SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)*
Transworld Home HealthCare, Inc.
(Name of Issuer)
Common Stock, $.01 par value per share
(Title of Class of Securities)
894081 10 8
(CUSIP Number)
Scott A. Shay, Hyperion Partners II L.P.,
50 Charles Lindbergh Blvd., Suite 500,
Uniondale, NY 11553 (516) 745-6644
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
April 10, 1997
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1 (b)(3) or
(4), check the following box. [ ]
Check the following box if a fee is being paid with the statement.
[ ] (A fee is not required only if the reporting person: (1) has
a previous statement on file reporting beneficial ownership of more
than five percent of the class of securities described in item 1;
and (2) has filed no amendment subsequent thereto reporting
beneficial ownership of five percent or less of such class.) (See
Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should
be filed with the Commission. See Rule 13d-1(a) for other parties
to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to the
subject class of securities, and for any subsequent amendment
containing information which would alter disclosure provided in a
prior cover page.
The information required on the remainder of this cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 ("Act") or otherwise subject to the
liabilities of that Section of the Act but shall be subject to all
other provisions of the Act (however, see the Notes).
(Continued on following pages)
CUSIP No. 894081 10 8 13D
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hyperion Partners II L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -4,400,000- (1)(2)
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-4,400,000- (1)(2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-4,400,000- (2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [x]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
43.8% (2)
14 TYPE OF REPORTING PERSON*
PN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Power is exercised through its sole general partner, Hyperion
Ventures II L.P.
(2) Excludes (1) 3,000,000 shares issuable upon exercise of
Warrants; (2) 898,877 shares subject to purchase under a Stock
Purchase Agreement; (3) 1,234,176 shares subject to purchase
under a Stock Purchase Agreement; and (4) 4,116,456 shares
subject to purchase under a Stock Purchase Agreement.
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hyperion Ventures II L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -4,400,000- (1)(2)
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-4,400,000- (1)(2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-4,400,000- (1)(2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [x]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
43.8% (2)
14 TYPE OF REPORTING PERSON*
PN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Solely in its capacity as the general partner of Hyperion
Partners II L.P.
(2) Excludes (1) 3,000,000 shares issuable upon exercise of
Warrants; (2) 898,877 shares subject to purchase under a Stock
Purchase Agreement; (3) 1,234,176 shares subject to purchase
under a Stock Purchase Agreement; and (4) 4,116,456 shares
subject to purchase under a Stock Purchase Agreement.
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hyperion Funding II Corp.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -4,400,000- (1)(2)
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-4,400,000- (1)(2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-4,400,000- (1)(2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [x]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
43.8% (2)
14 TYPE OF REPORTING PERSON*
CO
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Solely in its capacity as the sole general partner of Hyperion
Ventures II L.P., which is the sole general partner of
Hyperion Partners II L.P.
(2) Excludes (1) 3,000,000 shares issuable upon exercise of
Warrants; (2) 898,877 shares subject to purchase under a Stock
Purchase Agreement; (3) 1,234,176 shares subject to purchase
under a Stock Purchase Agreement; and (4) 4,116,456 shares
subject to purchase under a Stock Purchase Agreement.
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hyperion TW Fund L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
WC, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0- (1)(2)
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-0- (1)(2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-0- (2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [x]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0% (2)
14 TYPE OF REPORTING PERSON*
00
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Power is exercised through its sole general partner, Hyperion
TW LLC.
(2) Excludes 4,116,456 shares subject to purchase under a Stock
Purchase Agreement.
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hyperion TW LLC
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0- (1)(2)
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-0- (1)(2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-0- (2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [x]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0% (2)
14 TYPE OF REPORTING PERSON*
00
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Solely in its capacity as the general partner of Hyperion TW
Fund L.P.
(2) Excludes 4,116,456 shares subject to purchase under a Stock
Purchase Agreement.
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Lewis S. Ranieri
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -4,400,000- (1)(2)
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-4,400,000- (1)(2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-4,400,000- (1)(2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [x]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
43.8% (2)
14 TYPE OF REPORTING PERSON*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Solely in his capacity as Chairman and President, director and
shareholder of Hyperion Funding II Corp., which is the sole
general partner of Hyperion Ventures II L.P., which is the
sole general partner of Hyperion Partners II L.P., which is
the sole managing member of Hyperion TW LLC, which is the sole
general partner of Hyperion TW Fund L.P.
(2) Excludes (1) 3,000,000 shares issuable upon exercise of
Warrants; (2) 898,877 shares subject to purchase under a Stock
Purchase Agreement; (3) 1,234,176 shares subject to purchase
under a Stock Purchase Agreement; and (4) 4,116,456 shares
subject to purchase under a Stock Purchase Agreement.
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Scott A. Shay
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ]
(b) [x]
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) OR 2(e) [ ]
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
7 SOLE VOTING POWER
NUMBER OF -0-
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -4,400,000- (1)(2)
EACH
REPORTING 9 SOLE DISPOSITIVE POWER
PERSON -0-
WITH
10 SHARED DISPOSITIVE POWER
-4,400,000- (1)(2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
-4,400,000- (1)(2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* [x]
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
43.8% (2)
14 TYPE OF REPORTING PERSON*
IN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
(1) Solely in his capacity as Executive Vice President and
Assistant Secretary, director and shareholder of Hyperion
Funding II Corp., which is the sole general partner of
Hyperion Ventures II L.P., which is the sole general partner
of Hyperion Partners II L.P., which is the sole managing
member of Hyperion TW LLC, which is the sole general partner
of Hyperion TW Fund L.P.
(2) Excludes (1) 3,000,000 shares issuable upon exercise of
Warrants; (2) 898,877 shares subject to purchase under a Stock
Purchase Agreement; (3) 1,234,176 shares subject to purchase
under a Stock Purchase Agreement; and (4) 4,116,456 shares
subject to purchase under a Stock Purchase Agreement.
The Statement on Schedule 13D, dated June 6, 1996, filed
by the undersigned with the Securities and Exchange Commission on
June 7, 1996, relating to the Common Stock, par value $0.01 per
share, of Transworld Home HealthCare, Inc., as amended by Amendment
No. 1 thereto, dated August 1, 1996 and Amendment No. 2 thereto,
dated January 23, 1997 (the "Schedule 13D"), is hereby further
amended by adding thereto the information set forth below.
Capitalized terms used and not otherwise defined herein shall have
the meanings ascribed to them in the Schedule 13D, unless the
context otherwise requires.
Item 2. Identity and Background.
Item 2 is hereby supplemented by addition of the
following:
Hyperion TW Fund L.P. (the "TW Fund") and Hyperion TW LLC
(the "TW Fund GP") are hereby added to the Reporting Persons
joining in this Statement.
Pursuant to a Stock Purchase Agreement, dated as of March
26, 1997 by and between Transworld and the Fund (the "March 1997
Fund Stock Purchase Agreement"), the Fund agreed, upon satisfaction
of the conditions set forth therein, to purchase from Transworld an
additional 1,234,176 shares of Common Stock (the "March 1997 Fund
Shares"). As payment for the March 1997 Fund Shares, the Fund will
assign and transfer to Transworld (a) $12,396,948 of face amount of
accounts receivable originally owed by Health Management, Inc.
("HMI") to FoxMeyer Corporation and its subsidiaries and incurred
on or before November 13, 1996, and assigned to the Fund by
California Golden State Finance Company pursuant to an Agreement of
Transfer of Receivables dated November 19, 1996; and (b) $2,800,000
of face amount of accounts receivable originally owed by HMI to
Bindley Western Industries, Inc. ("Bindley") and assigned to the
Fund by Bindley pursuant to a Purchase and Sale Agreement dated
December 20, 1996.
Pursuant to a Stock Purchase Agreement, dated as of March
26, 1997, by and between Transworld and the TW Fund (the "March
1997 TW Stock Purchase Agreement"), the TW Fund agreed, upon
satisfaction of the conditions set forth therein, to purchase from
Transworld 4,116,456 shares of Common Stock (the "March 1997 TW
Shares") at a price of $9.875 per share, for an aggregate purchase
price of $40,650,000.
The TW Fund is a Delaware private investment limited
partnership formed to acquire Common Stock of Transworld. Its
principal business and office address is 50 Charles Lindbergh
Boulevard, Suite 500, Uniondale, New York 11553. The TW Fund GP is
the sole general partner of the TW Fund, and the Fund is the sole
member of the TW Fund GP.
The TW Fund GP is a Delaware limited liability company
whose sole business and activity is to act as general partner of
the TW Fund. Its principal business and office address is 50
Charles Lindbergh Boulevard, Suite 500, Uniondale, New York 11553.
Neither the TW Fund nor the TW Fund GP has during the
last five years been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors) or was a party to a
civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding any violation with respect to such
laws.
Item 3. Source and Amount of Funds and Other Consideration.
Item 3 is hereby supplemented by addition of the
following:
As described in Item 2, as consideration for the March
1997 Fund Shares the Fund will assign and transfer to Transworld
certain accounts receivable owned by the Fund.
The funds for the purchase of the March 1997 TW Shares
were obtained from capital contributed to the TW Fund by its
partners.
Item 4. Purpose of Transactions.
The March 1997 Fund Shares and the March 1997 TW Fund
Shares are being acquired by the Fund and the TW Fund,
respectively, for the purpose of investment. The March 1997 Fund
Shares, the March 1997 TW Fund Shares and any other shares of
Common Stock now owned or hereafter acquired by the Fund and the TW
Fund, respectively, or by the other Reporting Persons, may be
disposed of at any time or from time to time, in whole or in part.
In addition, the Reporting Persons and their affiliates may in the
future acquire additional shares of Common Stock.
Item 5. Interest in Securities of the Issuer.
Item 5(a) is hereby supplemented by addition of the
following:
(a) The Fund owns 4,400,000 shares of Common Stock,
constituting approximately 43.8% of the outstanding Common Stock
(on the basis of 10,046,683 shares outstanding as of March 12,
1997). In addition, (i) the Fund owns 3,000,000 Warrants; (ii)
pursuant to the Stock Purchase Agreement, the Fund has agreed, upon
satisfaction of the conditions set forth therein, to purchase an
additional 898,877 shares of Common Stock; (iii) pursuant to the
March 1997 Fund Purchase Agreement, the Fund has agreed, upon
satisfaction of the conditions set forth therein, to purchase an
additional 1,234,176 shares of Common Stock; and (iv) pursuant to
the March 1997 TW Fund Purchase Agreement, the TW Fund has agreed,
upon satisfaction of the conditions set forth therein, to purchase
an additional 4,116,456 shares of Common Stock.
As a result of its right to acquire Common Stock upon
exercise of the Warrants and pursuant to the Stock Purchase
Agreement and the March 1997 Fund Purchase Agreement and the TW
Fund's right to acquire Common Stock pursuant to the March 1997 TW
Fund Purchase Agreement, the Fund may be deemed under Rule 13d-
3(d)(1)(i)(A) under the Act, to own beneficially 13,649,509 shares
of Common Stock, constituting approximately 70.7% of the
outstanding Common Stock (on the basis of 10,046,683 shares
outstanding as of March 12, 1997).
Item 7. Material to be Filed as Exhibits.
Item 7 is hereby supplemented by addition of the
following:
11. Exhibit XI - Stock Purchase Agreement dated as of
March 26, 1997, filed herewith
12. Exhibit XII - Stock Purchase Agreement dated as of
March 26, 1997, filed herewith
Signature
After reasonable inquiry and to the best of each of the
undersigned's knowledge and belief, each of the undersigned
certifies that the information set forth in this statement is true,
complete and correct.
Dated: April 14, 1997
HYPERION TW FUND L.P.
