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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 30, 1998
--------------------
AMSURG CORP.
(Exact Name of Registrant as Specified in its Charter)
TENNESSEE 000-22217 62-1493316
(State or other jurisdiction of (Commission (I.R.S. employer
incorporation or organization) File Number) identification no.)
ONE BURTON HILLS BOULEVARD
SUITE 350
NASHVILLE, TN 37215
(Address of principal executive offices) (Zip code)
(615) 665-1283
(Registrant's Telephone Number, Including Area Code)
NOT APPLICABLE
(Former name or former address, if changed since last report)
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
Effective April 30, 1998, AmSurg Holdings, Inc. ("Holdings"), a
subsidiary of AmSurg Corp. (the "Company") acquired from Boswell Eye Center,
L.L.C., an Arizona limited liability company ("BEC") and Boswell Eye Institute,
Inc. an Arizona corporation ("BEI," and together with BEC, "Sellers"), a sixty
percent ownership interest in the assets comprising the business operations of
an ophthalmology ambulatory surgery center (the "Center") in Sun City, Arizona.
Pursuant to the terms of the Asset Purchase Agreement, dated as of April
30, 1998, by and between Holdings and the Sellers, Holdings paid $5,400,000 in
cash to the Sellers. Approximately $4,000,000 of the cash used in the purchase
transaction was provided from borrowings under the Company's revolving credit
agreement with SunTrust Bank, Nashville and approximately $1,400,000 was
provided from operating cash flow. The consideration paid to the Sellers was
determined through arm's-length negotiations between the Company and the members
and shareholders of the Sellers. Following the asset purchase, Holdings and the
Sellers contributed their respective ownership in the assets of the Center into
a newly formed limited liability company, The Sun City Ophthalmology ASC, LLC,
and received proportionate membership therein.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
It is impractical to provide at this time the financial statements and
pro forma financial information required by Items 7(a) and 7(b). The Company
anticipates filing this information in an amendment to this Form 8-K on or prior
to July 14, 1998.
(c) Exhibits:
2 Asset Purchase Agreement, dated as of April 30, 1998, by and among
AmSurg Holdings, Inc., Boswell Eye Center, L.L.C., Boswell Eye
Institute, Inc. and the members and shareholders thereof.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMSURG CORP.
By: /s/ Claire M. Gulmi
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CLAIRE M. GULMI
Senior Vice President and Chief Financial Officer
(Principal Financial and Duly Authorized Officer)
Date: May 13, 1998
2
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
2 Asset Purchase Agreement, dated as of April 30, 1998, by and among
AmSurg Holdings, Inc., Boswell Eye Center, L.L.C., Boswell Eye
Institute, Inc. and the members and shareholders thereof.
</TABLE>
3
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Exhibit 2
ASSET PURCHASE AGREEMENT
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THIS ASSET PURCHASE AGREEMENT (the "Agreement"), dated April 30, 1998, is by
and among AmSurg Holdings, Inc., a Tennessee corporation ("AmSurg"), Boswell Eye
Center, L.L.C., an Arizona limited liability company ("BEC"), Boswell Eye
Institute, Inc., an Arizona corporation ("BEI," and together with BEC, "Sellers"
or individually a "Seller") and the individuals set forth on the signature pages
attached hereto (individually "Doctor" and collectively "Doctors").
WHEREAS, AmSurg desires to purchase and Sellers desire to sell certain of their
assets, as more fully described herein, upon and subject to the terms and
conditions contained in this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual representations,
warranties and covenants of the parties hereinafter set forth, the parties agree
as follows:
ARTICLE 1. PURCHASE AND SALE OF ASSETS
1.1. PURCHASE AND SALE OF ASSETS. Subject to the terms and conditions of this
Agreement, at the Closing, Sellers shall sell, transfer, convey, assign and
deliver to AmSurg and AmSurg shall purchase, acquire and accept from Sellers an
undivided 60% interest in the assets comprising the business operations of the
ambulatory surgery center (the "Center") owned and operated by Sellers and
located in Sun City, Arizona, tangible or intangible, recorded or unrecorded,
known or unknown, of whatsoever type, kind, description, or nature owned,
leased, held, possessed, vested in or claimed in whole or in part by Sellers on
the Closing Date (the "Purchased Assets"), which Purchased Assets shall
specifically include the accounts receivable of the Center, but which shall
specifically exclude cash and certain cash equivalents in the approximate
aggregate amount of $780,000 and that certain promissory note from BEC to BEI of
even date in the amount of $600,000.
1.2. ASSUMPTION OF LIABILITIES. Except as described in Schedule 1.2, AmSurg will
not assume any debts, liabilities, obligations, expenses, taxes, contracts or
commitments of Sellers or the Center of any kind, character or description,
whether accrued, absolute, contingent or otherwise ("Liabilities"), no matter
whether arising before or after the Closing, and whether or not reflected or
reserved against in Sellers' or the Center's financial statements, books of
account or records. Sellers will indemnify AmSurg against and hold it harmless
from any such Liabilities. AmSurg will cause The Sun City Ophthalmology ASC,
LLC, a Tennessee limited liability company (the "LLC"), to assume all
Liabilities arising after the effective date of the transaction which relate to
supplies received by the Center or services rendered to the Center after the
effective date of the transaction, regardless of the date such Liabilities
arose.
ARTICLE 2. PURCHASE PRICE
The purchase price ("Purchase Price") for the Purchased Assets shall be
$5,400,000 payable in cash. The Purchase Price was determined based on an
assumption that the current expenses of operating the Center and on a going
forward basis are and will be as set forth on Exhibit 2.
ARTICLE 3. CLOSING
3.1. CLOSING. The closing ("Closing") of the sale and purchase of the Purchased
Assets shall take place at the offices of Bass, Berry & Sims PLC, First American
Center, Nashville, Tennessee 37238, within 10 business days after the
satisfaction of all conditions to the parties' obligations to consummate the
transactions contemplated hereby, which shall in no event be later than April
30, 1998, or at such other time as shall be agreed upon by all the parties
hereto (the "Closing Date").
3.2. OBLIGATIONS OF THE PARTIES AT THE CLOSING.
(a) At the Closing, AmSurg shall deliver to Sellers:
(i) the consideration as specified in Article 2;
(ii) a copy of resolutions of the Board of Directors of
AmSurg, certified by its Secretary, authorizing the execution, delivery
and performance of this Agreement and the other documents referred to
herein to be executed by AmSurg, and the consummation of the
transactions contemplated hereby;
(iii) a certificate of AmSurg certifying as to the accuracy of
the representations and warranties of AmSurg at and as of the Closing
and that AmSurg has performed or complied with all of the covenants,
agreements, terms, provisions and conditions to be performed or
complied with by AmSurg at or before the Closing;
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Asset Purchase Agreement/Page 1
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(iv) the opinion of Bass, Berry & Sims PLC, legal counsel for
AmSurg, the terms of which are substantially as set forth in Exhibit
10.4; and
(v) such other certificates and documents as Seller or its
counsel may reasonably request.
