chief Executive Officer of the Company
and the Chief Financial Officer of the Company, dated the Time of Purchase, from
the Company stating that the conditions specified in Sections 4.1(e), (f), (g)
and (l) have been satisfied or duly waived at the Time of Purchase.
(j) Each of the Basic Documents shall be reasonably
satisfactory in form and substance to the Initial Purchasers and shall have been
executed and delivered by all the respective parties thereto and shall be in
full force and effect.
(k) All proceedings taken in connection with the issuance of
the Senior Notes and the consummation of this Agreement, the other Basic
Documents and the Transactions and all documents and papers relating thereto
shall be reasonably satisfactory to the Initial Purchasers and counsel to the
Initial Purchasers. The Initial Purchasers and counsel to the Initial Purchasers
shall have received copies of such papers and documents as they may reasonably
request in connection therewith, all in form and substance reasonably
satisfactory to them.
(l) The sale of the Senior Notes hereunder shall not have been
enjoined (temporarily or permanently) at the Time of Purchase.
(m) There shall not have been any announcement by any
"nationally recognized statistical rating organization," as defined for purposes
of Rule 436(g) under the Act, that (A) it is downgrading its rating assigned to
any debt securities of the Company, or (B) it is reviewing its rating assigned
to any debt securities of the Company with a view to possible downgrading, or
with negative implications, or direction not determined.
(n) The Initial Purchasers shall have sold $100,000,000
aggregate principal amount of the Senior Notes in accordance with the provisions
of Section 3.2 hereof.
On or before the Closing, the Initial Purchasers and counsel
to the Initial Purchasers shall have received such further documents, opinions,
certificates and schedules or other instruments relating to the business,
corporate, legal and financial affairs of the Company and its Subsidiaries as
they may reasonably request.
ARTICLE V
COVENANTS
Section 5.1. Covenants of the Company and the Guarantors. The
Company and the Guarantors jointly and severally covenant and agree with the
Initial Purchasers that:
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(a) The Company will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which the Initial
Purchasers shall not previously have been advised and furnished a copy for a
reasonable period of time prior to the proposed amendment or supplement and as
to which the Initial Purchasers shall not have given its consent, which consent
shall not be unreasonably withheld. The Company will promptly, upon the
reasonable request of the Initial Purchasers or counsel to the Initial
Purchasers, make any amendments or supplements to the Preliminary Memorandum or
the Final Memorandum that may be necessary or advisable in the opinion of the
Initial Purchasers or counsel to the Initial Purchasers in connection with the
resale of the Senior Notes by the Initial Purchasers.
(b) The Company and the Guarantors will cooperate with the
Initial Purchasers in arranging for the qualification of the Senior Notes for
offering and sale under the securities or "Blue Sky" laws of such jurisdictions
as the Initial Purchasers may designate and will continue such qualifications in
effect for as long as may be reasonably necessary to complete the resale of the
Senior Notes; provided, however, that in connection therewith, none of the
Company and the Guarantors shall be required to qualify as a foreign corporation
or to execute a general consent to service of process in any jurisdiction or
subject itself to taxation in excess of a nominal dollar amount in any such
jurisdiction where it is not then so subject.
(c) If, at any time prior to the completion of the
distribution by the Initial Purchasers of the Senior Notes, the Exchange Notes
or the Private Exchange Notes, any event occurs or information becomes known as
a result of which the Final Memorandum as then amended or supplemented would
include any untrue statement of a material fact, or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if for any other reason it is
necessary at any time to amend or supplement the Final Memorandum to comply with
applicable law, the Company will promptly notify the Initial Purchasers thereof
(who thereafter will not use such Final Memorandum until appropriately amended
or supplemented) and will prepare, at the expense of the Company, an amendment
or supplement to the Final Memorandum that corrects such statement or omission
or effects such compliance; provided, however, that the Company's obligation
hereunder shall not be applicable to the extent resale by the Initial Purchasers
may be accomplished pursuant to a Registration Statement (as defined in the
Senior Note Registration Rights Agreement).
(d) The Company will, without charge, provide to the Initial
Purchasers and to counsel to the Initial Purchasers as many copies of the
Preliminary Memorandum and the Final Memorandum or any amendment or supplement
thereto as the Initial Purchasers may reasonably request.
(e) The Company will apply the net proceeds from the sale of
the Senior Notes as set forth under "Use of Proceeds" in the Final Memorandum.
(f) For and during the period ending on the date no Senior
Notes or Exchange Notes are outstanding, the Company and the Guarantors will
furnish to the Initial Purchasers copies of all reports and other communications
(financial or otherwise) furnished by the Company or any of the Guarantors to
the Trustee or the holders of the Senior Notes or Exchange Notes and, promptly
after available, copies of any reports or financial statements furnished to or
filed by the Company or any of the Guarantors with the Commission or any
national securities exchange on which any class of securities of the Company or
any of the Guarantors may be listed or the Nasdaq National Market.
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(g) Prior to the Time of Purchase, the Company and the
Guarantors will furnish to the Initial Purchasers, as soon as they have been
prepared, a copy of any unaudited interim financial statements of the Company
and the Guarantors for any period subsequent to the period covered by the most
recent financial statements appearing in the Final Memorandum.
(h) None of the Company, the Guarantors, or any of their
Affiliates will sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any "security" (as defined in the Act) which could be
integrated with the sale of the Senior Notes in a manner which would require the
registration under the Act of the Senior Notes.
(i) The Company and the Guarantors will not, and will not
permit any of their Subsidiaries to, solicit any offer to buy or offer to sell
the Senior Notes by means of any form of general solicitation or general
advertising (as those terms are used in Regulation D under the Act) or in any
manner involving a public offering within the meaning of Section 4(2) of the
Act.
(j) For so long as any of the Senior Notes remain outstanding
and are "restricted securities" within the meaning of Rule 144(a)(3) under the
Act and not salable in full under Rule 144 under the Act (or any successor
provision), the Company and the Guarantors will make available, upon request, to
any seller of such Senior Notes the information specified in Rule 144A(d)(4)
under the Act, unless the Company and the Guarantors are then subject to Section
13 or 15(d) of the Exchange Act.
(k) The Company and the Guarantors will use their best efforts
to (I) permit the Senior Notes to be included for quotation on PORTAL and (ii)
permit the Senior Notes to be eligible for clearance and settlement through The
Depository Trust Company.
(l) The Company and the Guarantors will use their best efforts
to do and perform all things required to be done and performed by them under
this Agreement and the other Basic Documents prior to or after the Closing and
to satisfy all conditions precedent on their part to the obligations of the
Initial Purchasers to purchase and accept delivery of the Senior Notes.
ARTICLE VI
FEES
Section 6.1. Costs, Expenses and Taxes. The Company and the
Guarantors agree to pay all costs and expenses incident to the performance of
their obligations under this Agreement, whether or not the transactions
contemplated herein are consummated or this Agreement is terminated pursuant to
Section 8.2 hereof, including, but not limited to, all costs and expenses
incident to (i) the negotiation, preparation, printing, typing, reproduction,
execution and delivery of this Agreement and each of the other Basic Documents,
any amendment or supplement to or modification of any of the foregoing and any
and all other documents furnished pursuant hereto or thereto or in connection
herewith or therewith, (ii) any costs of printing the Preliminary Memorandum and
the Final Memorandum and any amendment or supplement thereto, any other
marketing related materials and any "Blue Sky" memoranda (which shall include
the reasonable disbursements of counsel to the Initial Purchasers in respect
thereof), (iii) all arrangements relating to the delivery to the Initial
Purchasers of copies of the foregoing documents, (iv) the fees and disbursements
of the counsel, the accountants and any other experts or advisors retained by
the Company, (v) preparation (including printing), issuance and delivery to the
Initial Purchasers of the Senior Notes, (vi) the qualification of the Senior
Notes under state securities and
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"Blue Sky" laws, including filing fees and reasonable fees and disbursements of
counsel to the Initial Purchasers relating thereto, (vii) expenses and the cost
of any private or chartered airplanes or other transportation in connection with
any meetings with prospective investors in the Senior Notes, (viii) fees and
expenses of the Trustee including fees and expenses of counsel to the Trustee,
(ix) all expenses and listing fees incurred in connection with the application
for quotation of the Senior Notes on PORTAL, (x) any fees charged by investment
rating agencies for the rating of the Senior Notes and (xi) except as limited by
Article VII, all costs and expenses (including, without limitation, reasonable
attorneys' fees and expenses), if any, in connection with the enforcement of
this Agreement, the Senior Notes or any other agreement furnished pursuant
hereto or thereto or in connection herewith or therewith. In addition, the
Company and the Guarantors shall pay any and all stamp, transfer and other
similar taxes (but excluding any income, franchise, personal property, ad
valorem or gross receipts taxes) payable or determined to be payable in
connection with the execution and delivery of this Agreement, any of the other
Basic Documents or the issuance of the Senior Notes, and shall save and hold the
Initial Purchasers harmless from and against any and all liabilities with
respect to or resulting from any delay in paying, or omission to pay, such taxes
(other than if such delay is caused by the Initial Purchasers).