By: HYPERION TW LLC,
its General Partner
By: HYPERION PARTNERS II L.P.,
its Managing Member
By: HYPERION VENTURES II L.P.,
its General Partner
By: HYPERION FUNDING II CORP.,
its General Partner
By:/s/Scott A. Shay
Name: Scott A. Shay
Title: Executive Vice President
HYPERION TW LLC,
By: HYPERION PARTNERS II L.P.,
its Managing Member
By: HYPERION VENTURES II L.P.,
its General Partner
By: HYPERION FUNDING II CORP.,
its General Partner
By:/s/Scott A. Shay
Name: Scott A. Shay
Title: Executive Vice President
HYPERION PARTNERS II L.P.
By: Hyperion Ventures II L.P.,
its general partner
By: Hyperion Funding II Corp.,
its general partner
By:/s/Scott A. Shay
Name: Scott A. Shay
Title: Executive Vice President
HYPERION VENTURES II L.P.
By: Hyperion Funding II Corp.,
its general partner
By: /s/Scott A. Shay
Name: Scott A. Shay
Title: Executive Vice President
HYPERION FUNDING II CORP.
By: /s/Scott A. Shay
Name: Scott A. Shay
Title: Executive Vice President
/s/Scott A. Shay
Scott A. Shay, as Attorney-in-Fact
for Lewis S. Ranieri
/s/Scott A. Shay
Scott A. Shay
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is made as
of the 26th day of March, 1997 by and between Transworld Home
HealthCare, Inc., a New York corporation (the "Company"), and
Hyperion TW Fund L.P., a Delaware limited partnership (the
"Investor").
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Purchase and Sale of Shares.
1.1 Sale and Issuance of Shares. Subject to the terms
and conditions of this Agreement, at the Closing (as
hereinafter defined), the Investor agrees to purchase and
the Company agrees to sell and issue to the Investor
4,116,456 shares (the "Shares") of common stock, par value
$.01 per share, of the Company (the "Common Stock") at a
price of $9.875 per Share, for an aggregate purchase price
of $40,650,000.
1.2 Closing. The purchase and sale of the Shares
shall take place at the offices of Proskauer Rose Goetz &
Mendelsohn LLP, 1585 Broadway, New York, New York 10036,
within 15 days following the satisfaction of the conditions
set forth in Sections 4 and 5, or at such other time and
place as the Company and the Investor mutually agree upon
orally or in writing (which time and place are designated as
the "Closing"). At the Closing, in addition to satisfying
the other conditions set forth herein, the Company shall
deliver to the Investor one or more certificates
representing the Shares, against delivery to the Company by
the Investor of a wire transfer in the amount of
$40,650,000.
2. Representations and Warranties of the Company. The
Company hereby represents and warrants to, and agrees with, the
Investor that:
2.1 Organization, Good Standing and Qualification.
The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of
New York. The Company has all requisite power and authority
to own, lease, license and use its properties and assets and
to carry on its business as now conducted and as proposed to
be conducted. The Company has all requisite power and
authority to enter into and perform this Agreement and the
Registration Rights Agreement in the form attached hereto as
Exhibit A (the "Registration Rights Agreement") and the
transactions contemplated hereby and thereby.
2.2 Authorization. All corporate action on the part
of the Company and its officers, directors and shareholders
necessary for the authorization, execution and delivery of
this Agreement and the Registration Rights Agreement, the
performance of all obligations of the Company hereunder and
thereunder and the authorization, sale, issuance and
delivery of the Shares has been taken. This Agreement
constitutes, and when executed and delivered by the Company
the Registration Rights Agreement will constitute, the valid
and legally binding obligation of the Company, enforceable
in accordance with their respective terms, except (i) as
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of
general application affecting enforcement of creditors'
rights generally, (ii) as enforceability may be limited by
laws relating to the availability of specific performance,
injunctive relief or other equitable remedies, and (iii) to
the extent the indemnification provisions contained in the
Registration Rights Agreement may be limited by applicable
federal or state securities laws.
2.3 Valid Issuance of Shares.
(a) The Shares, when issued, sold and delivered in
accordance with the terms hereof and for the consideration
expressed herein, (i) will be duly and validly issued and
fully paid and nonassessable, (ii) will be free of any
pledges, liens, security interests, claims or other
encumbrances of any kind, (iii) will be issued in compliance
with all applicable federal and state securities laws, and
(iv) will not be issued in violation of any preemptive
rights of shareholders. The Shares have been duly and
validly reserved for issuance.
(b) The outstanding shares of Common Stock are all
duly and validly authorized and issued, fully paid and
nonassessable, and were issued in compliance with all
applicable federal and state securities laws.
2.4 Governmental Consents. No consent, approval,
order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state
or local governmental authority on the part of the Company
or any of its subsidiaries is required in connection with
the consummation of the transactions contemplated by this
Agreement and the Registration Rights Agreement except for
(i) filing with the Securities and Exchange Commission on
Form 10-C; and (ii) such filings as have been made.
2.5 Compliance with Other Instruments. The execution,
delivery and performance of this Agreement and the
Registration Rights Agreement and the consummation of the
transactions contemplated hereby and thereby will not result
in a violation of, or be in conflict with, or constitute,
with or without the passage of time or the giving of notice
or both, a default under, any provision of the Company's
certificate of incorporation, as amended, or bylaws, as
amended, or any judgment, order, writ or decree, or any
contract, agreement or instrument, or require any consent,
waiver or approval thereunder, or give rise to a right to
terminate or accelerate the performance required thereby, or
constitute an event which results in the creation of any
lien, charge or encumbrance upon any asset of the Company.
2.6 SEC Documents. The Company has provided the
Investor with copies of its Annual Report on Form 10-K for
the fiscal year ended October 31, 1996 and its Quarterly
Report on Form 10-Q for the quarter ended January 31, 1997
(collectively, the "SEC Documents"), each as filed with the
Securities and Exchange Commission. On the date of their
respective filings, such SEC Documents complied in all
material respects with the requirements of the Securities
Exchange Act of 1934, as amended, and none of such SEC
Documents contained any untrue statement of a material fact
or omitted to state a material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading.
2.7 Financial Statements. The Company has delivered
to the Investor its audited consolidated financial
statements (consolidated balance sheet and consolidated
statements of operations, changes in stockholders' equity
and cash flows) at October 31, 1996 and for the year then
ended and its unaudited financial statements (consolidated
balance sheet and consolidated statement of operations and
cash flows) at January 31, 1997 and for the three-month
period then ended (collectively the "Financial Statements").
The Financial Statements are complete and correct in all
material respects and have been prepared in conformity with
generally accepted accounting principles applied on a
consistent basis throughout the periods indicated. The
Financial Statements accurately describe the financial
condition and operating results of the Company and its
subsidiaries as of the dates, and for the periods, indicated
therein, subject, in the case of the unaudited financial
statements, to normal year-end audit adjustments which will
not in the aggregate be material.
2.8 No Material Adverse Changes. Except as disclosed
in the SEC Documents (and, to the extent the following
representation relates to Health Management, Inc., a
Delaware corporation ("HMI"), except as previously disclosed
to the Investor), since January 31, 1997, there has been no
material adverse change in the assets, properties, business,
operations, condition (financial or otherwise) or prospects
of the Company and its subsidiaries and the Company has no
knowledge of any event which is likely to result in any such
change. To the extent the foregoing representation relates
to HMI, it is being made to the best knowledge of the
Company.
2.9 Disclosure. The Company has fully provided the
Investor or its counsel with all the information which the
Investor has requested for deciding whether to purchase the
Shares and all information which the Company believes is
reasonably necessary to enable the Investor to make such
decision. Neither this Agreement nor any other statements
or certificates made or delivered in connection herewith
contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements
herein or therein not misleading.
3. Representations and Warranties of the Investor. The
Investor hereby represents and warrants to the Company that:
3.1 Authorization. The Investor has all requisite
power and authority to enter into this Agreement. This
Agreement has been duly executed and delivered and
constitutes the Investor's valid and legally binding
obligation, enforceable in accordance with its terms, except
(i) as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and other
laws of general application affecting enforcement of
creditors' rights generally and (ii) as enforceability may
be limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies.
3.2 Purchase Entirely for Own Account. The Shares to
be purchased by the Investor will be acquired for investment
for its own account, and, except as contemplated by the
Registration Rights Agreement or otherwise in accordance
with applicable securities laws, not with a view to the
resale or distribution of any part thereof and without the
present intention of selling, granting any participation in,
or otherwise distributing the same.
3.3 Investment Experience. The Investor can bear the
economic risk of its investment and has such knowledge and
experience in financial or business matters that it is
capable of evaluating the merits and risks of the investment
in the Shares.
3.4 Restricted Securities. The Investor understands
that the Shares it is purchasing are characterized as
"restricted securities" under the federal securities laws
inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under
such laws and applicable regulations such securities may be
resold without registration under the Securities Act of
1933, as amended (the "Act"), only in certain limited
circumstances. In this connection, the Investor represents
that it is familiar with Rule 144 of the Securities and
Exchange Commission, as presently in effect, and understands
the resale limitations imposed thereby and by the Act.
3.5 Legends. The Investor understands that the
certificates evidencing the Shares will bear the following
legend:
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR ANY STATE SECURITIES LAWS AND NEITHER
SUCH SHARES NOR ANY INTEREST THEREIN MAY BE TRANSFERRED
IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION
THEREFROM UNDER SUCH ACT OR SUCH LAWS AND THE RULES AND
REGULATIONS THEREUNDER."
The Shares shall not be required to bear such legend if
an opinion of counsel reasonably satisfactory to the Company
is delivered to the Company to the effect that neither the
legend nor the restrictions on transfer contained in this
Agreement are required to insure compliance with the Act.
Whenever, pursuant to the preceding sentence, any
certificate for any of the Shares is no longer required to
bear the foregoing legend, the Company may, and if requested
by the holder thereof, shall, issue to the holder, at the
Company's expense, a new certificate not bearing the
foregoing legend.
4. Conditions to the Investor's Obligations at Closing.
The obligations of the Investor under this Agreement are subject
to the fulfillment on or before the Closing of each of the
following conditions:
4.1 Representations and Warranties. The
representations and warranties of the Company contained in
Section 2 shall be true in all material respects on and as
of the Closing with the same effect as though such
representations and warranties had been made on and as of
the Closing.
4.2 Performance. The Company shall have performed and
complied with all agreements, covenants, obligations and
conditions contained in this Agreement in all material
respects that are required to be performed or complied with
by it on or before the Closing.
4.3 No Material Adverse Change. There shall have been
no material adverse change in the business, affairs,
prospects, operations, properties, assets or condition
(financial or otherwise) of the Company and its subsidiaries
taken as a whole.
4.4 Compliance Certificate. The President or Chief
Executive Officer of the Company shall deliver to the
Investor at the Closing a certificate certifying that the
conditions specified in Sections 4.1, 4.2, 4.3, 4.6, 4.9 and
4.12 have been fulfilled.
4.5 Qualifications; Litigation. All authorizations,
approvals or permits, if any, of any governmental authority
or regulatory body that are required in connection with the
lawful issuance and sale of the Shares pursuant to this
Agreement shall be duly obtained and effective as of the
Closing. No federal, state or local regulatory or other
governmental authority shall have taken any action or issued
any statement, written or oral, to the effect that the
transactions contemplated to be taken at the Closing may not
be consummated as currently structured, which action or
statement, in the reasonable judgment of the Investor, makes
proceeding with the transactions contemplated by this
Agreement inadvisable. There shall not have been instituted
or threatened any legal proceeding relating to, or seeking
to prohibit or otherwise challenge, this Agreement or the
consummation of the transactions contemplated by this
Agreement, or seeking to obtain substantial damages with
respect thereto.