(b) At the Closing, Sellers and the Doctors will deliver to AmSurg:
(i) a copy of resolutions of the Board of Directors or Board
of Governors of each Seller, certified by its Secretary, authorizing
the execution, delivery and performance of this Agreement and the other
documents referred to herein to be executed by Sellers, and the
consummation of the transactions contemplated hereby;
(ii) such deeds, bills of sale, endorsements, assignments and
other good and sufficient instruments of conveyance and transfer, in
form and substance reasonably satisfactory to AmSurg, as shall be
effective to vest in AmSurg all of Sellers' title to and interest in
the Purchased Assets, all of Sellers' books, records and other data
relating to the Purchased Assets (except company records and any other
documents and records which Sellers are required by law to retain in
their possession), and, simultaneously with such delivery, will take
such steps as may be necessary to put AmSurg in actual possession and
operating control of the Purchased Assets;
(iii) a certificate of each Seller certifying as to the
accuracy of Sellers' representations and warranties at and as of the
Closing and that they have performed or complied with all of the
covenants, agreements, terms, provisions and conditions to be performed
or complied with by Sellers at or before the Closing;
(iv) a certificate of each of the Doctors certifying as to the
accuracy of the Doctors' representations and warranties at and as of
the Closing and that they have performed or complied with all of the
covenants, agreements, terms, provisions and conditions to be performed
or complied with by each of them at or before the Closing;
(v) the opinion of Plattner, Schneidman & Schneider, P.C.,
legal counsel to Seller and the Doctors, in substantially the form of
Exhibit 9.6; and
(vi) such other certificates and documents as AmSurg or its
counsel may reasonably request.
ARTICLE 4. REPRESENTATIONS AND WARRANTIES BY SELLER
Sellers jointly represent and warrant as follows:
4.1. ORGANIZATION.
(a) BEC is a limited liability company duly organized, validly existing
and in good standing under the laws of the State of Arizona with full power and
authority to conduct its business as now conducted and to own, lease or operate
its properties and assets as now owned, leased or operated.
(b) BEI is a corporation duly organized, validly existing and in good
standing under the laws of the State of Arizona with full power and authority to
conduct its business as now conducted and to own, lease or operate its
properties and assets as now owned, leased or operated.
4.2. AUTHORIZATION. Sellers have full power and authority to enter into this
Agreement and perform their obligations hereunder and carry out the transactions
contemplated hereby. The execution, delivery and performance by Sellers of this
Agreement and the consum mation of the transactions contemplated hereby,
including the conveyance, assignment, transfer and delivery of the Purchased
Assets, have been duly authorized and approved by all necessary company or
corporate action, and this Agreement, when executed, will constitute a valid and
binding obligation of Sellers enforceable against Sellers in accordance with its
terms.
4.3. NO VIOLATION.
(a) The execution and delivery of this Agreement by BEC does not, and
the consummation of the transactions contemplated hereby will not, (i) violate
any provision of, or result in the creation of any lien or security interest
under, any agreement, indenture, instrument,
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Asset Purchase Agreement/Page 2
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lease, security agreement, mortgage or lien to which BEC is a party or by which
any of BEC's assets or properties are bound which violation or lien would have a
material adverse effect on the business or operations of BEC or the Center; (ii)
violate any provision of the articles of organization of BEC; (iii) violate any
order, arbitration award, judgment, writ, injunction, decree, statute, rule or
regulation applicable to BEC which violation would have a material adverse
effect on the business or operations of BEC or the Center; (iv) violate any
other contractual or legal obligation or restriction to which BEC is subject
which violation would have a material adverse effect on the business or
operations of BEC or the Center; or (v) violate any contractual or legal
obligation or restriction relating or pertaining to the estate of Richard J.
Flindall, Mona Sue Flindall or the Richard J. Flindall and Mona Sue Flindall
Revocable Living Trust.
(b) The execution and delivery of this Agreement by BEI does not, and
the consummation of the transactions contemplated hereby will not, (i) violate
any provision of, or result in the creation of any lien or security interest
under, any agreement, indenture, instrument, lease, security agreement, mortgage
or lien to which BEI is a party or by which any of BEI's assets or properties
are bound which violation or lien would have a material adverse effect on the
business or operations of BEI or the Center; (ii) violate any provision of the
charter or bylaws of BEI; (iii) violate any order, arbitration award, judgment,
writ, injunction, decree, statute, rule or regulation applicable to BEI which
violation would have a material adverse effect on the business or operations of
BEI or the Center; (d) violate any other contractual or legal obligation or
restriction to which BEI is subject which violation would have a material
adverse effect on the business or operations of BEI or the Center; or (e)
violate any contractual or legal obligation or restriction relating or
pertaining to the estate of Richard J. Flindall, Mona Sue Flindall or the
Richard J. Flindall and Mona Sue Flindall Revocable Living Trust.
4.4. FINANCIAL INFORMATION. Sellers have delivered to AmSurg: (a) statements of
Center charges and cash receipts by month for the twelve (12) month periods
ended December 31, 1997 and December 31, 1996 (b) cash basis unaudited
statements of income for the Sellers for the years ended December 31, 1997 and
December 31, 1996 (c) a cash basis unaudited balance sheets of the Sellers at
December 31, 1997 and December 31, 1996 and (d) details of patient accounts
receivable for the Center at April 29, 1998 (hereinafter collectively referred
to as "Financial Information"), all of which are attached as Schedule 4.4. The
Financial Information fairly presents the assets, liabilities, financial
condition and results of operation of the Center as at the respective dates
thereof and for the periods therein referred to, prepared on a cash basis and
accurately reflects the revenues and expenses of the Center for the periods
covered thereby and, in particular, reflects all expenses necessary for the
efficient operation of the Center as a stand-alone entity. The Financial
Information reflects the consistent application of such accounting principles
throughout the periods involved.
4.5. OWNERSHIP OF PURCHASED ASSETS. Sellers own and possess and have good and
marketable title to all of the Purchased Assets, free and clear of all
mortgages, pledges, liens, security interests, conditional sale agreements,
defects, charges, encumbrances and rights of third parties, and no conditions
exist which could give rise to any such mortgage, pledge, lien, security
interest, defect, charge, encumbrance on, or right of any such third party to,
the Purchased Assets.
Schedule 4.5 contains an accurate and complete description of the Purchased
Assets, which include, but are not limited to, supplies, inventory, uncollected
accounts receivable and equipment owned by Sellers, and which are all of the
assets which are in any way necessary to the continued operation of the Center
as it is now being conducted. All of the Purchased Assets are in good working
condition and repair, normal wear and tear excepted, and are adequate for the
uses for which they are intended. Schedule 4.5 also sets forth the current book
value of all equipment included in the Purchased Assets.
4.6. NO LIABILITIES OR ADVERSE CONDITIONS. Except as and to the extent of the
amounts specifically reflected in the Financial Information, Sellers do not have
any material liabilities or obligations of any nature with respect to the
Center, whether, absolute, accrued, contingent or otherwise and whether due or
to become due (including, without limitation, liabilities for taxes and
interest, penalties and other charges payable with respect thereto).
Furthermore, Sellers do not know or have reason to know of any basis for the
assertion against either Seller of any such liability or obligation of any
nature not fully reflected in the Financial Information. There are no conditions
existing with respect to any of Sellers' facilities, properties, assets or
personnel, which might materially and adversely affect any of the Center's
properties, business or prospects.