ARTICLE VII
INDEMNITY
Section 7.1. Indemnity.
(a) Indemnification by the Company and Guarantors. Each of the
Company and the Guarantors jointly and severally agrees and covenants to hold
harmless and indemnify each Initial Purchaser, their Affiliates, the directors,
officers, employees, affiliates and agents of each of the Initial Purchaser and
their Affiliates and each person, if any, who controls each of the Initial
Purchasers and their Affiliates within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act (collectively referred to for the purposes of
this Article VII as the "Initial Purchasers"), from and against any and all
losses, claims, liabilities, expenses and damages (including any and all
investigative, legal and other expenses reasonably incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding between any
parties to this Agreement or between any party to this Agreement and any third
party, or otherwise, or any claim asserted) (collectively, "Losses") to which
they, or any of them may become subject arising out of or based upon any untrue
statement or alleged untrue statement of any fact contained in the Memorandum
and any amendments or supplements thereto, the Basic Documents, or any documents
filed with the Commission or any State Commission (collectively, the "Offering
Materials") or arising out of or based upon the omission or alleged omission to
state in any of the Offering Materials a fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that
the Company and the Guarantors shall not be liable to any Initial Purchaser
under this paragraph (a) to the extent that such Losses arose out of or are
based upon an untrue statement or omission made in any of the documents referred
to in this paragraph (a) in reliance upon and in conformity with the information
relating to such Initial Purchaser or the plan of distribution furnished in
writing by such Initial Purchasers expressly for inclusion therein (or for a
breach by the Initial Purchasers of any representation or warranty contained in
this Agreement). The Company and the Guarantors further agree to reimburse the
Initial Purchasers for any reasonable legal and other expenses as they are
incurred by them in connection with investigating, preparing to defend,
defending or appearing as a third-party witness in connection with any lawsuits,
claims or other proceedings or investigations arising in any manner out of or in
connection
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with the Memorandum and any amendments or supplements thereto, the execution or
delivery of any of the Basic Documents, any Offering Materials or any
Transaction; provided that if the Company reimburses any Initial Purchaser
hereunder for any expenses incurred in connection with a lawsuit, claim or other
proceeding for which indemnification is sought, such Initial Purchaser hereby
agrees to refund such reimbursement of expenses to the extent that the lawsuit,
claim or other proceeding arises out of or is based upon an untrue statement or
omission made in any of the documents referred to in this paragraph (a) in
reliance upon and in conformity with the information relating to such Initial
Purchaser furnished in writing by such Initial Purchasers expressly for
inclusion therein (or for a breach by such Initial Purchaser of any
representation or warranty contained in this Agreement). The Company and the
Guarantors further agree that the indemnification, contribution and
reimbursement commitments set forth in this Article VII shall apply whether or
not the Initial Purchasers are formal parties to any such lawsuits, claims or
other proceedings. The indemnity, contribution and expense reimbursement
obligations of the Company and the Guarantors under this Article VII shall be in
addition to any liability the Company or the Guarantors may otherwise have under
common law or otherwise.
(b) Indemnification by the Initial Purchasers. Each Initial
Purchaser, severally and not jointly, agrees and covenants to hold harmless and
indemnify the Company, the Guarantors, their Affiliates, the directors,
officers, employees, agents and each person, if any, who controls each of the
Company and the Guarantors and their Affiliates (collectively referred to for
the purposes of this Article VII as the "Company") from and against any Losses,
insofar as such Losses arise out of or are based upon or relate to any untrue
statement of any material fact contained in the Offering Materials, or any
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or omission was made
in reliance upon and in conformity with the information relating to such Initial
Purchaser furnished in writing by such Initial Purchaser expressly for inclusion
therein. The indemnity, contribution and expense reimbursement obligations of
the Initial Purchasers under this Article VI[I shall be in addition to any
liability the Initial Purchasers may otherwise have under common law or
otherwise.
(c) Procedure. If any Person shall be entitled to indemnity
hereunder (each an "Indemnified Party"), such Indemnified Party shall give
prompt written notice to the party or parties from which such indemnity is
sought (each an "Indemnifying Party") of the commencement of any action, suit,
investigation or proceeding, governmental or otherwise (a "Proceeding"), with
respect to which such Indemnified Party seeks indemnification or contribution
pursuant hereto; provided, however, that the failure so to notify the
Indemnifying Parties shall not relieve the Indemnifying Parties from any
obligation or liability except to the extent that the Indemnifying Parties have
been prejudiced materially by such failure. The Indemnifying Parties shall have
the right, exercisable by giving written notice to an Indemnified Party promptly
after the receipt of written notice from such Indemnified Party of such
Proceeding, to assume, at the Indemnifying Parties' expense, the defense of any
such Proceeding, with counsel reasonably satisfactory to such Indemnified Party;
provided, however, that an Indemnified Party or parties (if more than one such
Indemnified Party is named in any Proceeding) shall have the right to employ
separate counsel in any such Proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party or parties unless: (1) the Indemnifying Parties agree to
pay such fees and expenses; or (2) the Indemnifying Parties fail promptly to
assume the defense of such Proceeding or fail to employ counsel reasonably
satisfactory to such Indemnified Party or parties; or (3) the named parties to
any such Proceeding (including any impleaded parties) include both such
Indemnified
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Party or parties and the Indemnifying Party or an Affiliate of the Indemnifying
Party and such Indemnified Parties, and the Indemnified Parties shall have been
advised by counsel that there may be one or more legal defenses available to
such Indemnified Party or parties that are different from or additional to those
available to the Indemnifying Parties, in which case, if such Indemnified Party
or parties notifies the Indemnifying Parties in writing that it elects to employ
separate counsel at the expense of the Indemnifying Parties, the Indemnifying
Parties shall not have the right to assume the defense thereof with respect to
the Indemnified Parties and such counsel shall be at the expense of the
Indemnifying Parties, it being understood, however, that the Indemnifying
Parties shall not, in connection with any one such Proceeding or separate but
substantially similar or related Proceedings in the same jurisdiction, arising
out of the same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (together with appropriate
local counsel) at any time for such Indemnified Party or parties, or for fees
and expenses that are not reasonable. No Indemnified Party or Parties will
settle any Proceeding without the consent of the Indemnifying Party or parties
(but such consent shall not be unreasonably withheld). No Indemnifying Party
shall, without the prior written consent of the Indemnified Party, effect any
settlement of any pending or threatened Proceeding in respect of which any
Indemnified Party is or could have been a party and indemnity could have been
sought hereunder by such Indemnified Party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability or claims
that are the subject of such Proceeding.
Section 7.2. Contribution. If for any reason the
indemnification provided for in Section 7.1 of this Agreement is unavailable to
an Indemnified Party, or insufficient to hold it entirely harmless, in respect
of any Losses, then each applicable Indemnifying Party, in lieu of indemnifying
such Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect not only the relative benefits received by the
Indemnifying Party on the one hand and the Indemnified Party on the other, but
also the relative fault of the Indemnifying and Indemnified Parties in
connection with the statements or omissions which resulted in such Losses, as
well as any other relevant equitable considerations. The relative benefits
received by the Indemnifying and Indemnified Parties shall be deemed to be in
the same proportion as the total proceeds from the offering of the Senior Notes
(before deducting expenses, but after giving effect to the Initial Purchasers'
discount) received by the Company bear to the total discounts and commissions
received by the Initial Purchasers. The relative fault of the Indemnifying and
Indemnified Parties shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Indemnifying or Indemnified Parties and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The amount paid or payable by a party as a result of
the Losses, referred to above shall be deemed to include any legal or other fees
or expenses incurred by such party in connection with investigating or defending
any such claim.
