<PAGE>
As filed with the Securities and Exchange Commission on March 11, 1998
Registration No. 333-____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
____________________________________
FORM S-3
Registration Statement
Under the Securities Act of 1933
______________________________
AMEDISYS, INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 8082 11-3131700
(State or other jurisdiction (Primary Standard (I.R.S. Employer
of incorporation or Industrial Classification Identification Number)
organization) Code Number)
3029 S. SHERWOOD FOREST BLVD. WILLIAM F. BORNE,
SUITE 300 CHIEF EXECUTIVE OFFICER
BATON ROUGE, LOUISIANA 70816 AMEDISYS, INC.
(504)292-2031 3029 S. SHERWOOD FOREST BLVD.
(Address, including zip code, and SUITE 300
telephone number, including BATON ROUGE, LOUISIANA 70816
area code, of registrant's (504)292-2031
principal executive offices) (Name, address, including zip code,
and telephone number, including
area code, of agent for service)
Copy To:
THOMAS C. PRITCHARD
BREWER & PRITCHARD, P.C.
1111 BAGBY, SUITE 2450
HOUSTON, TEXAS 77002
PHONE (713) 659-1744
____________________________
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of earlier effective
registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
number of the earlier effective registration statement for the same offering.
[_]
If the delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [_]
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
===========================================================================================================
Title of Each Class of Amount Proposed Proposed
Securities To Be Being Maximum Maximum Amount of
Registered Registered/(1)/ Offering Price Aggregate Registration
- -----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Resale of Shares Underlying Preferred Stock 1,621,622 $3.9375 $6,385,136.60 $1,934.70
- -----------------------------------------------------------------------------------------------------------
Resale of Share Underlying Warrants 113,514 $3.9375 $ 446,961.37 $ 135.43
===========================================================================================================
TOTAL 1,735,136 $3.9375 $6,832,098.00 $2,070.13
===========================================================================================================
</TABLE>
(1) Pursuant to Rule 416(a), this Registration Statement also covers an
indeterminate number of shares of Common Stock issuable pursuant to
adjustment provisions of the Preferred Stock Designation and the Warrant
Agreement.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c), based on prices the average of the high and low
sale for the Common Stock, as reported by Nasdaq on March 9, 1998, or
$3.9375 per share.
____________________________
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE>
AMEDISYS, INC.
RESALE OF 1,735,136 SHARES COMMON STOCK
This Prospectus relates to the resale of 1,735,136 shares of common
stock, par value $.001 per share (the "Common Stock"), of Amedisys, Inc., a
Delaware corporation (the "Company"), which shares shall be offered from time to
time by certain stockholders of the Company (the "Selling Stockholders"). These
shares relate to the Company's private placement of its Series A Convertible
Preferred Stock, par value $.001 per share (the "Preferred Stock"), that was
completed on March 3, 1998 (the "Private Placement"). The 750,000 shares of
Preferred Stock sold in the Private Placement are currently convertible into
1,621,622 shares of Common Stock, subject to adjustment, (the "Conversion
Shares"). In addition, the placement agent in the Private Placement received
warrants to purchase 52,500 shares of Preferred Stock (the "Placement Agent
Warrants") which are currently convertible into 113,514 shares of Common Stock
(the "Placement Agent Shares"). In connection with the Private Placement the
Company agreed to register the resale of the Conversion Shares and the Placement
Agent Shares (herein collectively referred to as the "Shares").
Pursuant to this Prospectus, the Shares may be offered by the Selling
Stockholders, or by certain pledgees, donees, transferees or other successors in
interest to the Selling Stockholders, from time to time on the Nasdaq National
Market, in privately negotiated transactions, or by a combination of such
methods of sale, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices relating to such prevailing market
prices or at negotiated prices. The Selling Stockholders may effect such
transactions by selling the Shares to or through broker-dealers, and such
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from the Selling Stockholders or the purchasers of the Shares for
whom such broker-dealers may act as agent or to whom they sell as principal or
both (which compensation to a particular broker-dealer may be in excess of
customary commissions). See "Selling Stockholders" and "Plan of Distribution."
Other methods by which the Shares may be sold include, without
limitation: (i) transactions which include cross or block trades or any other
transaction permitted by the Nasdaq National Market, (ii) "at the market" to or
through market makers or into an existing market for the Common Stock, (iii) in
other ways not involving market makers or established trading markets, including
direct sales to purchasers or sales effected through agents, (iv) through
transactions in options or swaps of other derivatives (whether exchange-listed
or otherwise), (v) through short sales, or (vi) any combination of any such
methods of sale. The Selling Stockholders may also enter into option or other
transactions with broker-dealers which require the delivery to such broker-
dealers of the Common Stock offered hereby, which Common Stock such broker-
dealers may resell pursuant to this Prospectus.
None of the proceeds from the sale of the Shares by the Selling
Stockholders will be received by the Company. However, the Company will receive
up to $570,500 upon the exercise of the Placement Agent Warrants. The Company
has agreed to bear certain expenses (other than any underwriting discounts and
selling commissions and any fees and disbursements of counsel for the Selling
Stockholders not specifically provided for by the parties), estimated to be
approximately $20,000, in connection with the registration and sale of the
Shares being offered by the Selling Stockholders. Pursuant to the registration
rights agreements with the Selling Stockholders, the Company has agreed to
indemnify the Selling Stockholders against certain liabilities, including
certain liabilities under the Securities Act of 1933, as amended (the "Act") or
will contribute to payments such Selling Stockholders or underwriters may be
required to make in respect of certain losses, claims, damages or liabilities.
The shares of Common Stock are quoted on the Nasdaq National Market
under the symbol "AMED." On March 9, 1998, the last reported sales price of the
Common Stock was $4.00 per share.
______________________________
AN INVESTMENT IN THE SECURITIES OFFERED HEREBY INVOLVES
A HIGH DEGREE OF RISK. SEE "RISK FACTORS" ON PAGE 5.
______________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
___________________
The date of this Prospectus is March 11, 1998
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
TABLE OF CONTENTS
PAGE
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Available Information 2
Incorporation of Certain Documents by Reference 3
The Company 3
Risk Factors 5
Selling Stockholders 9
Plan of Distribution 10
Legal Matters 10
Experts 10
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY. THE PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL
OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES IN ANY CIRCUMSTANCES IN
WHICH SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE
ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE BUSINESS OR AFFAIRS OF THE
COMPANY SINCE THE DATE HEREOF OR THAT THE INFORMATION IN THE PROSPECTUS IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE AS OF WHICH SUCH INFORMATION IS
FURNISHED.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "SEC"). Such reports, proxy statements
and other information are available for inspection and copying at the Public
Reference Room of the SEC, 450 Fifth Street, N.W., Judiciary Plaza, Washington,
D.C. 20549; and at the Regional Offices of the SEC located at 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661; and at 7 World Trade Center, New
York, New York 10048. Copies of such material may be obtained from the Public
Reference Section of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549,
at prescribed rates. The Commission maintains a Web site on the Internet that
contains reports, proxy and information statements and other information
regarding issuers that file electronically with the Commission. The address of
the site is http://www.sec.gov. Visitors to the site may access such
information by searching the EDGAR data base on the site.
The Company has filed with the SEC in Washington, D.C. a Registration
Statement on Form S-3 (the "Registration Statement") under the Act with respect
to the securities offered by this Prospectus. Certain of the information
contained in the Registration Statement is omitted from this Prospectus, and
reference is hereby made to the Registration Statement and exhibits and
schedules relating thereto for further information with respect to the Company
and the securities offered by this Prospectus. Statements contained herein
concerning the provisions of any document are not necessarily complete and in
each instance reference is made to the copy of the document filed as an exhibit
or schedule to the Registration Statement. Each such statement is qualified in
its entirety by this reference. The Registration Statement and the exhibits and
schedules thereto are available for inspection at, and copies of such materials
may be obtained upon payment of the fees prescribed therefor by the rules and
regulations of the SEC, from the SEC, Public Reference Section, Judiciary Plaza,
450 Fifth Street, N.W., Washington, D.C. 20549.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the Company with the
Commission are incorporated herein by reference:
1. The Company's Annual Report on Form 10-K for the year ended
December 31, 1996, as amended on Form 10-K/A dated April 16, 1997;
2. the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1997;
3. the Company's Quarterly Report on Form 10-Q for the quarter ended
June 30, 1997;
4. the Company's Proxy Statement dated July 16, 1997 regarding its
Annual Stockholder's Meeting held on August 6, 1997;
5. the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1997, and
6. the Company's Proxy Statement dated January 21, 1998 regarding a
Special Meeting held on February 12, 1998.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and before the
termination of the offering covered hereby will be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing
such documents. Any statement contained in a document incorporated or deemed to
be incorporated by reference in this Prospectus shall be deemed to be modified
or superceded for purposes of this Prospectus to the extent that a statement
contained in this Prospectus or any subsequently filed document that also is or
is deemed to be incorporated by reference modifies or replaces such statement.
The Company will provide, without charge upon oral or written request, to
each person whom this Prospectus is delivered, a copy of any or all of the
documents incorporated by reference, other than exhibits to such documents not
specifically incorporated by reference above. In addition, a copy of the
Company's most recent annual report to stockholders will be promptly furnished,
without charge and on oral or written request, to such persons. Requests for
such documents should be directed to the Company, 3029 South Sherwood Forest
Boulevard, Suite 300, Baton Rouge, Louisiana 70816, attention: Barbara Carey.
THE COMPANY
GENERAL
Amedisys, Inc., a Delaware corporation ("Company"), is a fully integrated
provider of outpatient health services and operates in two basic industry
segments: alternate-site provider services and management services operations.
The Company's alternate-site provider segment includes the following services:
alternate-site infusion therapy, ambulatory surgery centers and home health
care. Its management services operations encompass: home health care management,
software systems, staffing services, and physician support services. The Company
operates 46 offices within a network of wholly owned subsidiaries in the South
and South Eastern United States.
The Company operates through the following subsidiaries: (i) its wholly-
owned subsidiaries Amedisys Staffing Services, Inc.("ASS"), Amedisys Nursing
Services, Inc., Amedisys Specialized Medical Services, Inc. ("ASM"), Amedisys
Surgery Centers, L.C. ("ASC"); Alliance Home Health, Inc., Amedisys Management
Services Organization, Inc.; Amedisys Home Health, Inc., Amedisys, Alternate-
Site Infusion Therapy Services, Inc. ("AASI") Amedisys Durable Medical
Equipment, Inc.; (ii) it's 60%-owned subsidiary Amedisys Physician Services,
Inc., and 54%-owned subsidiary St. Lukes SurgiCenter; and (iii) the wholly-
owned and partially-owned subsidiaries of ASS, ASM, and AASI, being Analytical
Nursing Management Corporation of Texas, a wholly-owned subsidiary of ASS;
MedAmerica, Inc. of Texas and MedAmerica, Inc., each an 80%-owned subsidiary of
ASM, Hammond Surgical Care Center, L.C., a wholly owned subsidiary of ASC and
Infusioncare Solutions, Inc. and PRN, Inc., each wholly-owned subsidiaries of
AASI.
3
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The Company was incorporated as M&N Capital Corp. ("M&N") in October 1992
under the laws of the state of New York. Analytical Nursing Management Corp., a
Louisiana corporation, was formed in December 1992 ("ANMC"). In December 1993,
M&N acquired all of the issued and outstanding shares of common stock of ANMC.
In June 1994, M&N reincorporated in the state of Delaware under the name of
Analytical Nursing Management Corp., and in August 1995, the Company changed its
name to AMEDISYS, INC. References to the Company include references to its
subsidiaries. The Company's principal executive offices are located at 3029
South Sherwood Forest Boulevard, Third Floor, Baton Rouge, Louisiana 70816, and
its telephone number is (504) 292-2031.
RECENT DEVELOPMENTS
In January 1998, the Company acquired all of the issued and outstanding
capital stock of Alliance Home Health, Inc. ("Alliance") in exchange for
194,286 shares of its Common Stock. Of the 194,286 shares of Company Common
Stock issued to Alliance, 122,857 shares were placed in escrow as consideration
for certain contingent liabilities which may be asserted against the former
stockholder of Alliance if such claims are in excess of $500,000 (singularly
and/or in aggregate). The escrow period shall terminate no later than December
31, 2003. The majority stockholder of Alliance entered into a three year
employment agreement and two year non-competition and non-solicitation agreement
with the Company. The acquisition of Alliance was not deemed to be
"significant." Accordingly, the financial statements of Alliance will be
consolidated with the Company's financial statements, and separate financial
statements in a Current Report on Form 8-K were not filed with the SEC.
Alliance is a home health business located in Tulsa, Oklahoma.
In February 1998, the Company acquired all of the issued and outstanding
capital stock of PRN, Inc. d/b/a/ Home IV Therapy ("PRN") in exchange for
$430,000. The Company has agreed to pay additional consideration of up to
$150,000 upon PRN reaching certain revenue goals ("Additional Consideration").
The Company has retained the right to offset certain indemnifiable liabilities
against the Additional Consideration. The two majority stockholders of PRN
entered into a two year non-competition and non-solicitation agreements with the
Company. The acquisition of PRN was not deemed to be "significant," accordingly
the financial statements of PRN will be consolidated with the Company's
financial statements and separate financial statements in a Current Report on
Form 8-K will not be filed with the SEC. PRN is a home infusion pharmacy
business, which is based in San Antonio, Texas.
In February 1998, the Company acquired all of the issued and outstanding
capital stock of Infusioncare Solutions, Inc.("ICS") in exchange for aggregate
consideration of $520,000, of which $395,000 was payable in cash at closing and
$125,000 was payable pursuant to a two year promissory note. The Company has
retained the right to offset certain indemnifiable liabilities against the sums
payable pursuant to the promissory note. The majority stockholder of ICS entered
into a two year non-competition and non-solicitation agreement with the Company.
The acquisition of ICS was not deemed to be "significant," accordingly the
financial statements of ICS will be consolidated with the Company's financial
statements and separate financial statements in a Current Report on Form 8-K
will not be filed with the SEC. ICS is a home health care and infusion
business, which is based in Baton Rouge, Louisiana.
In February 1998, the Company acquired substantially all of the assets of
Precision Health Systems, L.L.C. ("PHS") in exchange for aggregate consideration
of $1,000,000, of which $750,000 was payable in cash at closing and $250,000 was
payable pursuant to a two year promissory note. The Company has retained the
right to offset certain indemnifiable liabilities against the sums payable
pursuant to the promissory note. The majority stockholder of PHS entered into a
two year non-competition and non-solicitation agreement and a two year
consulting agreement with the Company. The acquisition of PHS was not deemed to
be "significant," accordingly the financial statements of PHS will be
consolidated with the Company's financial statements and separate financial
statements in a Current Report on Form 8-K will not be filed with the SEC. PHS
is a home infusion business and ambulatory infusion center business, which is
based in Baton Rouge, Louisiana.
In March 1998, the Company completed a Private Placement of 750,000 shares
of Preferred Stock to accredited investors at a purchase price of $10.00 per
share in reliance upon an exemption from registration under the Act. In
connection with the Private Placement, the placement agent was issued the
Placement Agent Warrants to purchase 52,500 shares of Preferred Stock. The
shares of Common Stock underlying the Preferred Stock and the shares of Common
Stock underlying the Preferred Stock issuable upon exercise of the Placement
Agent Warrants are the Shares the resale of which are being registered under the
Act hereby.
4
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RISK FACTORS
An investment in the securities offered hereby involves a number of
significant risks. In addition to the other information contained in this
Prospectus, prospective investors should give careful consideration to the
following factors.
INCREASED WORKING CAPITAL NEEDS AND RISKS OF COLLECTION RELATING TO FEE-FOR-
SERVICE REIMBURSEMENT PROGRAMS
For the nine months ended September 30, 1997, approximately 53% of the
Company's revenue was derived from private insurers and patients, 42% from
Medicare and 5% from Medicaid. The portion of the Company's revenues
attributable to management services provided in connection with fee-for-service
agreements is expected to increase substantially. Management believes that
competitive trends will continue to increase the number and percentage of the
Company's fee-for-service agreements.
Under fee-for-service agreements, the Company assumes the financial risks
arising from changes in patient volume, payor mix and third party reimbursement
rates. Fee-for-service arrangements also involve a credit risk related to
services provided to uninsured individuals. In addition, fee-for-service
contracts also have less favorable cash flow characteristics than traditional
flat-rate contracts due to longer collection periods. Private and third party
fee-for-service arrangements can result in longer collection cycles than
government fee-for-service agreements. The Company has both types of contracts
in its payor mix.
The Company's working capital needs are generally a function of the
acquisition of new contracts or the conversion of fixed fee contracts to
fee-for-service contracts. As a result, the Company may require additional
working capital in the event of significant growth. The Company may experience a
net use of cash in its operating activities in future periods if the growth in
fee-for-service contracts continues.
The Company derives 42% of its revenues from the Medicare system. This
system is undergoing changes mandated by the congressional Balanced Budget Act
of 1997 which established the Interim Payment System ("IPS") for home health
care. The IPS was effective for home health agencies ("HHAs") for cost reporting
periods beginning on or after October 1, 1997. Under the previous system, HHAs
were reimbursed their costs per visit up to a specified limit which was based on
geographic region. In IPS HHAs will be reimbursed the lower of their actual
cost, per visit limit or per beneficiary limit. The per beneficiary limits are
75% provider specific and based on 1994 cost reports. Cost limits are also based
on the area where the patient resides and not the area of the HHA's office. Per
beneficiary cost limits will not be specified by the federal government until
April 1, 1998 and HHAs are at risk since agency specific reductions are not
known until after the start of the cost reporting period. The anticipated range
of reductions in cost limits is between 15% - 40%.
The public and private sectors are experiencing increasing pressures to
reduce health care costs and restrict reimbursement rates for medical services.
Any change in reimbursement amounts or practices could materially adversely
affect the operations of the Company. In addition, while the Company seeks to
comply with applicable Medicare and Medicaid reimbursement regulations, there
can be no assurance that the Company would be found to be in compliance in all
respects with such regulations.
CLASSIFICATION OF PHYSICIANS AND NURSES AS INDEPENDENT CONTRACTORS; POTENTIAL
STATE AND FEDERAL TAX LIABILITY
The Company contracts with physicians and nurses as independent
contractors, rather than employees, to fulfill some of its supplemental staffing
obligations. Therefore, the Company has not historically, and the Company does
not currently, withhold federal or state income taxes, make federal or state
unemployment tax payments or provide worker's compensation insurance with
respect to such independent contractors. The payment of applicable taxes is
regarded as the responsibility of such independent contractors. Management
believes that classification of physicians and nurses as independent contractors
is standard industry practice and proper for federal tax purposes. A contrary
determination by federal taxing authorities or a change in existing law could
materially adversely affect the Company and its operations. Most state taxing
authorities either have not challenged or have accepted the classification of
contract physicians and nurses as independent contractors. The Company's
records for independent contractors have been reviewed by federal taxing
authorities and no significant issues have been identified. The Company is
currently under review by the Department of Labor. Management believes that the
ultimate resolution of this review will not have a significant effect on the
Company's financial position or results of operations. However, there are some
states in which the independent contractor classification of physicians and
nurses is or has been under administrative or judicial review.
RISKS RELATED TO THE COMPANY'S ACQUISITION STRATEGY
The Company also intends to grow significantly through the acquisition of
additional outpatient health care and complimentary businesses. The Company
expects to face competition for acquisition candidates, which may limit the
number of acquisition opportunities and may lead to higher acquisition prices.
There can be no assurance that the Company will be able to identify, acquire or
manage profitably additional businesses or to integrate any acquired businesses
into the Company without substantial costs, delays or other operational or
financial problems. Further, acquisitions involve a number of risks, including
possible adverse effects on the Company's operating results, diversion of
management's attention, failure to retain key personnel of the acquired business
and risks associated with unanticipated events or liabilities, some or all of
which could have a material adverse effect on the Company's business,
5
<PAGE>
financial condition and results of operations.
RISKS RELATED TO ACQUISITION FINANCING
The timing, size and success of the Company's acquisition efforts and the
associated capital commitments cannot be readily predicted. The Company
currently intends to finance future acquisitions by using shares of its Common
Stock for a portion of the consideration to be paid. In the event that the
Common Stock does not maintain a sufficient market value, or potential
acquisition candidates are otherwise unwilling to accept Common Stock as part of
the consideration for the sale of their businesses, the Company may be required
to utilize more of its cash resources, if available, in order to initiate and
maintain its acquisition program. If the Company does not have sufficient cash
resources, its growth could be limited unless it is able to obtain additional
equity or debt financing.
DEPENDENCE ON MANAGEMENT
The success of the Company is dependent upon its management, including the
Company's Chief Executive Officer, William F. Borne, and President, James P.
Cefaratti. The Company maintains key employee life insurance in the amount of
$4.5 million on the life of Mr. Borne and has entered into an employment
agreement with Mr. Borne. The loss to the Company of the services of Messrs.
Borne and Cefaratti could materially adversely affect the Company's operations.
ADVERSE EFFECT OF STATE LAWS REGARDING THE CORPORATE PRACTICE OF MEDICINE
Business corporations are legally prohibited in many states from providing
or holding themselves out as providers of medical care. While the Company has
structured its operations to comply with the corporate practice of medicine laws
of states in which it operates and will seek to structure its operations in the
future to comply with the laws of any state in which it seeks to operate, there
can be no assurance that, given varying and uncertain interpretations of such
laws, the Company would be found to be in compliance with restrictions on the
corporate practice of medicine in such states. A determination that the Company
is in violation of applicable restrictions on the practice of medicine in any
state in which it operates could have a materially adverse effect on the Company
if the Company were unable to restructure its operations to comply with the
requirements of such state. Such regulations may limit the states in which the
Company can operate, thereby inhibiting future expansion of the Company into
potential markets in other states.
CORPORATE EXPOSURE TO PROFESSIONAL LIABILITIES
Due to the nature of its business, the Company and certain physicians who
provided services on its behalf may be the subject of medical malpractice
claims, with the attendant risk of substantial damage awards. The most
significant source of potential liability in this regard is the alleged
negligence of nurses placed by the Company in home health care and supplemental
staffing settings. In addition, the Company could be exposed to liability based
on the negligence of physicians operating in the Company's outpatient surgery
centers. To the extent such nurses or physicians were regarded as agents of the
Company in the practice of medicine, the Company could be held liable for any
medical negligence of such persons. In addition, the Company could be found in
certain instances to have been negligent in performing its contract management
services for hospital and clinics even if no agency relationship between the
Company and such physician exists. There can be no assurance that a future
claim or claims will not exceed the limits of available insurance coverage or
that such coverage will continue to be available.
POSSIBLE INSUFFICIENCY OF LIABILITY COVERAGE
The Company maintains professional liability insurance; however, there can
be no assurance that any such claims will not be made in the future in excess of
the limits of such insurance, if any, or that any such claims, if successful and
in excess of such limits, will not have a material adverse effect on the
Company's assets and its ability to conduct its business. There can be no
assurance that the Company will continue to maintain such insurance or that such
insurance can be maintained at acceptable costs. The Company's insurance
coverage currently includes medical malpractice, fire, property damage and
general liability. There can be no assurance that any claim will be within the
scope of the Company's coverage or that such claims will not exceed the
Company's coverage.
6
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POTENTIAL RESTRUCTURING OF HEALTHCARE DELIVERY SYSTEM THROUGH HEALTHCARE REFORM
PROPOSALS
President Clinton and members of Congress have made several proposals for
reform of the nation's health care system, including proposals limiting payments
under Medicaid and Medicare programs. Many of these proposals contain measures
intended to control public and private spending on health care as well as to
provide universal public access to the health care system. If enacted, such
proposals are expected to result in a substantial restructuring of the health
care delivery system. The Company cannot predict what health care reform
legislation, if any, will be enacted. Significant changes in the nation's health
care system are likely to have a substantial impact over time on the manner in
which the Company conducts its business. Such changes could have a materially
adverse effect on the results of operations of the Company.
CHANGES IN HEALTH CARE REGULATIONS AND TECHNOLOGY
There can be no assurance that the Company will not be adversely affected
by future possible changes in medical and health regulations, the use, cost and
availability of hospitals and other health care services and medical
technological developments.
REIMBURSEMENT BY THIRD PARTY PAYORS
The Company is generally reimbursed by a variety of third-party payors,
with outpatient surgery reimbursements coming primarily from insurance companies
and patients, home care reimbursements coming primarily from Medicare and
Medicaid, and supplemental staffing reimbursements coming primarily from
hospitals and other institutions. Accordingly, the Company may be materially
adversely affected in the event of future increased insurance premiums,
increased insurance deductibles, unavailability of insurance, changes in policy
exclusions covering specific types of disease or conditions or other changes in
medical and health insurance. The Company typically receives payment between 15
and 120 days after rendering an invoice, although such period can be longer.
Accordingly, the Company's cash flow may at times be insufficient to meet its
accounts payable requirements. The Company at times has been required to borrow
funds to meet its ongoing obligations and may be required to do so in the
future, and the Company would be adversely affected if in the future it were
unable either to borrow funds or to borrow funds on terms deemed favorable by
management.
COMPETITION
The business in which the Company operates is highly competitive. The
Company is in competition with hospitals, nursing homes, temporary employment
companies and other businesses that provide home health care services, many of
which are large and established companies with significantly greater resources
than the Company.
RELATIONSHIP WITH OTHER ORGANIZATIONS
The development and growth of the Company's business depends to a
significant extent on its ability to establish close working relationships with
health maintenance organizations, preferred provider organizations, hospitals,
clinics, nursing homes, physician groups, and other health care providers.
Although the Company has established such relationships, there is no assurance
that existing relationships will be successfully maintained and that additional
relationships will be successfully developed and maintained in existing and
future markets.
FEDERAL AND STATE REGULATION
As a provider of health care services, the Company is subject to laws and
regulations administered by the various states. The Company is subject to
certain federal laws and regulations as a result of the certification of its
operations in the Medicare/Medicaid Program. Compliance with laws and
regulations could increase the cost and time necessary to allow the Company to
operate successfully and may affect the Company in other respects not presently
foreseeable. Loss of certification in the Medicare/Medicaid Program could
adversely affect the ability of the Company to effectively market its services.
7
<PAGE>
DIVIDENDS NOT LIKELY
The Company has never paid cash dividends on its Common Stock, and it is
not anticipated that any will be paid in the foreseeable future.
FUTURE SALES OF COMMON STOCK
A substantial number of shares of Common Stock are currently tradeable, or
eligible for trading pursuant to Rule 144 as promulgated under the Act, in the
public market. Sales of Common Stock in the public market may have a depressive
effect on prevailing market prices for the Common Stock. There is no assurance
that the public market for the Common Stock will not be volatile, sporadic or
limited. Accordingly, purchasers may not be able to resell shares of Common
Stock at or above their respective purchase price, and a purchaser may not be
able to liquidate his investment even at a loss without considerable delay.
POSSIBLE ADVERSE EFFECT OF FUTURE ISSUANCES OF PREFERRED STOCK
The Company's Certificate of Incorporation authorizes the issuance of
2,500,000 shares, par value $.001 per share, of "blank check" preferred stock
with such designations, rights and preference as may be determined from time to
time by the Board of Directors. Accordingly, the Board of Directors is
empowered, without stockholder approval, to issue preferred stock with dividend,
liquidation, conversion, voting, or other rights that could adversely affect the
voting power or other rights of the holders of the Common Stock. In the event
of issuance, the preferred stock could be utilized, under certain circumstances,
as a method of discouraging, delaying or preventing a change in control of the
Company. The Company has no present intention to issue any additional shares of
its preferred stock. However, there can be no assurance that additional
preferred stock will not be issued at some time in the future.
STATUS OF PERSONS RESELLING COMMON STOCK
Holders who subsequently resell shares of Common Stock to the public
pursuant to this Prospectus may be deemed to be underwriters with respect to
such shares for purposes of the Act with the result that they may be subject to
certain statutory liabilities if the registration statement is defective. The
Company has agreed to indemnify the Selling Stockholders regarding such
liability. In addition, any profit on the sale of shares of Common Stock might
be deemed underwriting discounts and commissions under the Act. See "Plan of
Distribution."
DISCLOSURE REGARDING FORWARD LOOKING STATEMENTS
This Prospectus contains certain statements that are "Forward Looking
Statements" within the meaning of Section 27A of the Act and Section 21E of the
Exchange Act. Those statements include, among other things, the discussions of
the Company's operations, margins, profitability, liquidity and capital
resources. Forward Looking Statements are included in this section under
"Increased Working Capital Needs and Risks of Collection Relating to Fee-for-
Service Reimbursement Programs," "Classification of Physicians and Nurses as
Independent Contractors; Potential State and Federal Tax Liability," "Risks
Related to the Company's Acquisition Strategy," " Risks Related to Acquisition
Financing," "Dependence on Management," "Adverse Effect of State Laws Regarding
the Corporate Practice of Medicine," "Corporate Exposure to Professional
Liabilities," "Possible Insufficiency of Liability Coverage," "Potential
Restructuring of Healthcare Delivery System through Healthcare Reform
Proposals," "Changes in Health Care Regulations and Technology," "Reimbursement
by Third Party Payors," and "Relationship with Other Organizations". Although
the Company believes that the expectations reflected in Forward Looking
Statements are reasonable, they can give no assurance that such expectations
will prove to have been correct. Generally, these statements relate to business
plans or strategies, projected or anticipated benefits or other consequences of
such plans or strategies, or projections involving anticipated revenues,
expenses, earnings, levels of capital expenditures, liquidity or indebtedness or
other aspects of operating results or financial position. All phases of the
operations of the Company are subject to a number of uncertainties, risks and
other influences, many of which are outside the control of the Company and any
one of which, or a combination of which, could materially affect the results of
the Company's operations and whether the Forward Looking Statements made by the
Company ultimately prove to be accurate. Important factors that could cause
actual results to differ materially from the Company's expectations are
disclosed in this "Risk Factors" section.
8
<PAGE>
SELLING STOCKHOLDERS
The following table sets forth certain information concerning each Selling
Stockholder. Assuming that the Selling Stockholders offer all of their Shares,
the Selling Stockholders will not have any beneficial ownership. The Shares are
being registered to permit the Selling Stockholders and certain of their
respective pledgees, donees, transferors, or other successors in interest to
offer the shares for resale from time to time. See "Plan of Distribution."
RESALE OF COMMON STOCK BY SELLING STOCKHOLDERS
FOR SHARES TO BE ISSUED UPON CONVERSION OF PREFERRED STOCK ("P")
AND SHARES TO BE ISSUED, AFTER CONVERSION OF PREFERRED STOCK, UPON EXERCISE OF
WARRANTS ("W"),
<TABLE>
<CAPTION>
SHARES AMOUNT SHARES
BENEFICIALLY OFFERED BENEFICIALLY
OWNED (ASSUMING ALL OWNED
BEFORE SHARES IMMEDIATELY AFTER
STOCKHOLDER RESALE/(1)(2)(3)/ SOLD)/(2)(3)(4)/ RESALE PERCENTAGE
- ----------- ---------------- ------------------ ---------------- ----------
<S> <C> <C> <C> <C>
Bank Hofmann AG 21,622 21,622 P - -
Bank Julius Baer & Co. Ltd. 216,216 216,216 P - -
Bank Sarasin & Cie 43,243 43,243 P - -
Clariden Bank 108,108 108,108 P - -
Credit Lyonnaise (Schweiz) AG 86,486 86,486 P - -
Cresvale Far East Limited Hong Kong 43,243 43,243 P - -
Delphic Global Opportunities 64,865 64,865 P - -
Rush & Co. 43,243 43,243 P - -
Sigler & Co. 21,622 21,622 P - -
Terra Healthy Living, Ltd. 821,622 821,622 P - -
The Nominee of Chase Manhattan
Bank New York 151,352 151,352 P - -
Hudson Capital Partners, L.P. 113,514 113,514 W - -
</TABLE>
- -------------------
(1) The Selling Stockholders have sole voting and sole investment power with
respect to all Shares owned.
(2) Calculated using the current conversion rate for the Preferred Stock of
2.162 shares of Common Stock for each share of Preferred Stock, subject to
adjustment.
(3) Ownership is determined in accordance with Rule 13d-3 under the Exchange
Act. The actual number of Shares beneficially owned and offered for sale
hereunder is subject to adjustment and could be materially more than the
estimated account indicated depending upon factors which cannot be
predicted by the Company at this time.
(4) Assumes the sale of all Shares offered hereby to persons who are not
affiliates of the Selling Stockholders.
PLAN OF DISTRIBUTION
Pursuant to this Prospectus, the Selling Stockholders, or by certain
pledgees, donees, transferees or other successors in interest to the Selling
Stockholders, may sell Shares from time to time in transactions on the Nasdaq
National Market from time to time, in privately-negotiated transactions or by a
combination of such methods of sale, at fixed prices which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing
9
<PAGE>
market prices or at negotiated prices. The Selling Stockholders may effect such
transactions by selling the Shares to or through broker-dealers, and such
broker-dealers may receive compensation in the form of discounts, concessions or
commissions from the Selling Stockholders or the purchasers of the Shares for
whom such broker-dealers may act as agent or to whom they sell as principal, or
both (which compensation to a particular broker-dealer might be in excess of
customary commissions).
Other methods by which the Shares may be sold include, without limitation:
(i) transactions which involve cross or block trades or any other transaction
permitted by the Nasdaq National Market, (ii) "at the market" to or through
market makers or into an existing market for the Common Stock, (iii) in other
ways not involving market makers or established trading markets, including
direct sales to purchasers or sales effected through agents, (iv) through
transactions in options or swaps or other derivatives (whether exchange-listed
or otherwise), (v) through short sales, or (vi) any combination of any other
such methods of sale. The Selling Stockholders may also enter into option or
other transaction with broker-dealers which require the delivery to such broker-
dealers of the Common stock offered hereby which Common Stock such broker-dealer
may resell pursuant to this Prospectus.
The Selling Stockholders and any broker-dealers who act in connection with
the sale of Shares hereunder may be deemed to be "underwriters" as that term is
defined under the Act, and any commissions received by them and profit on any
resale of the Shares as principal may be deemed to be underwriting discounts and
commissions under the Act.
Pursuant to the registration rights agreements with the Selling
Stockholders, the Company has agreed to indemnify the Selling Stockholders
against certain liabilities, including certain liabilities under the Act, or to
contribute to payments such Selling Stockholders or underwriters are required to
make in respect of certain losses, claims, damages or liabilities.
LEGAL MATTERS
The legality of the securities offered hereby will be passed on for the
Company by Brewer & Pritchard, P.C., Houston, Texas.
EXPERTS
The consolidated financial statements of the Company and its subsidiaries
incorporated by reference herein have been audited by Arthur Andersen LLP and
Hannis T. Bourgeois & Co., L.L.P., independent certified public accountants, as
set forth in their reports incorporated by reference herein in reliance given
upon the authority of those firms as experts in accounting and auditing in
giving said reports. The single jointly signed auditor's report is considered
to be the equivalent of two separately signed auditor's reports. Thus, each
firm represents that it has complied with generally accepted auditing standards
and is in a position that would justify being the only signatory of the report.
10
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
SEC registration fee $ 2,070.13
Legal Fees and Expenses 10,000.00
Accounting Fees and Expenses 5,000.00
Miscellaneous $ 2,929.87
----------
Total $20,000.00
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article XI of the Certificate of Incorporation of the Company provides for
indemnification of officers, directors, agents and employees of the Company as
follows:
(a) The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation) by reason of the
fact that he is or was a director, officer, employee or agent of the
Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the Corporation, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order, settlement,
conviction or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act in good faith and in a
manner in which he reasonably believed to be in or not opposed to the best
interests of the Corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.
(b) The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a judgment in its favor by
reason of the fact that he is or was a director, officer, employee or agent of
the Corporation, or is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation and except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the Corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
(c) To the extent that a director, officer, employee or agent of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b) of this
Article, or in defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this Article
(unless ordered by a court) shall be made by the Corporation only as authorized
in the specific case upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in subsections (a) and (b) of this
Article. Such determination shall be made (1) by the Board of Directors by a
majority vote of a quorum consisting of directors who were not parties to such
action, suit or proceeding, or (2) if such quorum is not obtainable, or, even if
obtainable a quorum of disinterested directors so directs, by independent legal
counsel in a written opinion, or (3) by the stockholders.
II-1
<PAGE>
(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the Corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such amount if
it shall ultimately be determined that he is not entitled to be indemnified by
the Corporation as authorized by this Article. Such expenses (including
attorneys' fees) incurred by other employees and agents may be so paid upon such
terms and conditions, if any, as the Board of Directors deems appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this Article shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office.
(g) The Corporation shall have the power to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the Corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
him and incurred by him in any such capacity, or arising out of his status as
such, whether or not the Corporation would have the power to indemnify him
against such liability under this Article.
(h) For purposes of this Article references to "the Corporation" shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have had the power
and authority to indemnify its directors, officers, and employees or agents, so
that any person who is or was a director, officer, employee or agent of such
constituent corporation, or is or was serving at the request of such constituent
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, shall stand in the same
position under this Article with respect to the resulting or surviving
corporation as he would have with respect to such constituent corporation if its
separate existence had continued.
(i) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Article shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such a person.
The foregoing discussion of the Company's Certificate of Incorporation, and
of the Delaware General Corporation Law is not intended to be exhaustive and is
qualified in its entirety by such Certificate of Incorporation and statutes,
respectively.
ITEM 16. EXHIBITS
EXHIBIT NO. IDENTIFICATION OF EXHIBIT
- ----------- -------------------------
2.1(1) - Acquisition Agreement dated December 20, 1993 between the Company
and M & N Capital Corp.
2.2(3) - Plan of Merger dated August 3, 1994 between M & N Capital Corp. and
the Company
2.3(4) - Certificate of Merger dated August 3, 1994 between M & N Capital
Corp. and the Company
2.4(7) - Acquisition Agreement dated August 1,1997 between the Company and
Allgood Medical Services, Inc.
2.5(7) - Exchange Agreement dated January 1, 1998 between the Company and
Alliance Home Health, Inc. and University Capital Corp. dated
December 10, 1997.