4.6 Consents and Coordination. All third party
consents and waivers that are required in connection with
the Closing under this Agreement, and the consummation of
the transactions contemplated hereby, shall be duly obtained
and effective as of the Closing.
4.7 Proceedings and Documents. All corporate and
other proceedings in connection with the transactions
contemplated at the Closing and all documents incident
thereto shall be satisfactory in form and substance to the
Investor, and the Investor shall have received all such
counterpart original and certified or other copies of such
documents as it may reasonably request.
4.8 Opinion of Company Counsel. Baer, Marks & Upham
LLP, counsel for the Company, shall have delivered an
opinion which is addressed to the Investor, dated as of the
Closing and substantially in the form delivered pursuant to
the Unit Purchase Agreement dated as of November 20, 1995
between the Company and Hyperion Partners II L.P., a
Delaware limited partnership ("HPII") (the "Unit Purchase
Agreement").
4.9 Banks Waiver and Consent. The Company shall have
received, in form and substance satisfactory to the
Investor, (i) the waiver of the lenders (the "Banks") party
to the Credit Agreement dated as of July 31, 1996, as
amended (the "Credit Agreement") among the Company, the
Banks and Bankers Trust Company, as Agent, of any right the
Banks may have to the proceeds of the transactions
contemplated hereby to prepay outstanding indebtedness of
the Company under the Credit Agreement, (ii) the consent of
the Banks to the issuance and sale of the Shares and waiver
of any events of default caused in connection therewith, and
(iii) such other consents and waivers of the Banks as may be
required in connection with the transactions hereunder and
under the Stock Purchase Agreement dated as of January 8,
1997, between the Company and HPII (the "HPII Purchase
Agreement").
4.10 Hart-Scott-Rodino. Any applicable waiting periods
in respect of the transactions contemplated by this
Agreement under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, shall have expired at or prior to
the Closing.
4.11 Registration Rights Agreement. The Company shall
have executed and delivered the Registration Rights
Agreement.
4.12 Paribas Consent. The Company shall have received,
in form and substance satisfactory to the Investor, the
consent of Paribas Principal, Inc. to this Agreement and the
Registration Rights Agreement.
5. Conditions to the Company's Obligations at the Closing.
The obligations of the Company to the Investor under Section 1 of
this Agreement are subject to the fulfillment on or before the
Closing of the following conditions, any of which may be waived
by the Company:
5.1 Representations and Warranties. The
representations and warranties of the Investor contained in
Section 3 shall be true in all material respects on and as
of the Closing with the same effect as though such
representations and warranties had been made on and as of
the date of the Closing.
5.2 Payment of Purchase Price. The Investor shall
have delivered the purchase price specified in Section 1.2.
5.3 Performance. The Investor shall have performed
and complied with all agreements, covenants, obligations and
conditions contained in this Agreement in all material
respects that are required to be performed or complied with
by it on or before the Closing.
5.4 Qualifications; Litigation. All authorizations,
approvals or permits, if any, of any governmental authority
or regulatory body that are required in connection with the
lawful issuance and sale of the Shares pursuant to this
Agreement shall be duly obtained and effective as of the
Closing. There shall not have been instituted or threatened
any legal proceeding relating to, or seeking to prohibit or
otherwise challenge, this Agreement or the consummation of
the transactions contemplated by this Agreement, or seeking
to obtain substantial damages with respect thereto.
5.5 Banks Waiver and Consent. The Company shall have
received, in form and substance satisfactory to the Company,
(i) the waiver of the Banks of any right they may have to
the proceeds of the transactions contemplated hereby to
prepay outstanding indebtedness of the Company under the
Credit Agreement, (ii) the consent of the Banks to the
issuance and sale of the Shares and waiver of any events of
default caused in connection therewith, and (iii) such other
consents and waivers of the Banks as may be required in
connection with the transactions hereunder.
5.6 Hart-Scott-Rodino. Any applicable waiting periods
in respect of the transactions contemplated by this
Agreement under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, shall have expired at or prior to
the Closing.
5.7 Consents and Coordination. All consents and
waivers that are required in connection with the Closing
under this Agreement, and the consummation of the
transactions contemplated hereby, shall be duly obtained and
effective as of the Closing.
5.8 Paribas Consent. The Company shall have received,
in form and substance satisfactory to the Company, the
consent of Paribas Principal, Inc. to this Agreement and the
Registration Rights Agreement.
6. Covenants of the Company. The Company covenants and
agrees with the Investor as follows:
6.1 Advice of Changes. The Company will promptly
advise the Investor in writing of (i) any event occurring
subsequent to the date of this Agreement which would render
any representation or warranty of the Company contained in
this Agreement, if made on or as of the date of such event
or the date of the Closing, untrue or inaccurate in any
material respect and (ii) any material adverse change in the
business of the Company and its subsidiaries taken as a
whole.
6.2 Information. The Company will deliver to the
Investor the information required to be delivered to HPII
pursuant to Section 6.9 of the Unit Purchase Agreement (as
in effect on the date hereof), unless the Investor at any
time specifically requests that such information not be
delivered to it.
6.3 Observer Rights. The Company will afford to the
Investor the observer and other rights required to be
afforded to HPII pursuant to Section 6.11 of the Unit
Purchase Agreement (as in effect on the date hereof).
6.4 Listing Application. The Company shall prepare
and file with the National Association of Securities
Dealers, Inc. ("NASD") an Additional Listing Application, in
the form and within the time period prescribed by the NASD,
with respect to the listing of the Shares.
6.5 Publicity. Except as may be required by law, the
Company shall not use the name of, or make reference to, the
Investor or any of its affiliates in any press release or in
any public manner without the Investor's prior written
consent.
7. Indemnification. The Company agrees to indemnify the
Investor and its general and limited partners, and each officer,
director, employee, partner, member, agent and affiliate of the
Investor and its general and limited partners (the "Indemnified
Parties") for, and hold each Indemnified Party harmless from and
against: (i) any and all damages, losses, claims and other
liabilities of any and every kind, including, without limitation,
judgments and costs of settlement, and (ii) any and all out-of-
pocket costs and expenses of any and every kind, including,
without limitation, reasonable fees and disbursements of one
counsel for such Indemnified Parties (selected by the Investor)
(all of which expenses periodically shall be reimbursed as
incurred), in each case, arising out of or suffered or incurred
in connection with (A) any investigative, administrative or
judicial proceeding or claim brought or threatened relating to or
arising out of the Investor's purchase of the Shares, or this
Agreement, the Registration Rights Agreement, or the transactions
contemplated hereby and thereby, or (B) any material inaccuracy
or alleged inaccuracy in any representation or warranty of the
Company made or incorporated by reference in this Agreement or
any material breach or alleged breach by the Company of any
covenant or agreement made or incorporated by reference in this
Agreement or the Registration Rights Agreement.
8. Termination.
8.1 Termination Prior to Closing. This Agreement may
be terminated at any time prior to the Closing:
(a) by the mutual consent of the Investor and the
Company;
(b) by the giving of notice by the Investor or the
Company at any time after August 31, 1997 (or such later
date as shall have been agreed to in writing by the parties
hereto), if at the time notice of such termination is given
the Closing shall not have been consummated;
(c) by the giving of notice by the Investor or the
Company at any time after the HPII Purchase Agreement is
terminated; or
(d) by the Investor, if there has been a material
misrepresentation or material breach on the part of the
Company in any of the representations, warranties, covenants
or agreements of the Company set forth herein, or if there
has been any material failure on the part of the Company to
comply with its obligations hereunder, or by the Company if
there has been a material misrepresentation or material
breach on the part of the Investor in any of the
representations, warranties, covenants or agreements of the
Investor set forth herein, or if there has been any material
failure on the part of the Investor to comply with its
obligations hereunder.
8.2 Liability Upon Termination.
(a) In the event of termination of this Agreement
pursuant to Sections 8.1(a), 8.1(b) or 8.1(c), no party
hereto shall have any liability or further obligation to any
other party hereto except as provided in Sections 7, 9.7 and
9.8.
(b) In the event of termination pursuant to Section
8.1(d), (i) if the Investor is the non-breaching party, the
Investor shall be entitled to reimbursement of expenses as
set forth in Section 9.8 and (ii) the non-breaching party
shall have the right to pursue all rights and remedies
available to it hereunder or otherwise provided at law or
equity, including without limitation, the right to seek
specific performance and money damages.
9. Miscellaneous.
9.1 Survival of Warranties. The warranties,
representations, covenants and agreements of the Company and
the Investor contained in or made pursuant to this Agreement
shall survive the execution and delivery of this Agreement
and the Closing. Neither any investigation by or on behalf
of the Investor nor the receipt by the Investor of any data
or information from the Company, shall in any way affect the
right of the Investor to rely on the representations,
warranties, covenants and agreements of the Company or the
right of the Investor to terminate this Agreement as
provided in Section 8.
9.2 Successors and Assigns. The Investor and each
assignee of the Investor may, without the consent of the
Company, assign its rights under this Agreement, in whole or
in part, in connection with any sale or transfer to an
affiliate or a partner, and the terms and conditions of this
Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties.
Nothing in this Agreement, express or implied, is intended
to confer upon any person other than the parties hereto or
their respective successors and assigns any rights,
remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided in this
Agreement.
9.3 Governing Law. This Agreement shall be governed
by and construed under the laws of the State of New York as
applied to agreements among New York residents entered into
and to be performed entirely within New York.
9.4 Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and
the same instrument.
9.5 Titles and Subtitles. The titles and subtitles
used in this Agreement are used for convenience only and are
not to be considered in construing or interpreting this
Agreement.
9.6 Notices. Unless otherwise provided, any notice
required or permitted under this Agreement shall be given in
writing and shall be deemed effectively given upon receipt
by the party to be notified or five days after deposit with
the United States Post Office, by registered or certified
mail, postage prepaid and addressed to the party to be
notified (i) if to the Company, at the following address:
75 Terminal Avenue
Clark, New Jersey 07066
Attn: Robert W. Fine
with a copy to:
Baer Marks & Upham LLP
805 Third Avenue
New York, New York 10022
Attn: Leslie J. Levinson
(ii) if to the Investor, at the following address:
50 Charles Lindbergh Blvd.
Suite 500
Uniondale, New York 11553-3600
Attn: Scott A. Shay
with a copy to:
Proskauer Rose Goetz & Mendelsohn LLP
1585 Broadway
New York, New York 10036
Attn: Bruce Lieb
or at such other address as any of the parties may designate
by 10 days' advance written notice to the other parties.
9.7 No Finder's Fee. Each party represents that it is
not, and will not be, obligated for any finder's fee or
commission in connection with this transaction.
The Investor agrees to indemnify and hold harmless the
Company from any liability for any commission or
compensation in the nature of a finder's fee (and the costs
and expenses of defending against such liability or asserted
liability) for which the Investor or any of its officers,
employees or representatives is responsible.
The Company agrees to indemnify and hold harmless the
Investor from any liability for any commission or
compensation in the nature of a finder's fee (and the costs
and expenses of defending against such liability or asserted
liability) for which the Company or any of their respective
officers, employees or representatives is responsible.
9.8 Expenses. The Company agrees to pay all out-of-
pocket fees and reasonable expenses incurred by the Investor
in connection with this Agreement and the transactions
contemplated hereby (whether or not the transactions
contemplated hereby are consummated) including, without
limitation, (i) the reasonable fees and expenses of counsel
for the Investor incurred in connection with this Agreement
and the transactions contemplated hereby (including the
reasonable fees and expenses of Proskauer Rose Goetz &
Mendelsohn LLP, and including, without limitation, any legal
fees and expenses relating to any future waiver, consent or
amendment, whether or not any such future action is given or
consummated) and (ii) all filing fees relating to filings
under the Hart-Scott-Rodino Antitrust Improvements Act of
1974, as amended.