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Asset Purchase Agreement/Page 3
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4.7. ABSENCE OF CERTAIN CHANGES. Since January 31, 1998, with respect to the
Center, Sellers have not:
(a) suffered any material adverse change in their working capital,
financial condition, assets, liabilities, business or prospects, or suffered any
material casualty loss (whether or not insured);
(b) made any change in their business or operations or in the manner of
conducting their business, other than changes in the ordinary course of
business;
(c) incurred any obligations or liabilities (whether absolute, accrued,
contingent or otherwise and whether due or to become due), except items incurred
in the ordinary course of business and consistent with past practice, or
experienced any change in any assumptions or methods of calculating any bad
debt, contingency or other reserve;
(d) paid, discharged or satisfied any claim, lien, encumbrance or
liability (whether absolute, accrued, contingent or otherwise and whether due or
to become due), other than claims, liens, encumbrances, or liabilities:
(i) which are reflected in the Financial Information and which
were paid, discharged or satisfied since the date thereof in the
ordinary course of business consistent with past practice, or
(ii) which were incurred and paid, discharged or satisfied
since January 31, 1998 in the ordinary course of business consistent
with past practice;
(e) written off as uncollectible any notes or accounts receivable or
any portion thereof, except for immaterial write-offs made in the ordinary
course of business consistent with past practice;
(f) canceled any other debts or claims, or waived any rights, of
substantial value;
(g) sold, transferred or conveyed any of their properties or assets,
except in the ordinary course of business consistent with past practice;
(h) made any capital expenditures or commitments in excess of $10,000
in the aggregate for replacements or additions to property, plant, equipment or
intangible capital assets;
(i) declared, paid or made or set aside for payment of, any
distribution or dividends in respect of its outstanding membership interests or
capital stock, other than distributions or dividends made in the ordinary course
of business consistent with past practice, or directly or indirectly redeemed,
purchased or otherwise acquired any of its membership interests or capital
stock;
(j) made any change in any method of accounting or accounting practice;
(k) granted any increase in the compensation of any officer, employee
or agent of either Seller who performs services for or on behalf of the Center,
(including without limitation any increase pursuant to any bonus, pension,
profit sharing or other plan or commitment), other than increases in the
ordinary course of business consistent with past practice, or adopted any such
plan or other arrangement; and no such increase or the adoption of any such plan
or arrangement, is planned or required; and
(l) agreed, whether in writing or otherwise, to take any action
described in this Section 4.7.
4.8. TAXES. Sellers have filed all federal, state and local tax returns required
to be filed by them through the date hereof and have paid all taxes and
assessments (including, without limitation, income, excise, unemployment, social
security, occupation, franchise, property, sales and use taxes, services taxes,
import duties or charges, and all penalties and interest with respect thereto)
due and payable therefrom. Sellers have not signed any extension agreement with
any taxing authority and know of no open or questionable matters for any prior
periods. All taxes and assessments relating to or affecting the operations of
the Center through the date hereof have been paid.
4.9. LITIGATION. There is no claim, litigation, investigation or proceeding
pending or, to Sellers' knowledge, threatened at law or in equity or before any
court, legislative or administrative tribunal or governmental agency which
questions the validity of this Agreement or which, if adversely determined or
publicly disclosed, would have a material adverse effect on the business or
operations of the Center. Schedule 4.9 sets forth a true and accurate
description of all claims, actions, investigations or proceedings relating to
the Center and its operations initiated since January 1, 1998.
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Asset Purchase Agreement/Page 4
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4.10. COMPLIANCE WITH LAWS AND OTHER REGULATIONS. Sellers are in compliance in
all material respects with all requirements of applicable laws, rules,
regulations, orders, ordinances, judgments and decrees of all governmental
bodies or agencies (federal, state or local) (collectively, "Laws") relating to
or affecting the operations of the Center. Neither Seller has received any
notice of, or notice of any investigation of, a possible violation of any
applicable Laws, or any other Law or requirement relating to or affecting the
operations of a Seller or the Center.
Sellers have all required licenses, permits, certificates, authorizations and
agreements needed for the ownership and efficient operation of the Center, all
of which are listed on Schedule 4.10. Sellers know of no act or omission
occurring on or before the date hereof which would subject Sellers, or either of
them or the Center to the likelihood of any fine or suspension of any license,
permit, certificate, authorization or agreement.
4.11. CONTRACTS; SIGNIFICANT PAYORS. Schedule 4.11 is a complete and accurate
list of all individual payors, or group of affiliated payors, that accounted for
more than 2% of the Center's revenues in any two of the previous three years or
is expected to account for more than 5% of the Center's revenues in the current
year or the next year ("Significant Payors").
All contracts, agreements and instruments, including, but not limited to, third
party provider agreements and agreements with Significant Payors, to which BEC
or BEI is a party and which are necessary for the ownership and efficient
operation of the Center, are in full force and effect; there have been no
threatened cancellations thereof nor outstanding disputes thereunder, and
neither BEC nor BEI has breached any provision of, nor does there exist any
default in any material respect under, or event (including the execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby) which is, or with the giving of notice or the passage of time or both
would become, a breach or default in any material respect under the terms of any
such contract, instrument or agreement. Sellers have no reason to believe that
any Significant Payor intends to terminate any such contract, instrument or
agreement, or intends to withhold its consent to the assignment thereof, to the
LLC by Sellers.
4.12. ACCOUNTS RECEIVABLE. All accounts and notes receivable of the Center,
whether reflected in the Financial Information or otherwise, represent services
actually provided in the ordinary course of business; all such receivables are
current and collectible in accordance with their respective terms; and none of
such receivables is subject to any counterclaim or set-off, other than normal
discounts, allowances and bad debts consistent with past practice.
4.13. REPORTS AND RETURNS. All reports and returns heretofore required by
federal, state or municipal authorities with respect to the operations of the
Center and all reports and returns to the various governmental authorities which
control, directly or indirectly, any of the Center's activities, have been filed
and all sums heretofore due with respect to such reports and returns have been
paid.
4.14. DEFAULTS.
(a) BEC is not in default under, and no event has occurred which, with
the giving of notice or the passage of time, or both, would result in a default
under, any outstanding indenture, mortgage, contract, agreement or other
instrument with respect to the Center to which BEC is a party which default
would have a material adverse effect on the business or operations of the
Center. The execution, delivery and performance by BEC of this Agreement and the
transactions contemplated hereby will not violate any provision of, or result in
the breach of, or constitute a default under, or require any consent under, any
law, or any order, writ, injunction or decree of any court, governmental agency
or arbitration tribunal, or any material contract, agreement or instrument with
respect to the Center to which BEC is a party or by which BEC is bound.
(b) BEI is not in default under, and no event has occurred which, with
the giving of notice or the passage of time, or both, would result in a default
under, any outstanding indenture, mortgage, contract, agreement or other
instrument with respect to the Center to which BEI is a party which default
would have a material adverse effect on the business or operations of the
Center. The execution, delivery and performance by BEI of this Agreement and the
transactions contemplated hereby will not violate any provision of, or result in
the breach of, or constitute a default under, or require any consent under, any
law, or any order, writ, injunction or decree of any court, governmental agency
or arbitration tribunal, or any material contract, agreement or instrument with
respect to the Center to which BEI is a party or by which BEI is bound.
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Asset Purchase Agreement/Page 5
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4.15. EMPLOYEES; INDEPENDENT CONTRACTORS.