2.6(7) - Stock Purchase Agreement by and among Amedisys, Alternate-Site
Infusion Therapy Services, Inc., PRN, Inc. d/b/a Home IV Therapy,
Joseph W. Stephens, and Terry I. Stevens dated February 23, 1998.
2.7(7) - Agreement to Purchase by and between Amedisys, Alternate-Site
Infusion Therapy Services, Inc. and Precision Health Systems,
L.L.C. dated February 27, 1998.
2.8(7) - Promissory note in the amount of $250,000 to Precision Health
Solutions, L.L.C. in connection with the purchase of the company.
2.9(7) - Stock Purchase Agreement by and among Amedisys, Alternate-Site
Infusion Therapy Services, Inc., Infusioncare Solutions, Inc. and
Daniel D. Brown dated February 27,1998.
II-2
<PAGE>
2.10(7) - Promissory note in the amount of $125,000 to Daniel D. Brown in
connection with the purchase of the company.
3.1(4) - Certificate of Incorporation
3.2(4) - Bylaws
3.3(7) - Certificate of Designation for the Series A Preferred Stock
4.1(4) - Common Stock Specimen
4.2(7) - Preferred Stock Specimen
4.3(7) - Form of Placement Agent's Warrant Agreement
5.1(7) - Opinion regarding Legality
10.1(4) - Master Note with Union Planter's Bank of Louisiana
10.2(4) - Merrill Lynch Term Working Capital Management Account
10.3(5) - Promissory Note with Deposit Guaranty National Bank
10.4(7) - Amended and Restated Stock Option Plan
10.5(7) - Registration Rights Agreement
21.1(7) - List of Subsidiaries
23.1(7) - Consent of Counsel (contained in Exhibit 5.1)
23.2(7) - Consents of Arthur Andersen, LLP and Hannis T. Bourgeois & Co.,
L.L.P., independent public accountants
- ---------------
(1) Previously filed as an exhibit to the Current Report on Form 8-K dated
December 20, 1993.
(2) Previously filed as an exhibit to the Current Report on Form 8-K dated
February 14, 1994.
(3) Previously filed as an exhibit to the Current Report on Form 8-K dated
August 11, 1994.
(4) Previously filed as an exhibit to the Annual Report on Form 10-KSB for the
year ended December 31, 1994.
(5) Previously filed as an exhibit to the Current Report on Form 8-K dated June
30, 1995.
(6) Previously filed as an exhibit to the Registration Statement on Form S-1
(333-8329) dated July 18, 1996.
(7) Filed herewith.
ITEM 17. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
i. To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
ii. To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a
20% change in the maximum aggregate offering price set
forth in the "Calculation of Registration Fee" table in the
effective registration statement; and
iii. To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement.
provided, however, that paragraphs (1) (i) and (1) (ii) do not apply
if the information required to be included
II-3
<PAGE>
in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or
Section 15 (d) of the Exchange Act that are incorporated by reference
in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the registrant's annual
report pursuant to Section 13 (a) or 15 (d) of the Exchange Act that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Baton Rouge, State of
Louisiana, on the 11th day of March, 1998.
AMEDISYS, INC.
By /s/ WILLIAM F. BORNE
-----------------------------------------
WILLIAM F. BORNE, Chief Executive Officer
____________________________
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated:
Signature Title Date
- --------- ----- ----
//s// WILLIAM F. BORNE Chief Executive Officer March 11, 1998
- ----------------------------- and Director (Principal
WILLIAM F. BORNE Executive Officer)
//s// JAMES P. CEFARATTI President and Chief Operating March 11, 1998
- ----------------------------- Officer
JAMES P. CEFARATTI
//s// MITCHEL G. MOREL Chief Financial Officer March 11, 1998
- ----------------------------- (Principal Financial
MITCHEL G. MOREL and Accounting Officer)
//s// JAKE L. NETERVILLE, CPA Director March 11, 1998
- -----------------------------
JAKE L. NETERVILLE, CPA
//s// WILLIAM M. HESSION, JR. Director March 11, 1998
- -----------------------------
WILLIAM M. HESSION, JR.
//s// KARL A. LEBLANC, M.D. Director March 11, 1998
- -----------------------------
KARL A. LEBLANC, M.D.
//s// ALAN J. OSTROWE, M.D. Director March 11, 1998
- -----------------------------
ALAN J. OSTROWE, M.D.
//s// DAVID R. PITTS Director March 11, 1998
- -----------------------------
DAVID R. PITTS
//s// RONALD A.. LABORDE Director March 11, 1998
- -----------------------------
RONALD A. LABORDE
//s// PETER F. RICCHIUTI Director March 11, 1998
- -----------------------------
PETER F. RICCHIUTI
//s// S. F. HARTLEY, D.P.M. Director March 11, 1998
- -----------------------------
S. F. HARTLEY, D.P.M.
<PAGE>
EXHIBIT 2.4
ASSET PURCHASE AGREEMENT
BY
AND
AMONG
AMEDISYS, INC.,
AND
ALLGOOD MEDICAL SERVICES, INC.,
A LOUISIANA CORPORATION DOING BUSINESS AS
CARE MEDICAL AND MOBILITY EQUIPMENT COMPANY
<PAGE>
TABLE OF CONTENTS
Page
----
I. Definitions 1
1.01 Assets 1
1.02 Closing 2
1.03 Common Stock 2
1.04 GAAP 2
1.05 Inventory and Accounts Receivable 2
1.06 Accounts Payable 2
1.07 Liabilities 3
1.08 Material Adverse Effect 3
1.09 Seller's Business 3
1.10 Seller's Knowledge 3
II. Agreement to Sell and Purchase 3
2.01 The Closing 3
III. Purchase Price 3
3.01 Payment by Purchaser 3
3.02 Promissory Note 4
3.03 Delivery of Certificate 4
3.04 Consideration 4
IV. Assumption of Liabilities 4
V. Representations and Warranties of the Seller 4
5.01 Ownership 4
5.02 Valid Existence 4
5.03 Due Authorization; Consent of Third Parties 4
5.04 Use of Assets 5
5.05 Absence of Liens 5
5.06 Litigation 5
5.07 Employment Contracts 6
5.08 Insurance 6
5.09 Contracts, Agreements and Instruments 6
5.10 Compliance with Law; Taxes 7
5.11 Permits and Licenses 7
5.12 Employees 8
5.13 No violation of Contracts 8
5.14 Hazardous Materials 8
5.15 Interests in Competitors 8
5.16 Financial Condition 8
i
<PAGE>
5.17 Changes or Events 9
5.18 No Defaults 10
5.19 Liabilities 11
5.20 No Prohibited Payments 11
5.21 Seller's Capital Stock 11
5.22 Non-Distributive Intent 11
5.23 Completeness of Disclosure 11
VI. Representations and Warranties of Purchaser 12
6.01 Organization 12
6.02 Due Authorization; Third Party Consents 12
6.03 No Violation 12
6.04 Capitalization 12
6.05 Financial Condition 13
6.06 Continuity of Business 13
6.07 Completeness of Disclosure 13
VII. Conditions to Obligations of Purchaser 13
7.01 Accuracy of Representations and Compliance with Conditions 13
7.02 Closing Documents 13
7.03 Review of Proceedings 14
7.04 Legal Action 14
7.05 No Governmental Action 14
7.06 Contractual Consents Needed 15
7.07 Other Agreements 15
7.08 Non-Distributive Intent 15
7.09 Non-Competition and Non-Solicitation Agreement 15
7.10 Board and Shareholder Approval 15
VIII. Conditions to Obligations of Seller 15
8.01 Accuracy of Representations and Compliance with Conditions 15
8.02 Other Closing Documents 15
8.03 Review of Proceedings 16
8.04 Legal Action 16
8.05 No Governmental Action 16
8.06 Contractual Consents Needed 16
8.07 Other Agreements 16
8.08 Board Approval 17
8.09 Employment Agreements 17
IX. Covenants and Agreements of Seller 17
9.01 Public Statements 17
9.02 Consents Without any Condition 17
9.03 Access 17
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9.04 Conduct of Business 17
9.05 Notice of Changes 17
X. Covenants and Agreements of Purchaser 17
10.01 Public Statements 17
10.02 Consents Without any Condition 18
10.03 Conduct of Business 18
10.04 Notice of Changes 18
XI. Miscellaneous 18
11.01 Brokerage of Other Fees 18
11.02 Further Actions 18
11.03 Availability of Equitable Remedies 18
11.04 Survival 19
11.05 Modification 19
11.06 Notices 19
11.07 Waiver 19
11.08 Binding Effect 20
11.09 No Third-Party Beneficiaries 20
11.10 Separability 20
11.11 Headings 20
11.12 Counterparts, Governing Law 20
11.13 Indemnification 20
11.14 Indemnification Procedures 20
Witness Signatures 21
List of Schedules 22
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement') is made effective as of
August 1, 1997, by and between AMEDISYS, INC., a Delaware corporation, with its
principal place of business at 3029 South Sherwood Forest Blvd., Suite 300,
Baton Rouge, Louisiana 70816 ("Purchaser") and ALLGOOD MEDICAL SERVICES, INC., a
Louisiana corporation doing business as, CARE MEDICAL AND MOBILITY EQUIPMENT
COMPANY, a Louisiana corporation with its principal place of business at 1207 N.
Causeway Boulevard, Metairie, Louisiana 70001 ( collectively "Seller").
RECITALS
A. Seller conducts a health care services business located at 1207 N.
Causeway Blvd, Metarie, Lousiana, 70001 and ________________________,
Jackson, Mississippi.
B. Purchaser desires to buy and Seller desires to sell Seller's assets
pursuant to the terms and conditions of this Agreement.
C. The parties expect that this Agreement will further advance their
respective business objectives, including, without limitation, integration of
the business operations of Seller with the business operations of Purchaser,
including, without limitation, the expansion of Purchaser's "one-stop" approach
to offering health care services, and to better capitalize both businesses in
order to more effectively compete in the marketplace.
NOW, THEREFORE, in consideration of the premises and the mutual promises
made herein, and in consideration of the representations, warranties, and
covenants contained herein, the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
meanings indicated:
1.01. Assets: The assets to be sold and transferred by Seller to
Purchaser pursuant to this Agreement consist of the assets more specifically
detailed in Schedule 1.01 of this Agreement, plus any other assets and rights
pertaining to Seller's Business as reflected on the balance sheet of Seller
prepared as of July 31, 1997, (the "Balance Sheet"); however, specifically
excluded from the assets sold are cash, checking, savings, and Merrill Lynch
Accounts at July 31, 1997 ("Assets"). The Assets shall include, but not be
limited to, the following (irrespective if they are set forth on Schedule 1.01):
a. All furniture, fixtures, equipment, leasehold improvements and
supplies of Seller located at and used by Seller in the operation of Seller's
Business owned by Seller at the address stated above, which are further
identified in and by the books and records of Seller;
b. All merchandise inventory owned and/or acquired through Seller's
Business or otherwise located at the address stated above as of the Closing;
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c. All outstanding accounts receivable of Seller, as of the Closing,
together with all evidence of the indebtedness owed to Seller arising out of
Seller's Business;
d. Seller's right to use the name "Care Medical & Mobility" any d/b/a or
other name utilized to market its service and products, and all trademarks,
trade names, signage, marketing symbols and logos;
e. All patient lists of present of present or former patients, all
mailing lists, all business records relating to the operations of Seller's
Business (including all records relating to patients), and all telephone numbers
and listings used by Seller in Seller's Business, and all intangibles and other
rights and privileges of Seller currently used in Seller's Business;
f. A leasehold interest in the premises occupied by Seller's Business
at Metarie, Louisiana and Jackson, Mississippi, as evidenced by the Lease
Agreement included as Schedule 1.0l.f to this Agreement;
g. The goodwill and going concern value of Seller and all licenses and
permits of or per taining to Seller's Business;
h. The benefits of all amounts previously paid by Seller for advertising,
design fees, rent, services, or interest relating to Seller's Business or the
Assets, to the extent that they extend or are to be performed after the Closing;
i. All of Seller's rights contemplated in this Agreement and the
documents described in Schedule 5.09, and the rights given therein;
j. Seller's rights under all contracts, including all leases and non-
competition agreements relating to Seller's Business;
k. All technical outlines and records (including all plans, drawings,
diagrams, notes, reports, memoranda, and other similar documents), and any and
all know-how and software and other technology, including all contracts,
licenses, authorizations, permits, and other documents necessary for Seller's
Business; and
l. All trade secrets, inventions, patents, copyrights, trade names,
business names, trade marks, and other intangible assets used by Seller for
Seller's Business.
1.02. Closing: The consummation of the transactions contemplated by this
Agreement.
1.03. Common Stock: The $.001 par value per share voting common stock of
Purchaser.
1.04. GAAP: Generally accepted accounting principles.
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1.05. Inventory and Accounts Receivable. All inventory and accounts
receivable of the Seller, including Seller's interest in equipment which has
been expensed but not capitalized, more fully described in Schedule 1.05.
1.06 Accounts Payable. All accounts payable, including but not limited
to, trade payables and account payables more fully described in Schedule 1.06.
1.07 Liabilities: Those liabilities of Seller to be assumed by Purchaser
pursuant to this Agreement, which consist of those liabilities of Seller
specifically disclosed on Schedule 1.07. Purchaser shall not assume any
liabilities, contingent or certain, of Seller unless incurred and disclosed in
the manner provided in this paragraph 1.07. In addition, Purchaser is not
assuming (i) any expenses, liabilities, or obligations of Seller arising out of
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby (nor may Seller pay any of such expenses out of
the Assets), (ii) any liabilities or obligations of Seller relating to federal,
state, or local income for the period through the closing or other taxes
attributable to the transactions contemplated hereby or the conduct of the
Seller's Business, except for any accrued sales tax attributable to this asset
acquisition, or (iii) any obligation of Seller to pay a fee to any agent,
broker, or finder.
1.08. Material Adverse Effect: Any change in the financial condition or
operation of the business that would materially effect the Seller's Business
adversely, including, but not limited to, material changes to management,
business conditions, or financial standing.
1.09. Seller's Business: The health care services business and such
other related activities as carried on by Seller at 1207 N. Causeway Boulevard,
Metairie, Louisiana 70001, and at _______, Jackson, Mississippi prior to the
Closing.
1.10. Seller's Knowledge. As used in this agreement "Seller's Knowledge"
shall mean the actual, current knowledge of either Alan or Sheila Allgood as of
the date of execution and delivery of this Agreement.
2. Agreement to Sell and Purchase. Subject to the terms and conditions
of this Agreement, Purchaser agrees to purchase, and the Seller agrees to sell,
transfer, convey, assign, and deliver to Purchaser at Closing, the Assets, free
and clear of all liabilities, liens, conditions, and encumbrances, except those
liabilities listed in Schedule 1.07.
2.01. The Closing. The Closing of the transactions contemplated by this
Agreement shall be effective August 1, 1997.
3. Purchase Price. The purchase price in consideration of the sale,
transfer, conveyance, assignment, and delivery of the Assets to Purchaser,
subject to the terms and conditions of this Agreement, shall be One Million and
Two Hundred Thousand Dollars ($1,200,000), less certain amounts the parties may
agree to, to be paid Seller at Closing by the Purchaser as follows:
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3.01. Payment by Purchaser. The payment by Purchaser of the cash
amount of Five Hundred Thousand Dollars ($500,000) to be delivered in the form
of a cashiers check or wire transfer as instructed by the Seller, to be paid to
Seller at Closing less (i) accounts receivable less than $325,000 on July 31,
1997 and (ii) accounts payable greater than $40,000 at July 31, 1997.
3.02. Promissory Note. The delivery and execution of a promissory
note, in the form attached as Schedule 3.02, in the principal amount of One
Hundred Thousand Dollars ($100,000) payable to the order of Seller.
3.03 Delivery of Certificate. The delivery of certificates registered
in the name of Seller for the number of shares of Purchaser's Common Stock with
a value of Six Hundred Thousand Dollars ($600,000), such value and number of
shares to be calculated using the average of the last sale price quoted to the
public as stated in the Wall Street Journal for the thirty (30) days preceding
the Closing date, to be delivered to Seller at Closing.
3.04 Consideration. The consideration to be paid pursuant to
paragraphs 3.01-3.03 herein shall constitute all the consideration to be paid by
Purchaser in connection with the transactions contemplated by this Agreement.
4. Assumption of Liabilities. In connection with the purchase of the
Assets hereunder, Purchaser hereby specifically assumes only those Liabilities
of Seller specifically disclosed on Schedule 1.07. Purchaser shall not assume
any liabilities, contingent or certain, of Seller except pursuant to the
provisions of Section 1.07 and this Section 4 of this Agreement.
5. Representations and Warranties of the Seller. Seller hereby
agrees, represents, and warrants to Purchaser, on the date of this Agreement and
on the Closing Date, as follows:
5.01. Ownership. Seller is the beneficial owner of the Assets and
has good and marketable title to and the absolute right to sell, assign, and
transfer the Assets to Purchaser, free and clear of any interests, security
interest, claims, liens, pledges, penalties, charges, encumbrances, buy-sell
agreements, or other rights of any party whatsoever of every kind and character
except those items listed in Schedule 1.07. Upon delivery of and payment of
the purchase price in accordance with this Agreement, good and marketable title
thereto shall be delivered to Purchaser, free and clear of any interest,
security interest, claims, liens, pledges, penalties, charges, encumbrances,
buy-sell agreements, or other rights of any party whatsoever.
5.02. Valid Existence. Seller is duly organized, validly existing, and
in good standing under the laws of the State of Louisiana and has full power and
authority (including all licenses, franchises, permits, and other authorizations
that are legally required) to own its properties and to engage in the business
and activities now conducted by it. Seller is in good standing in each
jurisdiction in which, it conducts business the failure to be so qualified will
have a Material Adverse Effect.
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5.03. Due Authorization; Consent of Third Parties. Seller has the
right, power, legal capacity, and authority to enter into and perform Seller's
obligations under this Agreement and, except as set forth on Schedule 5.03 to
this Agreement, no approval or consent of any person other than the Seller is
necessary in connection with the execution, delivery, or performance of this
Agreement and the conduct of the Seller's business after the closing by
Purchaser. This Agreement constitutes a legal and binding obligation of the
Seller, and is valid and enforceable against the Seller in accordance with its
terms except that (i) the enforcement of certain rights and remedies created by
this Agreement is subject to bankruptcy, insolvency, reorganization, and similar
laws of general application affecting the rights and remedies of parties, and
(ii) the enforceability of any particular provision of this Agreement under
principles of equity or the availability of equitable remedies, such as specific
performance, injunctive relief, waiver, or other equitable remedies, is subject
to the discretion of courts of competent jurisdiction.
5.04. Use of Assets. All of the Assets are located at 1207 N. Causeway
Boulevard, Metairie, Louisiana 70001 and ___________________ Jackson,
Mississippi. Seller has had no other business address within the three years
prior to the Closing, except as stated on Schedule 5.04. The value of the
Assets reflect the true and correct amount, in all material respects, of the
value reflected in the Seller's Last Balance Sheet. To the best of Seller's
Knowledge, the furniture, fixtures, improvements, leaseholds, inventory,
equipment and other Assets of Seller are in good operating condition and repair,
reasonable wear and tear excepted. The Assets are being utilized by Seller in
conformity with all applicable federal, local and state health care related and
imposed rules, regulations, laws, statutes, and permits ("Health Care Laws"),
and to the best of Seller's Knowledge all other federal, state and local rules,
regulations, laws, statutes and permits. Accounts and notes receivable reflected
in the amount of $232,000 are good and collectible, in each case at the
aggregate recorded amounts thereof without right of recourse, defense,
deduction, return of goods or services, counterclaim, offset, or setoff on the
part of the obligor by July 31, 1998.
5.05. Absence of Liens. The Assets are free and clear of restrictions
on or conditions to transfer or assignment, and are free and clear of liens,
pledges, charges, encumbrances, equities, claims, conditions, or restrictions,
except for (i) those restrictions, conditions or liens disclosed in Schedule
5.05 to this Agreement; and (ii) any lien for current taxes not yet due and
payable.
5.06. Litigation. Except as set forth in Schedule 5.06, there is not
any suit, action, arbitration, or legal, administrative, or other proceeding or
governmental investigation, pending or to the best of Seller's Knowledge
threatened (in the form of threats made to representatives of Seller), against
or affecting Seller or any of the Assets, including but not limited to any
action or claim under any federal, state, local or other governmental act, rule,
regulation, or any interpretations thereof, relating to environmental matters or
the protection of the safety and health of persons connected with Seller's
Business (including but not limited to the transportation, treatment, storage,
recycling, disposal, or release into the environment of hazardous or toxic
materials or waste), or any basis on which any proceeding or investigation
against Seller might reasonably be undertaken or brought. The Seller has
informed Purchaser of, and upon request has furnished or made available to
Purchaser copies of all relevant court papers and other documents relating to,
the matters set forth in Schedule 5.06. Included in Schedule 5.06 is a list of
all suits, actions, arbitrations, or other
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proceedings or investigations in which Seller has been involved during the five
year period immediately preceding the Closing. Seller is not in default with
respect to any order, writ, injunction, or decree of any Health Care Law. In
addition, to Seller's Knowledge, it is not in violation of any other federal,
state, local law, rule or regulation, or foreign court, department, agency, or
instrumentality. The Seller is not presently engaged in any legal action to
recover monies due to the Seller, for damages sustained by the Seller, or
amounts owed to the Seller. During the five year period immediately preceding
the Closing, the Seller has neither received nor been a party to any written
notice of violations, orders, claims, citations, complaints, penalties,
assessments, court, or other proceedings, administrative, civil or criminal, at
law or in equity, with respect to any Health Care Law. In addition, to Seller's
Knowledge it has neither received nor been party to any written notice of
violations, orders, claims, citations, complaints, penalties, assessments,
court, or other proceedings, administrative, civil or criminal, at law or in
equity, with respect to any alleged violations of any other federal, state, or
local environmental law, regulation, ordinance, standard, permit, or order in
connection with the conduct of its business or otherwise during the past five
years.
5.07. Employment Contracts. Schedule 5.07 to this Agreement is a list
of all of Seller's employment contracts, collective bargaining agreements,
royalty agreements and pension, bonus, profit sharing, or other agreements
providing for employee remuneration or benefits, and all consulting, commission
and fee agreements with independent contractors. Seller shall be solely
responsible for any withdrawal or other liability which may be imposed in
connection with any pension, profit sharing, or other employee benefit plan of
Seller. A list of all commissions, and consulting and other fees due or to
become due and owing are set forth on Schedule 5.07. A complete copy of each of
the agreements listed on Schedule 5.07 has been provided to Purchaser. In
addition, at the closing of this Agreement all of Seller's employees shall be
enrolled in a medical program similar or substantially similar to the medical
program of all employees.
5.08 Insurance. Schedule 5.08 sets forth an accurate and complete list
and brief description of all policies of fire and extended coverage, liability,
and the forms of similar insurance or indemnity bonds held by Seller. Seller is
not in default with respect to any provisions of any such policy or indemnity
bond and has not failed to give any notice or present any claim thereunder in
due and timely fashion, which failure or failures to give such notice or present
such claim, individually or in the aggregate, could materially adversely affect
the Assets. All such policies and bonds are (i) in full force and effect, (ii)
with insurance companies believed by Seller to be financially sound and
reputable, (iii) are sufficient for compliance by Seller with all requirements
of law and of all agreements and instruments to which Seller is a party, (iv)
provide that they will remain in full force and effect through the respective
dates set forth in Schedule 5.08, and (v) will not in any significant respect be
affected by, and will not terminate or lapse by reason of, the transactions
contemplated by this Agreement. Schedule 5.08 sets forth an accurate and
complete list of all accident or other liability claims received by or known by
Seller for the three year period immediately preceding the Closing, as well as a
description of the status of each such claim. Such claims are covered by one or
more insurance policies set forth in Schedule 5.08.
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5.09. Contracts, Agreements and Instruments. Schedule 5.09 accurately
and completely sets forth the information required to be contained therein.
Seller has furnished to Purchaser:
5.09.01. The Articles of Incorporation, Bylaws and other
organizational documents of Seller and all amendments thereto, as
presently in effect, certified by the president of Seller;
509.02. True and correct copies of all material contracts, agreements
and other instruments referred to in Schedule 5.09;
5.09.03. True and correct written descriptions of all service,
material supply, distribution, agency, financing or other arrangements
or understandings referred to in Schedule 5.09.
Except for matters which, in the aggregate, would not have a Material Adverse
Effect or are otherwise disclosed in the Agreement, to the knowledge of Seller,
no other party to any such contract, agreement, instrument, leases, or license
is now in violation or breach of, or in default with respect to complying with,
any material provision thereof, and each such contract, agreement, instrument,
lease, or license contained in the Schedules hereto is in full force and effect
and is the legal, valid, and binding obligation of the parties thereto and is
enforceable as to them in accordance with its terms. Each such service, supply,
distribution, agency, financing, or other arrangement or understanding contained
in the Schedules hereto is a valid and continuing arrangement or understanding,
except for matters which, in the aggregate, would not have a Material Adverse
Effect; neither Seller, nor any other party to any such arrangement or
understanding has given notice of termination or taken any action inconsistent
with the continuance of such arrangement or understanding, except for matters
which, in the aggregate, would not have a Material Adverse Effect; and the
execution, delivery, and performance of this Agreement will not prejudice any
such arrangement or understanding in any way contained in the Schedules hereto,
except for matters which, in the aggregate, would not have a Material Adverse
Effect. Seller is not a member of a customer or user organization or of a trade
association which relationship would be materially affected by the execution and
performance of this Agreement.
5.10. Compliance With Law; Taxes. Seller has complied with, and is not
in violation of any (i) term or provision of its Articles of Incorporation or
Bylaws; (ii) term or provision of any applicable judgment, decree, order,
statute, injunction, rule, ordinance; (iii) any Health Care Law; or (iv) to the
best of Seller's knowledge, foreign, United States, state or local statutes,
laws, rules, or regulations. Seller has timely filed all federal, state, and
local tax returns required to be filed and all such returns are complete and
correct. The Seller has made timely payment of all such taxes when due and
payable and has paid all interest, penalties, deficiencies, and assessments, if
any, levied or assessed against it. Seller has duly withheld, collected, and
timely paid to the proper governmental authorities all taxes required to be
withheld and collected by it. There are no agreements for extension of the time
of assessment of payment of any taxes of Seller. No waiver of any statute of
limitations has been executed by the Seller. There are no examinations by the
Internal Revenue Service of Seller presently in process and the tax returns of
Seller for any year(s)
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open to such examination. All accrued but unpaid federal, state, and local
income and other taxes of Seller for the period ended as of the Closing and all
prior periods will be paid by Seller. Any sales tax imposed as a result of this
transaction will be paid by Purchaser to Seller for remittance to the
appropriate taxing authority.
5.11. Permits and Licenses. Seller has all permits, licenses, and
other similar authorizations necessary for the conduct of its business as now
being conducted by it, and it is not in default in any respect under any such
permits, licenses, or authorizations. All permits, licenses, and other similar
authorizations necessary for the conduct of Seller's business as now being
conducted by it are as set forth in Schedule 5.11. Except as set forth in
Schedule 5.11, no royalties, commissions, or fees are payable by Seller to any
person by reason of the ownership or use of any intangible property. Seller is
the sole and exclusive owner of all of the Assets, does not use any of the
Assets by the consent of any other person and is not required to and does not
make any payments to others with respect thereto. Except as set forth in
Schedule 6.11, there are no material licenses, sub-licenses, or agreements
relating to the use of any intangible property now in effect, and Seller has no
knowledge that any intangible property is being infringed by others. Except as
listed in Schedule 5.06, no claim that would have a Material Adverse Effect on
the business of the Seller is pending or, to the knowledge of Seller,
threatened, or has been made since Seller's inception to the effect that, nor
does Seller have any knowledge that the operation of Seller's Business or any
method, process, part, or material that Seller employs, conflicts in any
material way with, or infringes in any material way upon any rights of the type
enumerated above, owned by others.
5.12. Employees. Schedule 5.12 is a list of the names of all employees
of Seller, stating the amounts or rates of compensation payable to each.
5.13. No Violation of Employee Contracts. No employee of Seller is in
violation of any term of any employment contract, non-competition agreement, or
any other contract or agreement or any restrictive covenant with, or any other
common law obligation to, a former employer relating to the right of any such
employee to be employed by Seller because of the nature of the business
conducted by Seller or of the use of trade secrets or proprietary information of
others. There is neither pending nor, to the knowledge of Seller, threatened,
any actions, suits, proceedings, or claims with respect to any contract,
agreement, covenant, or obligation referred to in the preceding sentence, except
as listed in Schedule 5.06.
5.14. Hazardous Materials. The Seller is not in the business of
possession, transportation, or disposal of hazardous materials. If and to the
extent that Seller's Business has involved the possession, transportation, or
disposal of hazardous materials, to the best of Seller's Knowledge the Seller
has complied with any and all applicable laws, ordinances, rules, and
regulations and has not and will not be the basis of any claim or proceeding
against, or any liability of, Seller with respect to the period prior to the
Closing. To the best knowledge of Seller, no employee of Seller has been
exposed to hazardous materials such that exposure could cause damage to such
employee.
5.15. Interest in Competitors. Except as set forth in Schedule 5.15
to this Agreement, no shareholder, officer, director, or employee of Seller, nor
any spouse or child of any shareholder,
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officer, director, or any employee with authority to enter into contracts on
behalf of Seller, has any direct or indirect interest in any competitor,
supplier, or customer of Seller or in any person from whom or to whom Seller
leases any real or personal property, or in any other person with whom Seller is
doing business.
5.16. Financial Condition. Seller has delivered to Purchaser true and
correct copies of the following: the audited balance sheet, statement of income
and statement of cash flows of Seller for the fiscal years ended December 31,
1996 and 1995; and an unaudited balance sheet ("Seller's Last Balance Sheet"),
statement of income and statement of cash flows for the seven months endedJuly
31, 1997 ("Seller's Last Balance Sheet Date"). Each such balance sheet presents
fairly the financial condition, assets and liabilities of Seller as of its date;
each such statement of income presents fairly the results of operations of
Seller for the period indicated; and each statement of cash flows presents
fairly the information purported to be shown therein. The financial statements
referred to in this Section 5.16 have been prepared in accordance with GAAP
consistently applied throughout the periods involved, are correct and complete
in all material respects, and are in accordance with the books and records of
Seller.
5.17. Changes or Events. Except as set forth in Schedule 5.17, since
Seller's Last Balance Sheet Date, none of the following has occurred:
5.17.01 Any material transaction by Seller not in the ordinary
course of business involving amounts in excess of $20,000;
5.17.02. Any material capital expenditure by Seller involving amounts
in excess of $20,000;
5.17.03. Other than in the ordinary course of business, any changes in
the condition (financial or otherwise), liabilities, assets, or business
or in any business relationships of Seller, including relationships with
suppliers or customers, that, when considered individually or in the
aggregate, might reasonably be expected to have a Material Adverse
Effect;
5.17.04. The destruction of, damage to, or loss of any asset of Seller
(regardless of whether covered by insurance) that, when considered
individually or in the aggregate, might reasonably be expected to have
a Material Adverse Effect;
5.17.05 Any labor disputes that, when considered individually or in the
aggregate, might reasonably be expected to have a Material Adverse
Effect;
5.17.06. Except as listed on Schedule 5.17.06, there have been no
change in accounting methods or practices (including, without
limitation, any change in depreciation or amortization policies or
rates) by Seller, except for any such changes as were required by law;
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5.17.07. Other than in the ordinary course of business, any increase in
the salary or other compensation payable or to become payable by Seller
to any employee, or the declaration, payment, or commitment or
obligation of any kind for the payment by Seller of a bonus or other
additional salary or compensation to any such person;
5.17.08. The material amendment or termination of any material
contract, agreement, or license to which Seller is a party, except in
the ordinary course of business;
5.17.09. Any loan by Seller to any person or entity, or the
guaranteeing by Seller of any loan other than loans made in the
ordinary course of business;
5.17.10 Any mortgage, pledge, or other encumbrance of any asset of
Seller except in the ordinary course of business;
5.17.11 The waiver or release of any right or claim of Seller, except
in the ordinary course of business;
5.17.12. Any other events or conditions of any character within the
knowledge of Seller that, when considered individually or in the
aggregate, have or might reasonably be expected to have a Material
Adverse Effect;
5.17.13. Any loss or, to the knowledge of Seller, any threatened loss
of any permit, license, qualification, special charter or certificate
of authority held or enjoyed or formerly held or enjoyed by Seller which
loss has had or upon occurrence might reasonably be expected to have a
Material Adverse Effect;
5.17.14. To the knowledge of Seller, any statute, regulation, order,
ordinance or other law the adoption or rescission of which might
reasonably be expected to have a Material Adverse Effect;
5.17.15 Any failure on the part of Seller to operate its business in
the ordinar course and consistent with past practices so as to preserve
its business organization intact, to retain the services of its
employees and to preserve its goodwill and relationships with suppliers,
creditors, customers, and others having business relationships with it;
5.17.16. Any action taken or omitted to be taken by Seller which would
cause (after lapse of time, notice or both) the breach, default, or
acceleration of any right, contract, commitment, or other obligation of
Seller; or
5.17.17. Any agreement by Seller to do any of the things described in
the preceding clauses 5.17.01 through 5.17.16.
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5.18. No Defaults. Except as set forth in Schedule 5.18, the consummation of
the transactions contemplated by this Agreement will not result in or constitute
any of the following: (i) a breach of any term or provision of any other
agreement of Seller that will not be waived or released at Closing; (ii) a
default or an event that will not be waived or released at Closing, and that,
with notice or lapse of time or both, would be a default, breach, or violation
of the Articles of Incorporation or Bylaws of Seller or of any lease, license,
promissory note, conditional sales contract, commitment, indenture, mortgage,
deed of trust, or other agreement, instrument, or arrangement to which Seller is
a party or by which Seller or the Assets is bound; (iii) an event that will not
be waived or released at Closing and that would permit any party to terminate
any agreement or to accelerate the maturity of any indebtedness or other
obligation of Seller; (iv) the creation or imposition of any lien, charge, or
encumbrance on any of the Assets; or (v) a violation of any law or any rule or
regulation of any administrative agency or governmental body unrelated to the
business or profession of health care and any profession related to health care,
of any order, writ, injunction or decree of any court, administrative agency or
governmental body to which Seller is subject.
5.19. Liabilities. No liabilities of Seller will be assumed by or
transferred to Purchaser pursuant to the transactions contemplated by this
Agreement, nor will any of the Assets to be acquired by Purchaser pursuant to
this Agreement be subject to any pre-Closing liabilities, nor will Purchaser
otherwise be liable for any liabilities of Seller, except those liabilities
provided for in Section 4 of this Agreement and those listed in Schedule 1.07,
and the Seller shall take no action prior to Closing that would increase the
amount of any of the liabilities provided for in Section 4. The amounts payable
with respect to Liabilities listed on Schedule 1.07 to this Agreement are the
maximum amounts payable with respect to such Liabilities.
5.20. No Prohibited Payments. Neither Seller nor any employee, or agent of
Seller, has made or authorized any payment of funds of Seller or on behalf of
Seller prohibited by law and no funds of seller have been set aside to be used
for any payment prohibited by law.
5.21. Seller's Capital Stock. Alan J. Allgood and Shelia P. Allgood
(collectively the "Stockholders"), in the aggregate, own 100% of the issued and
outstanding capital stock of Seller (the "Seller's Stock"). The Seller's Stock
is not owned or held in violation of any preemptive right of any other person or
entity, is validly authorized, validly issued, fully paid and non-assessable and
is owned of record and beneficially by the Stockholders. The shares of Seller's
Stock held by each Stockholder is held free and clear of all liens, security
interests, pledges, charges, encumbrances, voting agreements, and voting trusts.
There is outstanding no security or other instrument convertible into or
exchangeable for capital stock of Seller.
5.22 Non-Distributive Intent. Seller and/or the Stockholders are receiving
the shares of Purchaser's Common Stock to be issued hereunder to them for their
own account (and not for the account of others) for investment and not with a
view to the distribution thereof. Neither Seller nor any Stockholder will sell
or otherwise dispose of such shares without registration under the Securities
Act of 1933, as amended (the "Act"), or an exemption therefrom, and the
certificate or certificates representing such shares will contain a legend to
the foregoing effect. The Seller and the
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Stockholders further acknowledge and agree that such shares shall be restricted
from resale for a period of 12 months after the Closing date. By virtue of their
position, Seller and each Stockholder have access to the kind of financial and
other information about Purchaser as would be contained in a registration
statement filed under the Act, including reports filed pursuant to the
Securities Exchange Act of 1934 as set forth in Schedule 6.05. Seller and each
Stockholder understand that they may not sell or otherwise dispose of such
shares in the absence of either a registration statement under the Act or an
exemption from the registration provisions of the Act.
5.23. Completeness of Disclosure. No representation or warranty and no
Schedule, Exhibit, or certificate prepared by Seller pursuant hereto and no
statement made or other document prepared by Seller and furnished to Purchaser
by Seller contains any untrue statement of a material fact or omits or will omit
any material fact necessary in order to make the statements contained therein
not misleading.
6. Representations and Warranties of Purchaser. Purchaser hereby agrees,
represents, and warrants to Seller, on the date of this Agreement and on the
Closing Date, as follows:
6.01. Organization. Purchaser is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware and
authorized to do business in the State of Louisiana and in every other
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of it business makes such qualification necessary, except
where the failure to do so would not have a Material Adverse Effect.