The Company and the Initial Purchasers agree that it would not
be just and equitable if contribution pursuant to the immediately preceding
paragraph were determined pro rata or per capita or by any other method of
allocation which does not take into account the equitable considerations
referred to in such paragraph. Notwithstanding any other provision of this
Section 7.2, the Initial Purchasers shall not be obligated to make contributions
hereunder that in the aggregate exceed the total discounts, commissions and
other compensation received by the Initial Purchasers under this Agreement, less
the aggregate amount of any damages that the Initial Purchasers have otherwise
been required to pay by reason of the untrue or
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alleged untrue statements or a breach of a representation or warranty or the
omissions or alleged omissions to state a material fact. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
Section 7.3. Senior Note Registration Rights Agreement.
Notwithstanding anything to the contrary in this Article VII, the
indemnification and contribution provisions of the Senior Note Registration
Rights Agreement shall govern any claim with respect thereto.
ARTICLE VIII
MISCELLANEOUS
Section 8.1. Survival of Provisions. The representations,
warranties and covenants of the Company, its officers and the Initial Purchasers
made herein, the indemnity and contribution agreements contained herein and each
of the provisions of Articles V, VII and VIII shall remain operative and in full
force and effect regardless of (a) the investigation made by or on behalf of the
Company, the Initial Purchasers or any Indemnified Person, (b) acceptance of any
of the Senior Notes and payment therefor, (c) any termination of this Agreement
or (d) disposition of the Senior Notes by the Initial Purchasers whether by
redemption, exchange, sale or otherwise.
Section 8.2. Termination.
(a) This Agreement may be terminated in the sole discretion of
the Initial Purchasers by notice to the Company given prior to the Time of
Purchase in the event that the Company shall have failed, refused or been unable
to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder at or prior thereto or, if at or prior to the
Closing:
(i) the Company or any of its Subsidiaries shall have
sustained any loss or interference with respect to its businesses or properties
from fire, flood, hurricane, accident or other calamity, whether or not covered
by insurance, or from any strike, labor dispute, slow down or work stoppage or
any legal or governmental proceeding or any action of any governmental
reimbursement source or intermediary therefor, which loss or interference, in
the sole judgment of the Initial Purchasers, has had or has a Material Adverse
Effect, or there shall have been, in the sole judgment of the Initial
Purchasers, any event or development that, individually or in the aggregate, has
or could be reasonably likely to have a Material Adverse Effect (including
without limitation a change in control of the Company or any of its
Subsidiaries), except in each case as described in the Final Memorandum
(exclusive of any amendment or supplement thereto);
(ii) trading in securities of the Company or in
securities generally on the New York Stock Exchange, American Stock Exchange or
the Nasdaq National Market shall have been suspended or minimum or maximum
prices shall have been established on any such exchange or market;
(iii) a banking moratorium shall have been declared
by New York or United States authorities;
(iv) there shall have been (A) an outbreak or
escalation of hostilities between the United States and any foreign power, or
(B) an outbreak or escalation of any other insurrection or armed conflict
involving the United States or any other national or international calamity or
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emergency, or (c) any material change in the financial markets of the United
States which, in the case of (A), (B) or (c) above and in the sole judgment of
the Initial Purchasers, makes it impracticable or inadvisable to proceed with
the offering or the delivery of the Senior Notes as contemplated by the Final
Memorandum; or
(v) any securities of the Company shall have been
downgraded or placed on any "watch list" for possible downgrading by any
nationally recognized statistical rating organization.
(b) Termination of this Agreement pursuant to this Section 8.2
shall be without liability of any party to any other party except as provided in
Section 8.1 hereof
Section 8.3. Defaulting Initial Purchasers. (a) If, on the day
of the Closing, any Initial Purchaser defaults in the performance of its
obligations under this Agreement, the non-defaulting Initial Purchasers may make
arrangements for the purchase of such Senior Notes by other persons satisfactory
to the Company and the Guarantors but if no such arrangements are made within 36
hours after such default, this Agreement shall terminate without liability on
the part of the non-defaulting Initial Purchasers, the Company or the Guarantors
except that the Company and the Guarantors will continue to be liable for the
payment of expenses to the extent set forth in Article VI and the provisions of
Article VII shall not terminate and shall remain in effect. As used in this
Agreement, the term "Initial Purchaser" includes, for all purposes of this
Agreement unless the context otherwise requires, any party not listed in
Schedule I hereto who, pursuant to this Section 8.3, purchases Senior Notes
which a defaulting Initial Purchaser agreed but failed to purchase.
(b) Nothing contained herein shall relieve a defaulting
Initial Purchaser of any liability it may have to the Company, the Guarantors or
the nondefaulting Initial Purchasers for damages caused by its default. If other
persons are obligated or agree to purchase the Senior Notes of a defaulting
Initial Purchaser, either the non-defaulting Initial Purchasers or the Company
may postpone the Closing Date for up to seven full business days in order to
effect any changes that in the opinion of counsel for the Company or counsel for
the Initial Purchasers may be necessary in the Offering Memorandum or in any
other document or arrangement, and the Company agrees to promptly make any
amendment or supplement to the Offering Memorandum that effects any such
changes.
Section 8.4. No Waiver; Modifications in Writing. No failure or delay
on the part of the Company, the Guarantors or the Initial Purchasers in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. The remedies provided for herein are cumulative
and are not exclusive of any remedies that may be available to the Company, the
Guarantors or the Initial Purchasers at law or in equity or otherwise. No waiver
of or consent to any departure by the Company, the Guarantors or the Initial
Purchasers from any provision of this Agreement shall be effective unless signed
in writing by the party entitled to the benefit thereof, provided that notice of
any such waiver shall be given to each party hereto as set forth below. Except
as otherwise provided herein, no amendment, modification or termination of any
provision of this Agreement shall be effective unless signed in writing by or on
behalf of each of the Company, the Guarantors and the Initial Purchasers. Any
amendment, supplement or modification of or to any provision of this Agreement,
any waiver of any provision of this Agreement, and any consent to any departure
by the Company, the Guarantors or the Initial Purchasers from the terms of any
provision of this Agreement, shall be effective only in the specific
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instance and for the specific purpose for which made or given. Except where
notice is specifically required by this Agreement, no notice to or demand on the
Company or the Guarantors in any case shall entitle the Company or the
Guarantors to any other or further notice or demand in similar or other
circumstances.
Section 8.5. Information Supplied by the Initial Purchasers.
The statements set forth in the legend on pages (i) and (ii) of the Final
Memorandum and in the second and third sentences of the third paragraph and the
seventh, eighth and ninth paragraphs under the heading "Plan of Distribution" in
the Final Memorandum (to the extent such statements relate to the Initial
Purchasers) constitute the only information furnished by the Initial Purchasers
to the Company for the purposes of Sections 3.1(a) and 7.1(a) and (b) hereof.
Section 8.6 Allocation of Expenses of Initial Purchasers. Each
of the Initial Purchasers hereby agrees that any expenses or disbursements to be
paid collectively by the Initial Purchasers (including, without limitation, the
fees and disbursements of counsel to the Initial Purchasers) shall be allocated
among the Initial Purchasers as follows: CIBC Wood Gundy Securities Corp., 50%;
Cruttenden Xxxx Incorporated, 42.5%; Wheat, First, Securities, Inc., 7.5%.
Section 8.7. Communications. All notices, demands and other
communications provided for hereunder shall be in writing, and, (a) if to the
Initial Purchasers, shall be given by registered or certified mail, return
receipt requested, telex, telegram, telecopy, courier service or personal
delivery, addressed to the initial Purchasers in care of CIBC Wood Gundy
Securities Corp., 000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxx Xxxxxx, with a copy to Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx,
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx X.