(a) Schedule 4.15(a) sets forth the names and titles of all employees
of Sellers who perform services in or on behalf of the Center, and the annual
rate of compensation (including bonuses) being paid to each such employee as of
the most recent practicable date. The employees listed on Schedule 4.15(a),
constitute all of the employees who are in any way necessary to the continued
operation of the Center as it is now being conducted.
(b) Schedule 4.15(b) hereto contains a list of each employment, bonus,
deferred compensation, pension, stock option, stock appreciation right, profit
sharing or retirement plan, arrangement or practice and each other agreement or
fringe benefit plan, arrangement or practice of BEC or BEI whether formal or
informal, whether legally binding or not and whether affecting one or more of
its employees who perform services in or on behalf of the Center. Copies of each
such agreement or plan have hereto been delivered to AmSurg. Neither Seller has
any commitment, whether formal or informal, and whether legally binding or not
(i) to create any additional such agreement, plan, arrangement or practice; (ii)
to modify or change any such agreement, arrangement, plan or practice; or (iii)
to maintain for any period of time any such agreement, arrangement, plan or
practice, except as described on Schedule 4.15(b).
(c) Schedule 4.15(c) hereto contains a list of all services provided to
the Center for which a Seller contracts with third parties. Copies of each such
agreement previously have been provided to AmSurg. Schedule 4.15(c) contains a
description of each such oral agreement.
(d) BEC sponsors for its employees a profit sharing plan known as the
Boswell Eye Center 401(k) Profit Sharing Plan and Trust (the "BEC Plan") which
will be adopted by the LLC for employees transferred from the Center and
employees hired in the future with regard to the BEC Plan, (i) neither Sellers
nor any trustee, administrator, fiduciary or sponsor of the BEC Plan has engaged
in the prohibited transactions as defined in Section 406 of the Employee
Retirement Income Security Act of 1974 ("ERISA"), or Section 4975 of the
Internal Revenue Code of 1986, as amended (the "Code"), for which there is no
statutory exemption in Section 408 of ERISA or Section 4975 of the Code; (ii)
all filings, reports and descriptions (including Form 5500 Annual Reports,
Summary Plan Descriptions, and Summary Annual Reports) required to have been
made or distributed to participants, the Internal Revenue Service, the United
States Department of Labor and other governmental agencies have been made; (iii)
there is no material litigation, disputed claim, governmental proceeding or
investigation pending or threatened with respect to the BEC Plan, the related
trust, or any fiduciary, trustee, administrator or sponsor of such Plan; (iv)
the BEC Plan has been established, maintained and administered in all material
respects in accordance with its governing documents and application provisions
of ERISA and the Code and Treasury Regulations promulgated thereunder; (v) the
BEC plan is not subject to Title IV of ERISA or the minimum funding requirement
of Section 412 of the Code or Section 302 of ERISA; and (vi) the BEC Plan has
received a favorable determination letter from the Internal Revenue Service
dated November 30, 1993.
4.16. CONSENTS AND APPROVALS. Sellers have obtained such consents, approvals,
authorizations and orders of third parties, including governmental authorities,
necessary for the authorization, execution and performance of this Agreement by
Sellers, which consents, approvals, authorizations and orders are listed on
Schedule 4.16.
4.17. FULL DISCLOSURE.
(a) Neither this Agreement, nor any schedule, exhibit, list,
certificate or other instrument or document delivered to AmSurg pursuant to this
Agreement by or on behalf of BEC, contains any untrue statement of a material
fact or omits to state any material fact required to be stated herein or therein
or necessary to make the statements, representations or warranties and
information contained herein or therein not misleading. BEC has not withheld
from AmSurg disclosure of any event, condition or fact which BEC knows, or has
reasonable grounds to know, may materially adversely affect the Purchased Assets
or the operations of the Center.
(b) Neither this Agreement, nor any schedule, exhibit, list,
certificate or other instrument or document delivered to AmSurg pursuant to this
Agreement by or on behalf of BEI, contains any untrue statement of a material
fact or omits to state any material fact required to be stated herein or therein
or necessary to make the statements, representations or warranties and
information contained herein or therein not misleading. BEI has not withheld
from AmSurg disclosure of any event, condition or fact which BEI knows, or has
reasonable grounds to know, may materially adversely affect the Purchased Assets
or the operations of the Center.
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4.18. NO BROKER'S FEES. Neither Seller has done anything to cause or incur any
liability or obligation for investment banking, brokerage, finder's, agent's or
other fees, commissions, expenses or charges in connection with the negotiation,
preparation, execution or performance of this Agreement or the consummation of
the transactions contemplated hereby, and neither Seller knows of any claim by
anyone for such a fee, commission, expense or charge.
4.19. MEMBERS OF BEC. All of the members of BEC are set forth on Schedule 4.19.
4.20. SHAREHOLDERS OF BEI. All of the shareholders of BEI are set forth on
Schedule 4.20.
ARTICLE 5. REPRESENTATIONS AND WARRANTIES OF THE DOCTORS
Each of the Doctors, severally and not jointly, represents and warrants as
follows:
5.1. AUTHORITY. Such Doctor has full authority to enter into and carry out the
provisions of this Agreement, and this Agreement, when executed, will constitute
a valid and binding legal obligation enforceable against him in accordance with
its terms.
5.2. NO VIOLATION. The execution and delivery of this Agreement by the Doctors
does not, and the consummation of the transactions contemplated hereby will not,
(a) violate any provision of, or result in the creation of any lien or security
interest under, any agreement, indenture, instrument, lease, security agreement,
mortgage or lien to which such Doctor is a party or by which any of such
Doctors's assets or properties are bound; (b) violate any provision of the
articles of organization of Seller; (c) violate any order, arbitration award,
judgment, writ, injunction, decree, statute, rule or regulation applicable to
such Doctor; or (d) violate any other contractual or legal obligation or
restriction to which such Doctor is subject.
5.3. MEMBERS OF BEC. All of the members of BEC are set froth on Schedule 4.19.
5.4. SHAREHOLDERS OF BEI. All of the shareholders of BEI are set forth on
Schedule 4.20.
5.5. RESTRICTIVE COVENANTS; CONFIDENTIALITY. Each Doctor agrees that he will not
be an officer, director or employee or consultant of or have any direct or
indirect ownership interest in, or manage, lease, develop or otherwise have any
financial interest in, or receive any compensation from any business or entity
competing with the LLC within ten (10) miles of the Center until the later of
(a) one (1) year after the Doctor ceases to be a member of Seller or (b) five
(5) years after the Closing Date. The foregoing shall not prohibit the Doctors
from owning shares of capital stock constituting less than 1% of the outstanding
capital stock of any corporation whose common stock is traded on a national
securities exchange or on The Nasdaq Stock Market. The Doctors recognize and
acknowledge that the ascertainment of damages in the event of a breach of this
Section 5.5 would be difficult, and agree that AmSurg, in addition to all other
remedies it may have, shall have the right to injunctive relief if there is such
a breach.
Notwithstanding the foregoing, the parties acknowledge and agree that Section
5.5 does not require the Doctors to perform ambulatory procedures at the Center
or to refer patients to the Center, and imposes no restrictions on where such
procedures are performed or where referrals are made. Also, notwithstanding the
foregoing, the parties agree that Section 5.5 does not prohibit (a) Gerald B.