6.02. Due Authorization; Third Party Consents. Purchaser has the right,
power, legal capacity, and authority to enter into and perform its obligations
under this Agreement and, except as set forth on Schedule 6.02 to this
Agreement, no approval or consent of any person other than the Purchaser is
necessary in connection with the execution, delivery, or performance of this
Agreement. The execution, delivery, and performance of this Agreement by the
Purchaser has been duly authorized by its board of directors and no other
corporate proceedings on the part of Purchaser are necessary to authorize this
Agreement or the consummation of the transactions contemplated hereby. This
Agreement constitutes a legal and binding obligation of the Purchaser, and is
valid and enforceable against the Purchaser in accordance with its terms except
that (i) the enforcement of certain rights and remedies created by this
Agreement is subject to bankruptcy, insolvency, reorganization, and similar laws
of general application affecting the rights and remedies of parties, (ii) the
enforceability of any particular provision of this Agreement under principles of
equity or the availability of equitable remedies, such as specific performance,
injunctive relief, waiver or other equitable remedies, is subject to the
discretion of courts of competent jurisdiction, and (iii) any court or
administrative body may refuse to enforce the choice of law provision of Section
12.12 of this Agreement.
6.03. No Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following: (i) a
breach of any term or provision of any other agreement of Purchaser that will
not be waived or released at Closing; (ii) a default or an event that will not
be waived or released at Closing and that, with notice or lapse of time or both,
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would be a default, breach, or violation of the Certificate of Incorporation or
Bylaws of Purchaser or of any lease, license, promissory note, conditional sales
contract, commitment, indenture, mortgage, deed of trust, or other agreement,
instrument, or arrangement to which Purchaser is a party or by which Purchaser
or the property of Purchaser is bound; or (iii) a violation of any law or any
rule or regulation of any administrative agency or governmental body or any
order, writ, injunction, or decree of any court, administrative agency or
governmental body to which Purchaser is subject.
6.04. Capitalization. The authorized capital stock of Purchaser includes
10,00,000 shares of Common Stock, of which 2,585,000 shares are outstanding as
of March 31,1997 and 499,581 shares are reserved to be issued upon exercise of
outstanding options and warrants. Each of such outstanding shares of
Purchaser's Common Stock is validly authorized, validly issued, fully paid, and
nonassessable, has not been issued and is not owned or held in violation of any
preemptive right of any stockholder.
6.05. Financial Condition. Purchaser (i) has delivered to Seller true and
correct copies of is Form 10-K for the fiscal year ended December 31, 1996
("Form 10-K") and (ii) has delivered its Form 10-Q for the three months ended
March 31, 1997 ("Form 10-Q"). The Form 10-K and Form 10-Q present fairly the
financial condition, assets, liabilities, and stockholders' equity of Purchaser
as of its date; each such statement of income and statement of retained earnings
presents fairly the results of operations of Purchaser for the period indicated;
and each such statement of changes in financial position presents fairly the
information purported to be shown therein. The financial statements referred to
in this Section 6.05 have been prepared in accordance with GAAP consistently
applied throughout the periods involved, are correct and complete in all
material respects and are in accordance with the books and records of Purchaser.
6.06. Continuity of Business. It is the present intent of Purchaser not to
dispose of any significant portion of its or Seller's Assets, except in the
ordinary course of business or to eliminate any duplicative facilities or excess
capacity.
6.07. Completeness of Disclosure. No representation or warranty and no
Schedule, Exhibit, or certificate prepared by Purchaser pursuant hereto and no
statement made or other document prepared by Purchaser and furnished to Seller
by Purchaser contains any untrue statement of a material fact or omits or will
omit any material fact necessary in order to make the statements contained
therein not misleading.
7. Conditions to Obligations of Purchaser. The obligations of Purchaser
under this Agreement are subject, at the option of Purchaser, to the following
conditions:
7.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of Seller contained in this Agreement shall be
accurate when made and, in addition, shall be materially accurate as of the
Closing as though such representations and warranties were then made by Seller.
As of the Closing, Seller shall have performed and complied with all covenants
and agreements and satisfied all conditions required to be performed and
complied with by Seller at or before such time by this Agreement.
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7.02. Closing Documents. In connection with the Closing, Seller shall
deliver to Purchaser the following items:
7.02.01. Bills of sale, endorsements, assignments, drafts, checks, and other
instruments of transfer in form and substance reasonably
satisfactory to Purchaser and its counsel in order to transfer all
right, title and interest in the Assets to Purchaser;
7.02.02. Original evidences of title or ownership of the Assets, including
drafts, warehouse receipts and licenses;
7.02.03. Original data and records relating to the Assets;
7.02.04. Evidence (including, if applicable, the delivery of duly executed
UCC-3 Termination Statements) reasonably satisfactory to Purchaser
and its counsel, of the satisfaction and discharge by Seller of all
existing liens, claims, and encumbrances upon or affecting the
Assets; and
7.02.05. Such other instruments and documents in form and content reasonably
satisfactory to counsel for Purchaser, as may be necessary or
appropriate to (i) effectively transfer and assign to and vest in
Purchaser good and marketable title to the Assets and/or to
consummate more effectively the transactions contemplated hereby
and (ii) in order to enable Purchaser to determine whether the
conditions to Seller's obligations under this Agreement have been
met and otherwise to carry out the provisions of this Agreement.
7.03. Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement incidental
thereto and all other related legal matters shall be subject to the reasonable
approval of counsel to Purchaser, and Seller shall have furnished such counsel
for Purchaser such documents as such counsel may have reasonably requested for
the purpose of enabling them to pass upon such matters.
7.04. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements or to obtain substantial damages with respect thereto, except as
listed in Schedule 5.06.
7.05. No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of Purchaser:
7.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
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7.05.02. Results in a delay which affects the ability of Purchaser to
consummate any of the transactions contemplated by this Agreement;
7.05.03. Requires the divestiture by Purchaser of a material portion of the
business of either Purchaser taken as a whole, or of Seller taken
as a whole; and
7.05.04. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the
contemplated benefits to Purchaser of the transactions contemplated
by this Agreement.
7.06. Contractual Consents Needed. The parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or understanding
to which any of them or any subsidiary is a party, or to which any of their
respective businesses, properties, or assets are subject, except where the
failure would not have a Material Adverse Effect.
7.07. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
parties thereto at or prior to the Closing, shall be in full force and effect,
valid and binding upon the parties thereto, and enforceable by them in
accordance with their terms at the Closing, and no party thereto at any time
from the execution thereof until immediately after the Closing shall have been
in violation of or in default in complying with any material provision thereof.
7.08. Non-Distributive Intent. Purchaser shall have received from the
Seller and the Stockholders executed letters of non-distributive intent,
substantially in the form of Schedule 7.08.
7.09. Non-Competition and Non-Solicitation Agreement. Alan J. Allgood and
Shelia P. Allgood shall have entered into the non-competition and non-
solicitation agreement in the form attached hereto as Schedule 7.09.
7.10. Board and Shareholder Approval. The Board of Directors and
shareholders of Seller shall have approved the transactions contemplated herein.
8. Conditions to Obligations of Seller. The obligations of Seller under
this Agreement are subject, at the option of Seller, to the following
conditions:
8.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of Purchaser contained in this Agreement shall be
accurate when made and shall be accurate as of the Closing as though such
representations and warranties were then made by
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Purchaser. As of the Closing, Purchaser shall have performed and complied
with all covenants and agreements and satisfied all conditions required to be
performed and complied with by any of them at or before such time by this
Agreement.
8.02. Other Closing Documents. Purchaser shall have delivered to Seller, at
or prior to the Closing, such other documents as Seller may reasonably request
in order to enable Seller to determine whether the conditions to its
obligations under this Agreement have been met and otherwise to carry out the
provisions of this Agreement.
8.03. Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement incidental
thereto and all other related legal matters shall be subject to the reasonable
approval of counsel to Seller and Purchaser shall have furnished such counsel
such documents as such counsel may have reasonably requested for the purpose of
enabling them to pass upon such matters.
8.04. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements set forth as an exhibit hereto, or to obtain substantial damages with
respect thereto.
8.05. No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of Seller:
8.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
8.05.02. Results in a delay which affects the ability of Seller to
consummate any of the transactions contemplated by this
Agreement;
8.05.03. Requires the divestiture by the Seller or the Stockholders of any
of the shares of Purchaser's Common Stock;
8.05.04. Imposes material limitations on the ability of the Seller or the
Stockholders to effectively exercise full rights of ownership of
the shares of Common Stock including the right to vote the shares
on all matters properly presented to the stockholders of
Purchaser; or
8.05.05 Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the
contemplated benefits to Seller or the Stockholders of the
transactions contemplated by this Agreement.
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8.06. Contractual Consents Needed. The Parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or understanding
to which any of them or any subsidiary is a party, or to which any of their
respective businesses, properties, or assets are subject, except where the
failure would not have a Material Adverse Effect.
8.07. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
Parties thereto at or prior to the Closing, shall be in full force, valid and
binding upon the Parties thereto, and enforceable by them in accordance with
their terms at the Closing, and no party thereto at any time from the execution
thereof until immediately after the Closing shall have been in violation of or
in default in complying with any material provision thereof.
8.08. Board Approval. The Board of Directors of Purchaser shall have
approved the transactions contemplated herein.
8.09. Employment Agreements. On or before Closing, Shelia P. Allgood and
Alan J. Allgood shall each enter into an employment agreement in the form
attached hereto as Exhibit 8.09.
9. Covenants and Agreements of Seller. Seller covenants and agrees as
follows:
9.01. Public Statements. Before Seller shall release any information
concerning this Agreement or the transactions contemplated by this Agreement
which is intended for or may result in public dissemination thereof, Seller
shall cooperate with Purchaser, shall furnish drafts of all documents or
proposed oral statements to Purchaser for comment, and shall not release any
such information without the written consent of Purchaser. Nothing contained
herein shall prevent Seller from furnishing any information to any governmental
authority if required to do so by law, with the exception of consents more fully
described in 8.06 of this Agreement.
9.02. Consents Without any Condition. Seller shall not make any agreement
or understanding with a third party not in the ordinary course of business
without approval in writing by Purchaser.
9.03. Access. Seller will afford the officers, counsel, agents,
investment bankers, accountants, and other representatives of Purchaser, free
and full access to the plans, properties, books, and records of Seller; will
permit them to make extracts from and copies of such books and records; and will
from time to time furnish Purchaser with such additional financial and operating
data and other information as to the financial condition, results of operations,
business, properties, assets, liabilities, or future prospects of Seller as
Purchaser from time to time may request. Seller will also cause the public
accountants of Seller to make available to Purchaser and its public accountants
the work papers relating to the audits of Seller.
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9.04. Conduct of Business. Seller will conduct its affairs so that at the
Closing, no representation or warranty of Seller will be inaccurate, no covenant
or agreement of Seller will be breached, and no condition in this Agreement will
remain unfulfilled by reason of the actions or omissions of Seller.
9.05. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, Seller will immediately advise Purchaser in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which any of them obtains knowledge and which (if existing and
known at the date of the execution of this Agreement) would have been required
to be set forth or disclosed in or pursuant to this Agreement or an exhibit or
schedule hereto, which (if existing and known at any time prior to or at the
Closing) would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more difficult than in
the absence of such fact or occurrence, or which (if existing and known at the
time of the Closing) would cause a condition to any party's obligations under
this Agreement not to be fully satisfied.
10. Covenants and Agreements of Purchaser. Purchaser covenants and
agrees as follows:
10.01. Public Statements. Before Purchaser shall release any
information concerning this Agreement or the transactions contemplated by this
Agreement which is intended for or may result in public dissemination thereof,
Purchaser shall cooperate with Seller, shall furnish drafts of all documents or
proposed oral statements to Seller for comments, and shall not release any such
information without the written consent of Seller. Nothing contained herein
shall prevent Purchaser from furnishing any information to any governmental
authority if required to do so by law. In the event Purchaser and Seller have
not completed the terms of this Agreement, both Purchaser and Seller shall not
disclose any information concerning this Agreement to any third party, except as
more fully described in Section 10.01 of this Agreement.
10.02. Consents Without any Condition. Purchaser shall not make any
agreement or understanding with a third party not in the ordinary course of
business not approved in writing by Seller.
10.03. Conduct of Business. Purchaser will conduct its affairs so that
at the Closing no representation or warranty of Purchaser will be inaccurate, no
covenant or agreement of Purchaser will be breached, and no condition in this
Agreement will remain unfulfilled by reason of the actions or omissions of
Purchaser.
10.04. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, Purchaser will immediately advise Seller in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which it obtains knowledge and which (if existing and known at the
date of the execution of this Agreement) would have been required to be set
forth or disclosed in or pursuant to this Agreement or an exhibit or schedule
hereto, which (if existing and known at any time prior to or at the Closing)
would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more
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difficult than in the absence of such fact or occurrence, or which (if existing
and known at the time of the Closing) would cause a condition to any party's
obligations under this Agreement not to be fully satisfied.
11. Miscellaneous.
11.01. Brokerage and Other Fees. The parties agree that there are no
brokerage arrangements or fee obligations, in writing or otherwise, with respect
to the transactions set forth in this Agreement. Each party shall be
responsible for the fees of their respective professionals (including, without
limitation, legal and accounting fees) engaged to assist in the preparation,
negotiation and counseling with respect, and relating, to this Agreement and
consummation of the transactions contemplated herein, as well as their
respective out-of-pocket expenses except Purchaser agrees to pay for the
preparation of the necessary transfer documents to accomplish the transactions
herein.
11.02. Further Actions. At any time and from time to time, the parties
agree, at their expense, to take such actions and to execute and deliver such
documents as may be reasonably necessary to effectuate the purposes of this
Agreement.
11.03. Availability of Equitable Remedies. Since a breach of the
provisions of this Agreement could not adequately be compensated by money
damages, the parties shall be entitled before, and only before, Closing, in
addition to any other right or remedy available to them, to an injunction
restraining such breach or a threatened breach and to specific performance of
any such provision of this Agreement; and in either case, no bond or other
security shall be required in connection therewith, and the parties hereby
consent to the issuance of such an injunction and to the ordering of specific
performance.
11.04. Survival. The covenants, agreements, representations, and
warranties contained in or made pursuant to this Agreement shall survive for a
period of 15 months from the Closing date, irrespective of any investigation
made by or on behalf of any party (the "Survival Date"). No claim for
indemnification may be brought pursuant to this Section 11.04 unless asserted by
written notice as provided herein by the party claiming indemnification on or
before the Survival Date.
11.05. Modification. The Agreement and the schedules and exhibits
hereto set forth the entire understanding of the parties with respect to the
subject matter hereof supersede all existing agreements among them concerning
such subject matter, and may be modified only by a written instrument duly
executed by the Parties.
11.06. Notices. Any notice or other communication required or permitted
to be given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested (or by the most nearly comparable method if mailed from
or to a location outside of the United States), or delivered against receipt to
the party to whom it is to be given at the address of such party set forth in
the preamble or signature pages to this Agreement. Any notice or other
communication given by
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certified mail (or by such comparable method) shall be deemed given at the time
of mailing (or comparable act), except for a notice changing a party's address,
which will be deemed given at the time of receipt thereof.
11.07. Waiver. Any waiver by any party of a breach of any provision of
this Agreement shall not operate as or be construed to be a waiver of any other
breach of that provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term
of this Agreement on one or more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing
and, in the case of a corporate party, be authorized by a resolution of the
Board of Directors or by an officer of the waiving party.
11.08. Binding Effect. The provisions of this Agreement shall be
binding upon and inure to the benefit of each party's respective successors,
assigns, heirs, and personal representatives.
11.09. No Third-Party Beneficiaries. This Agreement does not create,
and shall not be construed as creating, any rights enforceable by any person not
a party to this Agreement.
11.10. Separability. If any provision of this Agreement is invalid,
illegal, or unenforceable, the balance of this Agreement shall remain in effect,
and if any provision is inapplicable to any person or circumstance, it shall
nevertheless remain applicable to all other persons and circumstances.
11.11. Headings. The headings of this Agreement are solely for
convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement.
11.12. Counterparts, Governing Law. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument. It shall be
governed by and construed in accordance with the laws of the State of Louisiana
without giving effect to conflict of laws.
11.13. Indemnification. Seller and Stockholders shall, indemnify,
defend and hold harmless Purchaser and each of its officers, directors, agents
and affiliates from and against any damage, loss, claim, liability, cost or
expense, including fees and disbursements of counsel, accountants, experts and
other consultants (collectively, "Damages"), resulting from, arising out of,
based upon or occasioned by any misstatement or omission from any representation
by, or any breach of warranty, covenant or agreement of, Seller or the
Stockholders contained herein. Purchaser shall, indemnify, defend and hold
harmless Seller and each of its officers, directors, agents and affiliates and
the Stockholders from and against any Damages, resulting from, arising out of,
based upon or occasioned by any misstatement or omission from any representation
by, or any breach of warranty, covenant or agreement of, Purchaser contained
herein.
11.14. Indemnification Procedures. Promptly after receipt by Purchaser,
on the one hand, or Seller on the other hand (in any such case, the
"Indemnitee"), of notice of any action, suit,
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proceeding, audit, claim or potential claim (any of which is hereinafter
individually referred to as a "Circumstance"), which could give rise to a right
to indemnification for damages pursuant to Section 11.13, the Indemnitee shall
give the party who may become obligated to provide indemnification hereunder
(the "Indemnitor") written notice describing the Circumstance in reasonable
detail; provided, that failure of an Indemnitee to give such notice to the
Indemnitor shall not relieve the Indemnitor from any of its indemnification
obligations hereunder unless (and then only to the extent) that the failure to
give such notice prejudices the defense of the Circumstance by the Indemnitee.
Such Indemnitor shall have the right, at its option and upon its acknowledgment
to the Indemnitee of Indemnitor's liability to indemnify Indemnitee in respect
of such asserted liability, to compromise or defend, at its own expense and by
its own counsel, any such matter involving the asserted liability of the
Indemnitee; provided, that any such compromise (i) shall include as a
unconditional term thereof the giving by the claimant or the plaintiff to such
Indemnitee of a release from all liability in respect of such claim and (ii)
shall not result in the imposition on the Indemnitee of any remedy other than
monetary damages to be paid in full by the Indemnitor pursuant to this Section
11.14. If any indemnitor shall undertake to compromise or defend any such
asserted liability, it shall promptly notify the Indemnitee of its intention to
do so, and the Indemnitee agrees to, and to cause its own independent counsel
to, cooperate fully with the Indemnitor and its counsel in the compromise of, or
defense against, any such asserted liability. All reasonable out-of-pocket costs
and expenses incurred by the Indemnitee in connection with such cooperation
(including, without limitation, the reasonable fees and expenses of the
Indemnitee's own independent counsel) shall be borne by the Indemnitor. In any
event, the Indemnitee shall have the right to participate with its own counsel
(the reasonable fees and expenses of which will be borne by Indemnitor) in the
defense of such asserted liability; provided that if with respect to a
Circumstance, Indemnitor shall have acknowledged Indemnitor's liability to
indemnify Indemnitee if and to the extent of any loss arising out of such
Circumstance and Indemnitor shall be diligently defending such matter,
Indemnitor shall not be obligated to indemnify Indemnitee for the cost of
Indemnitee's participation in such defense, including Indemnitee's attorney's
fees. Under no circumstances shall the Indemnitee compromise any such asserted
liability without the written consent of the Indemnitor (which consent shall not
be unreasonably withheld), unless the Indemnitor shall have failed or refused to
undertake the defense of any such asserted liability after a reasonable period
of time has elapsed following the notice of a Circumstance received by such
Indemnitor pursuant to this Section 11.14.
11.15 Right to Sell-Off. Purchaser shall have the right to set off any
damages against any of the consideration paid by Purchaser pursuant to Sections
3.02 and 3.03 hereof.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement
effective as of the date written in the preamble of this Agreement.
AMEDISYS, INC.
By: ________________________________________
Name:
Title:
ALLGOOD MEDICAL SERVICES, INC.
By: ____________________________________
Name:
Title:
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LIST OF SCHEDULES
Schedule
No. Schedule Description
- ------ --------------------
1.01 List of Assets
1.01.f Lease Agreement
1.05 Inventory
1.06 Inventory Payables
1.07 Assumed Liabilities
3.02 Promissory Note
3.05 Asset Allocations
5.03 Seller Required Consents
5.04 Condition of Assets
5.05 Liens and Encumbrances
5.06 Litigation
5.07 Seller's Employment Contracts
5.08 Insurance
5.09 Material Contracts, etc.
5.11 Permits and Licenses
5.12 Employees
5.15 Competitors
5.17 Changes or Events
5.18 Defaults, etc.
6.02 Purchaser Required Consents
7.08 Non-Distributive Intent Letters
7.09 Non-Competition and Non-Solicitation Agreement
8.09 Allgood Employment Agreements
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EXHIBIT 2.5
EXCHANGE AGREEMENT
BY
AND
AMONG
AMEDISYS, INC.,
ALLIANCE HOME HEALTH, INC.
AND
UNIVERSITY CAPITAL CORP.
<PAGE>
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT (this "Agreement") is made effective as of December
___, 1997, by and between AMEDISYS, INC., a Delaware corporation, with its
principal place of business at 3029 South Sherwood Forest Blvd., Suite 300,
Baton Rouge, Louisiana 70816 ("AMED"), ALLIANCE HOME HEALTH, INC., an Oklahoma
corporation with its principal place of business at 4870 S. Lewis, Suite 120,
Tulsa, Oklahoma 74105 ("Company") and UNIVERSITY CAPITAL CORP., an Oklahoma
corporation with its principal place of business at 4870 S. Lewis, Suite 120,
Tulsa, Oklahoma 74105 ("Stockholder"). AMED, the Company and the Stockholder
are sometimes referred to collectively as the "Parties."
RECITALS
WHEREAS, AMED desires to exchange shares of its common stock for 100% of
the issued and outstanding capital stock of the Company ("Company Stock") from
the Stockholder as hereinafter provided and the Stockholder desires to effect
such exchange; and
NOW, THEREFORE, in consideration of the premises and the mutual promises
made herein, and in consideration of the representations, warranties, and
covenants contained herein, the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have
the meanings indicated:
1.01. Closing: The consummation of the transactions contemplated by
this Agreement.
1.02. GAAP: Generally accepted accounting principles.
1.03. Health Care Laws: All federal, state and local laws, regulations
and ordinances related to the business of the Company including but not
limited to Medicaid, Medicare and regulations of the Health Care Finance
Administration.
1.04. Knowledge: means actual knowledge after reasonable investigation.
1.05. Material Adverse Effect: Any change in the financial condition or
operation of the business that would materially affect the Company's
business adversely, including, but not limited to, material changes to
management, business conditions, or financial condition.
1.06. Medicare Liabilities: Any and all claims, losses, liabilities,
obligations, costs, expenses, fines, penalties, damages or judgments of any
kind or nature whatsoever assessed by Medicare for Cost Provider Numbers
_____ and _____ for the fiscal years ending August 31, 1995; 1996 and 1997;
and September 30, 1995; 1996 and 1997, respectively.
<PAGE>
1.07. Medicare Cost Reporting Letter: A letter from Medicare detailing
the Medicare Liabilities.
1.08. Operating Licenses: Licenses, permits and registrations issued by
the appropriate state and federal agencies, which are necessary to the
operation of the Company's business. Such Operating Licenses are more fully
described in Schedule 3.11 hereto.
2. Terms of Exchange. On the basis of the representations,
warranties, covenants, and agreements contained in this Agreement and subject to
the terms and conditions of this Agreement:
2.01. Transfer. The Stockholder shall assign, transfer and convey at
the Closing the Company Stock, representing 100% of the issued and outstanding
capital stock of the Company, to AMED. The Stockholder shall deliver at Closing
a Stock Power in the form attached hereto as Schedule 2.01, a letter of Non-
distributive Intent attached hereto as Schedule 5.06, and any other documents
required by this Agreement.
2.02. Consideration. AMED shall deliver and the Stockholder shall be
entitled to receive 278,571 shares of Amed common stock, of which ______ shares
will be placed in escrow as collateral for the indemnification provisions set
forth in Section 9.13, pursuant to the Escrow Agreement attached hereto as
Schedule 2.02.
2.03. Total Consideration. The Company Stock referred to in Section
2.01. and the consideration to be paid by AMED referred to in Section 2.02.
shall constitute all of the consideration to be paid in connection with the
transactions contemplated by this Agreement.
2.04. The Closing. The Closing of the transactions contemplated by
this Agreement shall be on or before December ___, 1997, at the law offices of
Brewer & Pritchard, P.C., 1111 Bagby, Suite 2450, Houston, Texas 77002 or such
other locations as mutually agreed.
3. Representations and Warranties of the Company and the
Stockholder. The Company and the Stockholder hereby agree, represent, and
warrant to AMED, on the date of this Agreement, as follows:
3.01. Organization and Qualification. The Company does not own any
interest in any other business enterprise or legal entity, except as disclosed
in Schedule 3.01. Schedule 3.01 also correctly sets forth as to the Company its
state of incorporation, principal place of business, and jurisdictions in which
it is qualified to do business. The Company is an Oklahoma corporation duly
organized, validly existing, and in good standing under the laws of its
jurisdiction of incorporation, with all requisite power and authority to conduct
its business and is not in breach of, or in default with respect to, any term of
its Certificate of Incorporation, Bylaws or other organizational documents,
except where such breach would not have a Material Adverse Effect. The Company
has obtained all necessary consents, authorizations, approvals, orders,
licenses, certificates, and permits of and from, and declarations and filings
with, all federal, state, local, and other governmental authorities and all
courts and other tribunals, to own, lease, license, and use its properties and
assets and to carry
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on the business in which it is now engaged and the business in which it
contemplates engaging, except where the failure to do so would not have a
Material Adverse Effect. The Company is duly qualified to transact the business
in which it is engaged in every jurisdiction in which its ownership, leasing,
licensing, or use of property or assets or the conduct of its business makes
such qualification necessary, except where the failure to do so would not have a
Material Adverse Effect.
3.02. Capitalization. The Stockholder owns ____ shares of the Company
Stock, which constitutes all of the outstanding capital stock of Company. The
Company Stock is not owned or held in violation of any preemptive right of any
other person or entity, is validly authorized, validly issued, fully paid and
non-assessable, and is owned of record and beneficially by the Stockholder. The
shares of Company Stock held by the Stockholder are free and clear of all liens,
security interests, pledges, charges, encumbrances, voting agreements, and
voting trusts. There is no commitment, plan, or arrangement to issue, and no
outstanding option, warrant, or other right calling for the issuance of, any
shares of capital stock of the Company or any security or other instrument
convertible into, exercisable for, or exchangeable for capital stock of the
Company. There is outstanding no security or other instrument convertible into
or exchangeable for capital stock of the Company.
3.03. Due Authorization; Third Party Consents. The Company and the
Stockholder have the right, power, legal capacity, and authority to enter into
and perform its obligations under this Agreement and, except as set forth on
Schedule 3.03 to this Agreement, no approval or consent of any person other than
the Company and the Stockholder is necessary in connection with the execu tion,
delivery, or performance of this Agreement. The execution, delivery, and
performance of this Agreement by the Company and the Stockholder have been duly
authorized by its board of directors and no other corporate proceedings on the
part of the Company or the Stockholder are necessary to authorize this Agreement
or the consummation of the transactions contemplated hereby. This Agreement
constitutes a legal and binding obligation of the Company and the Stockholder,
and is valid and enforceable against the Company and the Stockholder in
accordance with its terms except that (i) the enforcement of certain rights and
remedies created by this Agreement is subject to bankruptcy, insolvency,
reorganization, and similar laws of general application affecting the rights and
remedies of parties, (ii) the enforceability of any particular provision of this
Agreement under principles of equity or the availability of equitable remedies,
such as specific performance, injunctive relief, waiver or other equitable
remedies, is subject to the discretion of courts of competent jurisdiction, and
(iii) any court or administrative body may refuse to enforce the choice of law
provision of Section 9.12 of this Agreement.
3.04. Litigation. Except as set forth in Schedule 3.04, there is not
any suit, action, arbitration, or legal, administrative, or other proceeding or
governmental investigation (formal or informal), pending or to the best of
Company's or Stockholder's Knowledge threatened (or any basis therefor known to
the Company or the Stockholder), with respect to the Company or the Stockholder
(as it relates to the business of the Company), including but not limited to any
action or claim under any federal, state, local or other governmental act, rule,
regulation, or any interpretations thereof, relating to environmental matters or
the protection of the safety and health of persons connected with
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the Company's business (including but not limited to the transportation,
treatment, storage, recycling, disposal, or release into the environment of
hazardous or toxic materials or waste), or any basis on which any proceeding or
investigation against the Company or the Stockholder might reasonably be
undertaken or brought. The Company and the Stockholder have informed AMED of,
and upon request has furnished or made available to AMED copies of all relevant
court papers and other documents relating to, the matters set forth in Schedule
3.04. Included in Schedule 3.04 is a list of all suits, actions, arbitrations,
or other proceedings or investigations in which the Company has been involved
during the five year period immediately preceding the Closing. The Company is
not presently engaged in any legal action to recover monies due to the Company,
for damages sustained by the Company, or amounts owed to the Company, except as
set forth on Schedule 3.04. During the five year period immediately preceding
the Closing, the Company has neither received nor been a party to any written
notice of violations, orders, claims, citations, complaints, penalties,
assessments, court, or other proceedings, administrative, civil or criminal, at
law or in equity, with respect to any Health Care Law except for routine
regulatory inquiries or claims which would not have a material Adverse Effect.
In addition, to the Company's and Stockholder's Knowledge, the Company has
neither received nor been party to any written notice of violations, orders,
claims, citations, complaints, penalties, assessments, court, or other
proceedings, administrative, civil or criminal, at law or in equity, with
respect to any alleged violations of any other federal, state, or local
environmental law, regulation, ordinance, standard, permit, or order in
connection with the conduct of its business or otherwise during the past five
years.
3.05. Employees. The Company does not have, or contribute to, any
pension, profit-sharing, option, other incentive plan, or other Employee Benefit
Plan (as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974), or has any obligation to or customary arrangement with employees for
bonuses, incentive compensation, vacations, severance pay, insurance, or other
benefits, except as set forth in Schedule 3.05. Schedule 3.05. contains a true
and correct statement of the names, relationship with the Company, present rates
of compensation (whether in the form of salary, bonuses, commissions, or other
supplemental compensation now or hereafter payable), and aggregate compensation
for the fiscal year ended December 31, 1996 of each Stockholder, and the three
highest paid employees of the Company. As of November 30, 1997, the rate of
compensation of any of its Stockholder, employees, agents, dealers or
distributors, is disclosed in Schedule 3.05.
3.06. No Violation of Employee Contracts. No employee of the Company
is in violation of any term of any employment contract, non-competition
agreement, or any other contract or agreement or any restrictive covenant with a
former employer relating to the right of any such employee to be employed by the
Company because of the nature of the business conducted by the Company or of the
use of trade secrets or proprietary information of others. There is neither
pending nor, to the Knowledge of the Company or the Stockholder, threatened, any
actions, suits, proceedings, or claims with respect to any contract, agreement,
covenant, or obligation referred to in the preceding sentence, except as listed
in Schedule 3.04.
3.07. Insurance. Schedule 3.07 sets forth an accurate and complete
list and brief description of all policies of fire and extended coverage,
liability, and the forms of similar insurance
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or indemnity bonds held by the Company. The Company is not in default with
respect to any provisions of any such policy or indemnity bond and has not
failed to give any notice or present any claim thereunder in due and timely
fashion, which failure or failures to give such notice or present such claim,
individually or in the aggregate, could have a Material Adverse Effect on the
business of the Company. All such policies and bonds are (i) in full force and
effect, (ii) with insurance companies believed by the Company and the
Stockholder to be financially sound and reputable, (iii) are sufficient for
compliance by the Company with all requirements of law and of all agreements and
instruments to which the Company is a party, (iv) provide that they will remain
in full force and effect through the respective dates set forth in Schedule
3.07, and (v) will not in any significant respect be affected by, and will not
terminate or lapse by reason of, the transactions contemplated by this
Agreement. Schedule 3.07 sets forth an accurate and complete list of all
accident or other liability claims received by or known by the Company and the
Stockholder for the three year period immediately preceding the Closing,
involving claims in excess of $10,000 per claim, as well as a description of the
status of each such claim. Such claims are covered by one or more insurance
policies set forth in Schedule 3.07.
3.08. Contracts, Agreements and Instruments. Schedule 3.08 accurately
and completely sets forth the information required to be contained therein. The
Company has furnished to AMED:
3.08.01. The Certificate of Incorporation, Bylaws and other
organizational documents of the Company and all amendments thereto, as
presently in effect, certified by the president of the Company;
3.08.02. True and correct copies of all material contracts,
agreements and other instruments in excess of $20,000 referred to in
Schedule 3.08;
3.08.03. True and correct written descriptions of all service,
material supply, distribution, agency, financing or other arrangements
or understandings referred to in Schedule 3.08 involving an obligation
on the part of the Company in excess of $20,000.
Except for matters which, in the aggregate, would not have a Material Adverse
Effect or are otherwise disclosed in the Agreement, to the Knowledge of the
Company and the Stockholder, no other party to any such contract, agreement,
instrument, leases, or license is now in violation or breach of, or in default
with respect to complying with, any material provision thereof, and each such
contract, agreement, instrument, lease, or license contained in the Schedules
hereto is in full force and effect and is the legal, valid, and binding
obligation of the parties thereto and is enforceable as to them in accordance
with its terms. Each such service, supply, distribution, agency, financing, or
other arrangement or understanding contained in the Schedule hereto is a valid
and continuing arrangement or understanding, except for matters which, in the
aggregate, would not have a Material Adverse Effect; neither the Company, the
Stockholder, nor any other party to any such arrangement or understanding has
given notice of termination or taken any action inconsistent with the
continuance of such arrangement or understanding, except for matters which, in
the aggregate, would not have
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a Material Adverse Effect; and the execution, delivery, and performance of this
Agreement will not prejudice any such arrangement or understanding in any way
contained in the Schedule hereto, except for matters which, in the aggregate,
would not have a Material Adverse Effect.
3.09. Compliance With Laws. The Company has complied with, and is not
in violation of any term or provision of its Certificate of Incorporation or
Bylaws. To the Company's and the Stockholder's Knowledge, the Company has
complied with and is not in violation of any of the (i) terms or provisions of
any applicable judgment, decree, order, statute, injunction, rule, ordinance, or
(ii) any Health Care Law, or (iii) foreign, United States, state or local
statutes, laws, rules, or regulations, except for any variance that would not
have a Material adverse Effect.
3.10. Financial Condition. The Company has delivered to AMED true and
correct copies of the following: audited financial statements of the Company for
the fiscal year ended September 30, 1995, unaudited financial statements of the
Company for the fiscal year ended September 30, 1996, unaudited financial
statements of the Company for the fiscal year ended September 30, 1997 and the
unaudited balance sheet ("the Company's Last Balance Sheet") dated as of October
31, 1997 ("the Company's Last Balance Sheet Date"), all of which are set forth
in Schedule 3.10. Each such balance sheet presents fairly the financial
condition, assets and liabilities of the Company as of its date; each such
statement of income presents fairly the results of operations of the Company for
the period indicated; and each statement of cash flows presents fairly the
information purported to be shown therein. The financial statements referred to
in this Section 3.10 have been prepared in accordance with GAAP consistently
applied throughout the periods involved, are correct and complete in all
material respects, and are in accordance with the books and records of the
Company.
3.11. Permits and Licenses. The Company has all permits, licenses, and
other similar authorizations necessary for the conduct of its business as now
being conducted by it, and it is not in default in any respect under any such
permits, licenses, or authorizations. All permits, licenses, and other similar
authorizations necessary for the conduct of the Company's business as now being
conducted by it are as set forth in Schedule 3.11. Except as set forth in
Schedule 3.11, no royalties, commissions, or fees are payable by the Company to
any person by reason of the ownership or use of any intangible property. The
Company is the sole and exclusive owner of all of its assets, does not use any
of its assets by the consent of any other person and is not required to and does
not make any payments to others with respect thereto. Except as set forth in
Schedule 3.11, there are no material licenses, sub-licenses, or agreements
relating to the use of any intangible property now in effect, and the Company
and the Stockholder have no Knowledge that any intangible property is being
infringed by others. Except as listed in Schedule 3.04, no claim that would
have a Material Adverse Effect on the business of the Company is pending or, to
the Knowledge of the Company, threatened, or has been made since the Company's
inception to the effect that, nor does the Company have any Knowledge that the
operation of the Company's business or any method, process, part, or material
that the Company employs, conflicts in any material way with, or infringes in
any material way upon any rights of the type enumerated above, owned by others.
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3.12. Properties. The Company has good and marketable title to all
properties and assets used in its business or owned by it (except such real and
other property and assets as are held pursuant to leases or licenses described
in Schedule 3.12), free and clear of all liens, mortgages, security interests,
pledges, charges, and encumbrances (except such as are disclosed in Schedule
3.12 or disclosed on the Company's Last Balance Sheet).
3.12.01. Attached as Schedule 3.12 is a true and complete list of all
properties and assets owned, leased, or licensed by the Company having an
individual or aggregate value of $20,000 or more, including with respect to
such properties and assets leased or licensed by the Company, a description
of such lease or license. All such properties and assets owned by the
Company are reflected on the Company's Last Balance Sheet. All properties
and assets owned, leased, or licensed by the Company that are necessary to
the Company's business are in good and usable condition (reasonable wear
and tear, which is not such as to have a Material Adverse Effect on the
operation of the business of the Company, excepted);
3.12.02. The properties and assets owned, leased, or licensed by the
Company constitute all such properties and assets which are necessary to
the business of the Company as presently conducted or as it contemplates
conducting;
3.12.03. No real property owned, leased or licensed by the Company lies in
an area which is, to the Knowledge of the Company or any Stockholder, or
will be subjected to zoning, use or building code restrictions which would
prohibit the continued effective ownership, leasing, licensing or use of
such real property in the business in which the Company is now engaged or
the business in which it contemplates engaging; and
3.12.04. All accounts and notes receivable, net of reserve for bad debt,
reflected on the Company's Last Balance Sheet, and arising since the Last
Balance Sheet Date, have been collected, or are and will be good and
collectible, in each case at the aggregate recorded amounts thereof without
right of recourse, defense, deduction, return of goods, counterclaim,
offset, or setoff on the part of the obligor, and, if not collected, can
reasonably be anticipated to be paid within 90 days of the date incurred.