Xxxxxxx, Esq., and (b) if to the Company or any Guarantor, shall be given by
similar means to Unison Healthcare Corporation, 0000 X. Xxxxxx Xxxxxx Xxxx,
Xxxxx 000, Xxxxxxxxxx, Arizona 8525 1, Attention: Chief Financial Officer, with
a copy to Xxxxxxx & Xxxxx, Xxx Xxxx Xxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxxxx
00000, Attention: P. Xxxxxx Xxxx, Esq. In each case, notices, demands and other
communications shall be deemed given when received.
Section 8.8. Execution in Counterparts. This Agreement may be
executed in any number of counterparts and by different parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all of which counterparts,
taken together, shall constitute but one and the same Agreement.
Section 8.9. Successors. This Agreement shall inure to the
benefit of and be binding upon the Initial Purchasers, the Company, the
Guarantors and their respective successors and legal representatives, and
nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any other Person any legal or equitable right, remedy or claim
under or in respect of this Agreement, or any provisions herein contained; this
Agreement and all conditions and provisions hereof being intended to be and
being for the sole and exclusive benefit of such Persons and for the benefit of
no other Person except that (i) the indemnities of the Company and the
Guarantors contained in Section 7.1(a) of this Agreement shall also be for the
benefit of the directors, officers, employees and agents of the Initial
Purchasers and any Person or Persons who control the Initial Purchasers within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act and (ii)
the indemnities of the Initial Purchasers contained in Section 7.1(b) of this
Agreement shall also be for the benefit of the directors of the Company, the
Guarantors, their officers, employees and agents and any Person or Persons who
control the Company or any Guarantor
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within the meaning of Section 15 of the Act or Section 20 of the Exchange Act.
No purchaser of Senior Notes from the Initial Purchasers will be deemed a
successor because of such purchase.
Section 8.10. Governing Law. THIS AGREEMENT SHALL BE DEEMED TO
BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES
SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
Section 8.11. Severability of Provisions. Any provision of
this Agreement which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 8.12. Headings. The Article and Section headings and
Table of Contents used or contained in this Agreement are for convenience of
reference only and shall not affect the construction of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first written above.
UNISON HEALTHCARE CORPORATION
By: /s/ Xxxxx X. Xxxxx
-------------------------------
Name: Xxxxx X. Xxxxx
Title: EVP & CFO
SUNQUEST SPC, INC.
BRITWILL HEALTHCARE COMPANY
QUEST PHARMACIES, INC.
SUNBELT THERAPY MANAGEMENT SERVICES, INC., an Arizona corporation
DECATUR SPORTS FIT & WELLNESS CENTER, INC.
XXXXXXXXX & ASSOCIATES REHABILITATION, INC.
SUNBELT THERAPY MANAGEMENT SERVICES, INC., an Alabama corporation
BRITWILL INVESTMENTS - I, INC.
BRITWILL INVESTMENTS - II, INC.
BRITWILL FUNDING CORPORATION
EMORY CARE CENTER, INC.
THERAPY HEALTH SYSTEMS, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Secretary
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CIBC WOOD GUNDY SECURITIES CORP.
By: /s/ Xxxx X. Xxxxx
------------------------------------
Name: Xxxx X. Xxxxx
Title: Director
CRUTTENDEN XXXX INCORPORATED
By: /s/ Xxxxxx X. Xxxx
------------------------------------
Name: Xxxxxx X. Xxxx
Title: Chief Financial Officer
WHEAT, FIRST SECURITIES, INC.
By: /s/
------------------------------------
Name:
Title:
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Schedule I
Principal Amount
Initial Purchaser of Senior Notes
----------------- ---------------
CIBC Wood Gundy Securities Corp.............................. $ 58,333,333
Cruttenden Xxxx Incorporated ................................ 32,916,667
Wheat, First Securities, Inc................................. 8,750,000
------------
$100,000,000
============
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Schedule II
Subsidiaries
Sunquest SPC, Inc.
BritWill Healthcare Company
Quest Pharmacies, Inc.
Sunbelt Therapy Management Services, Inc. (Arizona)
Decatur Sports Fit & Wellness Center, Inc.
Xxxxxxxxx & Associates Rehabilitation, Inc.
Sunbelt Therapy Management Services, Inc. (Alabama)
BritWill Investments I, Inc.
BritWill Investments II, Inc.
BritWill Funding Corporation
Emory Care Center, Inc.
Therapy Health Systems, Inc.
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EXHIBIT 1
CIBC WOOD GUNDY SECURITIES CORP.
CRUTTENDEN XXXX INCORPORATED
WHEAT, FIRST SECURITIES, INC.
as Initial Purchasers
c/o CIBC Wood Gundy Securities Corp.
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
We have represented Unison HealthCare Corporation, a Delaware
corporation (the "Company"), in connection with the Securities Purchase
Agreement dated as of October 28, 1996 (the "Purchase Agreement") among you as
Initial Purchasers (the "Initial Purchasers"), the Company and the Guarantors
named in Schedule II thereto (the "Guarantors"), with respect to the issue and
sale by the Company of $100,000,000 aggregate principal amount of Senior Notes
to the Initial Purchasers and the offering thereof by the Initial Purchasers.
Unless otherwise defined herein, the definitions of terms used in this opinion
shall be those in the Purchase Agreement.
In such capacity, we have examined copies of the Final Offering
Memorandum of the Company with respect to the Senior Notes (the "Final
Memorandum") and the Purchase Agreement, and the forms of the Senior Notes, the
Indenture and the Senior Note Registration Rights Agreement referred to therein
(referred to with the Purchase Agreement as the "Basic Documents" herein). We
have also examined the originals, or copies identified to our satisfaction, of
such corporate records of the Company and the Guarantors, such other agreements
and instruments, certificates of public officials, officers of the Company and
other persons as we have deemed necessary as a basis for the opinions expressed
below. In all such examinations, we have assumed the genuineness of all
signatures, the authenticity of all documents, certificates and instruments
submitted to us as originals and the conformity with the originals of all
documents submitted to us as copies. In rendering the opinions expressed below,
we relied upon certificates of the Company given by certain of its officers
(copies of which certificates are attached hereto) as to factual matters, and on
certificates of public officials. We believe you and we are justified in relying
upon such certificates.
Based upon the foregoing, we are of the opinion that:
1. The Company and each of the Guarantors have been duly incorporated,
and are validly existing and in good standing under the laws of their respective
jurisdictions of incorporation.
2. Each of the Company and the Guarantors is duly qualified and in good
standing as a foreign corporation and is authorized to do business, in each
jurisdiction in which the ownership or leasing of any property or the character
of its operations makes such qualification necessary and in which the failure so
to qualify could have a Material Adverse Effect.
3. Except as set forth in the Final Memorandum, all outstanding shares
of capital stock of the Subsidiaries are owned by the Company either directly or
through wholly-owned subsidiaries.
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4. Except as set forth or contemplated in the Final Memorandum, nothing
has come to our attention that gives us reason to believe there exists any
defect in title or leasehold interest, or any lien, claim or encumbrance which
would materially affect the use made and, to the best of our knowledge, proposed
to be made, or any of the property of the Company or any of the Subsidiaries.
5. Each of the Company and the Guarantors has all requisite corporate
power and authority, as the case may be, to issue, sell and deliver the Senior
Notes, to execute and deliver the Basic Documents to which it is a party, to
perform all its obligations thereunder and to consummate the transactions
contemplated thereby. Each of the Company and its Subsidiaries has the corporate
power and authority to own or lease and operate its respective property and
assets and to conduct its respective business as described in the Final
Memorandum.
6. All necessary corporate action has been taken by each of the Company
and the Guarantors to authorize the execution, delivery and performance by it of
the Basic Documents to which it is a party, to consummate all of the
transactions contemplated thereby and to issue, sell and deliver the Senior
Notes.
7. The beneficial ownership of the equity interests in the Company is
as set forth in the Final Memorandum under the heading "Principal Stockholders."