Walman, M.D., from owning an interest in the Scottsdale Eye Surgery Center,
P.C., Phoenix Eye Surgical Center, P.L.C., or Osborn Ambulatory Surgical Center,
Ltd. limited partnership and their successors or assigns or (b) Emilio M. Justo,
M.D., from performing cosmetic-only medical procedures in a licensed center in
which he owns an interest.
5.6. NO BROKER'S FEES. Such Doctor has not done anything to cause or incur any
liability or obligation for investment banking, brokerage, finder's, agent's or
other fees, commissions, expenses or charges in connection with the negotiation,
preparation, execution or performance of this agreement or the consummation of
the transactions contemplated hereby, and Doctor does not know of any claim by
anyone for such a fee, commission, expense or charge.
ARTICLE 6. REPRESENTATIONS AND WARRANTIES OF AMSURG
AmSurg represents and warrants as follows:
6.1. ORGANIZATION. AmSurg is a corporation duly organized, validly existing and
in good standing under the laws of the state of Tennessee. AmSurg has full
corporate power and corporate authority to carry on its business as
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Asset Purchase Agreement/Page 7
<PAGE> 8
now conducted and to own, lease or operate its properties and assets as now
owned, leased or operated.
6.2. AUTHORIZATION. AmSurg has full corporate power and corporate authority to
enter into this Agreement and perform its obligations hereunder and carry out
the transactions contemplated hereby. The execution, delivery and performance by
AmSurg of this Agreement and the consummation of the transactions contemplated
hereby have been duly authorized and approved by all necessary corporate action.
This Agreement, when executed, will constitute a legal, valid and binding
obligation of AmSurg enforceable against it in accordance with its terms.
6.3. NO VIOLATION. The execution and delivery of this Agreement by AmSurg does
not, and the consummation of the transactions contemplated hereby will not, (a)
violate any provision of, or result in the creation of any lien or security
interest under, any material agreement, indenture, instrument, lease, security
agreement, mortgage or lien to which AmSurg is a party or by which any of
AmSurg's assets or properties are bound which violation or lien would have a
material adverse effect on the business or operations of AmSurg; (b) violate any
provision of the Charter or Bylaws of AmSurg; (c) violate any order, arbitration
award, judgment, writ, injunction, decree, statute, rule or regulation
applicable to AmSurg which violation would have a material adverse effect on the
business or operations of AmSurg; or (d) violate any other contractual or legal
obligation or restriction to which AmSurg is subject which violation would have
a material adverse effect on the business or operations of AmSurg.
6.4. TAXES. AmSurg has filed all federal, state and local tax returns required
to be filed by it through the date hereof (or has obtained an extension for such
filing) and has paid all taxes and assessments (including without limitation
income, excise, unemployment, social security, occupation, franchise, property,
sales and use taxes, import duties or charges, and all penalties and interest in
respect thereof) due and payable therefrom. AmSurg has not signed any extension
agreement with any taxing authority and knows of no open or questionable matters
for any prior periods.
6.5. LITIGATION. There is no claim, litigation, investigation or proceeding
pending or, to AmSurg's knowledge, threatened against AmSurg at law or in equity
or before any court, legislative or administrative tribunal or governmental
agency which questions the validity of this Agreement or which, if adversely
determined or publicly disclosed, would have a material adverse effect on the
business or operations of AmSurg.
6.6. COMPLIANCE WITH LAW AND OTHER REGULATIONS. AmSurg is in compliance in all
material respects with all requirements of applicable Laws. AmSurg possesses all
required licenses, permits, certificates, and authorizations needed for the
conduct of its business as presently conducted the failure of which to have
would have a material adverse effect on the business or operations of AmSurg.
AmSurg knows of no act or omission occurring on or before the date hereof which
would subject AmSurg to the likelihood of any material fine or suspension of any
material license, permit, certificate or authorization.
6.7. REPORTS AND RETURNS. AmSurg has filed all material reports and returns
heretofore required by federal, state or municipal authorities and all material
reports and returns to the various governmental authorities which control,
directly or indirectly, any of its activities, and has paid all sums heretofore
due with respect to such reports and returns.
6.8. DEFAULTS. AmSurg is not in default under, and no event has occurred which,
with the giving of notice or the passage of time, or both, would result in a
default under, any outstanding indenture, mortgage, contract or agreement to
which AmSurg is a party, which default would have a material adverse effect on
the business or operations of AmSurg.
The execution, delivery and performance by AmSurg of this Agreement and the
transactions contemplated hereby will not violate any provision of, or result in
the breach of, or constitute a default under, or require any consent under, any
law, or any order, writ, injunction or decree of any court, governmental agency
or arbitration tribunal, or any material contract, agreement or instrument to
which AmSurg is a party or by which AmSurg is bound.
6.9. CORPORATE DOCUMENTS. AmSurg has made available to Seller and the Doctors
for inspection by Seller and its authorized representatives, a copy of its
Charter, as amended to the date hereof, certified to be a true and correct copy
thereof by the Secretary of State of Tennessee, and the minute books of AmSurg
containing the bylaws and all records of the proceedings, meeting, actions and
consents of the shareholders and the board of directors (and any committees
thereof) of AmSurg.
6.10. FULL DISCLOSURE. Neither this Agreement, nor any Schedule, exhibit, list,
certificate or other instrument
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Asset Purchase Agreement/Page 8
<PAGE> 9
or document delivered to Seller and the Doctors pursuant to this Agreement by or
on behalf of AmSurg contains any untrue statement of a material fact or omits to
state any material fact required to be stated herein or therein in order to make
the statements, representations or warranties contained herein or therein not
misleading.
6.11. NO BROKER'S FEES. AmSurg has not done anything to cause or incur any
liability or obligation for investment banking, brokerage, finder's, agent's or
other fees, commissions, expenses or charges in connection with the negotiation,
preparation, execution or performance of this Agreement or the consummation of
the transactions contemplated hereby, and AmSurg does not know of any claim by
anyone for such a fee, commission, expense or charge.
ARTICLE 7. COVENANTS AND AGREEMENTS OF SELLERS AND THE DOCTORS
Sellers and the Doctors further covenant and agree that from the date hereof
until the Closing, and thereafter if so specified, they will fulfill the
following covenants and agreements unless otherwise consented to by AmSurg in
writing:
7.1. ACCESS; FURTHER ASSURANCES.
(a) Sellers will accord to AmSurg, its counsel, accountants, and other
representatives, from the date hereof and at any time after the Closing, full
access to all of the properties, books, contracts, commitments, financial
information and records of the Center, and will furnish AmSurg during such
period with all such information concerning the business and operations of the
Center, as AmSurg reasonably may request. At any time and from time to time
after the Closing, at AmSurg's request and without further consideration,
Sellers and the Doctors agree to execute and deliver such certificates and
documents as may be required in connection with any audit of the Center or its
operations.
(b) From the date hereof until the Closing, as soon as reasonably
practicable after the end of each quarter, but not later than the 15th day of
the next succeeding month, Sellers will deliver to AmSurg an unaudited statement
of income for the Center for the quarter and the period then ended, and an
unaudited balance sheet and a detail of patient accounts receivable for the
Center as at the quarter then ended ("Ongoing Quarterly Financial Information").