9.9 Amendments and Waivers. Any term of this
Agreement may be amended and the observance of any term of
this Agreement may be waived (either generally or in a
particular instance and either retroactively or
prospectively), only with the written consent of the
Investor and the Company.
9.10 Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law,
such provision shall be excluded from this Agreement and the
balance of this Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in
accordance with its terms.
9.11 Entire Agreement. This Agreement constitutes the
entire agreement between the parties hereto with respect to
the subject matter hereof.
9.12 Equitable Adjustments. Prior to the consummation
of the Closing, all number of Shares referred to herein
shall be equitably adjusted to account for stock splits,
stock dividends, mergers and similar corporate events.
[END OF TEXT]
IN WITNESS WHEREOF, the parties have executed this
agreement as of the date first above written.
"COMPANY"
TRANSWORLD HOME HEALTHCARE, INC.
By: /s/Robert W. Fine
Name: Robert W. Fine
Title: President
"THE INVESTOR"
HYPERION TW FUND L.P.
By: HYPERION TW LLC,
its General Partner
By: HYPERION PARTNERS II L.P.,
its Managing Member
By: HYPERION VENTURES II L.P.,
its General Partner
By: HYPERION FUNDING II CORP.,
its General Partner
By: /s/Scott A. Shay
Name: Scott A. Shay
Title: Executive Vice President
<PAGE>
EXHIBIT A
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement")
is made as of March 26, 1997 among Transworld Home HealthCare,
Inc., a New York corporation (the "Company") and Hyperion TW Fund
L.P., a Delaware limited partnership (the "Investor").
RECITALS:
A. Concurrently with the execution of this Agreement,
the Investor is acquiring from the Company shares of common stock
of the Company pursuant to the Stock Purchase Agreement dated
March 26, 1997 (the "Purchase Agreement").
B. By entering into this Agreement, the Company
wishes to provide a further inducement to the Investor to
purchase shares of common stock of the Company pursuant to the
Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing, the
parties agree as follows:
1. Definitions. For purposes of this Agreement:
(a) "Common Shares" means shares of common stock
of the Company.
(b) "Exchange Act" means the Securities Exchange
Act of 1934, as amended.
(c) "Form S-3" means such form under the
Securities Act as in effect on the date hereof or any
registration form under the Securities Act subsequently adopted
by the SEC which permits inclusion or incorporation of
substantial information by reference to other documents filed by
the Company with the SEC.
(d) "Holder" means any Person owning or having
the right to acquire Registrable Securities, or any assignee
thereof in accordance with Section 11.
(e) "Initiating Holders" means the Holder(s)
initiating a registration request under Section 2.
(f) "majority in interest of the Initiating
Holders" means Initiating Holders holding a majority of the
Registrable Securities held by all Initiating Holders.
(g) "Person" means any individual, partnership,
joint venture, corporation, association, trust or any other
entity or organization.
(h) "Qualifying Request" means a request from the
Investor or any of its affiliates, partners or assignees that in
the aggregate possess at least fifty percent (50%) of the
Registrable Securities outstanding as of the date of such
request, so long as the Investor or any of its partners is a
party to such request.
(i) "Register," "registered," and "registration"
refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the
Securities Act, and the declaration or ordering of effectiveness
of such registration statement or document.
(j) "Registrable Securities" means (1) any Common
Shares now or hereafter owned by the Investor, including without
limitation any Common Shares purchased pursuant to the Purchase
Agreement, (2) any Common Shares issuable or issued upon
conversion or exercise of any warrant, right or other security
now or hereafter owned by the Investor, and (3) any Common Shares
issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend
or other distribution with respect to, or in exchange for or in
replacement of, or upon conversion of, such Common Shares,
warrants, rights or other securities; provided, however, that any
Common Shares sold by a Person in a transaction in which such
Person's rights under this Agreement are not assigned pursuant to
Section 11 below shall cease to be Registrable Securities from
and after the time of such sale.
(k) The number of shares of "Registrable
Securities then outstanding" shall be determined by the number of
Common Shares outstanding, and the number of Common Shares
issuable, which are Registrable Securities.
(l) "SEC" means the Securities and Exchange
Commission.
(m) "Securities Act" means the Securities Act of
1933, as amended.
(n) "Violation" means any of the following
statements, omissions or violations: (i) any untrue statement or
alleged untrue statement of a material fact contained in a
registration statement under this Agreement, including any
preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto or any documents filed
under state securities or "blue sky" laws in connection
therewith, (ii) the omission or alleged omission to state therein
a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii) any
violation or alleged violation by the Company of the Securities
Act, the Exchange Act, any state securities law or any rule or
regulation promulgated under the Securities Act, the Exchange Act
or any state securities law.
2. Request for Registration.
(a) If, after the earlier of (i) the date six
months after the date of this Agreement or (ii) such time, if
any, as it becomes unlawful or, in the good faith judgment of the
Investor, unduly burdensome for regulatory reasons for the
Investor to continue to hold some or all of the Registrable
Securities then held by it, the Company shall receive a written
Qualifying Request that the Company file a registration statement
under the Securities Act, then the Company shall, within ten (10)
days of the receipt thereof, give written notice of such request
to all Holders and shall, subject to the limitations of Section
2(b) below, use its best efforts to effect as soon as
practicable, and in any event within sixty (60) days of the
receipt of such request, the registration under the Securities
Act of all Registrable Securities which the Holders request to be
registered within twenty (20) days of the mailing of such notice
by the Company in accordance with Section 19 below.
(b) If Initiating Holders intend to distribute
the Registrable Securities covered by their request by means of
an underwriting, they shall so advise the Company as a part of
their request made pursuant to this Section 2 and the Company
shall include such information in the written notice referred to
in Section 2(a). In such event, the right of any Holder to
include such Holder's Registrable Securities in such registration
shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable
Securities in the underwriting (unless otherwise mutually agreed
by a majority in interest of the Initiating Holders and such
Holder) to the extent provided herein. A majority in interest of
the Initiating Holders shall, after consultation with the Board
of Directors of the Company, select the managing underwriter or
underwriters in such underwriting, such underwriter(s) to be
reasonably satisfactory to the Company. All Holders proposing to
distribute their securities through such underwriting shall
(together with the Company as provided in Section 4(f)) enter
into an underwriting agreement in customary form with the
underwriter or underwriters so selected for such underwriting by
a majority in interest of the Initiating Holders; provided,
however, that no such Holder shall be required to make any
representations or warranties except as they relate to such
Holder's ownership of shares and authority to enter into the
underwriting agreement and to such Holder's intended method of
distribution, and the liability of such Holder shall be limited
to an amount equal to the net proceeds from the offering received
by such Holder. Notwithstanding any other provision of this
Section 2, if the underwriter advises the Initiating Holders in
writing that marketing factors require a limitation of the number
of shares to be underwritten, then the Initiating Holders shall
so advise the Company and the Company shall so advise all Holders
of Registrable Securities which would otherwise be underwritten
pursuant hereto, and the number of shares of Registrable
Securities that may be included in the underwriting shall be
allocated among all Holders thereof, including the Initiating
Holders, in proportion (as nearly as practicable) to the amount
of Registrable Securities of the Company owned by each such
Holder. Except to the extent, if any, that securities are
required to be included in such registration under (i) the
Registration Rights Agreement made as of August 5, 1994, among
the Company and Paribas Principal, Inc., (ii) the
Representative's Warrant Agreement dated as of December 7, 1992
between the Company and RAS Securities Corp., (iii) the
Agreement, made as of the 5th day of June, 1992, by and among
Kinder Investments L.P., a Delaware limited partnership, Richard
Elkin, Joseph J. Raymond, Elliott H. Vernon and United States
Home Health Care Corp. (which securities shall in the case of
clause (i) and, except with respect to 6,376 Common Shares held
by Elliott H. Vernon, clause (iii) be subject to the immediately
preceding sentence), or (iv) the Registration Rights Agreement
made as of May 29, 1996 among the Company and Hyperion Partners
II L.P., no securities other than Registrable Securities shall be
covered by such registration.
(c) The Company shall be obligated to effect only
three (3) registrations pursuant to this Section 2 (except as
otherwise provided in Section 6 hereof, registrations which are
not consummated shall not be counted for this purpose); provided,
however, that the Company shall be obligated to effect as many
registrations as may be requested by Holders in the event and so
long as a registration pursuant to Form S-3 or any similar
"short-form" registration statement is available. Any Qualifying
Request made after three (3) registrations have been consummated
pursuant to this Section 2 shall cover Registrable Securities
which, together with other securities of the Company entitled to
inclusion in such registration, are proposed to be sold at an
aggregate price to the public of not less than ten million
dollars ($10,000,000). The Company shall not be obligated to
effect more than two (2) registrations pursuant to this Section 2
in any twelve (12) month period.
(d) Notwithstanding the foregoing, if the Company
shall furnish to Holders requesting a registration statement
pursuant to this Section 2, a certificate signed by the President
of the Company stating that in the good faith judgment of the
Board of Directors of the Company, it would be seriously
detrimental to the Company and its shareholders for such
registration statement to be filed by reason of a material
pending transaction and it is therefore essential to defer the
filing of such registration statement, the Company shall have the
right to defer such filing for a period of not more than ninety
(90) days after receipt of the request of the Initiating Holders;
provided, however, that the Company may not utilize this right
more than once in any twelve (12) month period; and provided
further that the Company may not utilize this right unless (i)
each other person with rights to require the Company to register
securities shall have agreed that no securities will be
registered on behalf of such person during such ninety (90) day
period and (ii) the Company shall not file a registration
statement during such ninety (90) day period other than pursuant
to this Section 2.
3. Company Registration. If (but without any
obligation to do so) the Company proposes to register (including
for this purpose a registration effected by the Company for
shareholders other than the Holders) any of its stock or other
securities under the Securities Act in connection with the public
offering of such securities solely for cash (other than a
registration on Form S-8 relating solely to the sale of
securities to participants in a Company stock plan or to other
compensatory arrangements to the extent includable on Form S-8,
or a registration on Form S-4), the Company shall, at such time,
promptly give each Holder written notice of such registration.
Upon the written request of each Holder given within twenty (20)
days after mailing of such notice by the Company in accordance
with Section 19, the Company shall, subject to the provisions of
Section 8, use its best efforts to cause to be registered under
the Securities Act all of the Registrable Securities that each
such Holder has requested to be registered. The Company shall
have no obligation under this Section 3 to make any offering of
its securities, or to complete an offering of its securities that
it proposes to make, and shall incur no liability to any Holder
for its failure to do so.
4. Obligations of the Company. Whenever required
under this Agreement to effect the registration of any
Registrable Securities, the Company shall, as expeditiously as
reasonably possible:
(a) Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its
best efforts to cause such registration statement to become
effective, and, upon the request of the Holders of a majority of
the Registrable Securities being registered thereunder, keep such
registration statement effective for up to one hundred twenty
(120) days or until the Holders have completed the distribution
referred to in such registration statement, whichever occurs
first (but in any event for at least any period required under
the Securities Act); provided that before filing such
registration statement or any amendments thereto, the Company
will furnish to the Holders copies of all such documents proposed
to be filed.
(b) Prepare and file with the SEC such amendments
and supplements to such registration statement and the prospectus
used in connection with such registration statement as may be
necessary to comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such
registration statement.
(c) Furnish to the Holders such number of copies
of such registration statement and of each amendment and
supplement thereto (in each case including all exhibits), such
number of copies of the prospectus contained in such registration
statement (including each preliminary prospectus and any summary
prospectus) and any other prospectus filed under Rule 424 under
the Securities Act, in conformity with the requirements of the
Securities Act, and such other documents as Holders may
reasonably request in order to facilitate the disposition of
Registrable Securities owned by them.