3.13. Hazardous Materials. Except as disclosed on Schedule 3.13, the
Company is not in the business of possession, transportation, or disposal of
hazardous materials. If and to the extent that the Company's business has
involved the possession, transportation, or disposal of hazardous materials, to
the best of the Company's and the Stockholder's Knowledge the Company has
complied with any and all applicable laws, ordinances, rules, and regulations
and has not and will not be the basis of any claim or proceeding against, or any
liability of, the Company with respect to the period
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prior to the Closing. To the Knowledge of the Company and the Stockholder, no
employee of the Company has been exposed to hazardous materials in the course of
employment with the Company such that exposure could cause liability to the
Company.
3.14. Interest in Competitors. Except as set forth in Schedule 3.14
to this Agreement, no shareholder, officer, director, or employee of the
Company, nor any spouse or child of any shareholder, officer, director, or any
employee with authority to enter into contracts on behalf of the Company, has
any direct or indirect interest in any competitor, supplier, or customer of the
Company or in any person from whom or to whom the Company leases any real or
personal property, or in any other person with whom the Company is doing
business.
3.15. Tax and Other Liabilities. The Company does not have any present
liability of any nature, accrued or contingent, including, without limitation,
liabilities for federal, state, local, or foreign taxes and liabilities to
customers or suppliers, which could have a Material Adverse Effect upon the
Company, other than the following:
i. Liabilities for which full provision has been made on the Company
Last Balance Sheet as of the Company's Last Balance Sheet Date,
in accordance with GAAP, and
ii. Other liabilities arising since the Company's Last Balance Sheet
Date and prior to the Closing in the ordinary course of business
which are not inconsistent with the representations and
warranties of the Company's or any other provision of this
Agreement.
Without limiting the generality of the foregoing, the amounts set forth as
provisions for taxes on the Company's Last Balance Sheet are sufficient for all
accrued and unpaid taxes of the Company, whether or not due and payable and
whether or not disputed, under tax laws, as in effect on the Company's Last
Balance Sheet Date or now in effect, for the period ended on such date and for
all fiscal years prior thereto. The Company has filed all applicable tax
returns required to be filed by it or has obtained applicable extensions and are
not delinquent with respect to such extensions; have paid (or have established
on the Company's Last Balance Sheet a reserve for) all taxes, assessments, and
other governmental charges payable or remittable by it or levied upon it or its
properties, assets, income, or franchises, which are due and payable and have
delivered to the Company a true and correct copy of any report as to adjustments
received by the Company from any taxing authority during the past five years and
a statement as to any litigation, governmental or other proceeding (formal or
informal), or investigation pending.
3.16. Changes or Events. Except as set forth in Schedule 3.16, since
the Company's Last Balance Sheet Date, none of the following has occurred:
3.16.01. Any material transaction by the Company not in the ordinary
course of business involving amounts in excess of $20,000;
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3.16.02. Any material capital expenditure by the Company involving
amounts in excess of $20,000;
3.16.03. Other than in the ordinary course of business, any changes in
the condition (financial or otherwise), liabilities, assets, or business
or in any business relationships of the Company, including relationships
with suppliers or customers, that, when considered individually or in
the aggregate, might reasonably be expected to have a Material Adverse
Effect;
3.16.04. The destruction of, damage to, or loss of any asset of the
Company (regardless of whether covered by insurance) that, when
considered individually or in the aggregate, might reasonably be
expected to have a Material Adverse Effect;
3.16.05. Any labor disputes that, when considered individually or in
the aggregate, might reasonably be expected to have a Material Adverse
Effect;
3.16.06. Except as listed on Schedule 3.16, there have been no changes
in accounting methods or practices (including, without limitation, any
change in depreciation or amortization policies or rates) by the
Company, except for any such changes as were required by law;
3.16.07. Other than in the ordinary course of business or if it has no
Material Adverse Effect, any increase in the salary or other
compensation payable or to become payable by the Company to any
employee, or the declaration, payment, or commitment or obligation of
any kind for the payment by the Company of a bonus or other additional
salary or compensation to any such person;
3.16.08. The material amendment or termination of any material
contract, agreement, or license to which the Company is a party, except
in the ordinary course of business;
3.16.09. Any loan by the Company to any person or entity, or the
guaranteeing by the Company of any loan other than loans made in the
ordinary course of business;
3.16.10. Any mortgage, pledge, or other encumbrance of any asset of the
Company except in the ordinary course of business;
3.16.11. The waiver or release of any right or claim of the Company,
except in the ordinary course of business;
3.16.12. Any other events or conditions of any character within the
Knowledge of the Company and the Stockholder that, when considered
individually or in the aggregate, have or might reasonably be expected
to have a Material Adverse Effect;
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3.16.13. Any loss or, to the Knowledge of the Company or the
Stockholder, any threatened loss of any permit, license, qualification,
special charter or certificate of authority held or enjoyed or formerly
held or enjoyed by the Company which loss has had or upon occurrence
might reasonably be expected to have a Material Adverse Effect;
3.16.14. Any failure on the part of the Company to operate its business
in the ordinary course and consistent with past practices so as to
preserve its business organization intact, to retain the services of its
employees and to preserve its goodwill and relationships with
suppliers, creditors, customers, and others having business
relationships with it;
3.16.15. Any agreement by the Company to do any of the things described
in the preceding clauses 3.16.01 through 3.16.14.
3.17. No Defaults. Except as set forth in Schedule 3.17, the
consummation of the transactions contemplated by this Agreement will not result
in or constitute any of the following: (i) a breach of any term or provision of
any other agreement of the Company or Stockholder that will not be waived or
released at Closing; (ii) a default or an event that will not be waived or
released at Closing, and that, with notice or lapse of time or both, would be a
default, breach, or violation of the Certificate of Incorporation or Bylaws of
the Company or of any lease, license, promissory note, conditional sales
contract, commitment, indenture, mortgage, deed of trust, or other agreement,
instrument, or arrangement to which the Company or Stockholder is a party or by
which the Company or Stockholder or its assets are bound; (iii) an event that
will not be waived or released at Closing and that would permit any party to
terminate any agreement or to accelerate the maturity of any indebtedness or
other obligation of the Company or Stockholder; (iv) the creation or imposition
of any lien, charge, or encumbrance on any of the Company's assets; or (v) a
violation of any law or any rule or regulation of any administrative agency or
governmental body unrelated to the business or profession of health care and any
profession related to health care, of any order, writ, injunction or decree of
any court, administrative agency or governmental body to which the Company or
Stockholder is subject.
3.18. No Prohibited Payments. Neither the Company nor any employee, or
agent of the Company, has made or authorized any payment of funds of the Company
or on behalf of the Company prohibited by law and no funds of the Company have
been set aside to be used for any payment prohibited by law.
3.19. Non-Distributive Intent. The Stockholder is receiving the shares of
AMED's Common Stock to be issued hereunder to them for their own account (and
not for the account of others) for investment and not with a view to the
distribution thereof. The Stockholder will not sell or otherwise dispose of such
shares without registration under the Securities Act of 1933, as amended (the
"Act"), or an exemption therefrom, and the certificate or certificates
representing such shares will contain a legend to the foregoing effect. The
Stockholder further acknowledges and agrees that unless the resale of the shares
is registered under the Act, such resale must be made
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pursuant to Rule 144 under the Act. The Stockholder understands that it may not
sell or otherwise dispose of such shares in the absence of either a registration
statement under the Act or an exemption from the registration provisions of the
Act.
3.20. Completeness of Disclosure. No representation or warranty and no
Schedule, exhibit, or certificate prepared by the Company or Stockholder
pursuant hereto and no statement made or other document prepared by the Company
or Stockholder and furnished to AMED by the Company or Stockholder contains any
untrue statement of a material fact or omits or will omit any material fact
necessary in order to make the statements contained therein not misleading,
except where such instance would not have a Material Adverse Effect.
4. Representations and Warranties of AMED. AMED hereby agrees,
represents, and warrants to the Stockholder, on the date of this Agreement and
on the Closing Date, as follows:
4.01. Organization. AMED is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware and
authorized to carry on business in the State of Louisiana and in every other
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of it business makes such qualification necessary, except
where the failure to do so would not have a Material Adverse Effect.
4.02. Due Authorization; Third Party Consents. AMED has the right, power,
legal capacity, and authority to enter into and perform its obligations under
this Agreement and no approval or consent of any person other than AMED is
necessary in connection with the execution, delivery, or performance of this
Agreement. The execution, delivery, and performance of this Agreement by AMED
has been duly authorized by its board of directors and no other corporate
proceedings on the part of AMED are necessary to authorize this Agreement or the
consummation of the transactions contemplated hereby. This Agreement
constitutes a legal and binding obligation of AMED, and is valid and enforceable
against AMED in accordance with its terms except that (i) the enforcement of
certain rights and remedies created by this Agreement is subject to bankruptcy,
insolvency, reorganization, and similar laws of general application affecting
the rights and remedies of parties, (ii) the enforceability of any particular
provision of this Agreement under principles of equity or the availability of
equitable remedies, such as specific performance, injunctive relief, waiver or
other equitable remedies, is subject to the discretion of courts of competent
jurisdiction, and (iii) any court or administrative body may refuse to enforce
the choice of law provision of Section 9.12 of this Agreement.
4.03. No Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following: (i) a
breach of any term or provision of any other agreement of AMED that will not be
waived or released at Closing; (ii) a default or an event that will not be
waived or released at Closing and that, with notice or lapse of time or both,
would be a default, breach, or violation of the Certificate of Incorporation or
Bylaws of AMED or of any lease, license, promissory note, conditional sales
contract, commitment, indenture, mortgage, deed of trust, or other agreement,
instrument, or arrangement to which AMED is a party or by which AMED or
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the property of AMED is bound; or (iii) a violation of any law or any rule or
regulation of any administrative agency or governmental body or any order, writ,
injunction, or decree of any court, administrative agency or governmental body
to which AMED is subject.
4.04. Capitalization. The authorized capital stock of AMED includes
10,000,000 shares of Common Stock, of which 2,734,549 shares are outstanding as
of June 30,1997 and 499,581 shares are reserved to be issued upon exercise of
outstanding options and warrants. Each of such outstanding shares of AMED's
Common Stock is validly authorized, validly issued, fully paid, and
nonassessable, has not been issued and is not owned or held in violation of any
preemptive right of any stockholder.
4.05. Compliance With Laws. AMED has complied with, and is not in violation
of any term or provision of, its Certificate of Incorporation or Bylaws. To its
Knowledge, Amed has complied with and is not in violation of any (i) term or
provision of any applicable judgment, decree, order, statute, injunction, rule,
ordinance; (ii) any Health Care Law; or (iii) foreign, United States, state or
local statutes, laws, rules, or regulations.
4.06. Financial Condition. AMED has delivered to the Company and
Stockholder, and the Company and Stockholder acknowledges receipt of and have
read and understand a copy of its Form 10-K for the fiscal year ended December
31, 1996 ("Form 10-K"), its proxy statement dated July 16, 1997 and its Form
10-Q for the nine months ended September 30, 1997 ("Form 10-Q"). The Form 10-K
and Form 10-Q present fairly the financial condition, assets, liabilities, and
stockholders' equity of AMED as of its date; each such statement of income and
statement of retained earnings presents fairly the results of operations of AMED
for the period indicated; and each such statement of changes in financial
position presents fairly the information purported to be shown therein. The
financial statements referred to in this Section 4.06 have been prepared in
accordance with GAAP consistently applied throughout the periods involved, are
correct and complete in all material respects and are in accordance with the
books and records of AMED.
4.07. Reports. Since September 30, 1997, AMED has filed all forms, reports
and documents with the Securities and Exchange Commission (the "Commission")
required to be filed by it pursuant to the federal securities laws and
Commission rules and regulations thereunder, and all such forms, reports and
documents filed with the Commission have complied in all material respects with
all applicable requirements of the federal securities laws and the Commission
rules and regulations promulgated thereunder.
4.08. AMED Stock. All of the shares of AMED common stock to be issued to
the Stockholder hereunder will, upon delivery, be duly authorized and validly
issued, fully paid and non-assessable and issued in compliance with federal and
state securities laws, free and clear of all liens charges, restrictions,
mortgages, security interests or claims of any kind, except those restrictions
regarding transfer pursuant to Rule 144 of the Act. AMED has notified Nasdaq of
the issuance of its common stock hereunder to Stockholder.
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4.09. Completeness of Disclosure. No representation or warranty and no
Schedule, exhibit, or certificate prepared by AMED pursuant hereto and no
statement made or other document prepared by AMED and furnished to the Company
or Stockholder by AMED contains any untrue statement of a material fact or omits
or will omit any material fact necessary in order to make the statements
contained therein not misleading, except where such instance would not have a
Material Adverse Effect.
5. Conditions to Obligations of AMED. The obligations of AMED under this
Agreement are subject, at the option of AMED, to the following conditions:
5.01. Other Closing Documents. Company and the Stockholder shall have
delivered to AMED at or prior to the Closing such other documents as AMED may
reasonably request in order to enable AMED to determine whether the conditions
to their obligations under this Agreement have been met and otherwise to carry
out the provisions of this Agreement.
5.02. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements or to obtain substantial damages with respect thereto, except as
listed in Schedule 3.04.
5.03. No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of AMED:
5.03.01. Makes any of the transactions contemplated by this Agreement
illegal;
5.03.02. Results in a delay which affects the ability of AMED to
consummate any of the transactions contemplated by this Agreement;
5.03.03. Requires the divestiture by AMED of a material portion of the
business of either AMED taken as a whole, or of the Company taken as a
whole; and
5.03.04. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the contemplated
benefits to AMED of the transactions contemplated by this Agreement.
5.04. Contractual Consents Needed. The parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or understanding
to which any of them or any subsidiary is a party, or to which any of their
respective businesses, properties, or assets are subject, except where the
failure would not have a Material Adverse Effect.
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5.05. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
parties thereto at or prior to the Closing, shall be in full force and effect,
valid and binding upon the parties thereto, and enforceable by them in
accordance with their terms at the Closing, and no party thereto at any time
from the execution thereof until immediately after the Closing shall have been
in violation of or in default in complying with any material provision thereof.
5.06. Non-Distributive Intent. AMED shall have received from the Company
and the Stockholder executed letters of non-distributive intent, substantially
in the form of Schedule 5.06.
5.07. Non-Competition and Non-Solicitation Agreement. Kevin Webb shall have
entered into the non-competition and non-solicitation agreement in the form
attached hereto as Schedule 5.07.
5.08. Board and Shareholder Approval. The Board of Directors and
Stockholders of the Company shall have approved the transactions contemplated
herein.
5.09. Legal Opinion. AMED shall have received the opinion of Tilly &
Associates, dated the Closing Date, in the form of Schedule 5.09 attached
hereto.
5.10. Release. Stockholder shall have executed the release as set forth in
Schedule 5.10.
6. Conditions to Obligations of The Company. The obligations of the
Company under this Agreement are subject, at the option of the Company, to the
following conditions:
6.01. Other Closing Documents. AMED shall have delivered to the Company, at
or prior to the Closing, such other documents as the Company may reasonably
request in order to enable the Company to determine whether the conditions to
its obligations under this Agreement have been met and otherwise to carry out
the provisions of this Agreement.
6.02. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements set forth as an exhibit hereto, or to obtain substantial damages with
respect thereto.
6.03 No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of the Company:
6.03.01. Makes any of the transactions contemplated by this Agreement
illegal;
6.03.02. Results in a delay which affects the ability of the Company to
consummate any of the
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transactions contemplated by this Agreement;
6.03.03. Requires the divestiture by the Company or the Stockholder of any
of the shares of AMED's Common Stock;
6.03.04. Imposes material limitations on the ability of the Company or the
Stockholder to effectively exercise full rights of ownership of the shares
of Common Stock including the right to vote the shares on all matters
properly presented to the stockholders of AMED; or
6.03.05. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the contemplated
benefits to the Company or the Stockholder of the transactions contemplated
by this Agreement.
6.04. Contractual Consents Needed. The Parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or understanding
to which any of them or any subsidiary is a party, or to which any of their
respective businesses, properties, or assets are subject, except where the
failure would not have a Material Adverse Effect.
6.05. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
Parties thereto at or prior to the Closing, shall be in full force, valid and
binding upon the Parties thereto, and enforceable by them in accordance with
their terms at the Closing, and no party thereto at any time from the execution
thereof until immediately after the Closing shall have been in violation of or
in default in complying with any material provision thereof.
6.06. Board Approval. The Board of Directors of AMED shall have approved
the transactions contemplated herein.
6.07. Employment Agreements. On or before Closing, Kevin M. Webb shall
enter into an employment agreement in the form attached hereto as Schedule 6.07.
7. Covenants and Agreements of the Company. The Company covenants and
agrees as follows:
7.01. Public Statements. Before the Company shall release any information
concerning this Agreement or the transactions contemplated by this Agreement
which is intended for or may result in public dissemination thereof, the Company
shall cooperate with AMED, shall furnish drafts of all documents or proposed
oral statements to AMED for comment, and shall not release any such information
without the written consent of AMED. Nothing contained herein shall prevent the
Company from furnishing any information to any governmental authority if
required to do so by law.
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7.02. Consents Without any Condition. The Company shall not make any
agreement or understanding with a third party not in the ordinary course of
business without approval in writing by AMED.
7.03. Access. The Company will afford the officers, counsel, agents,
investment bankers, accountants, and other representatives of AMED, free and
full access to the plans, properties, books, and records of the Company; will
permit them to make extracts from and copies of such books and records; and will
from time to time furnish AMED with such additional financial and operating data
and other information as to the financial condition, results of operations,
business, properties, assets, liabilities, or future prospects of the Company as
AMED from time to time may request. The Company will also cause the public
accountants of the Company to make available to AMED and its public accountants
the work papers relating to the financial statements of the Company.
7.04. Conduct of Business. The Company will use its best efforts to conduct
its affairs so that at the Closing, no representation or warranty of the Company
will be inaccurate, no covenant or agreement of the Company will be breached,
and no condition in this Agreement will remain unfulfilled by reason of the
actions or omissions of the Company.
7.05. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, the Company will immediately advise AMED in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which any of them obtains knowledge and which (if existing and
known at the date of the execution of this Agreement) would have been required
to be set forth or disclosed in or pursuant to this Agreement or an exhibit or
schedule hereto, which (if existing and known at any time prior to or at the
Closing) would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more difficult than in
the absence of such fact or occurrence, or which (if existing and known at the
time of the Closing) would cause a condition to any party's obligations under
this Agreement not to be fully satisfied.
8. Covenants and Agreements of AMED. AMED covenants and agrees as
follows:
8.01. Public Statements. Before AMED shall release any information
concerning this Agreement or the transactions contemplated by this Agreement
which is intended for or may result in public dissemination thereof, AMED shall
cooperate with the Company, shall furnish drafts of all documents or proposed
oral statements to the Company for comments, and shall not release any such
information without the written consent of the Company. Nothing contained
herein shall prevent AMED from furnishing any information to any governmental
authority if required to do so by law. In the event AMED and the Company have
not completed the terms of this Agreement, both AMED and the Company shall not
disclose any information concerning this Agreement to any third party.
8.02. Consents Without any Condition. AMED shall not make any agreement or
understanding with a third party not in the ordinary course of business not
approved in writing by the Company.
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8.03. Conduct of Business. AMED will conduct its affairs so that at the
Closing no representation or warranty of AMED will be inaccurate, no covenant or
agreement of AMED will be breached, and no condition in this Agreement will
remain unfulfilled by reason of the actions or omissions of AMED.
8.04. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, AMED will immediately advise the Company in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which it obtains knowledge and which (if existing and known at the
date of the execution of this Agreement) would have been required to be set
forth or disclosed in or pursuant to this Agreement or an exhibit or schedule
hereto, which (if existing and known at any time prior to or at the Closing)
would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more difficult than in
the absence of such fact or occurrence, or which (if existing and known at the
time of the Closing) would cause a condition to any party's obligations under
this Agreement not to be fully satisfied.
9. Miscellaneous.
9.01. Brokerage and Other Fees. The parties agree that there are no
brokerage arrangements or fee obligations, in writing or otherwise, with respect
to the transactions set forth in this Agreement. Each party shall be
responsible for the fees of their respective professionals (including, without
limitation, legal and accounting fees) engaged to assist in the preparation,
negotiation and counseling with respect, and relating, to this Agreement and
consummation of the transactions contemplated herein, as well as their
respective out-of-pocket expenses except AMED agrees to pay for the preparation
of the necessary transfer documents to accomplish the transactions herein.
9.02. Further Actions. At any time and from time to time, the parties
agree, at their expense, to take such actions and to execute and deliver such
documents as may be reasonably necessary to effectuate the purposes of this
Agreement.
9.03. Availability of Equitable Remedies. Since a breach of the provisions
of this Agreement could not adequately be compensated by money damages, the
parties shall be entitled before, and only before, Closing, in addition to any
other right or remedy available to them, to an injunction restraining such
breach or a threatened breach and to specific performance of any such provision
of this Agreement; and in either case, no bond or other security shall be
required in connection therewith, and the parties hereby consent to the issuance
of such an injunction and to the ordering of specific performance.
9.04. Survival. The covenants, agreements, representations, and warranties
contained in or made pursuant to this Agreement shall survive until AMED is in
receipt of the final Medicare Cost Reporting Letter, irrespective of any
investigation made by or on behalf of any party (the "Survival
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Date"). No claim for indemnification may be brought pursuant to this Section
9.04 unless asserted by written notice as provided herein by the party claiming
indemnification on or before the Survival Date.
9.05. Modification. The Agreement and the schedules and exhibits hereto set
forth the entire understanding of the parties with respect to the subject matter
hereof supersede all existing agreements among them concerning such subject
matter, and may be modified only by a written instrument duly executed by the
Parties.
9.06. Notices. Any notice or other communication required or permitted to
be given hereunder shall be in writing and shall be mailed by certified mail,
return receipt requested (or by the most nearly comparable method if mailed from
or to a location outside of the United States), or delivered by hand or telecopy
to the party to whom it is to be given at the address of such party set forth in
the preamble or signature pages to this Agreement. Any notice or other
communication given by certified mail (or by such comparable method) shall be
deemed given at the time of mailing (or comparable act) and if given by hand or
telecopy, shall be deemed given upon delivery or as of the date of the telecopy
date of receipt, except for a notice changing a party's address, which will be
deemed given at the time of receipt thereof.
9.07. Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of that provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term
of this Agreement on one or more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing
and, in the case of a corporate party, be authorized by a resolution of the
Board of Directors or by an officer of the waiving party.
9.08. Binding Effect. The provisions of this Agreement shall be binding
upon and inure to the benefit of each party's respective successors, assigns,
heirs, and personal representatives.
9.09. No Third-Party Beneficiaries. This Agreement does not create, and
shall not be construed as creating, any rights enforceable by any person not a
party to this Agreement.
9.10. Separability. If any provision of this Agreement is invalid, illegal,
or unenforceable, the balance of this Agreement shall remain in effect, and if
any provision is inapplicable to any person or circumstance, it shall
nevertheless remain applicable to all other persons and circumstances.
9.11. Headings. The headings of this Agreement are solely for convenience
of reference and shall be given no effect in the construction or interpretation
of this Agreement.
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9.12. Counterparts, Governing Law. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. It shall be
governed by and construed in accordance with the laws of the State of Texas
without giving effect to conflict of laws and any action or proceedings must be
brought in Dallas County, Texas.
9.13. Indemnification by the Stockholder. The Stockholder shall,
indemnify, defend and hold harmless AMED and each of its officers, directors,
agents and affiliates from and against any damage, loss, claim, liability, cost
or expense, including fees and disbursements of counsel, accountants, experts
and other consultants (collectively, "Damages"), resulting from, arising out of,
based upon or occasioned by: (i) Medicare Liabilities in excess of $950,000, and
(ii) any misstatement or omission from any representation by, or any breach of
warranty, covenant or agreement of, the Company or the Stockholder contained
herein ("Other Liabilities") in excess of $20,000.
9.14. Indemnification Procedures. Promptly after receipt by AMED (the
"Indemnitee"), of notice of any action, suit, proceeding, audit, claim or
potential claim (any of which is hereinafter individually referred to as a
"Circumstance"), which could give rise to a right to indemnification for damages
pursuant to Section 9.13, the Indemnitee shall give the party who may become
obligated to provide indemnification hereunder (the "Indemnitor") written notice
describing the Circumstance in reasonable detail; provided, that failure of an
Indemnitee to give such notice to the Indemnitor shall not relieve the
Indemnitor from any of its indemnification obligations hereunder unless (and
then only to the extent) that the failure to give such notice prejudices the
defense of the Circumstance by the Indemnitee. Such Indemnitor shall have the
right, at its option and upon its acknowledgment to the Indemnitee of
Indemnitor's liability to indemnify Indemnitee in respect of such asserted
liability, to compromise or defend, at its own expense and by its own counsel,
any such matter involving the asserted liability of the Indemnitee; provided,
that any such compromise (i) shall include as an unconditional term thereof, the
giving by the claimant or the plaintiff to such Indemnitee of a release from all
liability in respect of such claim and (ii) shall not result in the imposition
on the Indemnitee of any remedy other than monetary damages to be paid in full
by the Indemnitor pursuant to this Section 9.14. If any indemnitor shall
undertake to compromise or defend any such asserted liability, it shall promptly
notify the Indemnitee of its intention to do so, and the Indemnitee agrees to,
and to cause its own independent counsel to, cooperate fully with the Indemnitor
and its counsel in the compromise of, or defense against, any such asserted
liability. All reasonable out-of-pocket costs and expenses incurred by the
Indemnitee in connection with such cooperation (including, without limitation,
the reasonable fees and expenses of the Indemnitee's own independent counsel)
shall be borne by the Indemnitor. In any event, the Indemnitee shall have the
right to participate with its own counsel (the reasonable fees and expenses of
which will be borne by Indemnitor) in the defense of such asserted liability;
provided that if with respect to a Circumstance, Indemnitor shall have
acknowledged Indemnitor's liability to indemnify Indemnitee if and to the extent
of any loss arising out of such Circumstance and Indemnitor shall be diligently
defending such matter, Indemnitor shall not be obligated to indemnify Indemnitee
for the cost of Indemnitee's participation in such defense, including
Indemnitee's attorney's fees. Under no circumstances shall the Indemnitee
compromise any such asserted liability without the written
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consent of the Indemnitor (which consent shall not be unreasonably withheld),
unless the Indemnitor shall have failed or refused to undertake the defense of
any such asserted liability after a reasonable period of time has elapsed
following the notice of a Circumstance received by such Indemnitor pursuant to
this Section 9.14.
9.15. Right to Set-Off. AMED shall have the right to set off Damages
against the consideration placed in escrow pursuant to the terms of the Escrow
Agreement set forth in Exhibit 2.02 hereof.
9.16. Other Indemnification Provisions. The foregoing indemnification
provisions under this Section 9 are in addition to any statutory, equitable or
common law remedy any party may have for breach of representation, warranty or
covenant.
IN WITNESS WHEREOF, the parties have duly executed this Agreement effective
as of the date written in the preamble of this Agreement.
AMEDISYS, INC.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
UNIVERSITY CAPITAL CORP.
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
STOCKHOLDER:
----------------------------------------
Name:
-----------------------------------
Address:
--------------------------------
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LIST OF SCHEDULES
Schedule No. Schedule Description
- ------------ --------------------
2.01 Stock Power
2.02 Escrow Agreement
3.01 Organization and Qualification
3.03 Authorizations and Third Party Consents
3.04 Litigation
3.05 Employees and Compensation
3.07 Insurance
3.08 Contracts, Agreements and Instruments
3.10 Financial Statements and Balance Sheets
3.11 Permits and Licenses
3.12 Properties
3.13 Hazardous Materials
3.14 Interest in Competitors
3.16 Changes or Events
3.17 Defaults
5.06 Letters of Non-Distributive Intent
5.07 Non-Compete and Non-Solicitation Agreement
5.09 Legal Opinion of Tilly & Associates
5.10 Release
6.07 Employment Agreement
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EXHIBIT 2.6
STOCK PURCHASE AGREEMENT
BY
AND
AMONG
AMEDISYS ALTERNATE-SITE INFUSION THERAPY SERVICES, INC.,
A LOUISIANA CORPORATION
AND
PRN, INC.
D/B/A
HOME IV THERAPY
AND
JOSEPH W. STEVENS
AND
TERRY I. STEVENS
<PAGE>
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement') is made effective as of
________, 1998, by and between AMEDISYS ALTERNATE-SITE INFUSION THERAPY
SERVICES, INC., a Louisiana corporation, with its principal place of business at
3029 South Sherwood Forest Blvd., Suite 300, Baton Rouge, Louisiana 70816
("AMED") and PRN, INC. D/B/A/ HOME IV THERAPY, a Texas corporation with its
principal place of business at 4115 Medical Drive, Suite 105, San Antonio, Texas
78229 (The "Company"), Joseph W. Stevens and Terry I. Stevens (collectively, the
"Stockholders"). AMED, the Company and the Stockholders are sometimes referred
to collectively as the "Parties."
RECITALS
WHEREAS, AMED desires to purchase 100% of the issued and outstanding
capital stock of the Company ("Company Stock") from the Stockholders as
hereinafter provided and the Stockholders desires to effect such purchase; and
NOW, THEREFORE, in consideration of the premises and the mutual promises
made herein, and in consideration of the representations, warranties, and
covenants contained herein, the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
meanings indicated:
1.01. Closing: The consummation of the transactions contemplated by
this Agreement.
1.02. GAAP: Generally accepted accounting principles.
1.03. Health Care Laws: All federal, state and local laws, regulations
and ordinances related to the business of the Company including but not
limited to Medicaid, Medicare and regulations of the Health Care Finance
Administration.
1.04. Knowledge: means actual knowledge after reasonable investigation.
1.05. Material Adverse Effect: Any change in the financial condition or
operation of the business that would materially affect the Company's
business adversely, including, but not limited to, material changes to
management, business conditions, or financial condition.
1.07. Operating Licenses: Licenses, permits and registrations issued by
the appropriate state and federal agencies, which are necessary to the
operation of the Company's business. Such Operating Licenses are more
fully described in Schedule 3.11 hereto.
2. Terms of Purchase. On the basis of the representations, warranties,
covenants, and agreements contained in this Agreement and subject to the terms
and conditions of this Agreement:
<PAGE>
2.01. Transfer. The Stockholders shall assign, transfer and convey at
the Closing the Company Stock, representing 100% of the issued and outstanding
capital stock of the Company, to AMED. The Stockholders shall deliver at
Closing a Stock Power in the form attached hereto as Schedule 2.01, and any
other documents required by this Agreement.
2.02. Purchase Price. At Closing AMED shall deliver and the
Stockholders shall be entitled to receive FOUR HUNDRED THIRTY THOUSAND AND
NO/100 ($430,000.00) DOLLARS, by wire transfer of immediately available funds,
the receipt and adequacy of which are hereby acknowledged by the Stockholders.
2.03. Additional Consideration. AMED will pay additional consideration
in the amount of ONE HUNDRED FIFTY THOUSAND AND NO/100 ($150,000.00) DOLLARS,
subject to the terms and conditions of Appendix "A", which is incorporated
herein by this reference. Amedisys, Inc. agrees to guarantee this payment.
2.04. The Company Stock referred to in Section 2.01. and the
consideration to be paid by AMED referred to in Section 2.02. and 2.03. shall
constitute all of the consideration to be paid in connection with the
transactions contemplated by this Agreement.
2.05. The Closing. The Closing of the transactions contemplated by
this Agreement shall be on or before February 27, 1998, at the AMED offices,
3029 S. Sherwood Forest Blvd., Suite 300, Baton Rouge, Louisiana.
3. Representations and Warranties of the Company and the
Stockholders. The Company and the Stockholders hereby agree, represent, and
warrant to AMED, on the date of this Agreement and on the Closing Date, as
follows:
3.01. Organization and Qualification. The Company does not own any
interest in any other business enterprise or legal entity, except as disclosed
in Schedule 3.01. Schedule 3.01 also correctly sets forth as to the Company its
state of incorporation, principal place of business, and jurisdictions in which
it is qualified to do business. The Company is a Texas corporation duly
organized, validly existing, and in good standing under the laws of its
jurisdiction of incorporation, with all requisite power and authority to conduct
its business and is not in breach of, or in default with respect to, any term of
its Certificate of Incorporation, Bylaws or other organizational documents,
except where such breach would not have a Material Adverse Effect. The Company
has obtained all necessary consents, authorizations, approvals, orders,
licenses, certificates, and permits of and from, and declarations and filings
with, all federal, state, local, and other governmental authorities and all
courts and other tribunals, to own, lease, license, and use its properties and
assets and to carry on the business in which it is now engaged, except where the
failure to do so would not have a Material Adverse Effect. The Company is
duly qualified to transact the business in which it is engaged in every
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of its business makes such qualification necessary, except
where the failure to do so would not have a Material Adverse Effect.
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3.02. Capitalization. The Stockholders own one hundred (100%) percent
of the issued and outstanding shares of Common Stock of the Company, which
constitutes all of the outstanding capital stock of Company. Except as set
forth in Schedule 3.02, The Company Stock is not owned or held in violation of
any preemptive right of any other person or entity, is validly authorized,
validly issued, fully paid and non-assessable, and is owned of record and
beneficially by the Stockholders. The shares of Company Stock held by the
Stockholders are free and clear of all liens, security interests, pledges,
charges, encumbrances, voting agreements, and voting trusts. There is no
commitment, plan, or arrangement to issue, and no outstanding option, warrant,
or other right calling for the issuance of, any shares of capital stock of the
Company or any security or other instrument convertible into, exercisable for,
or exchangeable for capital stock of the Company. There is outstanding no
security or other instrument convertible into or exchangeable for capital stock
of the Company.
3.03. Due Authorization; Third Party Consents. The Company has the
right, power, legal capacity, and authority to enter into and perform its
obligations under this Agreement and, except as set forth on Schedule 3.03 to
this Agreement, no approval or consent of any person other than the Company is
necessary in connection with the execution, delivery, or performance of this
Agreement. The execution, delivery, and performance of this Agreement by the
Company has been duly authorized by its board of directors and no other
corporate proceedings on the part of the Company are necessary to authorize this
Agreement or the consummation of the transactions contemplated hereby. This
Agreement constitutes a legal and binding obligation of the Company, and is
valid and enforceable against the Company in accordance with its terms except
that (i) the enforcement of certain rights and remedies created by this
Agreement is subject to bankruptcy, insolvency, reorganization, and similar laws
of general application affecting the rights and remedies of parties, (ii) the
enforceability of any particular provision of this Agreement under principles of
equity or the availability of equitable remedies, such as specific performance,
injunctive relief, waiver or other equitable remedies, is subject to the
discretion of courts of competent jurisdiction, and (iii) any court or
administrative body may refuse to enforce the choice of law provision of Section
9.11 of this Agreement.
3.04. Litigation. Except as set forth in Schedule 3.04, there is not
any suit, action, arbitration, or legal, administrative, or other proceeding or
governmental investigation (formal or informal), pending or to the best of
Company's or Stockholders's Knowledge threatened (or any basis therefor known to
the Company or the Stockholders), with respect to the Company or the
Stockholders (as it relates to the business of the Company), including but not
limited to any action or claim under any federal, state, local or other
governmental act, rule, regulation, or any interpretations thereof, relating to
environmental matters or the protection of the safety and health of persons
connected with the Company's business (including but not limited to the
transportation, treatment, storage, recycling, disposal, or release into the
environment of hazardous or toxic materials or waste), or any basis on which any
proceeding or investigation against the Company or the Stockholders might
reasonably be undertaken or brought. The Company and the Stockholders have
informed AMED of, and upon request have furnished or made available to AMED
copies of all relevant court papers and other documents relating to, the matters
set forth in Schedule 3.04. Included in Schedule 3.04 is a list of all suits,
actions, arbitrations, or other proceedings or
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investigations in which the Company has been involved during the five year
period immediately preceding the Closing. The Company is not presently engaged
in any legal action to recover monies due to the Company, for damages sustained
by the Company, or amounts owed to the Company, except as set forth on Schedule
3.04. During the five year period immediately preceding the Closing, the Company
has neither received nor been a party to any written notice of violations,
orders, claims, citations, complaints, penalties, assessments, court, or other
proceedings, administrative, civil or criminal, at law or in equity, with
respect to any Health Care Law. In addition, to the Company's and Stockholders's
Knowledge, the Company has neither received nor been party to any written notice
of violations, orders, claims, citations, complaints, penalties, assessments,
court, or other proceedings, administrative, civil or criminal, at law or in
equity, with respect to any alleged violations of any other federal, state, or
local environmental law, regulation, ordinance, standard, permit, or order in
connection with the conduct of its business or otherwise during the past five
years.
3.05. Employees. The Company does not have, or contribute to, any
pension, profit-sharing, option, other incentive plan, or other Employee Benefit
Plan (as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974), or have any obligation to or customary arrangement with employees for
bonuses, incentive compensation, vacations, severance pay, insurance, or other
benefits, except as set forth in Schedule 3.05. Schedule 3.05. contains a true
and correct statement of the names, relationship with the Company, present rates
of compensation (whether in the form of salary, bonuses, commissions, or other
supplemental compensation now or hereafter payable), and aggregate compensation
for the calendar year ended December 31, 1997 of each Stockholders, and the
three highest paid employees of the Company. Since December 31, 1997, the
Company has not changed the rate of compensation of any of its Stockholders,
employees, agents, dealers or distributors, except as disclosed in Schedule
3.05.
3.06. No Violation of Employee Contracts. No current or prior employee
or Stockholder of the Company has any employment agreement with the Company. To
the knowledge of the Company and the Stockholders, no employee of the Company is
in violation of any term of any employment contract, non-competition agreement,
or any other contract or agreement or any restrictive covenant with, or any
other common law obligation to, a former employer relating to the right of any
such employee to be employed by the Company because of the nature of the
business conducted by the Company or of the use of trade secrets or proprietary
information of others. There is neither pending nor, to the Knowledge of the
Company or the Stockholders, threatened, any actions, suits, proceedings, or
claims with respect to any contract, agreement, covenant, or obligation referred
to in the preceding sentence, except as listed in Schedule 3.04.