In addition, as soon as reasonably practicable after the end of each month, but
not later than the 15th day of the next succeeding month, Sellers will deliver
to AmSurg a statement of (i) the number of procedures performed, (ii) the billed
charges, and (iii) the cash collections, all with respect to the prior month
("Ongoing Monthly Financial Information") (the Ongoing Quarterly Financial
Information and the Ongoing Monthly Financial Information are collectively
referred to as the "Ongoing Financial Information"). All such Ongoing Financial
Information shall be prepared in accordance with generally accepted accounting
principles consistent with prior practice.
(c) At any time and from time to time after the Closing, at AmSurg's
request and without further consideration, Sellers will execute and deliver such
other instruments of sale, transfer, conveyance, assignment and delivery and
confirmation and take such action as AmSurg may reasonably deem necessary or
desirable in order more effectively to transfer, convey and assign to AmSurg and
to place AmSurg in possession and control of and to confirm AmSurg's title to,
the Purchased Assets, and to assist AmSurg in exercising all rights and enjoying
all benefits with respect thereto.
(d) At any time and from time to time after the Closing, at AmSurg's
request and without further consideration, the Doctors will execute and deliver
such other instruments of sale, transfer, conveyance, assignment and delivery
and confirmation and take such action as AmSurg may reasonably deem necessary or
desirable in order more effectively to transfer, convey and assign to AmSurg and
to place AmSurg in possession and control of and to confirm AmSurg's title to,
the Purchased Assets, and to assist AmSurg in exercising all rights and enjoying
all benefits with respect thereto.
7.2. CONFIDENTIALITY.
(a) In the event the transactions contemplated by this Agreement are
not consummated for any reason, Sellers and the Doctors promptly will return to
AmSurg all records and information provided to Sellers from AmSurg and Sellers
and the Doctors will treat all such records and information as confidential.
(b) Except as otherwise required by law, Sellers and the Doctors will
not disclose at any time to any other person not an employee of AmSurg or Seller
(or a person otherwise involved in the carrying out of the transactions
contemplated by this Agreement), nor make
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Asset Purchase Agreement/Page 9
<PAGE> 10
any public announcement of, the transactions or terms of the transactions
contemplated by this Agreement.
7.3. CONDUCT OF BUSINESS PENDING THE CLOSING. From the date hereof until the
Closing, and except as otherwise consented to by AmSurg in writing, Sellers
shall not:
(a) fail to maintain in effect adequate insurance coverage of the
Purchased Assets; or
(b) fail to use their best efforts to (i) maintain the Purchased Assets
in their present condition, (ii) comply with all applicable laws, rules and
regulations of governmental agencies or authorities, and (iii) operate its
business in the manner necessary to maintain the good will of its patients and
physicians and its reputation.
7.4. INSURANCE. Sellers will use their best efforts to include AmSurg and the
LLC as additional insureds on Sellers' professional liability, general property
and workers' compensation insurance policies, and will provide AmSurg with
written evidence of such coverage. AmSurg will pay the additional cost, if any,
for such insurance coverage.
7.5. TRANSFER OF SIGNIFICANT PAYOR AGREEMENTS. Sellers and the Doctors will take
all action necessary in order to effect the valid assignment to the LLC of all
agreements with Significant Payors effective as of the Closing Date or within a
reasonable time thereafter.
7.6. NOTICE OF ADVERSE CHANGE. Sellers will advise AmSurg in writing of any
material adverse change in the Purchased Assets from the date of this Agreement
to the Closing Date.
7.7. SCHEDULES. Sellers shall have the continuing obligation to supplement or
amend promptly the Schedules being delivered by either Seller pursuant to this
Agreement with respect to any matter hereafter arising or discovered which, if
existing or known at the date of this Agreement, would have been required to be
set forth or described in these Schedules.
ARTICLE 8. COVENANTS AND AGREEMENTS OF AMSURG
AmSurg further covenants and agrees that from the date hereof until the Closing,
unless otherwise consented to by Sellers in writing, it will fulfill the
following covenants and agreements:
8.1. CONFIDENTIALITY.
(a) In the event the transactions contemplated by this Agreement are
not consummated for any reason, AmSurg promptly will return to Sellers all
records and information provided to AmSurg from Sellers, and AmSurg will treat
all such records and information as confidential.
(b) Except as otherwise required by law, AmSurg will not disclose at
any time to any other person not an employee of AmSurg or Sellers (or a person
otherwise involved in the carrying out of the transactions contemplated by this
Agreement), nor make any public announcement of, the transactions or terms of
the transactions contemplated by this Agreement.
8.2. NOTICE OF ADVERSE CHANGE. AmSurg will notify Sellers and the Doctors in
writing of any material adverse change in the business, assets, operations,
conditions or prospects of AmSurg, as the case may be, from the date of this
Agreement to the Closing Date.
8.3. SCHEDULES. AmSurg shall have the continuing obligation to supplement or
amend promptly the Schedules being delivered by AmSurg pursuant to this
Agreement with respect to any matter hereafter arising or discovered which, if
existing or known at the date of this Agreement, would have been required to be
set forth or described in these Schedules.
ARTICLE 9. CONDITIONS TO AMSURG'S OBLIGATIONS
AmSurg shall not be obligated to consummate the transactions contemplated
hereby, unless each of the following conditions is fulfilled or performed
(unless expressly waived in writing by AmSurg) prior to or at the Closing:
9.1. COMPLIANCE. The representations and warranties made by Sellers and the
Doctors in this Agreement and the statements contained in the Schedules attached
hereto or in any instrument, list, certificate or writing delivered by a
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Asset Purchase Agreement/Page 10
<PAGE> 11
Seller or the Doctors pursuant to this Agreement shall be true when made and at
and as of the time of the Closing as though such representations and warranties
were made at and as of the Closing.
9.2. PERFORMANCE BY SELLERS AND THE DOCTORS. Sellers and the Doctors shall have
performed and complied with all covenants, agreements, obligations and
conditions required by this Agreement to be so complied with or performed by
each of them.
9.3. CERTIFICATE OF SELLERS. Each Seller shall have delivered to AmSurg a
certificate, dated the Closing Date, certifying as to the fulfillment by Sellers
of the conditions specified in Sections 9.1 and 9.2 hereof.
9.4. CERTIFICATE OF DOCTORS. Each of the Doctors shall have delivered to AmSurg
a certificate, dated the Closing Date, certifying as to the fulfillment by such
Doctor of the conditions specified in Sections 10.1 and 10.2 hereof.
9.5. CONSENTS AND LICENSES. All necessary consents, licenses, permits,
approvals, authorizations, orders and agreements from federal, state and local
governmental units and any other entity which are listed on Schedule 4.16,
including approval by the Arizona Department of Health and by applicable
Medicare and state Medicaid agencies, for the continued operation and
third-party reimbursement of the Center by the LLC following the consummation of
the transactions contemplated hereby, shall have been issued to the LLC or
notice of issuance shall have been provided.
9.6. OPINION OF COUNSEL. AmSurg shall have been furnished with the opinion of
Plattner, Schneidman & Schneider, P.C., counsel to Sellers and the Doctors, in
substantially the form of Exhibit 9.6.
9.7. LEASE. The LLC shall have entered into a lease agreement with Sun Health
Properties, Inc. satisfactory to AmSurg with respect to that certain medical
office complex in Sun City, Arizona.