8. The Purchase Agreement has been duly authorized by the Company and
the Guarantors and the Company and the Guarantors each have all requisite
corporate power and authority to execute, issue and deliver the Purchase
Agreement and to incur and perform its obligations provided for therein. The
Purchase Agreement, when executed and delivered by the Company and the
Guarantors (assuming the due authorization, execution and delivery by the
Initial Purchasers), will constitute a valid and legally binding agreement of
the Company and the Guarantors, enforceable against each of them in accordance
with its terms except (i) that the enforcement thereof may be subject to
bankruptcy, insolvency, reorganization, fraudulent transfer or conveyance,
moratorium or other similar laws now or hereafter in effect and relating to or
affecting creditors' rights generally, and to general principles of equity and
the discretion of the court before which any proceeding therefor may be brought,
(ii) the enforceability of any provision requiring the payment of attorney's
fees may be subject to a court determination that such fees are reasonable and
(iii) as any rights to indemnity or contribution hereunder may be limited by
federal or state securities laws and public policy considerations.
9. The Indenture has been duly authorized by the Company and each of
the Guarantors and the Company and each of the Guarantors shall have all
requisite corporate power and authority to execute, issue and deliver the
Indenture and the Guarantees and to incur and perform their respective
obligations provided for therein. The Indenture, when executed and delivered by
the Company and each of the Guarantors (assuming the due authorization,
execution and delivery by the Trustee), will constitute a valid and legally
binding agreement of the Company and each of the Guarantors, enforceable against
each of them in accordance with its terms except that (i)
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enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization, fraudulent transfer or conveyance and other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally, (ii)
the remedy of specific performance and injunctive and other forms of equitable
relief are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought, (iii) the
enforceability of provisions imposing penalties, forfeitures, late payment
charges or an increase in interest rate upon delinquency in payment or the
occurrence of a default may be limited in certain circumstances, and (iv) the
enforceability of any provision requiring the payment of attorneys' fees may be
subject to a court determination that such fees are reasonable. The Indenture is
in sufficient form for due qualification under the Trust Indenture Act of 1939,
as amended.
10. The Senior Note Registration Rights Agreement has been duly
authorized by the Company and the Guarantors and the Company and the Guarantors
each have all requisite corporate power and authority to execute, issue and
deliver the Senior Note Registration Rights Agreement and to incur and perform
their respective obligations provided for therein. The Senior Note Registration
Rights Agreement, when executed and delivered by the Company and the Guarantors
(assuming the due authorization, execution and delivery by the Initial
Purchasers), will constitute a valid and legally binding agreement of the
Company, enforceable against each of them in accordance with its terms except
that (i) rights to indemnity or contribution thereunder may be limited by
federal and state securities laws and public policy considerations; (ii)
enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization, fraudulent transfer or conveyance and other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally, (iii)
the remedy of specific performance and injunctive and other forms of equitable
relief are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought, (iv) the
enforceability of provisions imposing penalties, forfeitures, late payment
charges or an increase in interest rate upon delinquency in payment or the
occurrence of a default may be limited in certain circumstances, and (v) the
enforceability of any provision requiring the payment of attorneys' fees may be
subject to a court determination that such fees are reasonable, rights to
indemnity or contribution thereunder may be limited by federal and state
securities laws and public policy considerations.
11. The Senior Notes have each been duly authorized by the Company and
the Guarantors and the Company and the Guarantors each have all requisite
corporate power and authority to execute, issue and deliver the Senior Notes and
to incur and perform their respective obligations provided for therein. The
Senior Notes, when executed and delivered by the Company and the Guarantors
(assuming the due authorization, execution and delivery by the Trustee) in
accordance with the provisions of the Indenture and delivered to and paid for by
the Initial Purchasers in accordance with the terms of the Purchase Agreement,
will be entitled to the benefits of the Indenture and will constitute valid and
legally binding obligations of the Company and the Guarantors enforceable
against each of them in accordance with their terms, except that (i)
enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization, fraudulent transfer or conveyance and other similar laws now or
hereafter in effect relating to or affecting creditors'
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rights generally, (ii) the remedy of specific performance and injunctive and
other forms of equitable relief are subject to certain equitable defenses and to
the discretion of the court before which any proceeding therefor may be brought,
(iii) the enforceability of provisions imposing penalties, forfeitures, late
payment charges or an increase in interest rate upon delinquency in payment or
the occurrence of a default may be limited in certain circumstances, and (iv)
the enforceability of any provision requiring the payment of attorneys' fees may
be subject to a court determination that such fees are reasonable. The ranking
of the Senior Notes is as set forth in the Final Memorandum.
12. Each of the Guarantees have each been duly authorized by the
Guarantors and each Guarantor has all requisite corporate power and authority to
execute, issue and deliver its respective Guarantee and to incur and perform its
respective obligations provided for therein. The Guarantees, when executed and
delivered by the Guarantors in accordance with the provisions of the Indenture
will constitute valid and legally binding obligations of the Guarantors
enforceable against each of them in accordance with their terms, except that (i)
enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization, fraudulent transfer or conveyance and other similar laws nor or
hereafter in effect relating to or affecting creditors' rights generally, (ii)
the remedy of specific performance and injunctive and other forms of equitable
relief are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought, (iii) the
enforceability of provisions imposing penalties, forfeitures, late payment
charges or an increase in interest rate upon delinquency in payment or the
occurrence of a default may be limited in certain circumstances, and (iv) the
enforceability of any provision requiring the payment of attorneys' fees may be
subject to a court determination that such fees are reasonable. The ranking of
the Guarantees is as set forth in the Final Memorandum.
13. The Company and the Guarantors have all requisite corporate power
and authority under the laws of their respective state of incorporation to
execute, deliver and perform their respective obligations under the Purchase
Agreement and to consummate each of the Transactions set forth in the Final
Memorandum. Each of the Company and the Guarantors has all requisite corporate
power and authority under the laws of their respective state of incorporation to
(i) execute, deliver and perform its obligations under the Purchase Agreement
and each of the Basic Documents, (ii) execute, deliver and perform its
obligations under all other agreements and instruments executed and delivered by
the Company and the Guarantors pursuant to or in connection with the Purchase
Agreement, each of the Basic Documents and the Transactions and (iii) issue the
Senior Notes in the manner and for the purpose contemplated by the Purchase
Agreement.
14. To the best of our knowledge and other than as described in the
Final Memorandum, there is no action, suit, investigation or proceeding,
governmental or otherwise, pending or, to the best knowledge of the Company and
the Guarantors, threatened to which either the Company or any of the Guarantors
is or would be a party or of which the properties of either the Company or any
of the Guarantors are or may be subject, that (i) seeks to restrain, enjoin,
prevent the consummation of or otherwise challenge the issuance and sale of the
Senior Notes by the Company and the Guarantors or
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any of the transactions contemplated by the Transactions, (ii) questions the
legality or validity of any of the transactions contemplated by the Transactions
or seeks to recover damages or obtain other relief in connection with any of the
transactions contemplated by the Transactions, (iii) could reasonably be
expected to have any material adverse effect on the power or ability of either
the Company or any of the Guarantors to perform its obligations under the Basic
Documents or to consummate the transactions contemplated hereby or thereby or
(iv) could reasonably be expected to have a Material Adverse Effect.