3.07. Insurance. Schedule 3.07 sets forth an accurate and complete
list and brief description of all policies of fire and extended coverage,
liability, and the forms of similar insurance or indemnity bonds held by the
Company. The Company is not in default with respect to any provisions of any
such policy or indemnity bond and has not failed to give any notice or present
any claim thereunder in due and timely fashion, which failure or failures to
give such notice or present such claim, individually or in the aggregate, could
have a Material Adverse Effect on the business
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of the Company. All such policies and bonds (i) are in full force and effect,
(ii) are with insurance companies believed by the Company and the Stockholders
to be financially sound and reputable, (iii) are sufficient for compliance by
the Company with all requirements of law and of all material agreements and
instruments to which the Company is a party, (iv) provide that they will remain
in full force and effect through the respective dates set forth in Schedule
3.07, and (v) will not in any significant respect be affected by, and will not
terminate or lapse by reason of, the transactions contemplated by this
Agreement. Schedule 3.07 sets forth an accurate and complete list of all
accident or other liability claims received by or known by the Company and the
Stockholders for the three year period immediately preceding the Closing, as
well as a description of the status of each such claim. Such claims are covered
by one or more insurance policies set forth in Schedule 3.07.
3.08. Contracts, Agreements and Instruments. Schedule 3.08 accurately
and completely sets forth the information required to be contained therein. The
Company has furnished to AMED:
3.08.01. The Certificate of Incorporation, Bylaws and other
organizational documents of the Company and all amendments thereto, as
presently in effect, certified by the president of the Company;
3.08.02. True and correct copies of all material contracts,
agreements and other instruments referred to in Schedule 3.08;
3.08.03. True and correct written descriptions of all material
service, supply, distribution, agency, financing or other arrangements
or understandings referred to in Schedule 3.08 involving an obligation
on the part of the Company in excess of $5,000 per year.
Except for matters which, in the aggregate, would not have a Material Adverse
Effect or are otherwise disclosed in the Schedules attached hereto or in the
Agreement, to the Knowledge of the Company and the Stockholders, no other party
to any such contract, agreement, instrument, leases, or license is now in
violation or breach of, or in default with respect to complying with, any
material provision thereof, and each such contract, agreement, instrument,
lease, or license contained in the Schedules hereto is in full force and effect
and is the legal, valid, and binding obligation of the Company and to the
Knowledge of the Stockholders the other parties thereto and is enforceable as to
them in accordance with its terms. Neither the Company, the Stockholders, nor
to the knowledge of the Stockholders has any other party to any such contract
listed in Schedule 3.08 given notice of termination or taken any action
inconsistent with the continuance of such contract, agreement, instrument,
lease, or license, except for matters which, in the aggregate, would not have a
Material Adverse Effect; and the Company's execution, delivery, and performance
of this Agreement will not violate any such contract, agreement, instrument,
lease, or license in any way contained in the Schedules hereto, except for
matters which, in the aggregate, would not have a Material Adverse Effect. The
Company is not a member of a customer or user organization or of a trade
association which relationship would be materially affected by the execution and
performance of this Agreement.
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<PAGE>
3.09. Compliance With Laws. The Company has complied with, and is not
in violation of any (i) term or provision of its Certificate of Incorporation or
Bylaws; or (ii) to the Company's and the Stockholders's Knowledge term or
provision of any applicable judgment, decree, order, statute, injunction, rule,
ordinance; (iii) to the Company's and the Stockholders's Knowledge any Health
Care Law; or (iv) or the Company's and the Stockholders's Knowledge, foreign,
United States, state or local statutes, laws, rules, or regulations, except for
violations which would not have a Material Adverse Effect.
3.10. Financial Condition. The Company has delivered to AMED true and
correct copies of the following: the balance sheet ("the Company's Last Balance
Sheet") dated as of December 31, 1997 as supplemented in Schedule 3.10, and an
income statement and consolidated statement of the Company for the twelve month
period ended June 30, 1997, 1996 and 1995. Except for the absence of notes and
subject to normal year-end adjustments, in the case of interim statements, which
adjustments will not result in any Material Adverse Effects, such balance sheet
presents fairly the financial condition, assets and liabilities of the Company
as of its date; each such statement of income presents fairly the results of
operations of the Company for the period indicated; and each statement of cash
flows presents fairly the information purported to be shown therein. The
financial statements referred to in this Section 3.10, fairly present the
financial condition of the Company for the periods indicated in all material
respects, and are in accordance with the books and records of the Company.
3.11. Permits and Licenses. The Company has all permits, licenses, and
other similar authorizations necessary for the conduct of its business as now
being conducted by it, and it is not in default in any respect under any such
permits, licenses, or authorizations, except for the absence of which would not
have a Material Adverse Effect. Such permits, licenses, and other similar
authorizations of the Company are as set forth in Schedule 3.11. Except as set
forth in Schedule 3.11, no royalties, commissions, or fees are payable by the
Company to any person by reason of the ownership or use of any intangible
property. The Company is the sole and exclusive owner of all of its assets,
does not use any of its assets by the consent of any other person and is not
required to and does not make any payments to others with respect thereto.
Except as set forth in Schedule 3.11, there are no material licenses, sub-
licenses, or agreements relating to the use of any intangible property of the
Company now in effect, and the Company and the Stockholders have no Knowledge
that, any intangible property of the Company is being infringed by others.
Except as listed in Schedule 3.04, no claim that would have a Material Adverse
Effect on the business of the Company is pending or, to the Knowledge of the
Company, threatened, or has been made since the Company's inception to the
effect that, nor does the Company have any Knowledge that, the operation of the
Company's business or any method, process, part, or material that the Company
employs, conflicts in any material way with, or infringes in any material way
upon any rights of the type enumerated above, owned by others.
3.12. Properties. The Company has good and valid title to all
properties and assets used in its business or owned by it (except such real and
other property and assets as are held pursuant to leases or licenses described
in Schedule 3.12), free and clear of all liens, mortgages, security
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interests, pledges, charges, and encumbrances (except for liens for current
taxes not yet due and except such as are disclosed in Schedule 3.12 or disclosed
on the Company's Last Balance Sheet).
3.12.01. Attached as Schedule 3.12 is a true and complete list of all
properties and assets owned, leased, or licensed by the Company having an
individual value of $5,000 or more, including with respect to such
properties and assets leased or licensed by the Company, a description of
such lease or license. All such properties and assets owned by the Company
are reflected on the Company Last Balance Sheet. All properties and assets
owned, leased, or licensed by the Company are in good and usable condition
(reasonable wear and tear, which is not such as to have a Material Adverse
Effect on the operation of the business of the Company, excepted);
3.12.02. The properties and assets owned, leased, or licensed by the
Company constitute all such properties and assets which are necessary to
the business of the Company as presently conducted.
3.12.03. All accounts and notes receivable reflected on the Company Last
Balance Sheet, and arising since the Company's Last Balance Sheet Date,
have been collected, or are and will be good and valid, in each case at the
aggregate recorded amounts thereof without right of recourse, defense,
deduction, return of goods, counterclaim, offset, or setoff on the part of
the obligor, and, if not collected, can reasonably be anticipated to be
paid within 120 days of the date incurred.
3.13. Hazardous Materials. Except as disclosed on Schedule 3.13, the
Company is not in the business of possession, transportation, or disposal of
hazardous materials. If and to the extent that the Company's business has
involved the possession, transportation, or disposal of hazardous materials, to
the best of the Company's and the Stockholders' Knowledge, the Company has
complied with any and all applicable laws, ordinances, rules, and regulations.
To the Knowledge of the Company and the Stockholders, no employee of the Company
has been exposed to hazardous materials such that exposure could cause damage to
such employee.
3.14. Interest in Competitors. Except as set forth in Schedule 3.14
to this Agreement, no shareholder, officer or director of the Company, nor any
spouse or child of any shareholder, officer or director with authority to enter
into contracts on behalf of the Company, has any direct or indirect interest
(excepting stockholdings of securities of publicly held and traded companies) in
any competitor, supplier, or customer of the Company or in any person from whom
or to whom the Company leases any real or personal property, or in any other
person with whom the Company is doing business.
3.15. Tax and Other Liabilities. The Company does not have any present
liability of any nature, accrued or contingent, of the type required to be
reflected on a balance sheet or in appropriate footnotes prepared in accordance
with GAAP, including, without limitation, liabilities for federal,
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state, local, or foreign taxes and liabilities to customers or suppliers, which
could have a Material Adverse Effect upon the Company, other than the following:
i. Liabilities for which full provision has been made on the Company
Last Balance Sheet as of the Company Last Balance Sheet Date; and
ii. Other liabilities arising since the Company Last Balance Sheet
Date and prior to the Closing in the ordinary course of business
which are not inconsistent with the representations and
warranties of the Company or any other provision of this
Agreement.
Without limiting the generality of the foregoing, the amounts set forth as
provisions for taxes on the Company Last Balance Sheet are sufficient for all
accrued and unpaid taxes of the Company, whether or not due and payable and
whether or not disputed, under tax laws, as in effect on the Company Last
Balance Sheet Date or now in effect, for the period ended on such date and for
all fiscal years prior thereto. The Company has filed all applicable tax
returns required to be filed by it or has obtained applicable extensions and are
not delinquent with respect to such extensions; have paid (or have established
on the Company Last Balance Sheet a reserve for) all taxes, assessments, and
other governmental charges payable or remittable by it or levied upon it or its
properties, assets, income, or franchises, which are due and payable and have
delivered to AMED a true and correct copy of any report as to adjustments
received by the Company from any taxing authority during the past five years and
a statement as to any litigation, governmental or other proceeding (formal or
informal), or investigation pending.
3.16. Changes or Events. Except as set forth in Schedule 3.16, since
the Company's Last Balance Sheet Date, none of the following has occurred:
3.16.01. Any material transaction by the Company not in the ordinary
course of business involving amounts in excess of $5,000;
3.16.02. Any material capital expenditure by the Company.
3.16.03. Other than in the ordinary course of business, any changes in
the condition (financial or otherwise), liabilities, assets, or business
or in any business relationships of the Company, including relationships
with suppliers or customers, that, when considered individually or in
the aggregate, might reasonably be expected to have a Material Adverse
Effect;
3.16.04. The destruction of, damage to, or loss of any asset of the
Company (regardless of whether covered by insurance) that, when
considered individually or in the aggregate, might reasonably be
expected to have a Material Adverse Effect;
3.16.05. Any labor disputes that, when considered individually or in
the aggregate, might reasonably be expected to have a Material Adverse
Effect;
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<PAGE>
3.16.06. Except as listed on Schedule 3.16.06, there have been no
changes in accounting methods or practices (including, without
limitation, any change in depreciation or amortization policies or
rates) by the Company, except for any such changes as were required by
law;
3.16.07. Other than in the ordinary course of business, any increase in
the salary or other compensation payable or to become payable by the
Company to any employee, or the declaration, payment, or commitment or
obligation of any kind for the payment by the Company of a bonus or
other additional salary or compensation to any such person;
3.16.08. The material amendment or termination of any material
contract, agreement, or license to which the Company is a party, except
in the ordinary course of business;
3.16.09. Any loan by the Company to any person or entity, or the
guaranteeing by the Company of any loan other than loans made in the
ordinary course of business;
3.16.10. Any mortgage, pledge, or other encumbrance of any asset of the
Company except in the ordinary course of business;
3.16.11. The waiver or release of any right or claim of the Company,
except in the ordinary course of business;
3.16.12. Any other events or conditions of any character within the
Knowledge of the Company and the Stockholders that, when considered
individually or in the aggregate, have or might reasonably be expected
to have a Material Adverse Effect;
3.16.13. Any loss or, to the Knowledge of the Company or the
Stockholders, any threatened loss of any permit, license, qualification,
special charter or certificate of authority held or enjoyed or formerly
held or enjoyed by the Company which loss has had or upon occurrence
might reasonably be expected to have a Material Adverse Effect;
3.16.14. To the Knowledge of the Company and the Stockholders, since
December 31, 1997, no statute, regulation, order, ordinance or other law
has been adopted or rescinded which is reasonably expected to have a
Material Adverse Effect;
3.16.15. Any material failure on the part of the Company to operate its
business in the ordinary course and consistent with past practices so
as to preserve its business organization intact, to retain the services
of its employees and to preserve its goodwill and relationships with
suppliers, creditors, customers, and others having business
relationships with it;
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3.16.16. Any action taken or omitted to be taken by the Company which
would cause (after lapse of time, notice or both) the breach, default,
or acceleration of any right, contract, commitment, or other obligation
of the Company which would have a Material Adverse Effect; or
3.16.17. Any agreement by the Company to do any of the things described
in the preceding clauses 3.16.01 through 3.16.16.
3.17. No Defaults. Except as set forth in Schedule 3.17, the
consummation of the transactions contemplated by this Agreement will not result
in or constitute any of the following: (i) a breach of any term or provision of
any other agreement of the Company that will not be waived or released at
Closing; (ii) a default or an event that will not be waived or released at
Closing, and that, with notice or lapse of time or both, would be a default,
breach, or violation of the Certificate of Incorporation or Bylaws of the
Company or of any lease, license, promissory note, conditional sales contract,
commitment, indenture, mortgage, deed of trust, or other agreement, instrument,
or arrangement to which the Company is a party or by which the Company or its
assets are bound; (iii) an event that will not be waived or released at Closing
and that would permit any party to terminate any agreement or to accelerate the
maturity of any indebtedness or other obligation of the Company; (iv) the
creation or imposition of any lien, charge, or encumbrance on any of the
Company's assets; or (v) a violation of any law or any rule or regulation of any
administrative agency or governmental body unrelated to the business or
profession of health care and any profession related to health care, or any
order, writ, injunction or decree of any court, administrative agency or
governmental body to which the Company is subject.
3.18. No Prohibited Payments. Neither the Company nor any employee, or
agent of the Company, has made or authorized any payment of funds of the Company
or on behalf of the Company prohibited by law and no funds of the Company have
been set aside to be used for any payment prohibited by law.
3.19. Completeness of Disclosure. No representation or warranty in this
Agreement and no Appendix, Schedule, Exhibit, or certificate prepared by the
Company pursuant hereto and no statement made or other document prepared by the
Company and furnished to AMED by the Company contains any untrue statement of a
material fact or omits or will omit any material fact necessary in order to make
the statements contained therein not misleading.
4. Representations and Warranties of AMED. AMED hereby agrees,
represents, and warrants to the Stockholders, on the date of this Agreement and
on the Closing Date, as follows:
4.01. Organization. AMED is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Louisiana and
authorized to carry on business in the State of Texas and in every other
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of it business makes such qualification necessary, except
where the failure to do so would not have a Material Adverse Effect.
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4.02. Due Authorization; Third Party Consents. AMED has the right, power,
legal capacity, and authority to enter into and perform its obligations under
this Agreement and no approval or consent of any person other than AMED is
necessary in connection with the execution, delivery, or performance of this
Agreement. The execution, delivery, and performance of this Agreement by AMED
has been duly authorized by its board of directors and no other corporate
proceedings on the part of AMED are necessary to authorize this Agreement or the
consummation of the transactions contemplated hereby. This Agreement
constitutes a legal and binding obligation of AMED, and is valid and enforceable
against AMED in accordance with its terms except that (i) the enforcement of
certain rights and remedies created by this Agreement is subject to bankruptcy,
insolvency, reorganization, and similar laws of general application affecting
the rights and remedies of parties, (ii) the enforceability of any particular
provision of this Agreement under principles of equity or the availability of
equitable remedies, such as specific performance, injunctive relief, waiver or
other equitable remedies, is subject to the discretion of courts of competent
jurisdiction, and (iii) any court or administrative body may refuse to enforce
the choice of law provision of Section 9.11 of this Agreement.
4.03. No Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following: (i) a
breach of any term or provision of any other agreement of AMED that will not be
waived or released at Closing; (ii) a default or an event that will not be
waived or released at Closing and that, with notice or lapse of time or both,
would be a default, breach, or violation of the Certificate of Incorporation or
Bylaws of AMED or of any lease, license, promissory note, conditional sales
contract, commitment, indenture, mortgage, deed of trust, or other agreement,
instrument, or arrangement to which AMED is a party or by which AMED or the
property of AMED is bound; or (iii) a violation of any law or any rule or
regulation of any administrative agency or governmental body or any order, writ,
injunction, or decree of any court, administrative agency or governmental body
to which AMED is subject.
4.04. Completeness of Disclosure. No representation or warranty in this
Agreement and no Schedule, Exhibit, or certificate prepared by AMED pursuant
hereto and no statement made or other document prepared by AMED and furnished to
the Company by AMED contains any untrue statement of a material fact or omits
or will omit any material fact necessary in order to make the statements
contained therein not misleading.
4.05 Investment Intent. AMED is acquiring the Company Stock for its own
account and not with a view to distribution within the meaning of Section 2(11)
of the Securities Act of 1933, as amended. AMED confirms that the Company and
the Stockholders have made available to AMED and its representatives and agents
the opportunity to ask questions of the officers and management employees of the
Company and to acquire such additional information about the business and
financial condition of the Company as AMED has requested, and all such
information has been received, or represented to have been received.
5. Conditions to Obligations of AMED. The obligations of AMED under this
Agreement are subject, at the option of AMED, to the following conditions:
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5.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of Company or the Stockholders contained in this
Agreement shall be accurate when made and, in addition, shall be materially
accurate as of the Closing as though such representations and warranties were
then made by Company or such Stockholders on the part of Company or any
Stockholders. As of the Closing, the Company and the Stockholders shall have
performed and complied with all covenants and agreements and satisfied all
conditions required to be performed and complied with by any of them at or
before such time by this Agreement and AMED shall have received certificates
signed by the Stockholders dated the date of the Closing to that effect,
substantially in the form of Schedule 5.01.
5.02. Other Closing Documents. Company and the Stockholders shall have
delivered to AMED at or prior to the Closing such other documents as AMED may
reasonably request in order to enable AMED to determine whether the conditions
to their obligations under this Agreement have been met and otherwise to carry
out the provisions of this Agreement.
5.03. Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement incidental
thereto and all other related legal matters shall be subject to the reasonable
approval of counsel to AMED, and the Company shall have furnished such counsel
for AMED such documents as such counsel may have reasonably requested for the
purpose of enabling them to pass upon such matters.
5.04. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements or to obtain substantial damages with respect thereto, except as
listed in Schedule 3.04.
5.05. No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of AMED:
5.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
5.05.02. Results in a delay which affects the ability of AMED to
consummate any of the transactions contemplated by this Agreement;
5.05.03. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the contemplated
benefits to AMED of the transactions contemplated by this Agreement.
5.06. Contractual Consents Needed. The parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement,
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or understanding to which any of them or any subsidiary is a party, or to which
any of their respective businesses, properties, or assets are subject, except
where the failure would not have a Material Adverse Effect.
5.07. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
parties thereto at or prior to the Closing, shall be in full force and effect,
valid and binding upon the parties thereto, and enforceable by them in
accordance with their terms at the Closing, and no party thereto at any time
from the execution thereof until immediately after the Closing shall have been
in violation of or in default in complying with any material provision thereof.
5.08. Non-Competition and Non-Solicitation Agreement. Joseph W. Stevens and
Terry I. Stevens shall have entered into the non-competition and non-
solicitation agreement in the form attached hereto as Schedule 5.08.
5.09. Board and Shareholder Approval. The Board of Directors and
shareholders of the Company shall have approved the transactions contemplated
herein.
5.10. Legal Opinion. AMED shall have received the opinion of Cox & Smith,
Incorporated, dated the Closing Date, in the form of Schedule 5.10 attached
hereto.
5.11. Releases. AMED shall have received the releases from the Stockholders
and employees in the form set forth in Schedule 5.11
6. Conditions to Obligations of The Company and the Stockholders. The
obligations of the Company and the Stockholders under this Agreement are
subject, at the option of the Company and the Stockholders, to the following
conditions:
6.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of AMED contained in this Agreement shall be
accurate when made and, in addition, shall be materially accurate as of the
Closing as though such representations and warranties were then made by AMED on
the part of AMED. As of the Closing, AMED shall have performed and complied
with all covenants and agreements and satisfied all conditions required to be
performed and complied with at or before such time by this Agreement and the
Company shall have received certificates signed by the officers of AMED dated
the date of the Closing to that effect, substantially in the form of Schedule
6.01.
6.02. Other Closing Documents. AMED shall have delivered to the Company, at
or prior to the Closing, such other documents as the Company may reasonably
request in order to enable the Company to determine whether the conditions to
its obligations under this Agreement have been met and otherwise to carry out
the provisions of this Agreement.
6.03. Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement incidental
thereto and all other related legal
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<PAGE>
matters shall be subject to the reasonable approval of counsel to the Company
and AMED shall have furnished such counsel such documents as such counsel may
have reasonably requested for the purpose of enabling them to pass upon such
matters.
6.04. Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise challenging
the consummation of, the transactions contemplated by this Agreement or related
agreements set forth as an exhibit hereto, or to obtain substantial damages with
respect thereto.
6.05. No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated, enacted,
entered, enforced, or deemed applicable to the transactions contemplated by this
Agreement by any federal, state, local, or other governmental authority or by
any court or other tribunal, including the entry of a preliminary or permanent
injunction, which, in the reasonable judgment of the Company:
6.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
6.05.02. Results in a delay which affects the ability of the Company to
consummate any of the transactions contemplated by this Agreement;
6.05.03. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the contemplated
benefits to the Company or the Stockholders of the transactions contemplated
by this Agreement.
6.06. Contractual Consents Needed. The Parties to this Agreement shall have
obtained at or prior to the Closing all consents required for the consummation
of the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or understanding
to which any of them or any subsidiary is a party, or to which any of their
respective businesses, properties, or assets are subject, except where the
failure would not have a Material Adverse Effect.
6.07. Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and delivered by the
Parties thereto at or prior to the Closing, shall be in full force, valid and
binding upon the Parties thereto, and enforceable by them in accordance with
their terms at the Closing, and no party thereto at any time from the execution
thereof until immediately after the Closing shall have been in violation of or
in default in complying with any material provision thereof.
6.08. Board Approval. The Board of Directors of AMED shall have approved
the transactions contemplated herein.
6.09 Bank Debt Release. At Closing, AMED will satisfy the Company debt to
Frost National Bank, thereby releasing the Stockholders of their personal
guarantee of said debt.
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<PAGE>
7. Covenants and Agreements of the Company. The Company covenants and
agrees as follows:
7.01. Public Statements. Before the Company shall release any information
concerning this Agreement or the transactions contemplated by this Agreement
which is intended for or may result in public dissemination thereof, the Company
shall cooperate with AMED, shall furnish drafts of all documents or proposed
oral statements to AMED for comment, and shall not release any such information
without the written consent of AMED. Nothing contained herein shall prevent the
Company from furnishing any information to any governmental authority if
required to do so by law.
7.02. Consents Without any Condition. The Company shall not make any
agreement or understanding with a third party not in the ordinary course of
business without approval in writing by AMED.
7.03. Access. With reasonable prior notice, the Company will afford the
officers, counsel, agents, investment bankers, accountants, and other
representatives of AMED, free and full access to the plans, properties, books,
and records of the Company; will permit them to make, at AMED's expense,
extracts from and copies of such books and records; and will from time to time
furnish AMED with such additional financial and operating data and other
information as to the financial condition, results of operations, business,
properties, assets, liabilities, or future prospects of the Company as AMED from
time to time may reasonably request. The Company will also cause the public
accountants of the Company to make available to AMED and its public accountants
the work papers relating to the audits of the Company.
7.04. Conduct of Business. The Company will use its reasonable best efforts
to conduct its affairs so that at the Closing, no representation or warranty of
the Company will be inaccurate, no covenant or agreement of the Company will be
breached, and no condition in this Agreement will remain unfulfilled by reason
of the actions or omissions of the Company.
7.05. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, the Company will immediately advise AMED in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which any of them obtains knowledge and which (if existing and
known at the date of the execution of this Agreement) would have been required
to be set forth or disclosed in or pursuant to this Agreement or an exhibit or
schedule hereto, which (if existing and known at any time prior to or at the
Closing) would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more difficult than in
the absence of such fact or occurrence, or which (if existing and known at the
time of the Closing) would cause a condition to any party's obligations under
this Agreement not to be fully satisfied.
8. Covenants and Agreements of AMED. AMED covenants and agrees as
follows:
8.01. Public Statements. Before AMED shall release any information
concerning this Agreement or the transactions contemplated by this Agreement
which is intended for or may result
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<PAGE>
in public dissemination thereof, AMED shall cooperate with the Company, shall
furnish drafts of all documents or proposed oral statements to the Company for
comments, and shall not release any such information without the written consent
of the Company. Nothing contained herein shall prevent AMED from furnishing any
information to any governmental authority if required to do so by law.
8.02. Consents Without any Condition. AMED shall not make any agreement or
understanding with a third party not in the ordinary course of business not
approved in writing by the Company.
8.03. Conduct of Business. AMED will conduct its affairs so that at the
Closing no representation or warranty of AMED will be inaccurate, no covenant or
agreement of AMED will be breached, and no condition in this Agreement will
remain unfulfilled by reason of the actions or omissions of AMED.
8.04. Notice of Changes. Until the Closing or the earlier rightful
termination of this Agreement, AMED will immediately advise the Company in a
detailed written notice of any fact or occurrence or any pending or threatened
occurrence of which it obtains knowledge and which (if existing and known at the
date of the execution of this Agreement) would have been required to be set
forth or disclosed in or pursuant to this Agreement or an exhibit or schedule
hereto, which (if existing and known at any time prior to or at the Closing)
would make the performance by any party of a covenant contained in this
Agreement impossible or make such performance materially more difficult than in
the absence of such fact or occurrence, or which (if existing and known at the
time of the Closing) would cause a condition to any party's obligations under
this Agreement not to be fully satisfied.
9. Miscellaneous.
9.01. Brokerage and Other Fees. Each party shall be responsible for the
fees of their respective brokers and/or professionals (including, without
limitation, legal and accounting fees) engaged to assist in the preparation,
negotiation and counseling with respect, and relating, to this Agreement and
consummation of the transactions contemplated herein, as well as their
respective out-of-pocket expenses, except AMED agrees to pay for the
preparation of the necessary transfer documents to accomplish the transactions
herein.
9.02. Further Actions. At any time and from time to time, the parties
agree, at their expense, to take such actions and to execute and deliver such
documents as may be reasonably necessary to effectuate the purposes of this
Agreement.
9.03. Availability of Equitable Remedies. Without limiting the terms and
provisions of Section 10 hereof, since a breach of the provisions of this
Agreement could not adequately be compensated by money damages, the parties
shall be entitled before, and only before, Closing, in addition to any other
right or remedy available to them, to an injunction restraining such breach or
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<PAGE>
a threatened breach and to specific performance of any such provision of this
Agreement; and in either case, no bond or other security shall be required in
connection therewith, and the parties hereby consent to the issuance of such an
injunction and to the ordering of specific performance.
9.04. Modification. The Agreement and the schedules and exhibits hereto set
forth the entire understanding of the parties with respect to the subject matter
hereof supersede all existing agreements among them concerning such subject
matter, and may be modified only by a written instrument duly executed by the
Parties.
9.05. Notices. Any notice or other communication required or permitted to
be given hereunder shall be in writing and shall be delivered by personal
delivery or by overnight delivery or mailed by certified mail, return receipt
requested (or by the most nearly comparable method if mailed from or to a
location outside of the United States), or delivered against receipt to the
party to whom it is to be given at the address of such party set forth in the
preamble or signature pages to this Agreement. Any notice or other
communication given by certified mail (or by such comparable method) shall be
deemed given at the time of mailing (or comparable act), except for a notice
changing a party's address, which will be deemed given at the time of receipt
thereof.
9.06. Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of that provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term
of this Agreement on one or more occasions will not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing
and, in the case of a corporate party, be authorized by a resolution of the
Board of Directors or by an officer of the waiving party.
9.07. Binding Effect. The provisions of this Agreement shall be binding
upon and inure to the benefit of each party's respective successors, assigns,
heirs, and personal representatives.
9.08. No Third-Party Beneficiaries. This Agreement does not create, and
shall not be construed as creating, any rights enforceable by any person not a
party to this Agreement.
9.09. Separability. If any provision of this Agreement is invalid, illegal,
or unenforceable, the balance of this Agreement shall remain in effect, and if
any provision is inapplicable to any person or circumstance, it shall
nevertheless remain applicable to all other persons and circumstances.
9.10. Headings. The headings of this Agreement are solely for convenience
of reference and shall be given no effect in the construction or interpretation
of this Agreement.
9.11. Counterparts, Governing Law. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. It shall be
governed by and construed in accordance with the laws of the State of Texas
without giving effect to conflict of laws.
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<PAGE>
9.12. Indemnification by the Stockholders. The Stockholders shall,
indemnify, defend and hold harmless AMED and each of its officers, directors,
agents and affiliates from and against any damage, loss, claim, liability, cost
or expense, including reasonable fees and disbursements of counsel, accountants,
experts and other consultants (collectively, "Damages"), resulting from, arising
out of, or based upon any misstatement or omission from any representation by,
or any breach of warranty, covenant or agreement of the Company or the
Stockholders contained herein ("Other Liabilities") in excess of $12,500;
provided, however, notwithstanding anything contained herein to the contrary,
the term "Damages" shall not include expenses, losses, costs, deficiencies,
liabilities, taxes, penalties, fines, liens and damages (i) to the extent of any
proceeds received by such party from any insurance policies with respect
thereto, (ii) to the extent of any net tax benefits realized by such party and
(iii) to the extent of any indemnities or recoveries from third parties.
9.13. Indemnification by AMED. AMED shall indemnify, defend and hold
harmless the Stockholders, the Company, and each of its officers, directors,
agents and affiliates from and against any Damages resulting from, arising out
of, based upon or occasioned by any misstatement or omission from any
representations by, or any breach of warranty, covenant or agreement of, AMED
contained herein.
9.14. Indemnification Procedures. Promptly after receipt by the party
seeking indemnification hereunder (the "Indemnitee"), of notice of any action,
suit, proceeding, audit, claim or potential claim (any of which is hereinafter
individually referred to as a "Circumstance"), which could give rise to a right
to indemnification for damages pursuant to Section 9.12 or 9.13, the Indemnitee
shall give the party who may become obligated to provide indemnification
hereunder (the "Indemnitor") written notice describing the Circumstance in
reasonable detail; provided, that failure of an Indemnitee to give such notice
to the Indemnitor shall not relieve the Indemnitor from any of its
indemnification obligations hereunder unless (and then only to the extent) that
the failure to give such notice prejudices the defense of the Circumstance by
the Indemnitee. Such Indemnitor shall have the right, at its option to
compromise or defend, at its own expense and by counsel approved by Indemnitee
(which approval shall not be unreasonably withheld), any such matter involving
the asserted liability of the Indemnitee; provided, that any compromise entered
into without the consent of Indemnitee (i) shall include as an unconditional
term thereof, the giving by the claimant or the plaintiff to such Indemnitee of
a release from all liability in respect of such claim and (ii) shall not result
in the imposition on the Indemnitee of any remedy other than monetary damages to
be paid in full by the Indemnitor pursuant to this Section 9.14. If any
indemnitor shall undertake to compromise or defend any such asserted liability,
it shall promptly notify the Indemnitee of its intention to do so, and the
Indemnitee agrees to, and to cause its own independent counsel to, cooperate
fully with the Indemnitor and its counsel in the compromise of, or defense
against, any such asserted liability. All reasonable out-of-pocket costs and
expenses incurred by the Indemnitee in connection with such cooperation
(excluding the fees and expenses of the Indemnitee's own independent counsel)
shall be borne by the Indemnitor. In any event, the Indemnitee shall have the
right to participate with its own counsel in the defense of such asserted
liability; provided that Indemnitor shall not be obligated to indemnify
Indemnitee for the cost of Indemnitee's participation in such defense, including
Indemnitee's attorney's fees, unless both the Indemnitee and the Indemnitor are
named as parties and the Indemnitee shall in good faith determine the
representation
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<PAGE>
of both parties by the same counsel would be inappropriate due to actual or
potential conflicting interest between them; provided, however, that in no event
shall the Indemnitor be obligated to assume the expense of more than one such
separate counsel in connection with Damages arising out of the same claim or
cause of action. Under no circumstances shall the Indemnitee compromise any such
asserted liability without the written consent of the Indemnitor (which consent
shall not be unreasonably withheld), unless the Indemnitor shall have failed or
refused to undertake the defense of any such asserted liability after a
reasonable period of time has elapsed following the notice of a Circumstance
received by such Indemnitor pursuant to this Section 9.14.
9.15. Exclusivity. Except for the injunctive relief provided in Schedule
5.08 and off-set provision of Section 9.18 the indemnification provisions of
this Section 9 shall be the exclusive remedy for claims by AMED or its
representatives under this Agreement. Neither AMED or its representatives shall
be able to avoid the limitations expressly set forth in this Section 9 by
electing to pursue another remedy (other than claims based upon actual fraud).
The parties hereto hereby waive any provision of law to the extent it would
limit or restrict their agreement set forth in this section 9.15.
9.16. Survival of Representations and Warranties. Except as set forth in
the second sentence of this Section 9.16, each of the representations and
warranties made by the Company and the Stockholders pursuant to this Agreement
shall survive for a period of twelve (12) months after the Closing, and upon
expiration of such period, such representations and warranties shall expire. The
representations and warranties made by the Company and the Stockholders to the
extent relating to (i) Medicaid and Medicare shall survive for a period of
twenty-four (24) months after the Closing and (ii) taxes and the Company's
Defined Benefit Pension Plans shall survive for the applicable statute of
limitations period, and shall thereafter expire. No claim for the recovery of
Damages may be asserted by AMED or any of its representatives against the
Stockholders after such representation and warranty shall expire.
9.17. Limitations on Indemnification. The aggregate liability of the
Stockholders for indemnification claims under Section 9.12 shall not exceed
$430,000.
9.18. Right of Off-Set. If AMED reasonably believes it is entitled to
indemnification under this Agreement, the amount of such Damages shall first be
credited and off-set against the last amount to be repaid which are due and
owing to the Stockholders pursuant to the terms of Section 2.03 and Appendix A
hereto and written notice of such off-set shall be given to the Stockholders. In
the event the off-set is disputed by the Stockholders, such dispute shall be
governed by the provisions of Section 10. If it is ultimately determined that
such off-set was improper, AMED shall immediately pay the Stockholders the
amount due and owing plus interest of 15% on such amount from the date such
payment was originally due until the date payment is made.
10. Arbitration
10.1 Arbitration Procedures. Any and every dispute of any nature
whatsoever that may arise between the parties hereto, whether sounding in
contract, statute, tort, fraud, misrepresentation,
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discrimination or any other legal theory, or breach of this Agreement, or any
schedule, certificate or other document delivered by any party hereto or
thereto, or those arising under any federal, state or local law, regulation or
ordinance, shall be determined by binding arbitration in accordance with the
then-current commercial arbitration rules of the American Arbitration
Association ("AAA"), to the extent such rules do no conflict with the provision
of this Section 10. The arbitration shall be conducted by a single neutral
arbitrator. The parties shall endeavor to select neutral arbitrators by mutual
agreement. If such agreement cannot be reached within thirty (30) calendar days
after a dispute has arisen which is to be decided by arbitration, any party of
the parties jointly shall request AAA to submit to each party an identical panel
of fifteen (15) persons. Alternate strikes shall be made to the panel,
commencing with the party bringing the claim, until the name of one (1) person
remains. The parties may, however, by mutual agreement, request AAA to submit
additional panels of possible arbitrators. The arbitrator shall have the power
to determine all matters incident to the conduct of the arbitration, including
without limitation all procedural and evidentiary matters and the scheduling of
any hearing. The award made by the arbitrator shall be governed by the United
States Arbitration Act, 9 U.S.C. (S)(S) 1-16, and judgment upon the award
rendered by the arbitrator(s) may be entered by any court having jurisdiction
thereof. Unless otherwise agreed by the parties, the arbitration shall be held
in San Antonio, Texas.
10.2 Provision applicable to claims for injunctive relief. Except as set
forth in Section 9.18 and Schedule 5.08, the agreement of the parties hereto is
to submit all disputes to binding arbitration. In the event injunctive relief
is sought, the parties agree that Commercial Arbitration Rule 13 (as amended
November 1, 1993, or its subsequent equivalent) shall not apply, and instead, a
single arbitrator shall be appointed within one business day after the filing of
the demand or submission. Such arbitrator shall then preside over the
application for injunctive relief and all other disputes then arising under this
agreement. The arbitrator appointed under this paragraph 10.2 shall be
appointed by JAMS Endispute, San Antonio, Texas ("JAMS"), in the following
manner: the case administrator for the AAA shall contact JAMS immediately on
receipt of the demand for arbitration containing the claim for injunctive
relief. The case administrator shall provider JAMS with the names of the parties
to, and a copy of, this agreement. From its then current list of qualified,
licensed, but non-practicing attorneys who are former, sitting trial judges, the
San Antonio national account manager (or equivalent position) of JAMS shall
appoint one such individual as the arbitrator to preside over the application
for injunctive relief and all other disputes between the parties. Except in the
unlikely event of an actual conflict of interest under the Rules of Professional
Conduct or Code of Judicial Conduct, neither party shall have any right to
strike or object to the appointment of any person so selected. The parties
expressly agree and desire that the selection of an arbitrator hereunder shall
be effected within one business day of any application for injunctive relief and
agree that such application shall then be considered at least as expeditiously
as would be the case in the District Courts for Bexar County. The parties
further agree that any injunctive relief granted by the arbitrator shall be
separately enforceable in the District Court for Bexar County, to the same
extent as would be the case for a final award of the arbitrator.