9.8. SIGNIFICANT PAYOR AGREEMENTS. All of the Significant Payor agreements shall
have been validly assigned to the LLC and AmSurg shall have no reason to believe
that any such agreement with a Significant Payor will not be approved or that
such Significant Payor will not execute a new agreement with the LLC on terms
reasonably acceptable to AmSurg.
9.9. APPROVAL.
(a) All of the members of BEC shall have approved the transactions
contemplated by this Agreement, and BEC shall have furnished AmSurg with a
certificate of the Chief Manager of BEC evidencing such approval.
(b) All of the shareholders of BEI shall have approved the transactions
contemplated by this Agreement, and BEI shall have furnished AmSurg with a
certificate of the Secretary of BEI evidencing such approval.
9.10. FORM 8594. AmSurg initially will allocate the Purchase Price using the
methodology reflected on Exhibit 9.10. In the course of completing AmSurg's
consolidated federal income tax return, AmSurg shall provide Sellers with an IRS
Form 8594.
ARTICLE 10. CONDITIONS TO SELLERS' AND THE DOCTORS' OBLIGATIONS
Sellers and the Doctors shall not be obligated to consummate the transactions
contemplated hereby unless each of the following conditions is fulfilled or
performed (unless expressly waived in writing by Sellers) prior to or at the
Closing:
10.1. COMPLIANCE. The representations and warranties made by AmSurg in this
Agreement and the statements contained in the Schedules attached hereto or in
any instrument, list, certificate or writing delivered by AmSurg pursuant to
this Agreement shall be true when made and at and as of the time of the Closing
as though such representations and warranties were made at and as of the
Closing.
10.2. PERFORMANCE BY AMSURG AmSurg shall have performed and complied with all
agreements, obligations and conditions required by this Agreement to be so
complied with or performed by AmSurg.
10.3. CERTIFICATE OF AMSURG. AmSurg shall have delivered to Sellers and the
Doctors a certificate, dated the Closing Date, certifying as to the fulfillment
of the conditions specified in Sections 10.1 and 10.2 hereof.
10.4. OPINION OF COUNSEL. Sellers and the Doctors shall have been furnished the
opinion of Bass, Berry & Sims PLC, counsel to AmSurg, in substantially the form
of Exhibit 10.4.
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Asset Purchase Agreement/Page 11
<PAGE> 12
10.5. LEASE. The LLC shall have entered into a lease agreement with Sun Health
Properties, Inc. satisfactory to Seller with respect to that certain medical
office complex in Sun City, Arizona.
ARTICLE 11. INDEMNIFICATION
11.1. INDEMNIFICATION BY SELLERS AND THE DOCTORS. Sellers and the Doctors,
jointly and severally, hereby agree to defend, indemnify and hold harmless
AmSurg and shall reimburse AmSurg for, from and against each claim, loss,
liability, cost and expense (including without limitation, interest, penalties,
costs of preparation and investigation, and the reasonable fees, disbursements
and expenses of attorneys, accountants and other professional advisors)
(collectively, "Losses"), directly or indirectly relating to, resulting from or
arising out of:
(a) Any untrue representation, misrepresentation, breach of warranty or
nonfulfillment of any covenant, agreement or other obligation by or of a Seller
or any Doctor contained herein, any Schedule hereto or in any certificate,
document or instrument delivered to AmSurg pursuant hereto.
(b) Any tax liability of a Seller or the Center not previously paid,
which may at any time be asserted or assessed against a Seller or the Center for
any event or period prior to the Closing Date (regardless of whether the
possibility of the assertion or assessment of any such tax liability shall have
been disclosed to AmSurg at or prior to the Closing).
(c) Liability for any amounts owed by a Seller or the Center to any
governmental third party or private payors because of overpayments to a Seller
or the Center prior to the Closing for services rendered to patients, which
liability is due to a recomputation of rates, field audit adjustments,
overpayments or otherwise.
(d) Any other Loss incidental to any of the foregoing.
11.2. INDEMNIFICATION BY AMSURG. AmSurg hereby agrees to defend, indemnify and
hold harmless Sellers and the Doctors, and shall reimburse Sellers and the
Doctors for, from and against Losses directly or indirectly relating to,
resulting from or arising out of:
(a) Any untrue representation, misrepresentation, breach of warranty or
nonfulfillment of any covenant, agreement or other obligation by AmSurg, as the
case may be, contained herein or in any certificate, document or instrument
delivered to Sellers and the Doctors pursuant hereto.
(b) Any other Loss incidental to the foregoing.
11.3. PROCEDURE.
(a) The indemnified party shall promptly notify the indemnifying party
of any claim, demand, action or proceeding for which indemnification will be
sought under Sections 11.1 or 11.2 of this Agreement, and, if such claim,
demand, action or proceeding is a third party claim, demand, action or
proceeding, the indemnifying party will have the right at its expense to assume
the defense thereof using counsel reasonably acceptable to the indemnified
party. The indemnified party shall have the right to participate, at its own
expense, with respect to any such third party claim, demand, action or
proceeding. In connection with any such third party claim, demand, action or
proceeding, AmSurg, Sellers and the Doctors shall cooperate with each other and
provide each other with access to relevant books and records in their
possession. No such third party claim, demand, action or proceeding shall be
settled without the prior written consent of the indemnified party. If a firm
written offer is made to settle any such third party claim, demand, action or
proceeding and the indemnifying party proposes to accept such settlement and the
indemnified party refuses to consent to such settlement, then: (i) the
indemnifying party shall be excused from, and the indemnified party shall be
solely responsible for, all further defense of such third party claim, demand,
action or proceeding; and (ii) the maximum liability of the indemnifying party
relating to such third party claim, demand, action or proceeding shall be the
amount of the proposed settlement if the amount thereafter recovered from the
indemnified party on such third party claim, demand, action or proceeding is
greater than the amount of the proposed settlement.
(b) Any claim of indemnity of AmSurg against BEC and/or BEI with
respect to Section 11.1 hereof may in AmSurg's discretion be discharged by
setoff against any amounts owed or owing to BEC or any affiliate thereof under
the Operating Agreement between BEC and AmSurg.
(c) Notwithstanding the foregoing, no Doctor shall be required to
indemnify AmSurg for any
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Asset Purchase Agreement/Page 12
<PAGE> 13
amount in excess of his pro rata portion of the Purchase Price.
(d) Notwithstanding the foregoing, Sellers and the Doctors shall not be
obligated to make any indemnification under Section 11.1 unless the aggregate
amount of Losses exceeds $10,000 (the "Basket"), and such indemnification with
respect to such Losses shall be made by Sellers and the Doctors only to the
extent of such excess over the Basket.
ARTICLE 12. SURVIVAL OF REPRESENTATIONS AND WARRANTIES
12.1. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties contained herein shall survive the Closing Date and any investigation
made by or on behalf of any party hereto, and shall survive for a period of 24
months after the Closing Date (except for any Losses described in Section
11.1(b), which shall survive for the applicable statute of limitations,
including any waivers thereof, Section 11.1(c), which shall not terminate, and
any breach of the representations and warranties contained in Sections 4.6 and
4.9 with respect to professional malpractice claims arising before the Closing
Date, which shall not terminate).
In addition, in the event that all of the LLC and AmSurg, or their successors or
assigns, dissolves, liquidates or otherwise ceases to exist, the provisions of
Section 5.5 hereof shall terminate and be of no further force or effect.