(d) Use diligent efforts to register and qualify
the securities covered by such registration statement under such
other securities or "blue sky" laws of such states or
jurisdictions as shall be reasonably requested by the Holders,
provided that the Company shall not be required in connection
therewith or as a condition thereto (i) to qualify to do business
in any state or jurisdiction where it would not otherwise be
required to qualify but for the requirements of this clause (d),
or (ii) to file a general consent to service of process in any
such state or jurisdiction.
(e) Use diligent efforts to cause all Registrable
Securities covered by such registration statement to be
registered with or approved by such other governmental agencies
or authorities as may be necessary by virtue of the Company's
business or operations to enable the seller or sellers thereof to
consummate the disposition of such Registrable Securities.
(f) In the event of any underwritten public
offering, enter into and perform its obligations under an
underwriting agreement, in usual and customary form, with the
managing underwriter of such offering.
(g) Notify each Holder of Registrable Securities
covered by such registration statement at any time when a
prospectus relating thereto is required to be delivered under the
Securities Act of the happening of any event as a result of which
the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the
light of the circumstances then existing.
(h) Notify each Holder of Registrable Securities
covered by such registration statement and such Holder's
underwriters, if any, and confirm such advice in writing: (i)
when the registration statement has become effective, (ii) when
any post-effective amendment to the registration statement
becomes effective and (iii) of any request by the SEC for any
amendment or supplement to the registration statement or
prospectus or for additional information.
(i) Notify each Holder of Registrable Securities
if at any time the SEC should institute or threaten to institute
any proceedings for the purpose of issuing, or should issue, a
stop order suspending the effectiveness of the Registration
Statement. Upon the occurrence of any of the events mentioned in
the preceding sentence, the Company will use diligent efforts to
prevent the issuance of any such stop order or to obtain the
withdrawal thereof as soon as possible. The Company will advise
each Holder of Registrable Securities promptly of any order or
communication of any public board or body addressed to the
Company suspending or threatening to suspend the qualification of
any Registrable Securities for sale in any jurisdiction.
(j) Furnish, at the request of any Holder
requesting registration of Registrable Securities pursuant to
this Agreement, (i) on the date that such Registrable Securities
are delivered to the underwriters for sale in connection with a
registration pursuant to this Agreement, if such securities are
being sold through underwriters, or, if such securities are not
being sold through underwriters, on the date that the
registration statement with respect to such securities becomes
effective, an opinion, dated such date, of the counsel
representing the Company for the purposes of such registration,
in form and substance as is customarily given to underwriters in
an underwritten public offering, addressed to the underwriters,
if any, and to the Holders requesting registration of Registrable
Securities and (ii) on the date that the registration statement
with respect to such securities becomes effective, a "comfort"
letter dated such date, from the independent certified public
accountants of the Company, in form and substance as is
customarily given by independent certified public accountants to
underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Holders requesting registration
of Registrable Securities, and, if such securities are being sold
through underwriters, a reaffirmation of such letter on the date
that such Registrable Securities are delivered to the
underwriters for sale.
(k) As soon as practicable after the effective
date of the registration statement, and in any event within
sixteen (16) months thereafter, have "made generally available to
its security holders" (within the meaning of Rule 158 under the
Securities Act) an earning statement (which need not be audited)
covering a period of at least twelve (12) months beginning after
the effective date of the registration statement and otherwise
complying with Section 11(a) of the Securities Act.
5. Furnish Information. It shall be a condition
precedent to the obligations of the Company to take any action
pursuant to this Agreement with respect to the Registrable
Securities of any selling Holder that such Holder shall furnish
to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of
such securities as shall be required to effect the registration
of such Holder's Registrable Securities. If any registration
statement or comparable statement under the Securities Act refers
to the Investor or any of its affiliates, by name or otherwise,
as the holder of any securities of the Company then, unless
counsel to the Company advises the Company that the Securities
Act requires that such reference be included in any such
statement, each such holder shall have the right to require the
deletion of such reference to itself and its affiliates.
6. Expenses of Demand Registration. All expenses,
other than underwriting discounts and commissions, incurred in
connection with registrations, filings or qualifications pursuant
to Section 2, including without limitation all registration,
filing and qualification fees, printers' and accounting fees,
fees and disbursements of counsel for the Company, and the
reasonable fees and disbursements of one counsel (selected by the
Holders of a majority of the Registrable Securities being
registered) for the selling Holders shall be borne by the
Company; provided, however, that the Company shall not be
required to bear such expenses in connection with any
registration begun pursuant to Section 2 if the registration
request subsequently is withdrawn at the request of the Holders
of a majority of Registrable Securities to be registered (in
which case all participating Holders shall bear such expenses pro
rata), unless the Holders of a majority of Registrable Securities
then outstanding agree to forfeit one (1) demand registration
pursuant to Section 2; provided further, however, that if at the
time of such withdrawal, (a) the Holders have learned of a
material adverse change in the condition (financial or
otherwise), business or prospects of the Company from that known
to the Holders at the time of their request or (b) there has
occurred a material adverse change in marketing factors related
to the sale of Registrable Securities to the public from those
existing at the time of the Holders' request, then the Holders
shall not be required to pay any such expenses and shall retain
their rights pursuant to Section 2.
7. Expenses of Company Registration. The Company
shall bear and pay all expenses incurred in connection with any
registration, filing or qualification of Registrable Securities
with respect to the registrations pursuant to Section 3 for each
Holder, including without limitation all registration, filing and
qualification fees, printers' and accounting fees relating or
apportionable thereto and the fees and disbursements of one
counsel for the selling Holders (selected by the Holders of a
majority of the Registrable Securities being registered), but
excluding underwriting discounts and commissions relating to
Registrable Securities.
8. Underwriting Requirements. In connection with any
offering involving an underwriting of shares being issued by the
Company or being sold pursuant to a request for registration made
by shareholders other than the Holders, the Company shall not be
required under Section 3 to include any of the Holders'
securities in such underwriting unless they accept the terms of
the underwriting as agreed upon between the Company (or such
shareholders other than the Holders, as applicable) and the
underwriters selected by it (or them, as applicable), and then,
in the case of an offering by the Company, only in such quantity
as will not, in the opinion of the underwriters, jeopardize the
success of the offering by the Company; provided however that no
Holder participating in such underwriting shall be required to
make any representations or warranties except as they relate to
such Holder's ownership of shares and authority to enter into the
underwriting agreement and to such Holder's intended method of
distribution, and the liability of such Holder shall be limited
to an amount equal to the net proceeds from the offering received
by such Holder. If the total amount of securities, including
Registrable Securities, requested by shareholders to be included
in such offering exceeds the amount of securities to be sold
other than by the Company that the underwriters reasonably
believe compatible with the success of the offering, then the
Company shall be required to include in the offering only that
number of such securities, including Registrable Securities,
which the underwriters believe will not jeopardize the success of
the offering (the securities so included to be apportioned pro
rata among the selling shareholders according to the total amount
of securities entitled to be included therein owned by each
selling shareholder or in such other proportions as shall
mutually be agreed to by such selling shareholders); provided
that, if any selling shareholder has the right to include its
shares in such offering on terms or in an amount more favorable
than provided herein, then each Holder shall have the right to
participate along with such selling shareholder(s) in such
offering on such more favorable terms (i) pro rata based upon the
total amount of securities entitled to be included therein owned
by each such selling shareholder and the aggregate number of
Registrable Securities held by such Holder or (ii) in such other
proportions as shall mutually be agreed to by such selling
shareholders and the Holders of a majority of the Registrable
Securities requested to be included in such offering).
9. Indemnification. In the event any Registrable
Securities are included in a registration statement under this
Agreement:
(a) To the extent permitted by law, the Company
will indemnify and hold harmless each Holder, its heirs, personal
representatives and assigns, each of such Holder's partners, each
of such Holder's, and each of such Holder's partners', officers,
directors, employees and affiliates, any underwriter (as defined
in the Securities Act) for such Holder and each Person, if any,
who controls such Holder or underwriter within the meaning of the
Securities Act or the Exchange Act against any losses, claims,
damages or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or
other federal or state law, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out
of or are based upon a Violation (provided, however, that the
Company will not be required to indemnify any of the foregoing
Persons on account of any losses, claims, damages or liabilities
arising from a Violation if and to the extent that such Violation
was made in a preliminary prospectus and was corrected in a
subsequent prospectus that was required by law to be delivered to
the Person making the claim with respect to which indemnification
is sought hereunder (and such subsequent prospectus was made
available by the Company to permit delivery of such prospectus in
a timely manner), and such subsequent prospectus was not so
delivered to such Person); and the Company will pay to each such
indemnified party, as incurred, any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this
Section 9(a) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement
is effected without the consent of the Company (which consent
shall not be unreasonably withheld), nor shall the Company be
liable in any such case to a particular indemnified party for any
such loss, claim, damage, liability or action to the extent that
it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information
furnished expressly for use in connection with such registration
by such indemnified party.
(b) To the extent permitted by law, each selling
Holder will indemnify and hold harmless the Company, each of its
directors, each of its officers who has signed the registration
statement, each Person, if any, who controls the Company within
the meaning of the Securities Act, any underwriter, any other
Holder selling securities in such registration statement and any
controlling Person of any such underwriter or other Holder,
against any losses, claims, damages or liabilities (joint or
several) to which any of the foregoing Persons may become
subject, under the Securities Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are
based upon any Violation, in each case to the extent (and only to
the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Holder
expressly for use in connection with such registration; and each
such Holder will pay, as incurred, any legal or other expenses
reasonably incurred by any Person intended to be indemnified
pursuant to this Section 9(b), in connection with investigating
or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this
Section 9(b) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement
is effected without the consent of the Holder, which consent
shall not be unreasonably withheld; and provided further, that,
in no event shall the liability of any Holder under this Section
9(b) exceed the net proceeds from the offering received by such
Holder.
(c) Promptly after receipt by an indemnified
party under this Section 9 of notice of the commencement of any
action (including any governmental action), such indemnified
party will, if a claim in respect thereof is to be made against
any indemnifying party under this Section 9, deliver to the
indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate
in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party similarly noticed, to assume
the defense thereof with counsel mutually satisfactory to the
parties; provided, however, that an indemnified party shall have
the right to retain its own counsel, with the fees and expenses
to be paid by the indemnifying party, if representation of such
indemnified party by the counsel retained by the indemnifying
party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to
deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not
relieve such indemnifying party of any liability to the
indemnified party under this Section 9 except if, and only to the
extent that, the indemnifying party is actually prejudiced
thereby; and such failure to deliver written notice to the
indemnifying party will not relieve it of any liability that it
may have to any indemnified party otherwise than under this
Section 9.
(d) The obligations of the Company and Holders
under this Section 9 shall survive the completion of any offering
of Registrable Securities in a registration statement under this
Agreement, and otherwise.
(e) Any indemnity agreements contained herein
shall be in addition to any other rights to indemnification or
contribution which any indemnified party may have pursuant to law
or contract and shall remain operative and in full force and
effect regardless of any investigation made or omitted by or on
behalf of any indemnified party.