10.3 EACH OF THE PARTIES TO THIS AGREEMENT WAIVES ANY RIGHT TO TRIAL BY
JURY OF ANY DISPUTE OF ANY NATURE WHATSOEVER THAT MAY ARISE BETWEEN THEM,
RELATING TO OR INVOLVING, IN ANY WAY THE CONSTRUCTION,
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PERFORMANCE OR BREACH OF THIS AGREEMENT OR ANY OTHER AGREEMENT BETWEEN THE
PARTIES CONTEMPLATED HEREBY, THE PROVISIONS OF ANY FEDERAL, STATE OR LOCAL LAW,
REGULATION OR ORDINANCE NOTWITHSTANDING. By execution of this Agreement, each of
the parties hereto acknowledges and agrees that such party has had an
opportunity to consult with legal counsel and that such party knowingly and
voluntarily waives any right to a trial by jury of any dispute pertaining to or
relating in any way to the transactions contemplated by this Agreement, the
provisions of any federal, state or local law, regulation or ordinance
notwithstanding.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement effective
as of the date written in the preamble of this Agreement.
AMEDISYS Alternate Site Infusion Therapy
Services, Inc.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
PRN, Inc.
By:
------------------------------------------
Name:
----------------------------------------
Title:
---------------------------------------
Stockholders:
---------------------------------------------
Name:
----------------------------------------
Address:
-------------------------------------
---------------------------------------------
Name:
----------------------------------------
Address:
-------------------------------------
The undersigned hereby exercutes this Agreement solely for purposes of
guaranteeing the obligation of AMED under Section 2.03 and Appendix A.
AMEDISYS, INC.
By:
---------------------------------------
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APPENDIX "A"
AMED will pay to the Stockholders as additional consideration ONE HUNDRED FIFTY
THOUSAND AND NO/100 DOLLARS ($150,000.00), subject to adjustment as hereinafter
provided, plus interest as described herein. The payments due hereunder shall
bear interest at a rate of 9.5% per annum, and shall be calculated based upon
the remaining principal due, or which could become due, hereunder. There shall
be eight installment payments of principal plus accrued interest, such payments
being made on or before the thirtieth day following the end of each calendar
quarter beginning March 31, 1998 and ending December 31, 1999. The calendar
quarters are March 31/st/, June 30/th/, September 30/th/ and December 31/st/ and
each installment payment shall relate to the ended quarter immediately preceding
such payment.
The principal portion of each installment payment to be made hereunder shall be
equal to $150,000.00 multiplied by the Percentage (as hereinafter defined) for
the calendar quarter to which such payment relates. The Percentage for a
calendar quarter shall be equal to (i) the PRN Quarterly Revenue (as hereinafter
defined) for such quarter (ii) divided by $1,062,500 ($625,000 x 2 years x 85%).
In no event shall the aggregate principal paid with respect to all installment
payments made hereunder exceed $150,000.00.
Interest shall be computed on the basis of a 365 day year and the interest due
shall be calculated based upon the outstanding principal balance as of the date
of such payment (i.e., $150,000.00 minus the aggregate principal portions of all
previous installment payments made hereunder).
Privilege is reserved to prepay, all, or any portion of the unpaid principal
balance, at any time, without penalty; provided, however, that any partial
prepayment shall be applied first to accrued and unpaid interest and then to the
principal balance.
Matured unpaid principal and interest shall bear interest at a rate equal to the
lesser of (i) 18% per annum, or (ii) the maximum rate allowed by applicable
statute. In the event that default be made in the payment of principal or
interest, or otherwise, hereunder, and the amount owed hereunder is not subject
to a bonafide dispute between AMED and the Stockholders, the Stockholders may at
their option declare the entire principal balance (i.e., $150,000 minus the
aggregate principal portions of all previous installment payments made
hereunder) and accrued interest owing heron immediately due and payable.
Failure to exercise this option shall not constitute a waiver of the right to
exercise the same the same in the even of any subsequent default.
For purposes of this Appendix A, the term Quarterly PRN Revenue shall mean all
PRN Revenue relating to such calendar quarter. The term PRN Revenue shall mean
the aggregate amount of gross revenue (adjusted for contractual allowances)
calculated in accordance with GAAP of the Company, AMED or any other affiliate
or subsidiary or AMED to the extent such revenue relates to (i) operations of
the Company from January 1, 1998 to the Closing Date (ii) patients of the
Company as of or after the Closing Date or (iii) any of the referral sources of
the Company set forth on Exhibit A-1 attached hereto.
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On or before thirty days after the end of each calendar quarter during the term
hereof, AMED shall deliver to the Stockholders a report calculating the
Quarterly PRN Revenue for the immediately preceding quarter. Upon reasonable
notice, the Stockholders shall have the right to examine the books and records
of the Company and AMED or any other affiliate or subsidiary of AMED (to the
extent such company generates revenues properly included in PRN Revenue) for the
purpose of confirming the calculation of the Quarterly PRN Revenue amount
reported by AMED and AMED shall cooperate in such review.
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LIST OF SCHEDULES
Schedule No. Schedule Description
- ------------ --------------------
2.01 Stock Power
3.01 Organization and Qualification
3.03 Authorizations and Third Party Consents
3.04 Litigation
3.05 Employees and Compensation
3.07 Insurance
3.08 Contracts, Agreements and Instruments
3.10 Financial Condition
3.11 Permits and Licenses
3.12 Properties
3.13 Hazardous Materials
3.14 Interest in Competitors
3.16 Changes or Events
3.17 Defaults
5.08 Non-Compete and Non-Solicitation Agreement
5.10 Legal Opinion of Cox & Smith, Incorporated
5.11 Releases
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EXHIBIT 2.7
ASSET PURCHASE AGREEMENT
BY
AND
BETWEEN
AMEDISYS ALTERNATE-SITE INFUSION THERAPY SERVICES, INC. AS PURCHASER,
AND
PRECISION HEALTH SYSTEMS, L.L.C., AS SELLER
DATED AS OF FEBRUARY 1, 1998
<PAGE>
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is entered into and made
effective as of the 1/st/ day of February, 1998, by and between AMEDISYS
ALTERNATE-SITE INFUSION THERAPY SERVICES, INC., a Louisiana corporation, with
its principal place of business at 3029 South Sherwood Forest Blvd., Suite 300,
Baton Rouge, Louisiana 70816 (hereinafter referred to as "Purchaser") and
PRECISION HEALTH SYSTEMS, L.L.C., a Louisiana limited liability company having
its principal place of business at 10473 Old Hammond Highway, Baton Rouge,
Louisiana 70816 (hereinafter referred to as "Seller").
RECITALS
WHEREAS, Seller conducts a home health care and infusion business which
provides services to non-Medicare and non-Medicaid patients and whose offices
are located at 10473 Old Hammond Highway, Baton Rouge, Louisiana;
WHEREAS, Purchaser desires to buy and Seller desires to sell all or
substantially all of the assets of Seller's business enterprise; and
WHEREAS, the parties expect that this Agreement will further advance their
respective business objectives, including without limitation, integration of the
business operations of Seller with the business operations of Purchaser in order
for Purchaser to more effectively compete in the marketplace.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
meanings indicated:
1.01 Assets: The assets to be sold and transferred by Seller to Purchaser
pursuant to this Agreement consisting of the assets owned by Seller as
of the Closing that are described in clauses (a) - (l) below and that
are more specifically detailed in Schedule 1.01 of this Agreement,
plus any other assets and rights pertaining to Seller's Business as
reflected on the balance sheet of Seller prepared as of January 31,
1998, subject to payments and receipts within the ordinary course of
business between January 31, 1998 and the date of the Closing, (the
"Balance Sheet"); provided however, the Excluded Assets are
specifically excluded from the assets to be sold under this Agreement:
a) All furniture, fixtures, equipment, leasehold improvements and
supplies of Seller located at and used by Seller in the operation
of Seller's Business at the address stated above, which are
further identified in and by the books and records of Seller;
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b) All inventory owned by Seller and used by Seller in the operation
of Seller's Business at the address stated above as of the
Closing;
c) All outstanding accounts receivable of Seller, as of the Closing,
together with all other indebtedness owed to Seller arising out
of Seller's Business;
d) Seller's right to use the name "Precision Health Systems", any
d/b/a or other name utilized to market its service and products,
and all trademarks, trade names, signage, marketing symbols and
logos;
e) All of Seller's current patient lists of present or former
patients, all of Seller's mailing lists, all business records
relating to the operations of Seller's Business (including all
records relating to patients), and all telephone numbers and
listings used by Seller in Seller's Business, and all intangibles
and other rights and privileges of Seller currently used in
Seller's Business;
f) Seller's leasehold interest in the premises occupied by Seller in
Baton Rouge, Louisiana, in accordance with the Sublease Agreement
described in Schedule 1.01 to this Agreement;
g) The goodwill and going concern value of Seller and all provider
numbers, licenses and permits of or pertaining to Seller's
Business;
h) The benefits of all amounts previously paid by Seller for
advertising, design fees, rent services, or interest relating to
Seller's Business or the Assets, to the extent that they extend
or are to be performed after the Closing;
i) All of Seller's rights under the agreements described in Schedule
5.08 (other than those described in Section 5.08.01), and the
rights given therein;
j) Seller's rights under all other contracts, including all leases
and non-competition agreements relating to Seller's Business;
k) All technical outlines and records (including all plans,
drawings, diagrams, notes, reports, memoranda, and other similar
documents), and any and all know-how and software and other
technology, including all contracts, licenses, authorizations,
permits, and other documents necessary for Seller's Business that
are owned by Seller; and
l) All trade secrets, inventions, patents, copyrights, trade names,
business names, trademarks, and other intangible assets used by
Seller for Seller's Business that are owned by Seller.
1.02 Closing. The consummation of the transactions contemplated by this
Agreement.
1.03 Excluded Assets. The assets of Seller which are not to be sold and
transferred to Purchaser pursuant to this Agreement and which consist
of the following: organizational documents of Seller, insurance
policies providing coverage to Seller
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and all rights under such policies, Seller's tax identification
number, Seller's depositary accounts and the agreements between Seller
and Seller's bank(s) (subject to the reconciliation of cash balances
of accounts described in Section 11.02(b)), and any prepaid taxes by
Seller.
1.04 GAAP. Generally accepted accounting principles.
1.06 Inventory and Accounts Receivable. All inventory and accounts
receivable of the Seller as of the Closing, including Seller's
interest in equipment which has been expensed but not capitalized,
more fully described in Schedule 1.06.
1.07 Accounts Payable. All accounts payable of the Seller as of the
Closing, including but not limited to, trade payables and account
payables more fully described in Schedule 1.07.
1.08 Liabilities. Those liabilities of Seller to be assumed by Purchaser at
the Closing pursuant to this Agreement, which consist of those
liabilities of Seller specifically disclosed on Schedule 1.08.
Purchaser shall also assume the obligations of Seller accruing after
the Closing Date on the contracts and agreements comprising a part of
the Assets, as disclosed on Schedule 1.08. Purchaser shall not assume
any other liabilities, contingent or certain, of Seller unless
incurred and disclosed in the manner provided in this Section 1.08.
Without limiting the foregoing, Purchaser is not assuming (i) any
expenses, liabilities, or obligations of Seller arising out of the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby which are unpaid at the Closing, (nor
may Seller pay any of such expenses out of the Assets), except for its
payment as provided in Section 3.03, (ii) any liabilities or
obligations of Seller relating to federal, state, or local income for
the period through the Closing or other taxes attributable to the
transactions contemplated hereby or the conduct of Seller's Business
except for the sales taxes shown on the Seller's Last Balance Sheet
and the sales taxes, if any, attributable to this transaction, (iii)
any obligation of Seller to pay a fee to any agent, broker, or finder
relating to this transaction, or (iv) the specific liabilities of
Seller for accrued medical director's fees and accrued management
expenses.
1.09 Material Adverse Effect. Any change in the financial condition of
Seller or operation of its business that would materially effect the
Seller's Business adversely, including, but not limited to, material
changes to its business condition or financial condition.
1.10 Permitted Encumbrances. As to each of the following, for which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) liens for taxes, assessments and
governmental charges or levies not yet due and payable or which are
being contested in good faith which are not in excess of $5,000.00 in
the aggregate; (b) encumbrances imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's liens and other
similar liens arising in the ordinary course of business securing
obligations that are
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being contested in good faith or are not overdue for a period of more
than 30 days provided that they are not in excess of $5,000.00 in the
case of a single property or $10,000.00 in the aggregate at any time
or which are being contested in good faith; (c) pledges or deposits to
secure obligations under workers' compensation laws or similar
legislation or to secure public or statutory obligations; (d) minor
survey exceptions, reciprocal easement agreements and other customary
encumbrances on title to real property that (i) were not incurred in
connection with any indebtedness, (ii) do not render title to the
property encumbered thereby unmarketable and (iii) do not,
individually or in the aggregate, materially adversely affect the
value or use of such property for its current purposes.
1.11 Purchaser's Knowledge. The actual knowledge of Purchaser's officers
and directors after reasonable inquiry.
1.12 Seller's Business. The home health care and infusion business which
provides services to non-Medicare and non-Medicaid patients as
presently carried on by Seller at Seller's address stated above.
1.10 Seller's Knowledge. The actual knowledge of Seller's member, Daniel D.
Brown and the administrator of Seller's other member after reasonable
inquiry.
2. Agreement to Purchase and Sell. Subject to the terms and conditions of
this Agreement, Purchaser agrees to purchase from Seller, and Seller
agrees to sell, transfer, convey, assign, and deliver to Purchaser, at
the Closing, the Assets, free and clear of all liens, claims,
liabilities, restrictions on transfer and encumbrances, except (i)
those liabilities listed in Schedule 1.08, (ii) Permitted Encumbrances
(iii) the restrictions set forth in the agreements and contracts
identified in Schedule 1.01, copies of which are attached thereto;
(iv) the consents required but not obtained identified in Schedule
5.03 and (v) liens, claims and liabilities accruing after the Closing.
2.01 The Closing. The Closing of the transactions contemplated by this
Agreement shall occur on February 27, 1998, to be effective on the
1/st/ day of February, 1998.
3. Purchase Price. The purchase price for the sale, transfer, conveyance,
assignment, and delivery of the Assets to Purchaser, subject to the
terms and conditions of this Agreement, shall be ONE MILLION AND
NO/100 ($1,000,000.00) DOLLARS, to be paid to Seller at the Closing by
the Purchaser as follows:
3.01 SEVEN HUNDRED FIFTY THOUSAND AND NO/100 ($750,000.00) DOLLARS, cash in
hand; and
3.02 Purchaser will deliver and execute a promissory note ("Promissory
Note"), the form of which is attached hereto as Schedule 3.02, payable
to the order of Seller, for the principal amount of TWO HUNDRED FIFTY
THOUSAND AND NO/100 ($250,000.00) DOLLARS. The Promissory Note shall
bear interest from February 27, 1998 until paid on the unpaid
principal balance at a per annum interest rate equal to the prime
interest rate designated in the Wall Street Journal plus one
percentage
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point, adjusted on an annual basis, and shall be payable, principal
plus interest, in twenty-four (24) equal monthly installments. The
Promissory Note shall be solidarily guaranteed by Amedisys, Inc. (the
"Guarantor"), shall provide for acceleration of the entire principal
balance in the event of default by Purchaser in the payment of any
installment thereunder or under this Agreement and shall provide for
the payment of the reasonable attorney fees incurred by Seller in the
collection thereof.
3.03 In addition to the Purchase Price, Purchaser will pay Seller, at the
Closing, TWENTY THOUSAND AND NO/100 ($20,000.00) DOLLARS to defray
certain expenses incurred by Seller in association with this
transaction.
3.04 The consideration to be paid pursuant to the provisions of this
Section 3 and the Liabilities to be assumed by Purchaser pursuant to
Section 4 shall constitute all the consideration to be paid by
Purchaser in connection with the purchase of the Assets contemplated
by this Agreement.
4. Assumption of Liabilities. In connection with the purchase of the
Assets hereunder, Purchaser shall specifically assume at Closing the
Liabilities and Permitted Encumbrances. Purchaser shall not assume any
other liabilities, contingent or certain, of Seller.
5. Representations and Warranties of Seller. Seller hereby represents and
warrants to Purchaser, as of the date of this Agreement (unless
another date is expressly provided in this Section 5) that the
statements contained in this Section 5 are correct and complete:
5.01 Ownership. Seller is the beneficial owner of the Assets and has good
and marketable title to, and/or a valid leasehold interest in, and the
right to sell, assign, and transfer the Assets to Purchaser, free and
clear of any security interest, claims, liens, pledges, penalties,
charges, restrictions on transfer, encumbrances whatsoever of every
kind and character, other than (i) Permitted Encumbrances; (ii) the
restrictions set forth in the agreements and contracts identified in
Schedule 1.01, copies of which are attached thereto; (iii) the
consents required but not obtained identified in Schedule 5.03; and
(iv) those accruing after the Closing . Upon delivery of and payment
of the Purchase Price in accordance with this Agreement and obtaining
the consents described on Schedule 5.03, good and marketable title to,
or valid leasehold interest in, the Assets, shall be delivered to
Purchaser, free and clear of any security interest, claims, liens,
pledges, penalties, charges, encumbrances, whatsoever, other than the
liabilities set forth in Schedule 1.08, the Permitted Encumbrances,
the restrictions set forth in the agreements and contracts identified
in Schedule 1.01, copies of which are attached thereto, and those
accruing after the Closing.
5.02 Valid Existence. Seller is duly organized, validly exiting, and in
good standing as a limited liability company under the laws of the
State of Louisiana and has full power and authority (including all
licenses, franchises, permits, and other authorizations that are
legally required) to own the Assets, its properties and to engage in
the business and activities now conducted by it. Seller is in good
standing in each jurisdiction in which it conducts business.
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5.03 Due Authorization: Consent of Third Parties. Seller has the right,
power, legal capacity and authority to enter into and perform Seller's
obligations under this Agreement and, no approval or consent of any
person other than the Seller is necessary in connection with the
execution, delivery, or performance of this Agreement by the Seller,
except for the consents set forth in Schedule 5.03. This Agreement
constitutes a legal and binding obligation of the Seller, and is valid
and enforceable against the Seller in accordance with its terms except
that (i) the enforcement of certain rights and remedies created by
this Agreement is subject to bankruptcy, insolvency, reorganization,
and similar laws of general application affecting the rights and
remedies of parties, and (ii) the enforceability of any particular
provision of this Agreement under principles of equity or the
availability of equitable remedies, such as specific performance,
injunctive relief, waiver, or other equitable remedies, is subject to
the discretion of courts of competent jurisdiction.
5.04 Use of Assets. All of the Assets which are tangible personal property
are located at the above stated address of Seller and are free and
clear from defects, are maintained in accordance with normal industry
practice and are in good operating condition and repair, normal wear
and tear excepted. Seller has had no other business address within the
three years prior to the Closing. The Assets are being utilized by
Seller in conformity with all applicable federal, local and state
health care related and imposed rules, regulations, laws, statutes,
and permits ("Health Care Laws") applicable to Seller, and to the best
of Seller's Knowledge all other federal, state and local rules,
regulations, laws, statutes and permits, except where failure to so
conform will not have a Material Adverse Effect.
5.05 Reserved.
5.06 Litigation. Except as described on Schedule 5.06, there is not any
suit, action, arbitration, or legal, administrative, or other
proceeding or governmental investigation pending or, to the best of
Seller's Knowledge, threatened (in the form of threats made to
representatives of Seller), against or affecting Seller or any of the
Assets or other assets of Seller, including but not limited to any
action or claim under any federal, state, local or other governmental
act, rule, regulation, or any interpretations thereof, relating to
environmental matters or the protection of the safety and health of
persons connected with Seller's Business (including but not limited to
the transportation, treatment, storage, recycling, disposal, or
release into the environment of hazardous or toxic materials or
waste), or any basis on which any proceeding or investigation against
Seller might reasonably be undertaken or brought. The Seller has
informed Purchaser of, and upon request has furnished or made
available to Purchaser, copies of all relevant court papers and other
documents relating to, the matters set forth in this Section. Seller
has described on Schedule 5.06 all suits, actions, arbitrations, or
other proceedings or investigations in which Seller has been a party
to during the five year period immediately preceding the Closing.
Except as described on Schedule 5.06, Seller is not in default with
respect to any order, writ, injunction, or decree of any Health Care
Law. In addition, to
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Seller's Knowledge, it is not in violation of any other federal,
state, local law, rule or regulation, or foreign court, department,
agency, or instrumentality. Except as set forth on Schedule 5.06,
Seller is not presently engaged in any legal action to recover monies
due to the Seller, for damages sustained by the Seller, or amounts
owed to the Seller. During the five year period immediately preceding
the Closing, except as described on Schedule 5.06, Seller has neither
received nor been a party to any written notice of violations, orders,
claims, citations, complaints, penalties, assessments, court, or other
proceedings, administrative, civil or criminal, at law or in equity,
with respect to any Health Care Law. In addition, to Seller's
Knowledge, except as described on Schedule 5.06, it has neither
received nor been party to any written notice of violations, orders,
claims, citations, complaints, penalties, assessments, court, or other
proceedings, administrative, civil or criminal, at law or in equity,
with respect to any alleged violations of any other federal, state, or
local environmental law, regulation, ordinance, standard, permit, or
order in connection with the conduct of its business or otherwise
during the past five years.
5.07 Insurance. Schedule 5.07 contains an accurate and complete list and
brief description of all policies of fire and extended coverage,
liability, and the forms of similar insurance or indemnity bonds held
by Seller. Seller is not in default with respect to any provisions of
any such policy or indemnity bond and has not failed to give any
notice or present any claim thereunder in due and timely fashion,
which failure or failures to give such notice or present such claim,
individually or in the aggregate, could materially adversely affect
the Assets. All such policies and bonds are (i) in full force and
effect, (ii) with insurance companies believed by Seller to be
financially sound and reputable, (iii) are sufficient for compliance
by Seller with all requirements of law and of all agreements and
instruments to which Seller is a party, and (iv) will not in any
significant respect be affected by, and will not terminate or lapse by
reason of, the transactions contemplated by this Agreement. Schedule
5.07 contains an accurate and complete list of all accident or other
liability claims received by or known by Seller for the three year
period immediately preceding the Closing, as well as a description of
the status of each such claim. Such claims which remain outstanding
are covered by one or more insurance policies set forth in this
Section.
5.08 Contracts, Agreements and Instruments. Schedule 5.08 contains a list
of the following, copies of which have been heretofore furnished by
Seller to Purchaser, which acknowledges receipt thereof:
5.08.01 The Articles of Organization, Operating Agreement and other
organizational documents of Seller and all amendments
thereto, as presently in effect, certified by a member of
Seller;
5.08.02 True and correct copies of all material contracts, agreements
and other instruments to which Seller is a party;
5.08.03 True and correct written descriptions of all verbal material
contracts and/or agreements to which Seller is party.
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Except for matters which, in the aggregate, would not have a Material
Adverse Effect or are otherwise disclosed in the Agreement, Seller is not, and
to the best of Seller's Knowledge, no other party to any such contract,
agreement, instrument, lease, or license is now in violation or breach of, or in
default with respect to complying with, any material provision thereof, and each
such contract, agreement, instrument, lease, or license by which Seller is
presently engaged is in full force and effect and is the legal, valid, and
binding obligation of the parties thereto and is enforceable as to them in
accordance with its terms, except that (i) the enforcement of certain rights and
remedies created thereby is subject to bankruptcy, insolvency, reorganization,
and similar laws of general application affecting the rights and remedies of
parties, and (ii) the enforceability of any particular provision thereof under
principles of equity or the availability of equitable remedies, such as specific
performance, injunctive relief, waiver, or other equitable remedies, is subject
to the discretion of courts of competent jurisdiction. Each such service,
supply, distribution, agency, financing, or other arrangement, contract or
understanding is a valid and continuing arrangement, contract or understanding,
except for matters which, in the aggregate, will not have a Material Adverse
Effect; neither Seller, nor any other party to any such arrangement, contract or
understanding has given notice of termination or taken any action inconsistent
with the continuance of such arrangement, contract or understanding, except for
matters which, in the aggregate, will not have a Material Adverse Effect; and,
subject to obtaining the consents described on Schedule 5.03, the execution,
delivery, and performance of this Agreement will not prejudice any such
arrangement, contract or understanding in any way, except for matters which, in
the aggregate, will not have a Material Adverse Effect.
5.09 Compliance With Law: Taxes. Seller has complied with, and is not in
violation of any (i) term or provision of its Articles of
Organization or Operating Agreement; (ii) term or provision of any
applicable judgment, decree, order, statute, injunction, rule,
ordinance known to it; (iii) any Health Care Law; or (iv) to the best
of Seller's Knowledge, foreign, United States, state or local
statutes, laws, rules, or regulations except where such non-
compliance or violation will not have a Material Adverse Effect.
Seller has timely filed all federal, state, and local tax returns
required to be filed and all such returns are complete and correct.
Except as described on Schedule 5.06, the Seller has made timely
payment of all such taxes when due and payable and has paid all
interest, penalties, deficiencies, and assessments, if any, levied or
assessed against it. Except as described on Schedule 5.06, Seller has
duly withheld, collected, and timely paid to the proper governmental
authorities all taxes required to be withheld and collected by it.
There are no agreements for extension of the time of assessment of
payment of any taxes of Seller, except as otherwise disclosed by
Seller. No waiver of any statute of limitations has been executed by
the Seller. There are no examinations by the Internal Revenue Service
of Seller presently in process of the tax returns of Seller for any
year(s) open to such examination.
5.10 Permits and Licenses. Seller has all permits, licenses, and other
similar authorizations necessary for the conduct of its business as
now being conducted by it, and it is not in default in any respect
under any such permits, licenses, or authorizations. No royalties,
commissions, or fees are payable by Seller to any person by reason of
the ownership or use of any intangible property, except as set forth
in the contracts described on Schedule 5.08. There are no material
licenses,
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sub-licenses, or agreements relating to the use by Seller of any
intangible property now in effect, except as set forth in the
contracts described on Schedule 5.08, and Seller has no knowledge
that any intangible property is being infringed by others. No claim
that will have a Material Adverse Effect on the business of the
Seller is pending or, to the best of Seller's Knowledge, threatened,
that the operation of Seller's Business or any method, process, part,
or material that Seller employs, conflicts in any material way with,
or infringes in any material way upon any rights of the type
enumerated above, owned by others.
5.11 Employees. Schedule 5.11 is a list of the names of all employees of
Seller, stating the amounts or rates of compensation payable to each,
the employee benefits enjoyed by each, and whether or not each
respective employee has executed an employment agreement with Seller.
5.12 No Violation of Employee Contracts. Seller is not, and to the best of
Seller's Knowledge, no employee of Seller is in violation of any term
of any employment contract, non-competition agreement, or any other
contract or agreement or any restrictive covenant with, or any other
common law obligation to, a former employer of such employee relating
to the right of any such employee to be employed by Seller because of
the nature of the business conducted by Seller or of the use of trade
secrets or proprietary information of others. There is no pending
nor, to the best of Seller's Knowledge, threatened, any actions,
suits, proceedings, or claims with respect to any contract,
agreement, covenant, or obligation referred to in the preceding
sentence.
5.13 Hazardous Materials. The Seller is not in the business of possession,
transportation, or disposal of hazardous materials. If and to the
extent that Seller's Business has involved the possession,
transportation, or disposal of hazardous materials, to Seller's
Knowledge, the Seller has complied with any and all applicable laws,
ordinances, rules, and regulations and has not and will not be the
basis of any claim or proceeding against, or any liability of, Seller
with respect to the period prior to the Closing. To the best of
Seller's Knowledge, no employee of Seller has been exposed to
hazardous materials during the period of employment by Seller such
that exposure could cause damage to such employee.
5.14 Interest in Competitors. To Seller's Knowledge, except as disclosed
on Schedule 5.14, Daniel D. Brown has no direct or indirect ownership
interest in any competitor, supplier, or customer of Seller or in any
person from whom or to whom Seller leases any real or personal
property, or in any other person with whom Seller is doing business.
5.15 Financial Condition. Seller has delivered to Purchaser true and
correct copies of the following: the unaudited balance sheet and
income statement of Seller for the fiscal year ended December 31,
1997; and an unaudited balance sheet ("Seller's Last Balance Sheet"),
and income statement for the one month ended January 31, 1998
("Seller's Last Balance Sheet Date"). Each such balance sheet
presents fairly in all material respects the financial condition,
assets and liabilities of Seller as of its date;
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and, except for unrecorded revenue, each such statement of income
presents fairly in all material respects the results of operations of
Seller for the period indicated. The financial statements referred to
in this section have been prepared in accordance with the books and
records of Seller.
5.16 Changes or Events. Since Seller's Last Balance Sheet Date, except as
described on Schedule 5.16, none of the following has occurred:
5.16.01 Any material transaction by Seller not in the ordinary course
of business involving amounts in excess of $5,000;
5.16.02 Any material capital expenditure by Seller involving amounts
in excess of $5,000;
5.16.03 Other than in the ordinary course of business, any changes in
the condition (financial or otherwise), liabilities, assets,
or business or in any business relationships of Seller,
including relationships with suppliers or customers, that,
when considered individually or in the aggregate, are
reasonably expected to have a Material Adverse Effect;
5.16.04 The destruction of, damage to, or loss of any asset of Seller
(regardless of whether covered by insurance) that, when
considered individually or in the aggregate, are reasonably
expected to have a Material Adverse Effect;
5.16.05 Any labor disputes that, when considered individually or in
the aggregate, are reasonably expected to have a Material
Adverse Effect;
5.16.06 There have been no change in accounting methods or practices
(including, without limitation, any change in depreciation or
amortization policies or rates) by Seller, except for any
such changes as were required by law;
5.16.07 Other than in the ordinary course of business and payments to
the pharmacist employed by Seller in the amount of $4,000.00,
any increase in the salary or other compensation payable or
to become payable by Seller to any employee, or the
declaration, payment, or commitment or obligation of any kind
for the payment by Seller of a bonus or other additional
salary or compensation to any such person;
5.16.08 The material amendment or termination of any material
contract, agreement, or license to which Seller is a party,
except in the ordinary course of business;
5.16.09 Any loan by Seller to any person or entity, or the
guaranteeing by Seller of any loan other than loans made in
the ordinary course of business;
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5.16.10 Any mortgage, pledge, or other encumbrance of any asset of
Seller except in the ordinary course of business;
5.16.11 The waiver or release of any right or claim of Seller, except
in the ordinary course of business;
5.16.12 Reserved;
5.16.13 Any loss or, to the knowledge of Seller, any threatened loss
of any permit, license, qualification, special charter or
certificate of authority held or enjoyed by Seller which loss
has had or upon occurrence is reasonably expected to have a
Material Adverse Effect;
5.16.14 To Seller's Knowledge, any statute, regulation, order,
ordinance or other law the adoption or rescission of which is
reasonably expected to have a Material Adverse Effect;
5.16.15 Except such matters undertaken in consultation with
Purchaser, any failure on the part of Seller to operate its
business in the ordinary course and consistent with past
practices so as to preserve its business organization intact,
to retain the services of its employees and to preserve its
goodwill and relationships with suppliers, creditors,
customers, and others having business relationships with it;
5.16.16 Any action taken or omitted to be taken by Seller which would
cause (after lapse of time, notice or both) the breach,
default, or acceleration of any right, contract, commitment,
or other obligation of Seller; or
5.16.17 Any agreement by Seller to do any of the things described in
the preceding clauses in this section.
5.17 No Defaults. Subject to obtaining the consents described on Schedule
5.03, the consummation of the transactions contemplated by this
Agreement will not result in or constitute any of the following: (i)
a breach of any term or provision of any other agreement to which
Seller is a party that will not be waived or released at the Closing;
(ii) a default or an event that will not be waived or released at the
Closing, and that, with notice or lapse of time or both, would be a
default, breach, or violation of the Articles of Organization or
Operating Agreement of Seller or of any lease, license, promissory
note, conditional sales contract, commitment, indenture, mortgage,
deed of trust, or other agreement, instrument, or arrangement to
which Seller is a party or by which Seller or its assets is bound;
(iii) an event that will not be waived or released at Closing and
that would permit any party to terminate any agreement or to
accelerate the maturity of any indebtedness or other obligation of
Seller; (iv) the creation or imposition of any lien, charge, or
encumbrance on any of the Assets; or (v) a violation of any law or
any rule or regulation of any administrative agency or governmental
body unrelated to the business or profession
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of health care and any profession related to health care, of any
order, writ, injunction or decree of any court, administrative agency
or governmental body to which Seller is subject.
5.18 Liabilities. No liabilities of Seller will be assumed by or
transferred to Purchaser pursuant to the transactions contemplated by
this Agreement, except as provided in Section 1.08, those listed in
Schedule 1.08, or as provided in Section 4, nor will any of the
Assets to be acquired by Purchaser pursuant to this Agreement be
subject to any pre-Closing liabilities, nor will Purchaser otherwise
be liable for any other liabilities of Seller.
5.19 No Prohibited Payments. Neither Seller nor any employee or agent of
Seller has made or authorized any payment of funds of Seller or on
behalf of Seller prohibited by law and no funds of Seller have been
set aside to be used for any payment prohibited by law.
5.20 Completeness of Disclosure. No representation or warranty by Seller
in this Agreement including the Schedules, Exhibits, and certificates
prepared by Seller incorporated herein, contains any untrue statement
of a material fact or omits any material fact necessary in order to
make the statements contained herein not misleading.
6. Representations and Warranties of Purchaser and Guarantor. Purchaser,
and with respect to Sections 6.05, 6.06 and 6.07, Guarantor, hereby
represents and warrants to Seller, as of the date of this Agreement,
that the statements contained in this Section 6 are correct and
complete:
6.01 Organization. Purchaser is a corporation duly organized, validly
existing, and in good standing under the laws of the State of
Louisiana and is authorized to do business in every other
jurisdiction in which its ownership, leasing, licensing, or use of
property or assets or the conduct of its business makes such
qualification necessary, except where the failure to do so would not
have a Material Adverse Effect. Purchaser is a wholly owned
subsidiary of Guarantor.
6.02 Due Authorization: Third Party Consents. Purchaser has the right,
power, legal capacity, and authority to enter into and perform its
obligations under this Agreement and, except as otherwise set forth
herein, no approval or consent of any person other than the Purchaser
is necessary in connection with the execution, delivery, or
performance of this Agreement. The execution, delivery, and
performance of this Agreement by the Purchaser has been duly
authorized by its board of directors and no other corporate
proceedings on the part of Purchaser are necessary to authorize this
Agreement or the consummation of the transactions contemplated
hereby. This Agreement constitutes a legal and binding obligation of
the Purchaser, and is valid and enforceable against the Purchaser in
accordance with its terms except that (i) the enforcement of certain
rights and remedies created by this Agreement is subject to
bankruptcy, insolvency, reorganization, and similar laws of general
application affecting the rights and remedies of parties, and (ii)
the enforceability of any
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particular provision of this Agreement under principles of equity or
the availability of equitable remedies, such as specific performance,
injunctive relief, waiver or other equitable remedies, is subject to
the discretion of courts of competent jurisdiction.
6.03 No Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following:
(i) a breach of any term or provision of any other agreement of
Purchaser that will not be waived or released at the Closing; (ii) a
default or an event that will not be waived or released at the
Closing and that, with notice or lapse of time or both, would be a
default, breach, or violation of the Certificate of Incorporation or
Bylaws of Purchaser or of any lease, license, promissory note,
conditional sales contract, commitment, indenture, mortgage, deed of
trust, or other agreement, instrument, or arrangement to which
Purchaser is a party or by which Purchaser or the property of
Purchaser is bound; or (iii) a violation of any law or any rule or
regulation of any administrative agency or governmental body or any
order, writ, injunction, or decree of any court, administrative
agency or governmental body to which Purchaser is subject.
6.04 Completeness of Disclosure. No representation or warranty and no
Schedule, Exhibit, or certificate incorporated herein and prepared by
Purchaser pursuant hereto and no statement made or other document
prepared by Purchaser and furnished to Seller by Purchaser contains
any untrue statement of a material fact or omits or will omit any
material fact necessary in order to make the statements contained
therein not misleading.
6.05 Organization of Guarantor. Guarantor is a corporation duly organized,
validly existing, and in good standing under the laws of the State of
Delaware and is authorized to do business in every other jurisdiction
in which its ownership, leasing, licensing, or use of property or
assets or the conduct of it business makes such qualification
necessary, except where the failure to do so would not have a
Material Adverse Effect.
6.06 Due Authorization: Third Party Consents. Guarantor has the right,
power, legal capacity, and authority to enter into and perform its
obligations under this Agreement and, except as otherwise set forth
herein, no approval or consent of any person other than the Guarantor
is necessary in connection with the execution, delivery, or
performance of this Agreement. The execution, delivery, and
performance of this Agreement by the Guarantor has been duly
authorized by its board of directors and no other corporate
proceedings on the part of Guarantor are necessary to authorize this
Agreement or the consummation of the transactions contemplated
hereby. This Agreement constitutes a legal and binding obligation of
the Guarantor, and is valid and enforceable against the Guarantor in
accordance with its terms except that (i) the enforcement of certain
rights and remedies created by this Agreement is subject to
bankruptcy, insolvency, reorganization, and similar laws of general
application affecting the rights and remedies of parties, and (ii)
the enforceability of any particular provision of this Agreement
under principles of equity or the availability
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of equitable remedies, such as specific performance, injunctive
relief, waiver or other equitable remedies, is subject to the
discretion of courts of competent jurisdiction.
6.07 No Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following:
(i) a breach of any term or provision of any other agreement of
Guarantor that will not be waived or released at the Closing; (ii) a
default or an event that will not be waived or released at the
Closing and that, with notice or lapse of time or both, would be a
default, breach, or violation of the Certificate of Incorporation or
Bylaws of Guarantor or of any lease, license, promissory note,
conditional sales contract, commitment, indenture, mortgage, deed of
trust, or other agreement, instrument, or arrangement to which
Guarantor is a party or by which Guarantor or the property of
Guarantor is bound; or (iii) a violation of any law or any rule or
regulation of any administrative agency or governmental body or any
order, writ, injunction, or decree of any court, administrative
agency or governmental body to which Guarantor is subject.