15. The execution, delivery and performance by the Company and the
Guarantors of the Basic Documents, the issuance and sale by the Company of the
Senior Notes and the execution, delivery and performance by the Company and the
Guarantors of all other agreements and instruments to be executed and delivered
by the Company and the Guarantors, pursuant hereto or thereto or in connection
herewith or therewith or in connection with any of the other transactions
contemplated by the Transactions, and compliance by the Company and the
Guarantors with the terms and provisions hereof and thereof, do not and will not
(i) violate any provision of any law, rule or regulation (including, without
limitation, Regulation G, T, U or X of the Board of Governors of the Federal
Reserve System but excluding state "blue Sky" and legal investment laws and
regulations), order, writ, judgment, decree, determination or award known to us
presently in effect or in effect at the Time of Purchase having applicability to
either of the Company or any of the Guarantors, (ii) conflict with or result in
a breach or violation of (A) any of the terms or provisions of, or constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) by either the Company or any of the Guarantors or, except
as described in the Final Memorandum, give rise to any right to accelerate the
maturity or require the prepayment of any indebtedness under any contract,
indenture, mortgage, deed of trust, loan agreement, note, lease, license,
management agreement, authorization, permit, certificate or other agreement or
document known to us to which either the Company or any of the Guarantors is a
party or by which any of them may be bound, or to which any of them or any of
their respective assets or businesses is subject or (B) the certificate of
incorporation or bylaws (each, an "Organizational Document"), of either the
Company or any of the Guarantors, or (iii) result in, or require the creation or
imposition of, any Lien upon or with respect to any of the properties now owned
or hereafter acquired by either the Company or any of the Guarantors, except, in
each case, where such violation, conflict, breach, default or creation or
imposition of any Lien would not (individually or in the aggregate) (1) have a
Material Adverse Effect, (2) materially impair either the Company's or any of
the Guarantors' ability to perform the obligations contemplated by the Basic
Documents and the Final Memorandum or (3) materially affect the consummation of
the transactions contemplated by the Basic Documents and the Final Memorandum
and the Transactions.
16. Except as set forth in the Final Memorandum, no authorization,
consent, approval, license, qualification or formal exemption from, nor any
filing, declaration or registration with, any court, governmental agency or
regulatory authority or any securities exchange is required (i) in connection
with the execution, delivery or performance by the Company and the Guarantors
of, any of the Basic Documents or any of the transactions contemplated by the
Transactions or (ii) to permit the Company and the Guarantors to effect
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34
payments of principal of, premium and interest on the Senior Notes except (A) as
may be required under state securities or "Blue Sky" laws or the laws of any
foreign jurisdiction in connection with the offer and sale of the Senior Notes
or (B) as would not (individually or in the aggregate) have a Material Adverse
Effect.
17. Neither the Company nor any of the Guarantors is nor immediately
after the Time of Purchase will be an "investment company" or a company
"controlled" by an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
18. The statements set forth under the heading "Description of the
Senior Notes" in the Final Memorandum, insofar as such statements purport to
summarize certain provisions of the Senior Notes and the Indenture, provide a
fair summary of such provisions and information with respect thereto.
19. Assuming the accuracy of the representations of the Company and the
Guarantors in Section 3.1 of the Purchase Agreement and of the Initial
Purchasers set forth in Section 3.2 of the Purchase Agreement, it is not
necessary in connection with the offer and sale of the Senior Notes by the
Company and the Guarantors to the Initial Purchase under the circumstances
contemplated by the Purchase Agreement to register the Senior Notes under the
Act or to quality the Indenture under the Trust Indenture Act of 1939, as
amended.
20. No filing or registration with, notice to, or consent, approval,
authorization, order or other action of, any court or governmental authority or
agency is required for the consummation by the Company and the Guarantors of the
transactions contemplated by the Basic Documents except such as have been
obtained or made and except such as may be required under the state securities
or Blue Sky laws.
21. The execution and delivery of the Exchange Notes and the Private
Exchange Notes has been duly authorized by all necessary corporate action of the
Company and the Guarantors and the Exchange Notes and the Private Exchange
Notes, when duly executed and delivered by the Company and the Guarantors, all
in accordance with the terms of the Senior Note Registration Rights Agreement
and the Indenture, and assuming due authentication by the Trustee, will be the
legal, valid, and binding obligations of the Company and the Guarantors and will
be enforceable in accordance with their terms except that (i) enforceability may
be limited by bankruptcy, insolvency, moratorium, reorganization, fraudulent
transfer or conveyance and other similar laws now or hereafter in effect
relating to or affecting creditors' rights generally, (ii) the remedy of
specific performance and injunctive and other forms of equitable relief are
subject to certain equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought, (iii) the enforceability of
provisions imposing penalties, forfeitures, late payment charges or an increase
in interest rate upon delinquency in payment or the occurrence of a default may
be limited in certain circumstances, and (iv) the enforceability of any
provision requiring the payment of attorneys' fees may be subject to a court
determination that such fees are reasonable.
22. The descriptions in the Final Memorandum and any further amendments
or supplements thereto of contracts, agreements or other legal
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35
documents or which purport to summarize statutes, legal and governmental
proceedings or legal conclusions and other documents are accurate and fairly
present the information required to be shown.
23. We have no reason to believe that any Permit is not in full force
and effect and, to the best of our knowledge, other than as described or
contemplated in the Final Memorandum, there are no proceedings pending or
threatened against the Company, or any of its Subsidiaries or Facilities that
may cause any such Permit that is material to the conduct of the business of the
Company or any of its Subsidiaries as presently conducted to be revoked,
withdrawn, canceled, suspended or not renewed.
24. To the best of our knowledge, (a) the Company's and each
Subsidiary's and Facility's business practices do not violate any applicable
provisions of federal or state laws or regulations governing Medicare or any
state Medicaid programs, (b) no individual with an ownership or control
interest, as defined in 42 U.S.C. Section 1320a-3(a)(3), in the Company or any
Subsidiary, or who is an officer, director, or managing employee as defined in
42 U.S.C. Section 1320a-5(b), of the Company or any Subsidiary is a person
described in 42 U.S.C. Section 1320a-7(b)(8)(B), and (c) the Company's, and each
Subsidiary's and Facility's business practices do not violate any applicable
provisions of federal or state laws or regulations regarding physician ownership
of (or financial relationship with) and referral to entities providing health
care related goods or services, or laws requiring disclosure of financial
interests held by physicians in entities to which they may refer patients for
the provisions of health care related goods or services.
25. The statements regarding regulation of the Company and the
Subsidiaries under the captions "Business -- Government Regulation," "Risk
Factors -- Extensive Government Regulations," "--Healthcare Reform" and
"--Reimbursement by Third-Party Payors" (collectively, the "Regulatory
Sections ") in the Final Memorandum, to the extent that they constitute,
summarize or describe matters of law or legal conclusions, are correct in all
material respects and fairly describe the applicability of regulations to the
operations of the Company and the Subsidiaries as described in the Final
Memorandum, and nothing has come to our attention that caused us to believe that
the statements regarding regulation of the Company in the Regulatory Sections in
the Final Memorandum contain any untrue statement of a material fact or omitted
to state a material fact necessary to make the statements made therein, in the
light of the circumstances under which they were made, not misleading.
We have participated in the preparation of the Final Memorandum and in
conferences with officers and other representatives of the Company and
representatives of the independent public accountants for the Company at which
the contents of the Final Memorandum and related matters were discussed and,
although we are not passing upon and do not assume responsibility for the
accuracy, completeness or fairness of the statements contained in the Final
Memorandum (except as otherwise indicated above), on the foregoing basis, no
facts have come to our attention that leads us to believe that, as of the date
of the Final Memorandum or as of the date hereof, the Final Memorandum (other
than the financial statements and other financial and statistical data and
information included therein or omitted therefrom (including, without
limitation, any projected financial data or information),
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36
as to which we express no opinion) contained or contains an untrue statement of
a material fact or omitted or omits to state a material fact necessary to make
the statements therein, in light of the circumstances in which they were made,
not misleading.
We are admitted to practice only in the States of Arizona, Florida and
Wisconsin, and we are not admitted to practice in any other jurisdiction or
expert in the law of any other jurisdiction. Accordingly, we express no opinion
on the laws of any jurisdiction other than the federal laws of the United
States, the general corporation law of the State of Delaware and the laws of the
States of Arizona, Florida and Wisconsin. We have assumed for purposes of
paragraphs 8, 9, 10, 11 and 12 and to the extent that the laws of the State of
New York govern the legality and interpretation of the documents and instruments
referenced therein, that the applicable laws of the State of New York are
identical to the laws of the State of Arizona. However, with respect to the
opinions rendered in paragraphs 16 and 24-25, we have with your permission,
relied on the opinions of Krieg, Devault, Alexander & Xxxxxxxx; Xxxxxx & Xxxxxx;
Xxxxxx, Xxxxxx, Xxxxx & Xxxxx, P.A.; Saul, Emory, Xxxxxx & Xxxx; Fraser,
Trebilcock, Xxxxx & Xxxxxx, P.C.; Xxxxxxx, Xxxxxx, Xxxxxxx, Rock & Fields,
Chartered; Bass, Xxxxx & Xxxx; Xxxxxx Xxxxxx Xxxxx & Xxxxxxxx, X.X.; Ireland,
Xxxxxxxxx, Xxxxx & Xxxxxx, S.C; and Goodell, Stratton, Xxxxxxx & Xxxxxx, L.L.P.
regarding certain state healthcare laws and regulations in the States of
Indiana, Texas, Alabama, Pennsylvania, Michigan, Idaho, Tennessee, Washington,
Colorado and Kansas, and in certain respects upon a certificate from officers of
the Company.