(f) If for any reason the foregoing indemnity is
unavailable, then the indemnifying party shall contribute to the
amount paid or payable by the indemnified party as a result of
such losses, claims, damages, liabilities or expenses (i) in such
proportion as is appropriate to reflect the relative benefits
received by the indemnifying party on the one hand and the
indemnified party on the other (taking into consideration the
fact that the provision of the registration rights and
indemnification hereunder is a material inducement to the
Investor to purchase Registrable Securities pursuant to the
Purchase Agreement) or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law or provides a lesser
sum to the indemnified party than the amount hereinafter
calculated, in such proportion as is appropriate to reflect not
only the relative benefits received by the indemnifying party on
the one hand (taking into consideration the fact that the
provision of the registration rights and indemnification
hereunder is a material inducement to the Investor to purchase
Registrable Securities pursuant to the Purchase Agreement) and
the indemnified party on the other but also the relative fault of
the indemnifying party and the indemnified party as well as any
other relevant equitable considerations. The relative fault
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 party or the indemnified
party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue
statement or omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
Notwithstanding anything to the contrary in this Section 9, no
Holder shall be required, pursuant to this Section 9, to
contribute any amount in excess of the net proceeds received by
such indemnifying party from the sale of Common Shares in the
offering to which the losses, claims, damages, liabilities or
expenses of the indemnified party relate.
10. Reports Under the Exchange Act. With a view to
making available to the Holders the benefits of Rule 144 under
the Securities Act and any other rule or regulation of the SEC
that may at any time permit a Holder to sell securities of the
Company to the public without registration or pursuant to a
registration on Form S-3, the Company agrees to:
(a) use diligent efforts to make and keep public
information available, as those terms are understood and defined
in Rule 144 under the Securities Act, at all times;
(b) take such action as is necessary to enable
the Holders to utilize Form S-3 for the sale of their Registrable
Securities;
(c) use diligent efforts to file with the SEC in
a timely manner all reports and other documents required of the
Company under the Securities Act and the Exchange Act; and
(d) furnish to any Holder, so long as the Holder
owns any Registrable Securities, forthwith upon request (i) a
written statement by the Company that it has complied with the
reporting requirements of Rule 144 under the Securities Act or
that it qualifies as a registrant whose securities may be resold
pursuant to Form S-3 (at any time it so qualifies), (ii) a copy
of the most recent annual or quarterly report of the Company and
such other reports and documents so filed by the Company, and
(iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC which
permits the selling of any such securities without registration
or pursuant to such form.
11. Assignment of Registration Rights. The rights to
cause the Company to register Registrable Securities pursuant to
this Agreement may be assigned in whole or in part by a Holder to
one or more of its partners or affiliates or to one or more
transferees or assignees of not less than twenty-five percent
(25%) of all Registrable Securities acquired by the Holder
pursuant to the Purchase Agreement, provided that such transferee
or assignee delivers to the Company a written instrument by which
such transferee or assignee agrees to be bound by the obligations
imposed on Holders under this Agreement to the same extent as if
such transferee or assignee was a party hereto.
12. Limitations on Subsequent Registration Rights;
Existing Registration Rights. From and after the date of this
Agreement, the Company shall not, without the prior written
consent of the Holders of a majority of the outstanding
Registrable Securities, enter into any agreement with any holder
or prospective holder of any securities of the Company which
would allow such holder or prospective holder (a) to include such
securities in any registration filed under this Agreement, unless
under the terms of such agreement, such holder or prospective
holder may include such securities in any such registration only
to the extent that the inclusion of such Holder's securities will
not reduce the amount of the Registrable Securities of the
Holders which is included or (b) to request a registration. The
Company represents and warrants to the Holders that all
"registration rights" relating to securities of the Company that
exist on the date hereof are listed on Exhibit A attached hereto.
13. "Market Stand-Off" Agreement. Each Holder hereby
agrees that, during the period of ninety (90) days following the
effective date of a registration statement of the Company filed
under the Securities Act in connection with an underwritten
offering, it shall not, to the extent requested by the Company
and such underwriter, sell or otherwise transfer or dispose of
(other than to donees or partners who agree to be similarly
bound) any Common Shares of the Company held by it except Common
Shares included in such registration; provided, however, that:
(a) such agreement shall be applicable only to a
registration statement initiated by the Company which covers
Common Shares (or other securities) to be sold on its behalf to
the public in an underwritten offering; and
(b) all officers and directors of the Company and
all other Persons with registration rights (whether or not
pursuant to this Agreement) enter into similar agreements.
14. Amendment; Waiver. Any provision of this
Agreement may be amended only with the written consent of the
Company and the Holders of a majority of the Registrable
Securities then outstanding. The observance of any provision of
this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively) only with the
written consent of the party to be charged, provided that the
holders of a majority of the Registrable Securities then
outstanding may act on behalf of all such holders. Any amendment
or waiver effected in accordance with this Section 14 shall be
binding upon each holder of Registrable Securities at the time
outstanding, each future holder of all such securities, and the
Company.
15. Changes in Registrable Securities. If, and as
often as, there are any changes in the Registrable Securities by
way of stock split, stock dividend, combination or
reclassification, or through merger, consolidation,
reorganization or recapitalization, or by any other means,
appropriate adjustment shall be made in the provisions of this
Agreement, as may be required, so that the rights and privileges
granted hereby shall continue with respect to the Registrable
Securities as so changed. Without limiting the generality of the
foregoing, the Company will require any successor by merger or
consolidation to assume and agree to be bound by the terms of
this Agreement, as a condition to any such merger or
consolidation.
16. Entire Agreement. This Agreement constitutes the
full and entire understanding and agreement among the parties
with regard to the subject matter hereof. Nothing in this
Agreement, express or implied, is intended to confer upon any
Person, other than the parties hereto and their respective
successors and assigns, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, except as
expressly provided herein.
17. Governing Law. This Agreement shall be governed
in all respects by the laws of the State of New York as such laws
are applied to agreements between New York residents entered into
and to be performed entirely within New York, whether or not all
parties hereto are residents of New York.
18. Successors and Assigns. Except as otherwise
expressly provided herein, the provisions hereof shall inure to
the benefit of, and be binding upon, the successors, assigns,
heirs, executors and administrators of the parties hereto.
19. Notices. Unless otherwise provided, any notice
required or permitted under this Agreement shall be given in
writing and shall be deemed effectively given upon receipt by the
party to be notified or three (3) days after deposit with the
United States Post Office, by registered or certified mail,
postage prepaid and addressed to the party to be notified (a) if
to a party other than the Company, at such party's address set
forth at the end of this Agreement or at such other address as
such party shall have furnished the Company in writing, or, until
any such party so furnishes an address to the Company, then to
and at the address of the last holder of the shares covered by
this Agreement who has so furnished an address to the Company, or
(b) if to the Company, at its address set forth at the end of
this Agreement, or at such other address as the Company shall
have furnished to the parties in writing.
20. Severability. Any invalidity, illegality or
limitation on the enforceability of this Agreement or any part
thereof, by any party whether arising by reason of the law of the
respective party's domicile or otherwise, shall in no way affect
or impair the validity, legality or enforceability of this
Agreement with respect to other parties. If any provision of
this Agreement shall be judicially determined to be invalid,
illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way
be affected or impaired thereby.
21. Titles and Subtitles. The titles of the Sections
of this Agreement are for convenience of reference only and are
not to be considered in construing this Agreement.
22. Delays or Omissions; Remedies Cumulative. It is
agreed that no delay or omission to exercise any right, power or
remedy accruing to the parties, upon any breach or default of the
Company under this Agreement, shall impair any such right, power
or remedy, nor shall it be construed to be a waiver of any such
breach or default, or any acquiescence therein, or of any similar
breach or default thereafter occurring; nor shall any waiver of
any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. It is
further agreed that any waiver, permit, consent or approval of
any kind or character by a party of any breach or default under
this Agreement, or any waiver by a party of any provisions or
conditions of this Agreement must be in writing and shall be
effective only to the extent specifically set forth in writing
and that all remedies, either under this Agreement, or by law or
otherwise afforded to a party, shall be cumulative and not
alternative.
23. Attorneys' Fees. If any action at law or in
equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable
attorney's fees, costs and necessary disbursements in addition to
any other relief to which such party may be entitled.
24. Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be an original,
but all of which together shall constitute one instrument.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first above written.
"Company"
TRANSWORLD HOME HEALTHCARE,
INC.
Address:
11 Skyline Drive
Hawthorne, New York 10532
By:
Name:
Title:
"Investor"
HYPERION TW FUND L.P.
Address:
50 Charles Lindbergh Boulevard
Suite 500 By: HYPERION TW LLC,
Uniondale, New York 11553-6300 its General Partner
By: HYPERION PARTNERS II
L.P.,
its Managing Member
By: HYPERION VENTURES II
L.P.,
its General Partner
By: HYPERION FUNDING II
CORP.,
its General Partner
By:
Name:
Title:
EXHIBIT A
1. Agreement made as of the 5th day of June, 1992, by and among
Kinder Investments L.P., Richard Elkin, Joseph J. Raymond,
Elliott H. Vernon and United States Home Health Care Corp.
2. Representative's Warrant Agreement dated as of December 7,
1992 between Transworld Home HealthCare, Inc. and RAS
Securities Corp.
3. Registration Rights Agreement made as of August 5, 1994,
among Transworld Home HealthCare, Inc. and Paribas
Principal, Inc.
4. Registration Rights Agreement made as of May 29, 1996, among
Transworld Home HealthCare, Inc. and Hyperion Partners II
L.P.
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is made as
of the 26th day of March, 1997 by and between Transworld Home
HealthCare, Inc., a New York corporation (the "Company"), and
Hyperion Partners II L.P., a Delaware limited partnership (the
"Investor").
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Purchase and Sale of Shares.
1.1 Sale and Issuance of Shares. Subject to the terms
and conditions of this Agreement, at the Closing (as
hereinafter defined), the Investor agrees to purchase and
the Company agrees to sell and issue to the Investor
1,234,176 shares (the "Shares") of common stock, par value
$.01 per share, of the Company (the "Common Stock"). As
full payment for the Shares, the Investor agrees to assign
and transfer to the Company, without recourse and without
representation or warranty (except as expressly set forth
herein), the following:
(a) $12,396,948 of face amount of accounts
receivable originally owed by Health Management, Inc.
("HMI") to FoxMeyer Corporation and its subsidiaries
and incurred on or before November 13, 1996, and
assigned to the Investor by California Golden State
Finance Company pursuant to an Agreement of Transfer of
Receivables dated November 19, 1996, a copy of which
has been provided to the Company, together with any
rights of the Investor under such Agreement that are
assignable (the "FoxMeyer Receivable"); and
(b) $2,800,000 of face amount of accounts
receivable originally owed by HMI to Bindley Western
Industries, Inc. ("Bindley") and assigned to the
Investor by Bindley pursuant to a Purchase and Sale
Agreement dated December 20, 1996, a copy of which has
been provided to the Company, together with any rights
of the Investor under such Agreement that are
assignable (the "Bindley Receivable" and, together with
the FoxMeyer Receivable, the "HMI Receivables").
1.2 Closing. The purchase and sale of the Shares
shall take place at the offices of Proskauer Rose Goetz &
Mendelsohn LLP, 1585 Broadway, New York, New York 10036,
within 15 days following the satisfaction of the conditions
set forth in Sections 4 and 5, or at such other time and
place as the Company and the Investor mutually agree upon
orally or in writing (which time and place are designated as
the "Closing"). At the Closing, in addition to satisfying
the other conditions set forth herein, the Company shall
deliver to the Investor one or more certificates
representing the Shares, against delivery to the Company by
the Investor of a duly executed instrument assigning the HMI
Receivables to the Company.
2. Representations and Warranties of the Company. The
Company hereby represents and warrants to, and agrees with, the
Investor that:
2.1 Organization, Good Standing and Qualification.
The Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of
New York. The Company has all requisite power and authority
to own, lease, license and use its properties and assets and
to carry on its business as now conducted and as proposed to
be conducted. The Company has all requisite power and
authority to enter into and perform this Agreement and the
transactions contemplated hereby.