7. Conditions to Obligations of Purchaser. The obligations of Purchaser
under this Agreement are subject, at the option of Purchaser, to the
satisfaction of the following conditions:
7.01 Accuracy of Representations and Compliance With Conditions. All
representations and warranties of Seller contained in this Agreement
shall be accurate when made and, in addition, shall be materially
accurate as of the Closing as though such representations and
warranties were then made by Seller, other than such representations
and warranties that are made as to another date. As of the Closing,
Seller shall have performed and complied with all covenants and
agreements and satisfied all conditions required to be performed and
complied with by Seller at or before such time by this Agreement.
7.02 Closing Documents. In connection with the Closing, Seller shall
deliver to Purchaser the following items:
7.02.01 Bills of sale, endorsements, assignments, drafts, checks, and
other instruments of transfer in form and substance
consistent with this Agreement and mutually satisfactory to
Purchaser and Seller in order to transfer all right, title
and interest of Seller in the Assets to Purchaser;
7.02.02 To the extent applicable, original evidences of title or
ownership of the Assets, including drafts, warehouse receipts
and licenses;
7.02.03 Evidence (including, if applicable, the delivery of duly
executed UCC-3 Termination Statements) reasonably
satisfactory to Purchaser and its counsel, of the
satisfaction and discharge by Seller of all existing liens,
claims, and encumbrances upon or affecting the Assets; and
7.02.04 Such other instruments and documents in form and content
consistent with the terms of this Agreement and mutually
satisfactory to Seller and
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Purchaser, as may be necessary or appropriate to (i)
effectively transfer and assign to and vest in Purchaser good
and marketable title to the Assets and/or to consummate more
effectively the transactions contemplated hereby and (ii) in
order to enable Purchaser to determine whether the conditions
to Seller's obligations under this Agreement have been met
and otherwise to carry out the provisions of this Agreement.
7.03 Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement
incidental thereto and all other related legal matters shall be
subject to the reasonable approval of counsel to Purchaser, and
Seller shall have furnished such counsel for Purchaser such documents
as such counsel may have reasonably requested for the purpose of
enabling them to pass upon such matters.
7.04 Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise
challenging the consummation of, the transactions contemplated by
this Agreement or related agreements or to obtain substantial damages
with respect thereto.
7.05 No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated,
enacted, entered, enforced, or deemed applicable to the transactions
contemplated by this Agreement by any federal, state, local, or other
governmental authority or by any court or other tribunal, including
the entry of a preliminary or permanent injunction which, in the
reasonable judgment of Purchaser:
7.05.01 Makes any of the transactions contemplated by this Agreement
illegal;
7.05.02 Results in a delay which affects the ability of Purchaser to
consummate any of the transactions contemplated by this
Agreement;
7.05.03 Requires the divestiture by Purchaser of a material portion
of the business of either Purchaser taken as a whole, or of
Seller taken as a whole; and
7.05.04 Otherwise prohibits, restricts, or delays consummation of any
of the transactions contemplated by this Agreement or impairs
the contemplated benefits to Purchaser of the transactions
contemplated by this Agreement.
7.06 Contractual Consents Needed. Except for the consents described in
Schedule 5.03, the Parties to this Agreement shall have obtained at
or prior to the Closing all consents required for the consummation of
the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or
understanding to which either of them is a party, or to which any of
their respective businesses, properties, or assets are subject,
except where the failure to obtain the same would not have a Material
Adverse Effect on such party.
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7.07 Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and
delivered by the parties thereto at or prior to the Closing, shall be
in full force and effect, valid and binding upon the parties thereto,
and enforceable by them in accordance with their terms at the
Closing, and no party thereto at any time from the execution thereof
until immediately after the Closing shall have been in violation of
or in default in complying with any material provision thereof.
7.08 Member Approval. The members of Seller shall have approved the
transactions contemplated herein.
7.09 Legal Opinion. Seller shall have obtained a legal opinion from the
law firm of Kantrow, Spaht, Weaver & Blitzer in the form shown in
Schedule 7.09.
7.10 Public Statements. Before Seller shall execute or administer a press
release or public announcement related to consummation of this
transaction, Seller shall cooperate with Purchaser, shall furnish
drafts of all documents or proposed oral statements to Purchaser for
comment, and shall not release any such information without the
written consent of Purchaser. Nothing contained herein shall prevent
Seller from furnishing any information to any governmental authority
if required to do so by law.
8. Conditions to Obligations of Seller. The obligations of Seller under
this Agreement are subject, at the option of Seller, to the
satisfaction of the following conditions:
8.01 Accuracy of Representations and Compliance With Conditions. All
representations and warranties of Purchaser contained in this
Agreement shall be accurate when and shall be accurate as of the
Closing as though such representations and warranties were then made
by Purchaser, other than such representations and warranties as are
made as to another date. As of the Closing, Purchaser shall have
performed and complied with all covenants and agreements and
satisfied all conditions required to be performed and complied with
by any of them at or before such time by this Agreement.
8.02 Other Closing Documents. Purchaser shall have delivered to Seller, at
or prior to the Closing, such other documents as Seller may
reasonably request in order to enable Seller to determine whether the
conditions to its obligations under this Agreement have been met and
otherwise to carry out the provisions of this Agreement.
8.03 Review of Proceedings. All actions, proceedings, instruments, and
documents required to carry out this Agreement, or any agreement
incidental thereto and all other related legal matters shall be
subject to the reasonable approval of counsel to Seller and Purchaser
shall have furnished such counsel such documents as such counsel may
have reasonably requested for the purpose of enabling them to pass
upon such matters.
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8.04 Legal Action. There shall not have been instituted or threatened any
legal proceeding relating to, or seeking to prohibit or otherwise
challenging the consummation of, the transactions contemplated by
this Agreement or related agreements set forth as an exhibit hereto,
or to obtain substantial damages with respect thereto.
8.05 No Governmental Action. There shall not have been any action taken,
or any law, rule, regulation, order, or decree proposed, promulgated,
enacted, entered, enforced, or deemed applicable to the transactions
contemplated by this Agreement by any federal, state, local, or other
governmental authority or by any court or other tribunal, including
the entry of a preliminary or permanent injunction, which, in the
reasonable judgment of Seller:
8.05.01 Makes any of the transactions contemplated by this Agreement
illegal;
8.05.02 Results in a delay which affects the ability of Seller to
consummate any of the transactions contemplated by this
Agreement;
8.05.03 Otherwise prohibits, restricts, or delays consummation of any
of the transactions contemplated by this Agreement or impairs
the contemplated benefits to Seller or the Stockholders of
the transactions contemplated by this Agreement.
8.06 Contractual Consents Needed. The parties to this Agreement shall have
obtained at or prior to the Closing the consents described on
Schedule 5.01 and all other consents required for the consummation of
the transactions contemplated by this Agreement from any party to any
contract, agreement, instrument, lease, license, arrangement, or
understanding to which either of them is a party, or to which any of
their respective businesses, properties, or assets are subject,
except where the failure would not have a Material Adverse Effect.
8.07 Other Agreements. Agreements set forth as exhibits or schedules to
this Agreement shall have been duly authorized, executed, and
delivered by the parties thereto at or prior to the Closing, shall be
in full force, valid and binding upon the parties thereto, and
enforceable by them in accordance with their terms at the Closing,
and no party thereto at any time from the execution thereof until
immediately after the Closing shall have been in violation of or in
default in complying with any material provision thereof.
8.08 Board Approval. The Boards of Directors of Purchaser and Guarantor
shall have approved the transactions contemplated herein and
certified copies of authroizing resolutions shall have been delivered
to Seller.
9. Covenants and Agreements of Purchaser. Purchaser covenants and agrees
as follows:
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9.01 Payment of Sales Taxes. Any sales tax incurred as a result of this
transaction will be paid by Purchaser to Seller at the Closing for
remittance to the appropriate taxing authority.
9.02 Post Closing Covenants. On and after the Closing, Purchaser agrees to
maintain in confidence and not to disclose, except in accordance with
and as permitted by applicable laws and regulations, the records of
the patients to whom Seller provided services.
9.03 Employment Matters. On or prior to the Closing, Purchaser shall offer
employment to all of Seller's employees, other than Kim Arceneaux, on
such terms and providing such health and other benefits as Purchaser
has previously advised Seller.
9.04 Collection of Receivables. Purchaser shall use it best good faith
efforts to collect all outstanding receivables of Seller, as detailed
in Schedule 1.01, in a timely and efficient manner.
9.05 Release of Daniel D. Brown. Subsequent to closing, Purchaser shall
ensure that Daniel D. Brown is released from any personal contract or
agreement guarantees which are active with respect to Seller's
business.
9.06 Information Accessibility. Upon prior reasonable notice and at
reasonable times, Seller shall be allowed access to those business
records transferred herein.
10. Covenants and Agreements of Seller. Seller covenants and agrees as
follows:
10.01 Payment of Taxes. Except City sales taxes in the amount shown on
Seller's Last Balance Sheet, all accrued but unpaid federal, state,
and local income and other taxes of Seller for the period ended as of
the Closing and all prior periods will be paid by Seller.
10.02 Post-Closing Consents. Seller agrees to use its best good faith
effort to secure and/or assist Purchaser in securing post-Closing
third party consents material to the ongoing operation of Seller's
Business.
11. Miscellaneous.
11.01 Brokerage and Other Fees. The parties agree that there are no
brokerage arrangements or fee obligations, in writing or otherwise,
with respect to the transactions set forth in this Agreement. Each
party shall be responsible for the fees of their respective
professionals (including, without limitation, legal and accounting
fees) engaged to assist in the preparation, negotiation and
counseling with respect, and relating, to this Agreement and
consummation of the transactions contemplated herein, as well as
their respective out-of-pocket expenses except Purchaser agrees to
pay for the preparation of the necessary transfer documents to
accomplish the transactions herein.
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11.02 Further Actions.
(a) At any time and from time to time, the parties agree, at their
expense, to take such actions and to execute and deliver such
documents as may be reasonably necessary to effectuate the purposes
of this Agreement.
(b) Purchaser and Seller shall reconcile Seller's depositary accounts
as of the effective date of the Closing, and for the period
thereafter through the date of the Closing, and upon completion
thereof, Seller shall pay to Purchaser the balance of said accounts.
11.03 Reserved.
11.04 Survival. The representations, and warranties contained in or made
pursuant to this Agreement by the Parties hereto shall survive for a
period of 24 months from the date of the Closing, irrespective of any
investigation made by or on behalf of any party (the "Survival
Date"). No claim for indemnification or otherwise may be brought by a
party hereto against another party hereto unless asserted by written
notice as provided herein by the party claiming indemnification or
otherwise on or before the Survival Date.
11.05 Entire Agreement; Modification. The Agreement and the Schedules and
Exhibits hereto set forth the entire understanding of the parties
with respect to the subject matter hereof, supersede all existing
agreements between them concerning such subject matter, and may be
modified only by a written instrument duly executed by the parties.
11.06 Notices. Any notice or other communication required or permitted to
be given hereunder shall be in writing and shall be given or made
(and shall be deemed to have been duly given or made upon receipt) by
delivery in person, by courier service, by telecopy (confirmed by
telephone within twenty-four (24) hours following receipt thereof),
or by registered or certified mail, (postage prepaid, return receipt
requested) to the respective parties at the following address (or at
such other address for a party as shall be specified in a notice
given in accordance with this Section 11.06:
(a) If to Seller:
Precision Health Systems, L.L.C.
10474 Old Hammond Highway, Suite 101
Baton Rouge, Louisiana 70816
Attention: Danny D. Brown
Telecopy: (50) 927-7205
Telephone: (504) 927-7688
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with copy to:
Kantrow, Spaht, Weaver & Blitzer
(A Professional Law Corporation)
Suite 300, City Plaza
445 North Boulevard
P.O. Box 2997
Baton Rouge, Louisiana 70821-2997
Attention: Lee C. Kantrow
Telecopy: (504) 343-0637
Telephone: (504) 383-4703
(b) If to Purchaser:
Amedisys Alternate-Site Infusion Therapy Services, Inc.
3029 S. Sherwood Forest Blvd.
Suite 300
Baton Rouge, Louisiana 70816
Attention: Stephen Taglianetti
Telecopy: (504) 292-8163
Telephone: (504) 292-2031
11.07 Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any
other breach of that provision or of any breach of any other
provision of this Agreement. The failure of a party to insist upon
strict adherence to any term of this Agreement on one or more
occasions will not be considered a waiver or deprive that party of
the right thereafter to insist upon strict adherence to that term or
any other term of this Agreement. Any waiver must be in writing and,
in the case of a corporate party, be authorized by a resolution of
the Board of Directors or by an officer of the waiving party.
11.08 Binding Effect. The provisions of this Agreement shall be binding
upon and inure to the benefit of each party's respective successors
and assigns; provided, however, any such assignment by Purchaser
shall not release Purchaser of any of its obligations under this
Agreement.
11.09 No Third-Party Beneficiaries. This Agreement does not create, and
shall not be construed as creating, any rights enforceable by any
person not a party to this Agreement.
11.10 Severability. If any provision of this Agreement is invalid, illegal,
or unenforceable, the balance of this Agreement shall remain in
effect, and if any provision is inapplicable to any person or
circumstance, it shall nevertheless remain applicable to all other
persons and circumstances.
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11.11 Headings. The headings of this Agreement are solely for convenience
of reference and shall be given no effect in the construction or
interpretation of this Agreement.
11.12 Counterparts, Governing Law. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original,
but all of which together shall constitute one and the same
instrument. It shall be governed by and construed in accordance with
the laws of the State of Louisiana without giving effect to conflict
of laws.
11.13 Indemnification. Subject to the limitations set forth in Sections
11.14 and 11.15 hereof, Seller shall indemnify, defend and hold
harmless Purchaser and each of its officers, directors, agents and
affiliates from and against any damage, loss, claim, liability, cost
or expense incurred by Purchaser, including fees and disbursements of
counsel, accountants, experts and other consultants reasonably and
necessarily incurred by Purchaser, net of any tax benefit to which
Purchaser is entitled and net of any and all amounts to which
Purchaser is entitled to from insurance, guarantees, indemnities, and
contractual and legal rights by, from or against other persons, firms
or entities (collectively, "Damages"), resulting from, arising out
of, based upon or occasioned by the inaccuracy of any warranty or any
representation made by Seller in this Agreement, or any breach of any
covenant or agreement of Seller contained herein. Purchaser shall
indemnify, defend and hold harmless Seller and each of its members,
officers, directors, agents and affiliates from and against any
Damages, resulting from, arising out of, based upon or occasioned by
the inaccuracy of any warranty or representation made by the
Purchaser herein, or any breach of any covenant or agreement of
Purchaser contained herein.
11.14 Limitations on Indemnification and Other Claims. The maximum amount
of Damages for which Seller shall be responsible under this
Agreement, whether pursuant to a claim for indemnification or
otherwise, shall not exceed the unpaid principal balance of the
Promissory Note, such maximum amount to be reduced by principal
payments made by the Purchaser or the Guarantor on the Promissory
Note and by amounts offset against the unpaid principal balance of
the Promissory Note in the manner permitted by this Agreement. Such
right of offset shall be the exclusive remedy of the Purchaser, and
all other persons entitled to indemnity against the Seller pursuant
to Section 11.13 above, for Damages under this Agreement and
otherwise. It is understood and agreed that Seller shall have no
liability to return any part of the cash portion of the Purchase
Price or any payments of principal or interest on the Promissory Note
received by it or otherwise pay any amount of Damages (except
pursuant to the right of offset as permitted by this Agreement). The
right of offset permitted in this Agreement shall be exercised first
against accrued but unpaid interest and then against the unpaid
principal installments of the Promissory Note in the inverse order of
their maturity.
11.15 Right of Off-Set. If Purchaser reasonably believes it is entitled to
indemnification under this Agreement, it shall be entitled to the
right of offset against amounts owing by it under the Promissory Note
in accordance with the following terms and
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provisions: Purchaser shall promptly notify Seller of the matter for
which it seeks indemnification and shall specify in reasonable detail
the facts and circumstances thereof and a good faith estimate of the
Damages occasioned thereby. Seller shall have ten (10) days from the
receipt of Purchaser's notice in which to cure the circumstance
giving rise to the Damages and provide evidence of such cure to the
Purchaser. If the circumstance is not cured within the ten day
period, Purchaser shall have the immediate right to deposit the
monthly payment due and payable pursuant to the Promissory Note into
an escrow account at a bank mutually acceptable to the parties to be
held and invested pursuant to a mutually agreeable escrow agreement.
Monthly payments into said escrow account shall continue until the
amount of the Damages specified in Purchaser's notice is equal to the
balance of said escrow account, at which time payments to Seller
under the Promissory Note shall resume as originally contemplated. In
the event the Purchaser's claim for indemnification is disputed by
Seller, such dispute shall be resolved by the provisions of Section
9.15. If it is ultimately determined that Purchaser's claim for
indemnification was improper, the escrowed funds and earnings thereon
shall be distributed to Seller. If it is ultimately determined that
Purchaser's claim for indemnification was proper, the escrowed funds
and earnings thereon shall be distributed to Purchaser.
11.16 Arbitration Procedures. Any and every dispute of any nature
whatsoever that may arise between the parties hereto, whether
sounding in contract, statute, tort, fraud, misrepresentation,
discrimination or any other legal theory, or breach of this
Agreement, or any schedule, certificate or other document delivered
by any party hereto or thereto, or those arising under any federal,
state or local law, regulation or ordinance, shall be subject to the
limitations of Section 11.14 and shall be determined by binding
arbitration in accordance with the then-current commercial
arbitration rules of the American Arbitration Association ("AAA"), to
the extent such rules do no conflict with the provision of this
Section 11. The arbitration shall be conducted by a single neutral
arbitrator. The parties shall endeavor to select a neutral arbitrator
by mutual agreement. If such agreement cannot be reached within
thirty (30) calendar days after a dispute has arisen which is to be
decided by arbitration, any party or the parties jointly shall
request AAA to submit to each party an identical panel of fifteen
(15) persons. Alternate strikes shall be made to the panel,
commencing with the party bringing the claim, until the name of one
(1) person remains. The parties may, however, by mutual agreement,
request AAA to submit additional panels of possible arbitrators. The
arbitrator shall have the power to determine all matters incident to
the conduct of the arbitration, including without limitation all
procedural and evidentiary matters and the scheduling of any hearing.
The award made by the arbitrator shall be governed by the United
States Arbitration Act, 9 U.S.C. (S)(S) 1-16, and judgment upon the
award rendered by the arbitrator(s) may be entered by any court
having jurisdiction thereof. Unless otherwise agreed by the parties,
the arbitration shall be held in Baton Rouge, Louisiana.
11.17 Provision applicable to claims for injunctive relief. This agreement
to arbitrate shall specifically include, without limitation, an
application for injunctive relief under Section 11. In the event
injunctive relief is sought, the parties agree that Commercial
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Arbitration Rule 13 (as amended November 1, 1993, or its subsequent
equivalent) shall not apply, and instead, a single arbitrator shall
be appointed within one business day after the filing of the demand
or submission. Such arbitrator shall then preside over the
application for injunctive relief and all other disputes then arising
under this Agreement. The arbitrator appointed under this paragraph
10(b) shall be appointed by JAMS Endispute, Baton Rouge, Louisiana
("JAMS"), in the following manner: the case administrator for the AAA
shall contact JAMS immediately on receipt of the demand for
arbitration containing the claim for injunctive relief. The case
administrator shall provider JAMS with the names of the parties to,
and a copy of, this agreement. From its then current list of
qualified, licensed, but non-practicing attorneys who are former,
sitting trial judges, the Baton Rouge national account manager (or
equivalent position) of JAMS shall appoint one such individual as the
arbitrator to preside over the application for injunctive relief and
all other disputes between the parties. Except in the unlikely event
of an actual conflict of interest under the Rules of Professional
Conduct or Code of Judicial Conduct, neither party shall have any
right to strike or object to the appointment of any person so
selected. The parties expressly agree and desire that the selection
of an arbitrator hereunder shall be effected within one business day
of any application for injunctive relief and agree that such
application shall then be considered at least as expeditiously as
would be the case in the District Courts for East Baton Rouge Parish.
The parties further agree that any injunctive relief granted by the
arbitrator shall be separately enforceable in the District Court for
East Baton Rouge Parish, to the same extent as would be the case for
a final award of the arbitrator.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement effective as
of the date written in the preamble of this Agreement.
AMEDISYS ALTERNATE-SITE INFUSION THERAPY SERVICES, INC.
By: ________________________________________
Stephen Taglianetti, President
AMEDISYS, INC.
By:_________________________________________
Print Name:__________________________________
Title:_______________________________________
PRECISION HEALTH SYSTEMS, L.L.C.
By: ________________________________________
Daniel D. Brown, Member
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SCHEDULES OF SELLER
TO ASSET PURCHASE AGREEMENT (THE "ASSET PURCHASE AGREEMENT")
BY AND BETWEEN
AMEDISYS ALTERNATE-SITE INFUSION THERAPY SERVICES, INC.
(THE "PURCHASER")
AND
PRECISION HEALTH SYSTEMS, L.L.C
(THE "SELLER")
DATED AS OF FEBRUARY ____, 1998
NOTE: Unless otherwise defined herein, capitalized terms used herein shall have
the meanings ascribed to them in the Asset Purchase Agreement. Matters
disclosed under any Schedule hereof shall be deemed incorporated into matters
disclosed under any other Schedule hereof to the extent applicable.
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EXHIBIT 2.8
THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED AND IS TRANSFERRABLE ONLY UPON COMPLIANCE WITH OR AN EXEMPTION FROM
ALL APPLICABLE SECURITIES AND OTHER LAWS.
PROMISSORY NOTE
$250,000 Baton Rouge, Louisiana February 27, 1998
FOR VALUE RECEIVED, the undersigned, AMEDISYS ALTERNATE-SITE INFUSION
THERAPY SERVICES, INC. a Louisiana corporation ("Maker"), hereby promises to pay
to the order of PRECISION HEALTH SYSTEMS, LLC ("Payee"), at Baton Rouge,
Louisiana, the principal sum of Two Hundred Fifty Thousand and no/100 Dollars
($250,000), in lawful money of the United States of America, which shall be
legal tender, in payment of all debts and dues, public and private, at the time
of payment, bearing interest and payable as provided herein.
Interest on the unpaid balance of this Note shall accrue from the date
hereof at a rate per annum equal to 9.5% from the date hereof to February 27,
1999, and thereafter at the prime interest rate designated in the Wall Street
Journal on the anniversary date hereof, plus one percentage point; provided,
however, that such interest shall not exceed the Maximum Rate as hereinafter
defined. All past-due principal and interest shall bear interest at the maximum
rate permitted by applicable law. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
The principal amount of and accrued interest on this Note shall be due
and payable in twenty-four (24) equal monthly installments, the first
installment of which is due on March 27, 1998, and a like amount on the same day
of each month thereafter. The monthly installments through February 27, 1999,
shall be in the amount of $11,478.62 each, with the amount thereafter to be
adopted on the basis of the changes in the interest rate as provided above.
This Note may be prepaid in whole or in part, at any time and from
time to time, without premium or penalty.
If any payment of principal of or interest on this Note shall become
due on a Saturday, Sunday or any other day on which national banks are not open
for business, such payment shall be made on the next succeeding business day.
An event of default means default by the Maker (i) in the payment of
any installment of the principal of, and interest on, the Note when due,
whatever the reason for such event of default and whether it shall be voluntary
or involuntary or effected by operation of law or pursuant to any judgment,
decree or order of any Court or any order, rule or regulation of any
administrative governmental body or (ii) in the performance of its obligations
under the Asset Purchase Agreement dated as of February 1, 1998, between Payee
and Maker ("The Asset Purchase Agreement")("Event of Default").
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If an Event of Default shall occur and be continuing, the Payee of
subsequent holders may, at its option, declare the unpaid principal amount of
this Note immediately due and payable.
The indebtedness of the Maker hereunder is solidarily guaranteed by
Amedisys, Inc. pursuant to a Guaranty Agreement having the same date hereof.
Notwithstanding anything to the contrary in this Note or any other
agreement entered into in connection herewith, whether now existing or hereafter
arising and whether written or oral, it is agreed that the aggregate of all
interest and any other charges constituting interest, or adjudicated as
constituting interest, and contracted for, chargeable or receivable under this
Note or otherwise in connection with this loan transaction, shall under no
circumstances exceed the Maximum Rate. In the event the maturity of this Note
is accelerated by reason of an Event of Default under this Note, other agreement
entered into in connection herewith or therewith, by voluntary prepayment by
Maker or otherwise, then earned interest may never include more than the Maximum
Rate. If from any circumstance any holder of this Note shall ever receive
interest or any other charges constituting interest, or adjudicated as
constituting interest, the amount, if any, which would exceed the Maximum Rate
shall be applied to the reduction of the principal amount owing on this Note,
and not to the payment of interest; or if such excessive interest exceeds the
unpaid balance of principal hereof, the amount of such excessive interest that
exceeds the unpaid balance of principal hereof shall be refunded to Maker. In
determining whether or not the interest paid or payable exceeds the Maximum
Rate, to the extent permitted by applicable law (i) any nonprincipal payment
shall be characterized as an expense, fee or premium rather than as interest;
and (ii) all interest at any time contracted for, charged, received or preserved
in connection herewith shall be amortized, prorated, allocated and spread in
equal parts during the period of the full stated term of this Note. The term
"Maximum Rate" shall mean the maximum rate of interest allowed by applicable
federal or state law.
Except as provided herein, Maker and any sureties, guarantors and
endorsers of this Note jointly and severally waive demand, presentment, notice
of nonpayment or dishonor, notice of intent to accelerate, notice of
acceleration, diligence in collecting, grace, notice and protest, and consent to
all extensions without notice for any period or periods of time and partial
payments, before or after maturity, without prejudice to the holder. The holder
shall similarly have the right to deal in any way, at any time, with one or more
of the foregoing parties without notice to any other party, and to grant any
such party any extensions of time for payment of any of said indebtedness, or to
grant any other indulgences or forbearance whatsoever, without notice to any
other party and without in any way affecting the personal liability of any party
hereunder. If any efforts are made to collect or enforce this Note or any
installment due hereunder, the undersigned agrees to pay all collection costs
and fees, including reasonable attorney's fees.
This Note shall be construed and enforced under and in accordance with
the laws of the State of Louisiana.
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This Note is subject to off-set as provided in the Asset Purchase Agreement.
Timely payment in escrow as permitted by, and in accordance with, the terms of
the Asset Purchase Agreement shall constitute payments under this Note.
IN WITNESS WHEREOF, Maker has duly executed this Note as of the day
and year first above written.
AMEDISYS ALTERNATE-SITE INFUSION
THERAPY SERVICES, INC.
By
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EXHIBIT 2.9
STOCK PURCHASE AGREEMENT
BY
AND
AMONG
AMEDISYS, ALTERNATE-SITE INFUSION THERAPY SERVICES, INC.,
A LOUISIANA CORPORATION, AS PURCHASER,
AND
INFUSIONCARE SOLUTIONS, INC.
A LOUISIANA CORPORATION, AS COMPANY,
AND
DANIEL D. BROWN, AS SELLER
DATED AS OF FEBRUARY 1, 1998
<PAGE>
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement') is made effective as of
February 1, 1998, by and among AMEDISYS ALTERNATE-SITE INFUSION THERAPY
SERVICES, INC., a Louisiana corporation ("AMED" or "Purchaser"), with its
principal place of business at 3029 South Sherwood Forest Blvd., Suite 300,
Baton Rouge, Louisiana 70816, INFUSIONCARE SOLUTIONS, INC., a Louisiana
corporation (the "Company"), with its principal place of business at 10473 Old
Hammond Highway, Baton Rouge, Louisiana 70816, and DANIEL D. BROWN (the
"Stockholder" or the "Seller"), with his principal place of business at 10473
Old Hammond Highway, Baton Rouge, Louisiana 70816. AMED, the Company and the
Stockholder are sometimes referred to collectively as the "Parties" and singly,
a "Party".
RECITALS
WHEREAS, AMED desires to purchase 100% of the issued and outstanding
capital stock of the Company ("Company Stock") from the Stockholder as
hereinafter provided; and
WHEREAS, the Stockholder desires to sell the Company Stock to AMED as
hereinafter provided.
WHEREAS the parties expect that this Agreement will further advance their
respective business objectives, including without limitation, integration of the
business operations of the Company with the business operations of Purchaser in
order for Purchaser to more effectively compete in the marketplace.
NOW, THEREFORE, in consideration of the premises and the mutual promises
made herein, and in accordance with the representations, warranties and
covenants contained herein, the Parties agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
meanings indicated:
1.01 Closing: The consummation of the transactions contemplated by
this Agreement.
1.02 GAAP: Generally accepted accounting principles.
1.03 Health Care Laws: All federal, state and local health care related
laws, regulations and ordinances including but not limited to
Medicaid, Medicare and regulations of the Health Care Finance
Administration.
1.04 Knowledge: With respect to a Party, the actual knowledge of such
Party, its officers and directors, after reasonable inquiry.
1.05 Material Adverse Effect: Any change in the financial condition of
the Company or the operation of its business that would materially
affect the Company's business adversely, including, but not limited
to, material adverse changes to its business
<PAGE>
condition or financial condition.
1.06 Operating Licenses: In the case of the Company or AMED, as the
case may be, the licenses, permits and registrations issued by the
appropriate state and federal agencies which are necessary to the
operation of its business. Such Operating Licenses are more fully
described in Schedule 3.11 hereto for the Company.
1.07 Prime: The prime interest rate as designated daily by The Wall
Street Journal.
1.08 Permitted Encumbrances: As to each of the following, for which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) liens for taxes, assessments and
governmental charges or levies not yet due and payable or which
are being contested in good faith which are not in excess of
$5,000.00 in the aggregate; (b) encumbrances imposed by law, such
as materialmen's, mechanics', carriers', workmen's and repairmen's
liens and other similar liens arising in the ordinary course of
business securing obligations that are being contested in good
faith or are not overdue for a period of more than 30 days
provided that they are not in excess of $5,000.00 in the case of a
single property $10,000.00 in the aggregate at any time or which
are being contested in good faith; (c) pledges or deposits to
secure obligations under workers' compensation laws or similar
legislation or to secure public or statutory obligations; (d)
minor survey exceptions, reciprocal easement agreements and other
customary encumbrances on title to real property that (i) were not
incurred in connection with any indebtedness, (ii) do not render
title to the property encumbered thereby unmarketable and (iii) do
not, individually or in the aggregate, materially adversely affect
the value or use of such property for its current purposes.
2. Terms of Stock Purchase. On the basis of the representations,
warranties, covenants and agreements contained in this Agreement and subject to
the terms and conditions of this Agreement:
2.01 Transfer. The Stockholder shall assign, transfer and convey at
the Closing the Company Stock, representing 100% of the issued and outstanding
capital stock of the Company, to AMED. The Stockholder shall deliver at Closing
a Stock Power in the form attached hereto as Schedule 2.01 and any other
documents required by this Agreement.
2.02 Purchase Price. AMED shall deliver and the Stockholder shall be
entitled to receive at the Closing from AMED in consideration of the sale and
transfer of the Company Stock, the sum of FIVE HUNDRED THOUSAND AND NO/100
($500,000.00) DOLLARS (the "Purchase Price") the adequacy of which is hereby
acknowledged by the Stockholder, payable as follows: (a) THREE HUNDRED SEVENTY
FIVE THOUSAND AND NO/100 ($375,000.00) DOLLARS, cash in hand; and (b) for the
balance of the Purchase Price, AMED will execute and deliver a promissory note
(the "Promissory Note") in the principal amount of ONE HUNDRED TWENTY FIVE
THOUSAND AND NO/100 ($125,000.00) DOLLARS, payable to the order of the
Stockholder in twenty-four
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equal monthly payments of principal plus interest, bearing interest from
February 27, 1998 until paid on the unpaid principal balance at the rate of
Prime plus one (1%) percentage point. The Promissory Note shall be solidarily
guaranteed by Amedisys, Inc. (the "Guarantor"), shall provide for acceleration
of the entire principal balance in the event of default by Purchaser in the
payment of any installment thereunder or under this Agreement and shall provide
for the payment of the reasonable attorney fees incurred by Seller in the
collection thereof. The Company Stock referred to in Section 2.01 and the
consideration to be paid by AMED referred to in Section 2.02 shall constitute
all of the consideration to be paid in connection with the transactions
contemplated by this Agreement.
2.03 Reserved.
2.04. The Closing. The Closing of the transactions contemplated by
this Agreement shall be on February 27, 1998, to be effective February 1, 1998
at the AMED offices, 3029 S. Sherwood Forest Blvd., Suite 300, Baton Rouge,
Louisiana, to be effective on the 1/st/ day of February, 1998.
3. Representations and Warranties of the Company and the Stockholder.
The Company and the Stockholder hereby represent and warrant to AMED, as of the
date of this Agreement (unless another date is specified in this Section 3) that
the statements contained in this Section 3 are correct and complete:
3.01. Organization and Qualification. The Company does not own any
interest in any other business enterprise or legal entity, except as disclosed
in Schedule 3.01. Schedule 3.01 also correctly sets forth as to the Company its
state of incorporation, principal place of business, and jurisdictions in which
it is qualified to do business. The Company is a Louisiana corporation duly
organized, validly existing, and in good standing under the laws of its
jurisdiction of incorporation, with all requisite power and authority to conduct
its business and is not in breach of, or in default with respect to, any term of
its Articles of Incorporation, Bylaws or other organizational documents. Except
for the consents required but not obtained identified in Schedule 3.03, the
Company has obtained all necessary consents, authorizations, approvals, orders,
licenses, certificates, and permits of and from, and declarations and filings
with, all federal, state, local, and other governmental authorities and all
courts and other tribunals, to own, lease, license, and use its properties and
assets and to carry on the business in which it is now engaged, except where the
failure to do so would not have a Material Adverse Effect. The Company is
duly qualified to transact the business in which it is engaged in every
jurisdiction in which its ownership, leasing, licensing, or use of its property
or assets or the conduct of its business makes such qualification necessary,
except where the failure to do so would not have a Material Adverse Effect.
3.02. Capitalization. The Stockholder owns 5,000 shares of the Company
Common Stock, which constitutes all of the outstanding capital stock of Company.
The Company Stock is not owned or held in violation of any preemptive right of
any other person or entity, is validly authorized, validly issued, fully paid
and non-assessable, and is owned of record and beneficially by the Stockholder.
The shares of Company Stock held by the Stockholder are free and clear of all
liens, security interests, pledges, charges, encumbrances, voting agreements,
and voting trusts. There is no commitment, plan, or arrangement to issue, and
no outstanding option, warrant, or other right
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calling for the issuance of, any shares of capital stock of the Company or any
security or other instrument convertible into, exercisable for, or exchangeable
for capital stock of the Company. There is outstanding no security or other
instrument convertible into or exchangeable for capital stock of the Company.
3.03. Due Authorization; Third Party Consents. The Company and
Stockholder have the right, power, legal capacity, and authority to enter into
and perform their respective obligations under this Agreement and, except as set
forth on Schedule 3.03 to this Agreement, no approval or consent of any person
other than the Company is necessary in connection with the execution, delivery,
or performance of this Agreement. The execution, delivery, and performance of
this Agreement by the Company has been duly authorized by its board of directors
and no other corporate proceedings on the part of the Company are necessary to
authorize this Agreement or the consummation of the transactions contemplated
hereby. This Agreement constitutes a legal and binding obligation of the
Company and the Seller, and is valid and enforceable against the Company and the
Seller in accordance with its terms except that (i) the enforcement of certain
rights and remedies created by this Agreement is subject to bankruptcy,
insolvency, reorganization, and similar laws of general application affecting
the rights and remedies of parties, (ii) the enforceability of any particular
provision of this Agreement under principles of equity or the availability of
equitable remedies, such as specific performance, injunctive relief, waiver or
other equitable remedies, is subject to the discretion of courts of competent
jurisdiction, and (iii) any court or administrative body may refuse to enforce
the choice of law provision of Section 9.11 of this Agreement.
3.04. Litigation. Except as described in Schedule 3.04, there is not
any suit, action, arbitration, or legal, administrative, or other proceeding or
governmental investigation pending or, to the best of Company's or
Stockholder's Knowledge, threatened (in the form of threats made to
representatives of the Company or the Stockholder), with respect to the Company
or the Stockholder (as it relates to the business of the Company), including but
not limited to any action or claim under any federal, state, local or other
governmental act, rule, regulation, or any interpretations thereof, relating to
environmental matters or the protection of the safety and health of persons
connected with the Company's business (including but not limited to the
transportation, treatment, storage, recycling, disposal, or release into the
environment of hazardous or toxic materials or waste), or any basis on which any
proceeding or investigation against the Company or the Stockholder might
reasonably be undertaken or brought. The Company and the Stockholder have
informed AMED of, and upon request has furnished or made available to AMED
copies of all relevant court papers and other documents relating to, the matters
set forth in Schedule 3.04. Included in Schedule 3.04 is a list of all suits,
actions, arbitrations, or other proceedings or investigations in which the
Company has been a party to during the five year period immediately preceding
the Closing. The Company is not presently engaged in any legal action to
recover monies due to the Company, for damages sustained by the Company, or
amounts owed to the Company, except as set forth on Schedule 3.04. During the
five year period immediately preceding the Closing, the Company has neither
received nor been a party to any written notice of violations, orders, claims,
citations, complaints, penalties, assessments, court, or other proceedings,
administrative, civil or criminal, at law or in equity, against the Company or
Stockholder, with respect to any Health Care Law. In addition, to the Company's
and the Stockholder's Knowledge, the Company has neither received nor been party
to any written
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<PAGE>
notice of violations, orders, claims, citations, complaints, penalties,
assessments, court, or other proceedings, administrative, civil or criminal, at
law or in equity, with respect to any alleged violations of any other federal,
state, or local environmental law, regulation, ordinance, standard, permit, or
order in connection with the conduct of its business or otherwise during the
past five years.