The qualification of any opinion or statement herein by the words "to
the best of our knowledge" or similar words means that, during the course of our
representation as described herein, no information has come to the attention of
the attorneys in this firm involved in the transactions which are the subject of
this opinion which would give such attorneys current actual knowledge of the
existence of the facts so qualified.
This opinion is being delivered to you at the request of the Company
under Section 4.1(a) of the Purchase Agreement and is intended solely for the
benefit of the Initial Purchasers. Except as may be required by law, it is not
to be quoted, filed with any governmental authority or used for any other
purpose or by any other person without our prior written consent. This opinion
is rendered as of the date hereof, and we disclaim any obligation to advise you
of any changes or any new developments which might affect any matters or
opinions set forth herein. This opinion is limited to the matters stated herein
and no opinions may be inferred or implied beyond the matters expressly stated
herein.
Very truly yours,
Xxxxxxx & Xxxxx
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EXHIBIT 2
October 31, 1996
CIBC WOOD GUNDY SECURITIES CORP.
CRUTTENDEN XXXX INCORPORATED
WHEAT, FIRST SECURITIES, INC.
As Initial Purchasers
c/o CIBC Wood Gundy Securities Corp.
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Re: Unison HealthCare Corporation
Ladies and Gentlemen:
We have acted as special healthcare regulatory counsel to Unison
HealthCare Corporation, a Delaware corporation, and its Subsidiaries
(collectively, the "Company") pursuant to that certain Securities Purchase
Agreement dated October 28, 1996 (the "Purchase Agreement"), related to the
offer and sale of $100,000,000 aggregate principal amount of the Senior Notes
and the guarantee thereof by the Guarantors listed on Schedule II to the
Purchase Agreement. Unless otherwise expressly defined herein, capitalized terms
used herein shall have the same meanings given to them in the Purchase
Agreement. This opinion is being rendered pursuant to Section 4.1(b) of the
Purchase Agreement.
In our capacity as special healthcare regulatory counsel to the
Company, we have examined originals or copies otherwise identified to our
satisfaction as being true and correct copies or otherwise satisfied ourselves
as to existence of the following documents of the Company and those facilities
listed on Exhibit A to this opinion (the "Facilities"):
(a) Licenses issued by the state agencies listed on Exhibit A with
effective dates stated thereon for the operation of the
Facilities (the "License");
(b) Medicare and Medicaid Provider Agreements listed on Exhibit A
(and in each case, including those for which Exhibit A
indicates that an agreement has not been reviewed, either the
Company or Signature Health Care Corporation, or its
subsidiaries or affiliates, as applicable ("Signature"), has
confirmed to us that such agreement exists, that the Medicare
and/or Medicaid provider number relating thereto is currently
in effect, that the Company or Signature (or the Facility) is
billing and receiving reimbursement from Medicare and/or
Medicaid, as appropriate, and that the Company or Signature is
certified to receive such reimbursement);
(c) The final Offering Memorandum of the Company dated as of
October 28, 1996 with respect to the issuance and sale of the
Senior Notes (the "Final Memorandum");
(d) The Purchase Agreement.
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38
In rendering the opinions expressed below, we have relied, with your
permission, to the extent we deemed reasonable, on opinions from counsel in the
states of Alabama, Colorado, Idaho, Indiana, Kansas, Michigan, Pennsylvania,
Tennessee, Texas, and Washington, on certificates and certain other information
provided to us by officers of the Company and Signature and public officials as
to matters of fact of which the maker of such certificates or the person
providing such other information had knowledge. Furthermore, in rendering such
opinions we have assumed that the signatures on all documents examined are
genuine, that all documents submitted to us as originals are accurate and
complete, and that all documents submitted to us as copies are true, correct and
complete copies of the originals thereof.
We are admitted to practice only in the States of Arizona, Florida and
Wisconsin, and we are not admitted to practice in any other jurisdiction or
expert in the law of any other jurisdiction. To the extent this opinion relates
to the laws of other states (other than Alabama, Colorado, Idaho, Indiana,
Kansas, Michigan, Pennsylvania, Tennessee, Texas, and Washington, as to which we
have relied on opinions of counsel in these states as indicated above) it is
based upon examination of statutes and regulations of those states and upon
responses to inquiries we have made to representatives of certain jurisdictions.
This opinion relates solely to the laws of each of the states in which
Facilities are located, and the federal laws of the United States, and we
express no opinion with respect to the effect or applicability of the laws in
other areas or of other jurisdictions other than the general corporation law of
the State of Delaware.
The qualification of any opinion or statement herein by the words "to
our knowledge" or similar words means that, during the course of our
representation as described herein, no information has come to the attention of
the attorneys in this firm involved in the transactions which are the subject of
this opinion which would give such attorneys current actual knowledge of the
existence of the facts so qualified.
Based upon the foregoing and on our consideration of such other matters
of fact and questions of law as we consider relevant in the circumstances, we
are of the opinion that:
1. The Company (or an appropriate Subsidiary) and each Facility
identified in the Final Memorandum as a facility leased by the Company or a
Subsidiary or owned or leased by Signature, as the case may be, has all
necessary health care licenses, permits, approvals, consents, qualifications,
authorizations and accreditations of any governmental agency or authority to
lease or own and operate such Facility as a long-term care facility comprising
the number of long-term care beds, or as an assisted or independent living
facility comprising the number of units, as now leased or owned and operated and
as set forth in the Final Memorandum (the "Approvals").
2. No Approvals of any government agency or authority were required by
the Company or any Facility, as the case may be, prior to and in connection with
execution, delivery and performance of the Signature merger agreements or with
any of the transactions contemplated thereby and which are necessary to lease or
own and operate such Facility as now leased or owned and operated, except for
such Approvals as have been obtained or waived as of the date of this opinion.
The continuation, validity and effectiveness of all such Approvals will not be
adversely affected by the transactions contemplated by the acquisition of
Signature by the Company.
3. No Approvals of any governmental agency or authority which are
necessary to lease or own and operate each Facility as now leased or owned and
operated (as described in the Final Memorandum) were required by the Company or
any Facility, as the case may be, prior to and in connection with
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39
the execution, delivery and performance of the sale of the Senior Notes to the
Initial Purchasers (the "Offering") or with any of the transactions contemplated
thereby, including the Transactions specified in the Final Memorandum, except
for such Approvals as have been obtained or waived as of the date of this
opinion. The continuation, validity and effectiveness of all such Approvals will
not be adversely affected by the transactions contemplated by the Offering.
4. To our knowledge, (a) no condition exists, and no event has
occurred, which, with the giving of notice, the passage of time or both, would
result in the suspension, revocation, impairment, forfeiture or nonrenewal of
any of the Approvals, and (b) there is no claim pending challenging the validity
of any of the Approvals.
5. With respect to Facilities which the Final Memorandum indicates
participate in the Medicare program or the Medicaid program, the applicable
Subsidiary and/or such Facility, upon consummation of the transactions
contemplated by the Purchase Agreement and after giving effect to the
Transactions, has the requisite provider agreement, provider number or other
authorization to xxxx the Medicare program and the respective Medicaid program
in the state or states in which such Facility is located. The number of licensed
beds and the number of Medicare certified beds at each of the Facilities are as
indicated in the Final Memorandum. Except for routine surveys and as otherwise
set forth in the Final Memorandum, there is no action threatened or pending
which could reasonably be expected to result in a revocation of any such
provider number or authorization or the Company's, or any Subsidiary's or
Facility's exclusion from the Medicare or any state Medicaid programs. Except as
otherwise set forth in the Final Memorandum, the Company and/or each Facility
has made all material filings necessary to (a) the United States Department of
Health and Human Services in order to meet the requirements for continued
participation by the Facility in the Medicare program; and (b) the state
Department of Human Services in order to meet the requirements for continued
participation by the Facility in the Medicaid program.