12.2. REMEDIES CUMULATIVE. The remedies provided herein shall be cumulative and
shall not preclude the assertion by any party hereto of any other rights or the
seeking of any other remedies against the other party hereto.
ARTICLE 13. TERMINATION OF AGREEMENT
This Agreement may be terminated at any time prior to the Closing:
(a) by mutual agreement of Sellers and AmSurg;
(b) by AmSurg, if there has been a material violation or breach by a
Seller or the Doctors of any of the agreements, representations or warranties
contained in this Agreement which has not been waived in writing, or if any of
the conditions set forth in Article 9 hereof have not been satisfied by the
Closing or have not been waived in writing by AmSurg;
(c) by Sellers, if there has been a material violation or breach by
AmSurg of any of the agreements, representations or warranties contained in this
Agreement which has not been waived in writing, or if any of the conditions set
forth in Article 10 hereof have not been satisfied by the Closing or have not
been waived in writing by Seller;
(d) By either AmSurg or Sellers if the transactions contemplated by
this Agreement shall not have been consummated on or before April ___, 1998; or
(e) By either AmSurg or Sellers if the other makes an assignment for
the benefit of creditors, files a voluntary petition in bankruptcy or seeks or
consents to any reorganization or similar relief under any present or future
bankruptcy act or similar law, or is adjudicated a bankrupt or insolvent, or if
a third party commences any bankruptcy, insolvency, reorganization or similar
proceeding involving the other.
ARTICLE 14. MISCELLANEOUS
14.1. EXPENSES. All fees and expenses incurred by Sellers and the Doctors,
including without limitation, legal fees and expenses, in connection with this
Agreement will be borne by Sellers and the Doctors and all fees and expenses
incurred by AmSurg, including without limitation, legal fees and expenses, in
connection with this Agreement will be borne by AmSurg.
14.2. ASSIGNABILITY; PARTIES IN INTEREST.
(a) AmSurg may assign any or all of its rights hereunder to any
affiliate or any direct or indirect subsidiary of AmSurg, and AmSurg shall
advise Sellers of any such assignment and shall designate such party as the
assignee and transferee of the Purchased Assets. Any such assignee shall assume
all of AmSurg's duties, obligations and undertakings hereunder.
(b) Sellers and the Doctors may not assign, transfer or otherwise
dispose of any of their respective rights hereunder without the prior written
consent of AmSurg.
(c) All the terms and provisions of this Agreement shall be binding
upon, shall inure to the benefit of and shall be enforceable by the respective
heirs,
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Asset Purchase Agreement/Page 13
<PAGE> 14
successors, assigns and legal or personal representatives of the parties hereto.
14.3. ENTIRE AGREEMENT; AMENDMENTS. This Agreement, including the exhibits,
Schedules, lists and other documents and writings referred to herein or
delivered pursuant hereto, which form a part hereof, contains the entire
understanding of the parties with respect to its subject matter. There are no
restrictions, agreements, promises, warranties, covenants or undertakings other
than those expressly set forth herein or therein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to its
subject matter. This Agreement may be amended only by a written instrument duly
executed by all parties or their respective heirs, successors, assigns or legal
personal representatives. Any condition to a party's obligations hereunder may
be waived but only by a written instrument signed by the party entitled to the
benefits thereof. The failure or delay of any party at any time or times to
require performance of any provision or to exercise its rights with respect to
any provision hereof, shall in no manner operate as a waiver of or affect such
party's right at a later time to enforce the same.
14.4. SEVERABILITY. The invalidity of any term or terms of this Agreement shall
not affect any other term of this Agreement, which shall remain in full force
and effect.
14.5. NOTICES. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered or mailed (registered or certified mail, postage prepaid, return
receipt requested or by overnight courier service) as follows:
If to Sellers:
Boswell Eye Center, L.L.C.
10541 Thunderbird Boulevard
Sun City, Arizona 85351
Attn:________________
and
Boswell Eye Institute, Inc.
10541 Thunderbird Boulevard
Sun City, Arizona 85351
Attn:________________
with copies to:
Plattner, Schneidman & Schneider, P.C.
1707 East Highland, Suite 190
Phoenix, Arizona 85016
Attn: Leslie A. Plattner, Esq.
If to AmSurg:
AmSurg Holdings, Inc.
One Burton Hills Boulevard
Suite 350
Nashville, TN 37215
Attn: Claire M. Gulmi
with a copy to:
Bass, Berry & Sims PLC
First American Center
Nashville, TN 37238
Attn: Cynthia Y. Reisz, Esq.
or to such other address as any party may have furnished to the others in
writing in accordance herewith, except that notices of change of address shall
only be effective upon receipt.
14.6. SECTION AND OTHER HEADINGS. The section and other headings contained in
this Agreement are for reference purposes only and shall not in any way affect
the meaning or interpretation of this Agreement.
14.7. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, provided, however, that
the several executed counterparts shall together have been signed by AmSurg,
Sellers and each of the Doctors. All of such executed counterparts shall
constitute one and the same instrument.
14.8. PARTIES IN INTEREST. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, executors,
administrators, successors and assigns. The parties acknowledge that they have
independently negotiated the provisions of this Agreement, that they have relied
upon their own counsel as to matters of law and application and that neither
party has relied on the other party with regard to such matters. The parties
expressly agree that there shall be no presumption created as a result of either
party having prepared in whole or in part any provisions of this Agreement.
14.9. APPLICABLE LAW. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of Tennessee, without regard
to its conflict of laws rules.
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Asset Purchase Agreement/Page 14
<PAGE> 15
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
first above written.
AMSURG HOLDINGS, INC.
By: /s/ Claire M. Gulmi
-------------------------------------------
Title: Chief Financial Officer
---------------------------------------
BOSWELL EYE CENTER, L.L.C.
By: /s/ Charles J. Hofer, M.D.
------------------------------------------
Title: President
----------------------------------------
BOSWELL EYE INSTITUTE, INC.
By: /s/ Charles J. Hofer, M.D.
------------------------------------------
Title: President
----------------------------------------
By their execution of this Agreement, the Doctors hereby consent to the
execution hereof by Sellers and agree to be bound by the provisions of Section
5.5 hereof:
DOCTORS:
/s/ Kenneth A. Batko, M.D.
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Kenneth A. Batko, M.D.
/s/ Ronald S. Garlikov, M.D.
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Ronald S. Garlikov, M.D.
/s/ Richard A. Hess, M.D.
- ----------------------------------------------
Richard A. Hess, M.D.
/s/ Charles J. Hofer, M.D.
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Charles J. Hofer, M.D.
/s/ Emilio M. Justo, M.D.
- ----------------------------------------------
Emilio M. Justo, M.D.
/s/ Alan H. Manas, M.D.
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Alan H. Manas, M.D.
/s/Robert Rubenzik, M.D.
- ----------------------------------------------
Robert Rubenzik, M.D.
/s/ Errol R. Sweet, M.D.
- ----------------------------------------------
Errol R. Sweet, M.D.
/s/ Gerald B. Walman, M.D.
- ----------------------------------------------
Gerald B. Walman, M.D.
Schedules described in the asset purchase agreement have been omitted. The
Company agrees to provide such schedules supplementally to the Securities and
Exchange Commission upon request.
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Asset Purchase Agreement/Page 15