2.2 Authorization. All corporate action on the part
of the Company and its officers, directors and shareholders
necessary for the authorization, execution and delivery of
this Agreement, the performance of all obligations of the
Company hereunder and the authorization, sale, issuance and
delivery of the Shares has been taken, except for the
approval of the shareholders of the Company which is
required by Rule 4460(i)(1)(C)(i) of the National
Association of Securities Dealers, Inc. (the "NASD") for
continued trading of the Company's securities on the
National Association of Securities Dealers Automated
Quotation/National Market System ("Shareholder Approval").
This Agreement constitutes the valid and legally binding
obligation of the Company, enforceable in accordance with
its terms, except (i) as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting
enforcement of creditors' rights generally and (ii) as
enforceability may be limited by laws relating to the
availability of specific performance, injunctive relief or
other equitable remedies.
2.3 Valid Issuance of Shares.
(a) The Shares, when issued, sold and delivered in
accordance with the terms hereof and for the consideration
expressed herein, (i) will be duly and validly issued and
fully paid and nonassessable, (ii) will be free of any
pledges, liens, security interests, claims or other
encumbrances of any kind, (iii) will be issued in compliance
with all applicable federal and state securities laws, and
(iv) will not be issued in violation of any preemptive
rights of shareholders. The Shares have been duly and
validly reserved for issuance.
(b) The outstanding shares of Common Stock are all
duly and validly authorized and issued, fully paid and
nonassessable, and were issued in compliance with all
applicable federal and state securities laws.
2.4 Governmental Consents. No consent, approval,
order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state
or local governmental authority on the part of the Company
or any of its subsidiaries is required in connection with
the consummation of the transactions contemplated by this
Agreement except for (i) filing with the Securities and
Exchange Commission on Form 10-C; (ii) Shareholder Approval;
and (iii) such filings as have been made.
2.5 Compliance with Other Instruments. The execution,
delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will
not result in a violation of, or be in conflict with, or
constitute, with or without the passage of time or the
giving of notice or both, a default under, any provision of
the Company's certificate of incorporation, as amended, or
bylaws, as amended, or any judgment, order, writ or decree,
or any contract, agreement or instrument, or require any
consent, waiver or approval thereunder, or give rise to a
right to terminate or accelerate the performance required
thereby, or constitute an event which results in the
creation of any lien, charge or encumbrance upon any asset
of the Company.
2.6 Registration Rights Agreement. The Shares are
"Registrable Securities" as that term is used in the
Registration Rights Agreement dated as of May 29, 1996
between the Company and the Investor (the "Registration
Rights Agreement"), and are entitled to all of the benefits
of the Registration Rights Agreement, except that the
Investor may not require the Company to effect the
registration of the Shares prior to the first anniversary of
the date of this Agreement.
2.7 SEC Documents. The Company has provided the
Investor with copies of its Annual Report on Form 10-K for
the fiscal year ended October 31, 1996 and its Quarterly
Report on Form 10-Q for the quarter ended January 31, 1997
(collectively, the "SEC Documents"), each as filed with the
Securities and Exchange Commission. On the date of their
respective filings, such SEC Documents complied in all
material respects with the requirements of the Securities
Exchange Act of 1934, as amended, and none of such SEC
Documents contained any untrue statement of a material fact
or omitted to state a material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading.
2.8 Financial Statements. The Company has delivered
to the Investor its audited consolidated financial
statements (consolidated balance sheet and consolidated
statements of operations, changes in stockholders' equity
and cash flows) at October 31, 1996 and for the year then
ended and its unaudited financial statements (consolidated
balance sheet and consolidated statement of operations and
cash flows) at January 31, 1997 and for the three-month
period then ended (collectively the "Financial Statements").
The Financial Statements are complete and correct in all
material respects and have been prepared in conformity with
generally accepted accounting principles applied on a
consistent basis throughout the periods indicated. The
Financial Statements accurately describe the financial
condition and operating results of the Company and its
subsidiaries as of the dates, and for the periods, indicated
therein, subject, in the case of the unaudited financial
statements, to normal year-end audit adjustments which will
not in the aggregate be material.
2.9 No Material Adverse Changes. Except as disclosed
in the SEC Documents (and, to the extent the following
representation relates to HMI, except as previously
disclosed to the Investor), since January 31, 1997, there
has been no material adverse change in the assets,
properties, business, operations, condition (financial or
otherwise) or prospects of the Company and its subsidiaries
and the Company has no knowledge of any event which is
likely to result in any such change. To the extent the
foregoing representation relates to HMI, it is being made to
the best knowledge of the Company.
2.10 Disclosure. The Company has fully provided the
Investor or its counsel with all the information which the
Investor has requested for deciding whether to purchase the
Shares and all information which the Company believes is
reasonably necessary to enable the Investor to make such
decision. Neither this Agreement nor any other statements
or certificates made or delivered in connection herewith
contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements
herein or therein not misleading.
3. Representations and Warranties of the Investor. The
Investor hereby represents and warrants to the Company that:
3.1 Authorization. The Investor has all requisite
power and authority to enter into this Agreement. This
Agreement has been duly executed and delivered and
constitutes the Investor's valid and legally binding
obligation, enforceable in accordance with its terms, except
(i) as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and other
laws of general application affecting enforcement of
creditors' rights generally and (ii) as enforceability may
be limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies.
3.2 Purchase Entirely for Own Account. The Shares to
be purchased by the Investor will be acquired for investment
for its own account, and, except as contemplated by the
Registration Rights Agreement or otherwise in accordance
with applicable securities laws, not with a view to the
resale or distribution of any part thereof and without the
present intention of selling, granting any participation in,
or otherwise distributing the same.
3.3 Investment Experience. The Investor can bear the
economic risk of its investment and has such knowledge and
experience in financial or business matters that it is
capable of evaluating the merits and risks of the investment
in the Shares.
3.4 Restricted Securities. The Investor understands
that the Shares it is purchasing are characterized as
"restricted securities" under the federal securities laws
inasmuch as they are being acquired from the Company in a
transaction not involving a public offering and that under
such laws and applicable regulations such securities may be
resold without registration under the Securities Act of
1933, as amended (the "Act"), only in certain limited
circumstances. In this connection, the Investor represents
that it is familiar with Rule 144 of the Securities and
Exchange Commission, as presently in effect, and understands
the resale limitations imposed thereby and by the Act.
3.5 Legends. The Investor understands that the
certificates evidencing the Shares will bear the following
legend:
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR ANY STATE SECURITIES LAWS AND NEITHER
SUCH SHARES NOR ANY INTEREST THEREIN MAY BE TRANSFERRED
IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION
THEREFROM UNDER SUCH ACT OR SUCH LAWS AND THE RULES AND
REGULATIONS THEREUNDER."
The Shares shall not be required to bear such legend if
an opinion of counsel reasonably satisfactory to the Company
is delivered to the Company to the effect that neither the
legend nor the restrictions on transfer contained in this
Agreement are required to insure compliance with the Act.
Whenever, pursuant to the preceding sentence, any
certificate for any of the Shares is no longer required to
bear the foregoing legend, the Company may, and if requested
by the holder thereof, shall, issue to the holder, at the
Company's expense, a new certificate not bearing the
foregoing legend.
3.6 Ownership of HMI Receivables. The Investor owns
and has good title to the HMI Receivables, free and clear of
all liens, claims, security interests and encumbrances.
4. Conditions to the Investor's Obligations at Closing.
The obligations of the Investor under this Agreement are subject
to the fulfillment on or before the Closing of each of the
following conditions:
4.1 Representations and Warranties. The
representations and warranties of the Company contained in
Section 2 shall be true in all material respects on and as
of the Closing with the same effect as though such
representations and warranties had been made on and as of
the Closing.
4.2 Performance. The Company shall have performed and
complied with all agreements, covenants, obligations and
conditions contained in this Agreement in all material
respects that are required to be performed or complied with
by it on or before the Closing.
4.3 Compliance Certificate. The President or Chief
Executive Officer of the Company shall deliver to the
Investor at the Closing a certificate certifying that the
conditions specified in Sections 4.1, 4.2, 4.5, 4.8, 4.10
and 4.11 have been fulfilled.
4.4 Qualifications; Litigation. All authorizations,
approvals or permits, if any, of any governmental authority
or regulatory body that are required in connection with the
lawful issuance and sale of the Shares pursuant to this
Agreement shall be duly obtained and effective as of the
Closing. No federal, state or local regulatory or other
governmental authority shall have taken any action or issued
any statement, written or oral, to the effect that the
transactions contemplated to be taken at the Closing may not
be consummated as currently structured, which action or
statement, in the reasonable judgment of the Investor, makes
proceeding with the transactions contemplated by this
Agreement inadvisable. There shall not have been instituted
or threatened any legal proceeding relating to, or seeking
to prohibit or otherwise challenge, this Agreement or the
consummation of the transactions contemplated by this
Agreement, or seeking to obtain substantial damages with
respect thereto.
4.5 Consents and Coordination. All third party
consents and waivers that are required in connection with
the Closing under this Agreement, and the consummation of
the transactions contemplated hereby, shall be duly obtained
and effective as of the Closing.
4.6 Proceedings and Documents. All corporate and
other proceedings in connection with the transactions
contemplated at the Closing and all documents incident
thereto shall be satisfactory in form and substance to the
Investor, and the Investor shall have received all such
counterpart original and certified or other copies of such
documents as it may reasonably request.
4.7 Opinion of Company Counsel. Baer, Marks & Upham
LLP, counsel for the Company, shall have delivered an
opinion which is addressed to the Investor, dated as of the
Closing and substantially in the form delivered pursuant to
the Unit Purchase Agreement dated as of November 20, 1995
between the Company and the Investor (the "Unit Purchase
Agreement").
4.8 Banks Waiver and Consent. The Company shall have
received, in form and substance satisfactory to the
Investor, (i) the waiver of the lenders (the "Banks") party
to the Credit Agreement dated as of July 31, 1996, as
amended (the "Credit Agreement") among the Company, the
Banks and Bankers Trust Company, as Agent, of any right the
Banks may have to the proceeds of the transactions
contemplated hereby to prepay outstanding indebtedness of
the Company under the Credit Agreement, (ii) the consent of
the Banks to the issuance and sale of the Shares and waiver
of any events of default caused in connection therewith, and
(iii) such other consents and waivers of the Banks as may be
required in connection with the transactions hereunder.
4.9 Hart-Scott-Rodino. Any applicable waiting periods
in respect of the transactions contemplated by this
Agreement under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, shall have expired at or prior to
the Closing.
4.10 Shareholder Meeting. A special or annual meeting
of shareholders of the Company (the "Shareholder Meeting")
shall have been duly called and held at which meeting the
shareholders of the Company shall have had an opportunity to
vote on a proposal to approve this Agreement and the
transactions contemplated hereby and at the Shareholder
Meeting, Shareholder Approval shall have obtained.
4.11 Paribas Consent. The Company shall have received,
in form and substance satisfactory to the Investor, the
consent of Paribas Principal, Inc. to this Agreement and the
Registration Rights Agreement.
5. Conditions to the Company's Obligations at the Closing.
The obligations of the Company to the Investor under Section 1 of
this Agreement are subject to the fulfillment on or before the
Closing of the following conditions, any of which may be waived
by the Company:
5.1 Representations and Warranties. The
representations and warranties of the Investor contained in
Section 3 shall be true in all material respects on and as
of the Closing with the same effect as though such
representations and warranties had been made on and as of
the date of the Closing.
5.2 Payment of Purchase Price. The Investor shall
have delivered to the Company a duly executed instrument
assigning the HMI Receivables to the Company.