6. To our knowledge, except as set forth in the Final Memorandum there
is not pending or threatened against the Company or any Facility any action,
suit, proceeding or investigation before or by any court, regulatory body, or
administrative agency or any other governmental agency or body which would
reasonably be expected to have a material adverse effect on the Company.
7. To our knowledge, except as set forth in the Final Memorandum there
is no pending legislation, or proposed regulations, guidelines or instructions,
or pending or threatened action, suit or proceeding before any court or
governmental agency, authority or arbitrator to change the method or structure
of Medicaid coverage, eligibility, reimbursement or payment which would
reasonably be expected to have a Material Adverse Effect on the Company or any
Facility.
8. To our knowledge, except as set forth in the Final Memorandum there
is no pending legislation or proposed regulations, guidelines or instructions,
or pending or threatened action, suit or proceeding before any court or
governmental agency, authority or arbitrator to require licensure,
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40
certificate of need or other health planning approval, accreditation or any
other regulatory approval for the operation of a subacute or long-term care
facility or the provision of subacute or long-term care services which would
reasonably be expected to have a material adverse effect on the Company or any
Facility.
This opinion is furnished by us to you and is solely for your benefit.
Except as may be required by law, this opinion is not to be quoted, filed with
any governmental authority or used for any other purpose, and it may not be
relied upon by any other person, firm or corporation without our prior written
consent. This opinion is rendered as of the date first written above and we
assume no obligation to advise you of facts, circumstances, events or
developments which hereafter may be brought to our attention and which may
alter, affect or modify the opinions expressed herein. This opinion is limited
to the matters stated herein an no opinions may be inferred or implied beyond
the matters expressly stated herein.
Sincerely,
Xxxxxxx & Xxxxx
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EXHIBIT 3
October [__], 1996
CIBC Wood Gundy Securities Corp.
Cruttenden Xxxx Incorporated
Wheat, First Securities, Inc.
c/o CIBC Wood Gundy Securities Corp.
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
We have acted as counsel for the several Initial Purchasers
(the "Initial Purchasers") named in the Securities Purchase Agreement, dated
October [__], 1996 (the "Purchase Agreement") relating to the issuance and sale
by Unison HealthCare Corporation, a Delaware corporation (the "Company") of
$100,000,000 aggregate principal amount of Senior Notes unconditionally
guaranteed by each of the Guarantors named in the Purchase Agreement (the
"Senior Notes"). This opinion is being furnished to you pursuant to Section
4.1(c) of the Purchase Agreement. Capitalized terms used herein but not
otherwise defined shall have the respective meanings assigned to them in the
Purchase Agreement.
In connection with furnishing this opinion, we have examined:
(1) the Purchase Agreement; (2) the Indenture, dated October [__], 1996, among
the Company, the, Guarantors named therein and First Bank National Association,
as trustee; (3) the form of the Senior Notes attached as Exhibit A to the
Indenture; (4) the Offering Memorandum relating to the Senior Notes, dated
October [__], 1996 (the "Final Memorandum"); and (5) the Senior Note
Registration Rights Agreement dated October [__], 1996 among the Company, the
Guarantors and the Initial Purchasers.
In addition, in connection with the opinions expressed below, we have
made such other investigations of fact and law and have relied upon the
originals or copies, certified or otherwise identified to our satisfaction, of
such other documents, records, certificates or other instruments, and have
relied upon such factual information otherwise supplied to us, as in our
judgment were necessary or appropriate to enable us to render the opinions
expressed below.
In rendering the opinions expressed below, we have assumed (1) the
enforceability of the Basic Documents, (2) the authenticity of all documents and
instruments submitted to us as originals, (3) that each of the parties (other
than the Initial Purchasers) has complied with all if its obligations and
agreements arising with the Basic Documents, (4) that the statements regarding
matters of fact made in the agreements, documents, records, certificates and
instruments that we have examined are accurate and complete, (5) the genuineness
of all signatures, (6) that all documents and instruments submitted to us as
copies conform to the originals thereof, and (7) the legal
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42
capacity of natural persons executing such documents, none of which matters we
have independently verified.
The opinions expressed herein are limited to Applicable Law. As used
herein, "Applicable Law" shall mean the federal laws of the United States, the
laws of the State of New York and the General Corporation Law of the State of
Delaware (the "GCL"), in each case which, in our experience, are normally
applicable to transactions of the type contemplated by the Basic Documents,
except that you expressly understand and agree that we express no opinion with
respect to laws, rules and regulations and legal and governmental proceedings
relating to Medicare or Medicaid or, federal, state or local licensure and
certification laws. Our opinions are rendered only with respect to the laws and
the rules, regulations and orders thereunder which are currently in effect. To
the extent the opinions set forth below relate to the Company, we have, without
independent investigation and with your consent, relied on the opinion of
Xxxxxxx & Xxxxx, counsel to the Company, and the Guarantors dated the date
hereof and delivered to you pursuant to the Purchase Agreement.
Based upon the foregoing, and subject to the limitations and
qualifications stated herein, we are of the opinion that:
1. Assuming that the Basic Documents (other than the Senior Notes) have
been duly authorized, executed and delivered by each of the Company and the
Guarantors and assuming that the Indenture has been duly authorized, executed
and delivered by the Trustee, and assuming the power and authority of the
Company and the Guarantors to enter into the same, each of the Basic Documents
(other than the Senior Notes) constitutes a legal, valid and binding obligation
of each of the Company and the Guarantors, enforceable against each of them in
accordance with its terms except that (i) rights to indemnity and contribution
may be limited by federal or state securities law or public policy, (ii)
enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization, fraudulent transfer or conveyance and other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally, (iii)
the remedy of specific performance and injunctive and other forms of equitable
relief are subject to certain equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought, (iv) the
enforceability of provisions imposing penalties, forfeitures, late payment
charges of an increase in interest rate upon delinquency in payment or the
occurrence, of a default may be limited in @n circumstances, and (v) the
enforceability of any provision requiring the payment of attorneys' fees may be
subject to a court determination that such fees are reasonable.
2. Assuming that the Senior Notes have been duly authorized by the
Company and the Guarantors and assuming the power and authority of the Company
and the Guarantors to execute, delivery and perform the same, when executed and
authenticated in accordance with the terms of the Indenture and delivered to and
paid for by you in accordance with the terms of the Purchase Agreement, the
Senior Notes will constitute the legal, valid and binding obligations of the
Company and the Guarantors, enforceable against each of them in accordance with
their terms except that (i) enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization, fraudulent transfer or conveyance and
other similar laws now or hereafter in effect
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relating to or affecting creditors' rights generally, (ii) the remedy of
specific performance and injunctive and other forms of equitable relief are
subject to certain equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought, and (iii) the enforceability of
provisions imposing penalties, forfeitures, late payment charges or an increase
in interest rate upon delinquency in payment or the occurrence of a default may
be limited in certain circumstances.
3. The Senior Notes and the indenture conform in all material respects
to the descriptions thereof contained in the Final Memorandum.
4. Assuming the accuracy of the representations of the Company and the
Guarantors in Section 3.1 of the Purchase Agreement and of the Initial
Purchasers set forth in Section 3.2 of the Purchase Agreement, it is not
necessary in connection with the issuance and sale of the Senior Notes by the
Company and the Guarantors to the Initial Purchasers under the circumstances
contemplated by the Purchase Agreement to register the Senior Notes under the
Act or to qualify the Indenture under the Trust Indenture Act of 1939, as
amended.
We are furnishing this opinion to you as your counsel in connection
with the sale of the Senior Notes pursuant to the Purchase Agreement. This
opinion is solely for your benefit and is not to be used, circulated, quoted,
otherwise referred to for any other purpose or relied upon by any person other
than you without our prior written consent.
Very truly yours,
XXXX, WEISS, RIFKIND, XXXXXXX XXXXXXXX
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