5.3 Performance. The Investor shall have performed
and complied with all agreements, covenants, obligations and
conditions contained in this Agreement in all material
respects that are required to be performed or complied with
by it on or before the Closing.
5.4 Qualifications; Litigation. All authorizations,
approvals or permits, if any, of any governmental authority
or regulatory body that are required in connection with the
lawful issuance and sale of the Shares pursuant to this
Agreement shall be duly obtained and effective as of the
Closing. The Shareholder Approval shall be duly obtained
and effective as of the Closing. There shall not have been
instituted or threatened any legal proceeding relating to,
or seeking to prohibit or otherwise challenge, this
Agreement or the consummation of the transactions
contemplated by this Agreement, or seeking to obtain
substantial damages with respect thereto.
5.5 Banks Waiver and Consent. The Company shall have
received, in form and substance satisfactory to the Company,
(i) the waiver of the Banks of any right they may have to
the proceeds of the transactions contemplated hereby to
prepay outstanding indebtedness of the Company under the
Credit Agreement, (ii) the consent of the Banks to the
issuance and sale of the Shares and waiver of any events of
default caused in connection therewith, and (iii) such other
consents and waivers of the Banks as may be required in
connection with the transactions hereunder.
5.6 Hart-Scott-Rodino. Any applicable waiting periods
in respect of the transactions contemplated by this
Agreement under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, shall have expired at or prior to
the Closing.
5.7 Consents and Coordination. All consents and
waivers that are required in connection with the Closing
under this Agreement, and the consummation of the
transactions contemplated hereby, shall be duly obtained and
effective as of the Closing.
5.8 Paribas Consent. The Company shall have received,
in form and substance satisfactory to the Company, the
consent of Paribas Principal, Inc. to this Agreement and the
Registration Rights Agreement.
6. Covenants of the Company. The Company covenants and
agrees with the Investor as follows:
6.1 Advice of Changes. The Company will promptly
advise the Investor in writing of (i) any event occurring
subsequent to the date of this Agreement which would render
any representation or warranty of the Company contained in
this Agreement, if made on or as of the date of such event
or the date of the Closing, untrue or inaccurate in any
material respect and (ii) any material adverse change in the
business of the Company and its subsidiaries taken as a
whole.
6.2 Information. The Company will deliver to the
Investor the information specified in Section 6.9 of the
Unit Purchase Agreement (as in effect on the date hereof),
unless the Investor at any time specifically requests that
such information not be delivered to it.
6.3 Observer and Director Rights. The Company will
afford to the Investor the observer, director and other
rights specified in Sections 6.11 and 8.1(a) of the Unit
Purchase Agreement (as in effect on the date hereof).
6.4 Listing Application. The Company shall prepare
and file with the NASD an Additional Listing Application, in
the form and within the time period prescribed by the NASD,
with respect to the listing of the Shares.
6.5 Publicity. Except as may be required by law, the
Company shall not use the name of, or make reference to, the
Investor or any of its affiliates in any press release or in
any public manner without the Investor's prior written
consent.
6.6 Certain Covenants Relating to Shareholder Approval
Requirement. (a) The Company will take all action necessary
in accordance with applicable law and its Certificate of
Incorporation and By-laws to convene a meeting of its
shareholders as promptly as practicable to consider and vote
upon the approval of this Agreement and the transactions
contemplated hereby. The Board of Directors of the Company
shall recommend such approval to the shareholders of the
Company and the Company shall take all lawful actions to
solicit such approval. The Company represents and warrants
to, and agrees with, the Investor that the Investor may vote
at the Shareholder Meeting in any manner as it, in its sole
discretion, may choose, pursuant to Section 7.2(d) of the
Unit Purchase Agreement.
(b) As soon as practicable, the Company shall file a
proxy statement in preliminary and definitive form with the
Securities and Exchange Commission in connection with the
Shareholder Meeting. The Investor agrees to assist and
cooperate with the Company in the preparation of the proxy
statement. The definitive proxy statement ("Proxy
Statement") for the Shareholder Meeting shall be mailed to
shareholders as soon as practicable. The Company represents
and warrants to the Investor that the Proxy Statement will
comply in all material respects with the requirements of the
Exchange Act, and the applicable rules and regulations
thereunder, and that the Proxy Statement will contain no
untrue statement of any material fact and will not omit to
state any material fact required to be stated therein or
necessary to make the statements therein not misleading.
7. Indemnification. The Company agrees to indemnify the
Investor and its general and limited partners, and each officer,
director, employee, partner, member, agent and affiliate of the
Investor and its general and limited partners (the "Indemnified
Parties") for, and hold each Indemnified Party harmless from and
against: (i) any and all damages, losses, claims and other
liabilities of any and every kind, including, without limitation,
judgments and costs of settlement, and (ii) any and all out-of-
pocket costs and expenses of any and every kind, including,
without limitation, reasonable fees and disbursements of one
counsel for such Indemnified Parties (selected by the Investor)
(all of which expenses periodically shall be reimbursed as
incurred), in each case, arising out of or suffered or incurred
in connection with (A) any investigative, administrative or
judicial proceeding or claim brought or threatened relating to or
arising out of the Investor's purchase of the Shares, or this
Agreement, the Registration Rights Agreement, or the transactions
contemplated hereby and thereby, or (B) any material inaccuracy
or alleged inaccuracy in any representation or warranty of the
Company made or incorporated by reference in this Agreement or
any material breach or alleged breach by the Company of any
covenant or agreement made or incorporated by reference in this
Agreement or the Registration Rights Agreement.
8. Termination.
8.1 Termination Prior to Closing. This Agreement may
be terminated at any time prior to the Closing:
(a) by the mutual consent of the Investor and the
Company;
(b) by the giving of notice by the Investor or the
Company at any time after August 31, 1997 (or such later
date as shall have been agreed to in writing by the parties
hereto), if at the time notice of such termination is given
the Closing shall not have been consummated; or
(c) by the Investor, if there has been a material
misrepresentation or material breach on the part of the
Company in any of the representations, warranties, covenants
or agreements of the Company set forth herein, or if there
has been any material failure on the part of the Company to
comply with its obligations hereunder, or by the Company if
there has been a material misrepresentation or material
breach on the part of the Investor in any of the
representations, warranties, covenants or agreements of the
Investor set forth herein, or if there has been any material
failure on the part of the Investor to comply with its
obligations hereunder.
8.2 Liability Upon Termination.
(a) In the event of termination of this Agreement
pursuant to Sections 8.1(a) or 8.1(b), no party hereto shall
have any liability or further obligation to any other party
hereto except as provided in Sections 7, 9.7 and 9.8.
(b) In the event of termination pursuant to Section
8.1(c), (i) if the Investor is the non-breaching party, the
Investor shall be entitled to reimbursement of expenses as
set forth in Section 9.8 and (ii) the non-breaching party
shall have the right to pursue all rights and remedies
available to it hereunder or otherwise provided at law or
equity, including without limitation, the right to seek
specific performance and money damages.
9. Miscellaneous.
9.1 Survival of Warranties. The warranties,
representations, covenants and agreements of the Company and
the Investor contained in or made pursuant to this Agreement
shall survive the execution and delivery of this Agreement
and the Closing. Neither any investigation by or on behalf
of the Investor nor the receipt by the Investor of any data
or information from the Company, shall in any way affect the
right of the Investor to rely on the representations,
warranties, covenants and agreements of the Company or the
right of the Investor to terminate this Agreement as
provided in Section 8.
9.2 Successors and Assigns. The Investor and each
assignee of the Investor may, without the consent of the
Company, assign its rights under this Agreement, in whole or
in part, in connection with any sale or transfer to an
affiliate or a partner, and the terms and conditions of this
Agreement shall inure to the benefit of and be binding upon
the respective successors and assigns of the parties.
Nothing in this Agreement, express or implied, is intended
to confer upon any person other than the parties hereto or
their respective successors and assigns any rights,
remedies, obligations or liabilities under or by reason of
this Agreement, except as expressly provided in this
Agreement.
9.3 Governing Law. This Agreement shall be governed
by and construed under the laws of the State of New York as
applied to agreements among New York residents entered into
and to be performed entirely within New York.
9.4 Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and
the same instrument.
9.5 Titles and Subtitles. The titles and subtitles
used in this Agreement are used for convenience only and are
not to be considered in construing or interpreting this
Agreement.
9.6 Notices. Unless otherwise provided, any notice
required or permitted under this Agreement shall be given in
writing and shall be deemed effectively given upon receipt
by the party to be notified or five days after deposit with
the United States Post Office, by registered or certified
mail, postage prepaid and addressed to the party to be
notified (i) if to the Company, at the following address:
75 Terminal Avenue
Clark, New Jersey 07066
Attn: Robert W. Fine
with a copy to:
Baer Marks & Upham LLP
805 Third Avenue
New York, New York 10022
Attn: Leslie J. Levinson
(ii) if to the Investor, at the following address:
50 Charles Lindbergh Blvd.
Suite 500
Uniondale, New York 11553-3600
Attn: Scott A. Shay
with a copy to:
Proskauer Rose Goetz & Mendelsohn LLP
1585 Broadway
New York, New York 10036
Attn: Bruce Lieb
or at such other address as any of the parties may designate
by 10 days' advance written notice to the other parties.
9.7 No Finder's Fee. Each party represents that it is
not, and will not be, obligated for any finder's fee or
commission in connection with this transaction.
The Investor agrees to indemnify and hold harmless the
Company from any liability for any commission or
compensation in the nature of a finder's fee (and the costs
and expenses of defending against such liability or asserted
liability) for which the Investor or any of its officers,
employees or representatives is responsible.
The Company agrees to indemnify and hold harmless the
Investor from any liability for any commission or
compensation in the nature of a finder's fee (and the costs
and expenses of defending against such liability or asserted
liability) for which the Company or any of their respective
officers, employees or representatives is responsible.
9.8 Expenses. The Company agrees to pay all out-of-
pocket fees and reasonable expenses incurred by the Investor
in connection with this Agreement and the transactions
contemplated hereby (whether or not the transactions
contemplated hereby are consummated) including, without
limitation, (i) the reasonable fees and expenses of counsel
for the Investor incurred in connection with this Agreement
and the transactions contemplated hereby (including the
reasonable fees and expenses of Proskauer Rose Goetz &
Mendelsohn LLP, and including, without limitation, any legal
fees and expenses relating to any future waiver, consent or
amendment, whether or not any such future action is given or
consummated) and (ii) all filing fees relating to filings
under the Hart-Scott-Rodino Antitrust Improvements Act of
1974, as amended.
9.9 Amendments and Waivers. Any term of this
Agreement may be amended and the observance of any term of
this Agreement may be waived (either generally or in a
particular instance and either retroactively or
prospectively), only with the written consent of the
Investor and the Company.
9.10 Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law,
such provision shall be excluded from this Agreement and the
balance of this Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in
accordance with its terms.
9.11 Entire Agreement. This Agreement constitutes the
entire agreement between the parties hereto with respect to
the subject matter hereof.
9.12 Equitable Adjustments. Prior to the consummation
of the Closing, all number of Shares referred to herein
shall be equitably adjusted to account for stock splits,
stock dividends, mergers and similar corporate events.
[END OF TEXT]
IN WITNESS WHEREOF, the parties have executed this
agreement as of the date first above written.
"COMPANY"
TRANSWORLD HOME HEALTHCARE, INC.
By: /s/Robert W. Fine
Name: Robert W. Fine
Title: President
"THE INVESTOR"
HYPERION PARTNERS II L.P.
By: HYPERION VENTURES II L.P.,
its General Partner
By: HYPERION FUNDING II CORP.,
its General Partner
By: /s/Scott A. Shay
Name: Scott A. Shay
Title: Executive Vice President