3.05. Employees. The Company does not have, or contribute to, any
pension, profit-sharing, option, other incentive plan, or other Employee Benefit
Plan (as defined in Section 3(3) of the Employee Retirement Income Security Act
of 1974), or have any obligation to or customary arrangement with employees for
bonuses, incentive compensation, vacations, severance pay, insurance, or other
benefits, except as set forth in Schedule 3.05. Schedule 3.05. contains a true
and correct statement of the names, relationship with the Company, present rates
of compensation (whether in the form of salary, bonuses, commissions, or other
supplemental compensation now or hereafter payable), and aggregate compensation
for the fiscal year ended December 31, 1997 of each Stockholder, and the three
highest paid employees of the Company. Since December 31, 1997, the Company has
not changed the rate of compensation of the Stockholder or any of its employees,
agents, dealers or distributors, except as disclosed in Schedule 3.05.
3.06. No Violation of Employee Contracts. The Company is not, and to
the best of Company's and Stockholder's Knowledge, no employee of the Company is
in violation of any term of any employment contract, non-competition agreement,
or any other contract or agreement or any restrictive covenant with, or any
other common law obligation to, a former employer relating to the right of any
such employee to be employed by the Company because of the nature of the
business conducted by the Company or of the use of trade secrets or proprietary
information of others. There is neither pending nor, to the Knowledge of the
Company or the Stockholder, threatened, any actions, suits, proceedings, or
claims with respect to any contract, agreement, covenant, or obligation referred
to in the preceding sentence, except as listed in Schedule 3.04.
3.07. Insurance. Schedule 3.07 sets forth an accurate and complete
list and brief description of all policies of fire and extended coverage,
liability, and the forms of similar insurance or indemnity bonds held by the
Company. The Company is not in default with respect to any provisions of any
such policy or indemnity bond and has not failed to give any notice or present
any claim thereunder in due and timely fashion, which failure or failures to
give such notice or present such claim, individually or in the aggregate, will
have a Material Adverse Effect. All such policies and bonds are (i) in full
force and effect, (ii) with insurance companies believed by the Company and the
Stockholder to be financially sound and reputable, (iii) are sufficient for
compliance by the Company with all requirements of law and of all agreements and
instruments to which the Company is a party, (iv) provide that they will remain
in full force and effect through the respective dates set forth in Schedule
3.07, and (v) will not in any significant respect be affected by, and will not
terminate or lapse by reason of, the transactions contemplated by this
Agreement. Schedule 3.07 sets forth an accurate and complete list of all
accident or other liability claims received by or known by the Company and the
Stockholder for the three year period immediately preceding the Closing, as well
as a description of the status of each such claim. Such claims are covered by
one or more insurance policies set forth in Schedule 3.07.
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3.08. Contracts, Agreements and Instruments. Schedule 3.08 contains a
list of the following, copies of which have been heretofore furnished by Seller
to Purchaser, which acknowledges receipt thereof:
3.08.01. The Articles of Incorporation, Bylaws and other
organizational documents of the Company and all amendments thereto, as
presently in effect, certified by the president of the Company;
3.08.02. True and correct copies of all material contracts, and other
agreements to which Company is a party;
3.08.03. True and correct written descriptions of all verbal material
contracts and/or agreements to which Company or Seller is a party.
Except for matters which, in the aggregate, would not have a Material Adverse
Effect or are otherwise disclosed in the Agreement, the Company is not, and to
the best of the Company's and the Stockholder's Knowledge, no other party to any
such contract, agreement, instrument, lease, or license is now in violation or
breach of, or in default with respect to complying with, any material provision
thereof, and each such contract, agreement, instrument, lease, or license by
which the Company is presently engaged is in full force and effect and is the
legal, valid, and binding obligation of the parties thereto and is enforceable
as to them in accordance with its terms, except that (i) the enforcement of
certain rights and remedies created thereby is subject to bankruptcy,
insolvency, reorganization, and similar laws of general application affecting
the rights and remedies of parties, and (ii) the enforceability of any
particular provision thereof under principles of equity or the availability of
equitable remedies, such as specific performance, injunctive relief, waiver, or
other equitable remedies, is subject to the discretion of courts of competent
jurisdiction. Each such service, supply, distribution, agency, financing, or
other arrangement, contract or understanding is a valid and continuing
arrangement, contract or understanding, except for matters which, in the
aggregate, will not have a Material Adverse Effect; neither the Stockholder,
nor any other party to any such arrangement, contract or understanding has given
notice of termination or taken any action inconsistent with the continuance of
such arrangement, contract or understanding, except for matters which, in the
aggregate, will not have a Material Adverse Effect; and, subject to obtaining
the consents described on Schedule 3.03, the execution, delivery, and
performance of this Agreement will not prejudice any such arrangement, contract
or understanding in any way, except for matters which, in the aggregate, will
not have a Material Adverse Effect.
3.09. Compliance With Laws. The Company has complied with, and is not
in violation of any (i) term or provision of its Articles of Incorporation or
Bylaws; or (ii) to the Company's and the Stockholder's Knowledge term or
provision of any applicable judgment, decree, order, statute, injunction, rule,
ordinance; (iii) to the Company's and the Stockholder's Knowledge any Health
Care Law; or (iv) or the Company's and the Stockholder's Knowledge, foreign,
United States, state or local statutes, laws, rules, or regulations, in each
case, except as described on the Schedules hereto or where such non-compliance
or violation will not have a Material Adverse Effect.
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3.10. Financial Condition. The Company has delivered to AMED true and
correct copies of the following: the unaudited balance sheet of the Company
("the Company's Last Balance Sheet") dated as of January 31, 1998 ("the
Company's Last Balance Sheet Date"), and an unaudited balance sheet and income
statement of the Company for the twelve month period ended December 31, 1997,
1996 and 1995. Each such balance sheet presents fairly in all material respects
the financial condition, assets and liabilities of the Company as of its date;
and each such statement of income presents fairly in all material respects the
results of operations of the Company for the period indicated. The financial
statements referred to in this Section have been prepared in accordance with the
books and records of the Company.
3.11. Permits and Licenses. The Company has all permits, licenses, and
other similar authorizations necessary for the conduct of its business as now
being conducted by it, and it is not in default in any respect under any such
permits, licenses, or authorizations. All permits, licenses, and other similar
authorizations necessary for the conduct of the Company's business as now being
conducted by it are as set forth in Schedule 3.11. Except as set forth in
Schedule 3.11, no royalties, commissions, or fees are payable by the Company to
any person by reason of the ownership or use of any intangible property. The
Company is the sole and exclusive owner of all of its assets and, except as
disclosed in this Agreement and the Schedules hereto, does not use any of its
assets by the consent of any other person and is not required to and does not
make any payments to others with respect thereto. Except as set forth in
Schedule 3.11, there are no material licenses, sub-licenses, or agreements
relating to the use of any of its intangible property now in effect, and the
Company and the Stockholder have no Knowledge that any intangible property is
being infringed by others. Except as listed in Schedule 3.04, no claim that
would have a Material Adverse Effect on the business of the Company is pending
or threatened alleging the operation of the Company's business or any method,
process, part, or material that the Company employs, conflicts in any material
way with, or infringes in any material way upon any rights of the type
enumerated above, owned by others.
3.12. Properties. The Company has good and marketable title to all
properties and assets owned by it and used in its business (except such real and
other property and assets as are held pursuant to leases or licenses described
in Schedule 3.12), free and clear of all liens, mortgages, security interests,
pledges, charges, and encumbrances (except such as are disclosed in Schedule
3.12 or disclosed on the Company's Last Balance Sheet) other than Permitted
Encumbrances.
3.12.01. Attached as Schedule 3.12 is a true and complete list of all
properties and assets owned, leased, or licensed by the Company having an
individual or aggregate value of $5,000 or more, including with respect to
such properties and assets leased or licensed by the Company, a description
of such lease or license. All such properties and assets owned by the
Company are reflected on the Company's Last Balance Sheet. All properties
and assets owned, leased, or licensed by the Company are in good and usable
condition (reasonable wear and tear excepted);
3.12.02. The properties and assets owned, leased, or licensed by the
Company constitute all such properties and assets which are necessary to
the business
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of the Company as presently conducted;
3.12.03. To the Knowledge of the Company or the Stockholder, no real
property owned, leased or licensed by the Company lies in an area which is,
or will be subjected to zoning, use or building code restrictions which
would prohibit, and no stated facts relating to the actions or inaction of
another person or entity of his or its ownership, licensing, leasing, or
use of any real or personal property exists which would prevent, the
continued effective ownership, leasing, licensing or use of such real
property in the business in which the Company is now engaged; and
3.12.04. All accounts and notes receivable reflected on the Company's Last
Balance Sheet, and arising since the Last Balance Sheet Date, arise from
services or products provided by the Company and have been collected, or
are valid, subject to the Company's reserve therefor as reflected on the
Company's Last Balance Sheet and adjustments consistent with the Company's
past practices.
3.13. Hazardous Materials. Except as disclosed on Schedule 3.13, the
Company is not in the business of possession, transportation, or disposal of
hazardous materials. If and to the extent that the Company's business has
involved the possession, transportation, or disposal of hazardous materials, to
the best of the Company's and the Stockholder's Knowledge the Company has
complied with any and all applicable laws, ordinances, rules, and regulations
with respect to the period prior to the Closing. To the best of Company's and
Stockholder's Knowledge, no employee of the Company has been exposed to
hazardous materials during the period of employment by Company such that
exposure could cause damage to such employee.
3.14. Interest in Competitors. Except as set forth in Schedule 3.14
to this Agreement, the Seller has no direct or indirect ownership interest in
any competitor, supplier, or customer of the Company or in any person from whom
or to whom the Company leases any real or personal property, or in any other
person with whom the Company is doing business.
3.15. Tax and Other Liabilities. The Company does not have any present
liability of any nature, accrued or contingent, for the period prior to the date
hereof, including, without limitation, liabilities for federal, state, local, or
foreign taxes and liabilities to customers or suppliers, which will have a
Material Adverse Effect upon the Company, other than the following:
i. Liabilities for which full provision has been made on the
Company's Last Balance Sheet as of the Company's Last Balance
Sheet Date; and
ii. Other liabilities arising since the Company Last Balance Sheet
Date and prior to the Closing in the ordinary course of business
which are not inconsistent with the representations and
warranties of the Company or any other provision of this
Agreement.
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Without limiting the generality of the foregoing, the amounts set forth as
provisions for taxes on the Company's Last Balance Sheet are sufficient for all
accrued and unpaid taxes owed by the Company, whether or not due and payable
prior to or after such date and whether or not disputed, under tax laws, as in
effect on the Company's Last Balance Sheet Date or now in effect, for the period
ended on such date and for all fiscal years prior thereto. The Company has
filed all applicable tax returns required to be filed by it or has obtained
applicable extensions and is not delinquent with respect to such extensions; has
paid (or has established on the Company's Last Balance Sheet a reserve for) all
taxes, assessments, and other governmental charges payable or remittable by it
or levied upon it or its properties, assets, income, or franchises, which are
due and payable on or prior to the date hereof and has delivered to the Company
a true and correct copy of any report as to adjustments received by the Company
from any taxing authority during the past five years and a statement as to any
litigation, governmental or other proceeding (formal or informal), or
investigation pending.
3.16. Changes or Events. Except as set forth in Schedule 3.16, since
the Company's Last Balance Sheet Date, none of the following has occurred:
3.16.01. Other than the assignment by the Company of its Agreement for
Consulting Services dated as of February 1, 1997, with 164083 Canada,
Inc., the Purchaser hereby acknowledging that said agreement for
consulting services has been assigned by the Company and that the
Company has no intent therein, any material transaction by the Company
not in the ordinary course of business involving amounts in excess of
$5,000;
3.16.02. Any material capital expenditure by the Company involving
amounts in excess of $5,000;
3.16.03. Other than in the ordinary course of business, any changes in
the condition (financial or otherwise), liabilities, assets, or business
or in any business relationships of the Company, including relationships
with suppliers or customers, that, when considered individually or in
the aggregate, are reasonably expected to have a Material Adverse
Effect;
3.16.04. The destruction of, damage to, or loss of any asset of the
Company (regardless of whether covered by insurance) that, when
considered individually or in the aggregate, are reasonably expected to
have a Material Adverse Effect;
3.16.05. Any labor disputes that, when considered individually or in
the aggregate, are reasonably expected to have a Material Adverse
Effect;
3.16.06. Except as listed on Schedule 3.16.06, there have been no
changes in accounting methods or practices (including, without
limitation, any change in depreciation or amortization policies or
rates) by the Company, except for any such changes as were required by
law;
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3.16.07. Other than in the ordinary course of business, any increase in
the salary or other compensation payable or to become payable by the
Company to any employee, or the declaration, payment, or commitment or
obligation of any kind for the payment by the Company of a bonus or
other additional salary or compensation to any such person;
3.16.08. The material amendment or termination of any material
contract, agreement, or license to which the Company is a party, except
in the ordinary course of business;
3.16.09. Any loan by the Company to any person or entity, or the
guaranteeing by the Company of any loan other than loans made in the
ordinary course of business;
3.16.10. Any mortgage, pledge, or other encumbrance of any asset of the
Company except in the ordinary course of business;
3.16.11. The waiver or release of any right or claim of the Company,
except in the ordinary course of business;
3.16.12. Reserved.
3.16.13. Any loss or, to the Knowledge of the Company or the
Stockholder, any threatened loss of any permit, license, qualification,
special charter or certificate of authority held or enjoyed or formerly
held or enjoyed by the Company which loss has had or upon occurrence is
reasonably expected to have a Material Adverse Effect;
3.16.14. To the Knowledge of the Company and the Stockholder, the
adoption or recession of any statute, regulation, order, ordinance or
other law wich are reasonably expected to have a Material Adverse
Effect;
3.16.15. Except for such matters undertaken in consultation with AMED
any failure on the part of the Company to operate its business in the
ordinary course and consistent with past practices so as to preserve its
business organization intact, to retain the services of its employees
and to preserve its goodwill and relationships with suppliers,
creditors, customers, and others having business relationships with it;
3.16.16. Any action taken or omitted to be taken by the Company which
would cause (after lapse of time, notice or both) the breach, default,
or acceleration of any right, contract, commitment, or other obligation
of the Company will have a Material Adverse Effect; or
3.16.17. Any agreement by the Company to do any of the things described
in
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the preceding clauses 3.16.01 through 3.16.16.
3.17. No Defaults. Except as set forth in Schedule 3.17, the
consummation of the transactions contemplated by this Agreement will not result
in or constitute any of the following: (i) a breach of any term or provision of
any other agreement of the Company that will not be waived or released at
Closing; (ii) a default or an event that will not be waived or released at
Closing, and that, with notice or lapse of time or both, would be a default,
breach, or violation of the Articles of Incorporation or Bylaws of the Company
or of any lease, license, promissory note, conditional sales contract,
commitment, indenture, mortgage, deed of trust, or other agreement, instrument,
or arrangement to which the Company is a party or by which the Company or its
assets are bound; (iii) an event that will not be waived or released at Closing
and that would permit any party to terminate any agreement or to accelerate the
maturity of any indebtedness or other obligation of the Company; (iv) the
creation or imposition of any lien, charge, or encumbrance on any of the
Company's assets; or (v) a violation of any law or any rule or regulation of any
administrative agency or governmental body unrelated to the business or
profession of health care and any profession related to health care, of any
order, writ, injunction or decree of any court, administrative agency or
governmental body to which the Company is subject.
3.18. No Prohibited Payments. Neither the Company nor any employee, or
agent of the Company, has made or authorized any payment of funds of the Company
or on behalf of the Company prohibited by law and no funds of the Company have
been set aside to be used for any payment prohibited by law.
3.20. Completeness of Disclosure. No representation or warranty by
Company or Stockholder in this Agreement, including the Schedules, Exhibits, and
certificates incorporated herein and prepared by the Company or Stockholder
contains any untrue statement of a material fact or omits any material fact
necessary in order to make the statements contained herein not misleading.
4. Representations and Warranties of AMED. AMED, and with respect to
Sections 4.06, 4.07 and 4.08, Guarantor, hereby represents and warrants to the
Seller, as of the date of this Agreement, that the statements contained in this
Section 4 are correct and complete:
4.01. Organization. AMED is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Louisiana and is
authorized to carry on business in the State of Louisiana and in every other
jurisdiction in which its ownership, leasing, licensing, or use of property or
assets or the conduct of its business makes such qualification necessary, except
where the failure to do so would not have a Material Adverse Effect.
4.02. Due Authorization; Third Party Consents. AMED has the right,
power, legal capacity, and authority to enter into and perform its obligations
under this Agreement and, no approval or consent of any person other than AMED
is necessary in connection with the execution, delivery, or performance of this
Agreement. The execution, delivery, and performance of this Agreement by AMED
has been duly authorized by its board of directors and no other corporate
proceedings on the part of AMED are necessary to authorize this Agreement or the
consummation
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of the transactions contemplated hereby. This Agreement constitutes a legal and
binding obligation of AMED, and is valid and enforceable against AMED in
accordance with its terms except that (i) the enforcement of certain rights and
remedies created by this Agreement is subject to bankruptcy, insolvency,
reorganization, and similar laws of general application affecting the rights and
remedies of parties, or (ii) the enforceability of any particular provision of
this Agreement under principles of equity or the availability of equitable
remedies, such as specific performance, injunctive relief, waiver or other
equitable remedies, is subject to the discretion of courts of competent
jurisdiction.
4.03. No Violation. The consummation of the transactions contemplated
by this Agreement will not result in or constitute any of the following: (i) a
breach of any term or provision of any other agreement of AMED that will not be
waived or released at Closing; (ii) a default or an event that will not be
waived or released at Closing and that, with notice or lapse of time or both,
would be a default, breach, or violation of the Articles of Incorporation or
Bylaws of AMED or of any lease, license, promissory note, conditional sales
contract, commitment, indenture, mortgage, deed of trust, or other agreement,
instrument, or arrangement to which AMED is a party or by which AMED or the
property of AMED is bound; or (iii) a violation of any law or any rule or
regulation of any administrative agency or governmental body or any order, writ,
injunction, or decree of any court, administrative agency or governmental body
to which AMED is subject.
4.04. Completeness of Disclosure. No representation or warranty and no
Schedule, Exhibit, or certificate prepared by AMED pursuant hereto and no
statement made or other document prepared by AMED and furnished to the Company
by AMED contains any untrue statement of a material fact or omits or will omit
any material fact necessary in order to make the statements contained therein
not misleading.
4.05 Investment Purpose, Etc. (a) Purchaser is acquiring the Company
Stock solely for the purpose of investment and not with a view to, or for offer
or sale in connection with, any distribution thereof. Purchaser is aware and
understand that the Company Stock has not been registered under the Securities
Act or under the securities laws of any state, that any transfer of the Company
Stock by Purchaser shall be restricted under the provision of the Securities Act
and such state laws, and that the certificates representing the Company Stock
will bear legends to such effect. Purchaser possesses such knowledge and
experience in financial and business matters generally and with respect to the
business of the Company so as to enable it to evaluate the risks and merits of
its purchase of the Company Stock.
(b) Purchaser is an "accredited investor" within the meaning of Rule 501(a)
of Regulation D promulgated under the Securities Act.
4.06 Organization of Guarantor. Guarantor is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Delaware
and is authorized to do business in every other jurisdiction in which its
ownership, leasing, licensing, or use of property or assets or the conduct of it
business makes such qualification necessary, except where the failure to do so
would not have a Material Adverse Effect.
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4.07 Due Authorization: Third Party Consents. Guarantor has the right,
power, legal capacity, and authority to enter into and perform its obligations
under this Agreement and, except as otherwise set forth herein, no approval or
consent of any person other than the Guarantor is necessary in connection with
the execution, delivery, or performance of this Agreement. The execution,
delivery, and performance of this Agreement by the Guarantor has been duly
authorized by its board of directors and no other corporate proceedings on the
part of Guarantor are necessary to authorize this Agreement or the consummation
of the transactions contemplated hereby. This Agreement constitutes a legal and
binding obligation of the Guarantor, and is valid and enforceable against the
Guarantor in accordance with its terms except that (i) the enforcement of
certain rights and remedies created by this Agreement is subject to bankruptcy,
insolvency, reorganization, and similar laws of general application affecting
the rights and remedies of parties, and (ii) the enforceability of any
particular provision of this Agreement under principles of equity or the
availability of equitable remedies, such as specific performance, injunctive
relief, waiver or other equitable remedies, is subject to the discretion of
courts of competent jurisdiction.
4.08 No Violation. The consummation of the transactions contemplated by
this Agreement will not result in or constitute any of the following: (i) a
breach of any term or provision of any other agreement of Guarantor that will
not be waived or released at the Closing; (ii) a default or an event that will
not be waived or released at the Closing and that, with notice or lapse of time
or both, would be a default, breach, or violation of the Certificate of
Incorporation or Bylaws of Guarantor or of any lease, license, promissory note,
conditional sales contract, commitment, indenture, mortgage, deed of trust, or
other agreement, instrument, or arrangement to which Guarantor is a party or by
which Guarantor or the property of Guarantor is bound; or (iii) a violation of
any law or any rule or regulation of any administrative agency or governmental
body or any order, writ, injunction, or decree of any court, administrative
agency or governmental body to which Guarantor is subject.
5. Conditions to Obligations of AMED. The obligations of AMED under this
Agreement are subject, at the option of AMED, to the satisfaction of the
following conditions:
5.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of Company or the Stockholder contained in this
Agreement shall be accurate when made and, in addition, shall be materially
accurate as of the Closing as though such representations and warranties were
then made by Company or such Stockholder on the part of Company or any
Stockholder. As of the Closing, the Company and the Stockholder shall have
performed and complied with all covenants and agreements and satisfied all
conditions required to be performed and complied with by any of them at or
before such time by this Agreement.
5.02. Other Closing Documents. In connection with the Closing, Seller
shall deliver to Purchaser such other instruments of transfer in form and
substance consistent with this Agreement and mutually satisfactory to Purchaser
and Seller in order to transfer all rights, title and interest of Seller in the
Company Stock to Purchaser;
5.03. Review of Proceedings. All actions, proceedings, instruments,
and documents
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required to carry out this Agreement, or any agreement incidental thereto and
all other related legal matters shall be subject to the reasonable approval of
counsel to AMED, and the Company shall have furnished such counsel for AMED such
documents as such counsel may have reasonably requested for the purpose of
enabling them to pass upon such matters.
5.04. Legal Action. There shall not have been instituted or threatened
any legal proceeding relating to, or seeking to prohibit or otherwise
challenging the consummation of, the transactions contemplated by this Agreement
or related agreements or to obtain substantial damages with respect thereto,
except as listed in Schedule 3.04.
5.05. No Governmental Action. There shall not have been any action
taken, or any law, rule, regulation, order, or decree proposed, promulgated,
enacted, entered, enforced, or deemed applicable to the transactions
contemplated by this Agreement by any federal, state, local, or other
governmental authority or by any court or other tribunal, including the entry of
a preliminary or permanent injunction, which, in the reasonable judgment of
AMED:
5.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
5.05.02. Results in a delay which affects the ability of AMED to
consummate any of the transactions contemplated by this
Agreement;
5.05.03. Requires the divestiture by AMED of a material portion of the
business of either AMED taken as a whole, or of the Company taken
as a whole; and
5.05.04. Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the
contemplated benefits to AMED of the transactions contemplated by
this Agreement.
5.06. Contractual Consents Needed. Except for the consents described
in Schedule 3.03, the Parties to this Agreement shall have obtained at or prior
to the Closing all consents required for the consummation of the transactions
contemplated by this Agreement from any party to any contract, agreement,
instrument, lease, license, arrangement, or understanding to which any of them
or any subsidiary is a party, or to which any of their respective businesses,
properties, or assets are subject, except where the failure would not have a
Material Adverse Effect.
5.07. Other Agreements. Agreements set forth as exhibits or schedules
to this Agreement shall have been duly authorized, executed, and delivered by
the parties thereto at or prior to the Closing, shall be in full force and
effect, valid and binding upon the parties thereto, and enforceable by them in
accordance with their terms at the Closing, and no party thereto at any time
from the execution thereof until immediately after the Closing shall have been
in violation of or in default in complying with any material provision thereof.
5.08. Non-Competition and Non-Solicitation Agreement. Daniel D. Brown
shall have entered into the non-competition and non-solicitation agreement in
the form attached hereto as
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Schedule 5.08.
5.09 Board and Shareholder Approval. The Board of Directors and
shareholders of the Company shall have approved the transactions contemplated
herein.
5.10 Legal Opinion. Company shall have received the opinion of Kantrow,
Spaht, Weaver & Blitzer, dated the Closing Date, in the form of Schedule 5.10
attached hereto.
5.11 Public Statements. Before Seller shall execute or administer a press
release or public announcement related to consummation of this transaction,
Seller shall cooperate with Purchaser, shall furnish drafts of all documents or
proposed oral statements to Purchaser for comment, and shall not release any
such information without the written consent of Purchaser. Nothing contained
herein shall prevent Seller from furnishing any information to any governmental
authority if required to do so by law.
6. Conditions to Obligations of The Company. The obligations of the
Company under this Agreement are subject, at the option of the Company, to the
following conditions:
6.01. Accuracy of Representations and Compliance With Conditions. All
representations and warranties of AMED contained in this Agreement shall be
accurate when made and, in addition, shall be materially accurate as of the
Closing as though such representations and warranties were then made by AMED on
the part of AMED. As of the Closing, AMED shall have performed and complied
with all covenants and agreements and satisfied all conditions required to be
performed and complied with at or before such time by this Agreement.
6.02. Other Closing Documents. AMED shall have delivered to the
Company and the Stockholder, at or prior to the Closing, such other documents as
the Company and the Stockholder may reasonably request in order to enable the
Company and the Stockholder to determine whether the conditions to its
obligations under this Agreement have been met and otherwise to carry out the
provisions of this Agreement.
6.03. Review of Proceedings. All actions, proceedings, instruments,
and documents required to carry out this Agreement, or any agreement incidental
thereto and all other related legal matters shall be subject to the reasonable
approval of counsel to the Company and the Stockholder and AMED shall have
furnished such counsel such documents as such counsel may have reasonably
requested for the purpose of enabling them to pass upon such matters.
6.04. Legal Action. There shall not have been instituted or threatened
any legal proceeding relating to, or seeking to prohibit or otherwise
challenging the consummation of, the transactions contemplated by this Agreement
or related agreements set forth as an exhibit hereto, or to obtain substantial
damages with respect thereto.
6.05. No Governmental Action. There shall not have been any action
taken, or any law, rule, regulation, order, or decree proposed, promulgated,
enacted, entered, enforced, or deemed
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<PAGE>
applicable to the transactions contemplated by this Agreement by any federal,
state, local, or other governmental authority or by any court or other tribunal,
including the entry of a preliminary or permanent injunction, which, in the
reasonable judgment of the Company and the Stockholder:
6.05.01. Makes any of the transactions contemplated by this Agreement
illegal;
6.05.02. Results in a delay which affects the ability of the Company and
the Stockholder to consummate any of the transactions
contemplated by this Agreement;
6.05.03 Otherwise prohibits, restricts, or delays consummation of any of
the transactions contemplated by this Agreement or impairs the
contemplated benefits to the Company or the Stockholder of the
transactions contemplated by this Agreement.
6.06. Contractual Consents Needed. The Parties to this Agreement shall
have obtained at or prior to the Closing all consents required for the
consummation of the transactions contemplated by this Agreement from any party
to any contract, agreement, instrument, lease, license, arrangement, or
understanding to which any of them is a party, or to which any of their
respective businesses, properties, or assets are subject, except where the
failure to obtain any such consent would not have a Material Adverse Effect on
such Party.
6.07. Other Agreements. Agreements set forth as exhibits or schedules
to this Agreement shall have been duly authorized, executed, and delivered by
the Parties thereto at or prior to the Closing, shall be in full force, valid
and binding upon the Parties thereto, and enforceable by them in accordance with
their terms at the Closing, and no party thereto at any time from the execution
thereof until immediately after the Closing shall have been in violation of or
in default in complying with any material provision thereof.
6.08. Board Approval. The Board of Directors of AMED and the Guarantor
shall have approved the transactions contemplated herein and certified copies of
the authorizing resolutions shall have been delivered to Seller.
7. Covenants and Agreements of AMED. AMED covenants and agrees as
follows:
7.01 Post-Closing Covenants. On and after the Closing, Purchaser agrees
to maintain in confidence and not to disclose, except in accordance
with and as permitted by applicable laws and regulations, the
records of the patients to whom the Company provided services.
7.02 Release of Stockholder. Subsequent to closing, Purchaser shall ensure
that Stockholder is released from any personal contract or agreement
guarantees which are active with respect to Seller's business.
7.03 Information Accessibility. Upon prior reasonable notice and at
reasonable times, Seller shall be allowed access to those business
records transferred herein.
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<PAGE>
8. Reserved.
9. Miscellaneous.
9.01. Brokerage and Other Fees. The Parties agree that there are no
brokerage arrangements or fee obligations, in writing or otherwise, with respect
to the transactions set forth in this Agreement. Each Party shall be
responsible for the fees of their respective professionals (including, without
limitation, legal and accounting fees) engaged to assist in the preparation,
negotiation and counseling with respect, and relating, to this Agreement and
consummation of the transactions contemplated herein, as well as their
respective out-of-pocket expenses except AMED agrees to pay for the preparation
of the necessary transfer documents to accomplish the transactions herein.
9.02. Further Actions. At any time and from time to time, the Parties
agree, at their expense, to take such actions and to execute and deliver such
documents as may be reasonably necessary to effectuate the purposes of this
Agreement.
9.03. Survival. The representations and warranties contained in or made
pursuant to this Agreement by the Company, Seller and Purchaser shall survive
the Closing for a period of 24 months thereafter (the date which is 24 months
after the Closing Date, the "Survival Date"). No claim for indemnification or
otherwise may be brought by Purchaser, Seller or the Company against the other
unless asserted by written notice as provided herein by the party making such
claim for indemnification or otherwise on or before the Survival Date.
9.04. Entire Agreement; Modification. The Agreement and the Schedules
and Exhibits hereto set forth the entire understanding of the Parties with
respect to the subject matter hereof supersede all existing agreements among
them concerning such subject matter, and may be modified only by a written
instrument duly executed by the Parties.
9.05. Notices. Any notice or other communication required or permitted
to be given hereunder shall be in writing and shall be given or made (and shall
be deemed to have been duly given or made upon receipt) by delivery in person,
by courier service, by telecopy (confirmed by telephone within twenty-four (24)
hours following receipt thereof), or by registered or certified mail, (postage
prepaid, return receipt requested) to the respective parties at the following
address (or at such other address for a party as shall be specified in a notice
given in accordance with this Section 9.05:
(a) If to Seller:
Danny D. Brown
10474 Old Hammond Highway, Suite 101
Baton Rouge, Louisiana 70816
Telecopy: (504) 927-7205
Telephone: (504) 927-7688
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<PAGE>
with copy to:
Kantrow, Spaht, Weaver & Blitzer
(A Professional Law Corporation)
Suite 300, City Plaza
445 North Boulevard
P.O. Box 2997
Baton Rouge, Louisiana 70821-2997
Attention: Lee C. Kantrow
Telecopy: (504) 343-0637
Telephone: (504) 383-4703
(b) If to Purchaser:
Amedisys Alternate-Site Infusion Therapy Services, Inc.
3029 S. Sherwood Forest Blvd.
Suite 300
Baton Rouge, Louisiana 70816
Attention: Stephen Taglianetti
Telecopy: (504) 292-8163
Telephone: (504) 292-2031
9.06. Waiver. Any waiver by any Party of a breach of any provision of
this Agreement shall not operate as or be construed to be a waiver of any other
breach of that provision or of any breach of any other provision of this
Agreement. The failure of a Party to insist upon strict adherence to any term
of this Agreement on one or more occasions will not be considered a waiver or
deprive that Party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement. Any waiver must be in writing
and, in the case of a corporate Party, be authorized by a resolution of the
Board of Directors or by an officer of the waiving Party.
9.07. Binding Effect. The provisions of this Agreement shall be
binding upon and inure to the benefit of each Party's respective successors and
assigns representatives.
9.08. No Third-Party Beneficiaries. This Agreement does not create,
and shall not be construed as creating, any rights enforceable by any person not
a Party to this Agreement.
9.09. Separability. If any provision of this Agreement is invalid,
illegal, or unenforceable, the balance of this Agreement shall remain in effect,
and if any provision is inapplicable to any person or circumstance, it shall
nevertheless remain applicable to all other persons and circumstances.
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9.10. Headings. The headings of this Agreement are solely for
convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement.
9.11. Counterparts, Governing Law. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument. It shall be
governed by and construed in accordance with the laws of the State of Louisiana
without giving effect to conflict of laws.
9.12 Indemnification. Subject to the limitations set forth in Sections
9.13 and 9.14 hereof, Seller shall indemnify, defend and hold harmless Purchaser
and each of its officers, directors, agents and affiliates from and against any
damage, loss, claim, liability, cost or expense incurred by Purchaser, including
fees and disbursements of counsel, accountants, experts and other consultants
reasonably and necessarily incurred by Purchaser, net of any tax benefit to
which Purchaser is entitled and net of any and all amounts to which Purchaser is
entitled to from insurance, guarantees, indemnities, and contractual and legal
rights by, from or against other persons, firms or entities (collectively,
"Damages"), resulting from, arising out of, based upon or occasioned by the
inaccuracy of any warranty or any representation made by Company or Seller in
this Agreement, or any breach of any covenant or agreement of Company or Seller
contained herein. Purchaser shall indemnify, defend and hold harmless Seller
from and against any Damages, resulting from, arising out of, based upon or
occasioned by the inaccuracy of any warranty or representation made by the
Purchaser herein, or any breach of any covenant or agreement of Purchaser
contained herein.
9.13 Limitations on Indemnification and Other Claims. The maximum amount
of Damages for which Seller shall be responsible under this Agreement, whether
pursuant to a claim for indemnification or otherwise, shall not exceed the
unpaid principal balance of the Promissory Note, such maximum amount to be
reduced by principal payments made by the Purchaser or the Guarantor on the
Promissory Note and by amounts offset against the unpaid principal balance of
the Promissory Note in the manner permitted by this Agreement. Such right of
offset shall be the exclusive remedy of the Purchaser, and all other persons
entitled to indemnity against the Seller pursuant to Section 9.12 above, for
Damages under this Agreement and otherwise. It is understood and agreed that
Seller shall have no liability to return any part of the cash portion of the
Purchase Price or any payments of principal or interest on the Promissory Note
received by it or otherwise pay any amount of Damages (except pursuant to the
right of offset as permitted by this Agreement). The right of offset permitted
in this Agreement shall be exercised first against accrued but unpaid interest
and then against the unpaid principal installments of the Promissory Note in the
inverse order of their maturity.
9.14 Right of Off-Set. If Purchaser reasonably believes it is entitled to
indemnification under this Agreement, it shall be entitled to the right of
offset against amounts owing by it under the Promissory Note in accordance with
the following terms and provisions: Purchaser shall promptly notify Seller of
the matter for which it seeks indemnification and shall specify in reasonable
detail the facts and circumstances thereof and a good faith estimate of the
Damages occasioned thereby. Seller shall have ten (10) days from the receipt of
Purchaser's notice in which to cure the circumstance giving rise to the Damages
and provide evidence of such cure to the Purchaser. If the
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circumstance is not cured within the ten day period, Purchaser shall have the
immediate right to deposit the monthly payment due and payable pursuant to the
Promissory Note into an escrow account at a bank mutually acceptable to the
parties to be held and invested pursuant to a mutually agreeable escrow
agreement. Monthly payments into said escrow account shall continue until the
amount of the Damages specified in Purchaser's notice is equal to the balance of
said escrow account, at which time payments to Seller under the Promissory Note
shall resume as originally contemplated. In the event the Purchaser's claim for
indemnification is disputed by Seller, such dispute shall be resolved by the
provisions of Section 9.15. If it is ultimately determined that Purchaser's
claim for indemnification was improper, the escrowed funds and earnings thereon
shall be distributed to Seller. If it is ultimately determined that Purchaser's
claim for indemnification was proper, the escrowed funds and earnings thereon
shall be distributed to Purchaser.
9.15 Arbitration Procedures. Any and every dispute of any nature
whatsoever that may arise between the parties hereto, whether sounding in
contract, statute, tort, fraud, misrepresentation, discrimination or any other
legal theory, or breach of this Agreement, or any schedule, certificate or other
document delivered by any party hereto or thereto, or those arising under any
federal, state or local law, regulation or ordinance, shall be determined by
binding arbitration in accordance with the then-current commercial arbitration
rules of the American Arbitration Association ("AAA"), to the extent such rules
do no conflict with the provision of this Section 9. The arbitration shall be
conducted by a single neutral arbitrator. The parties shall endeavor to select
neutral arbitrators by mutual agreement. If such agreement cannot be reached
within thirty (30) calendar days after a dispute has arisen which is to be
decided by arbitration, any party of the parties jointly shall request AAA to
submit to each party an identical panel of fifteen (15) persons. Alternate
strikes shall be made to the panel, commencing with the party bringing the
claim, until the name of one (1) person remains. The parties may, however, by
mutual agreement, request AAA to submit additional panels of possible
arbitrators. The arbitrator shall have the power to determine all matters
incident to the conduct of the arbitration, including without limitation all
procedural and evidentiary matters and the scheduling of any hearing. The award
made by the arbitrator shall be governed by the United States Arbitration Act, 9
U.S.C. (S)(S) 1-16, and judgment upon the award rendered by the arbitrator(s)
may be entered by any court having jurisdiction thereof. Unless otherwise
agreed by the parties, the arbitration shall be held in Baton Rouge, Louisiana.
9.16 Provision applicable to claims for injunctive relief. This agreement
to arbitrate shall specifically include, without limitation, an application for
injunctive relief under Section 9. In the event injunctive relief is sought,
the parties agree that Commercial Arbitration Rule 13 (as amended November 1,
1993, or its subsequent equivalent) shall not apply, and instead, a single
arbitrator shall be appointed within one business day after the filing of the
demand or submission. Such arbitrator shall then preside over the application
for injunctive relief and all other disputes then arising under this agreement.
The arbitrator appointed under this paragraph shall be appointed by JAMS
Endispute, Baton Rouge, Louisiana ("JAMS"), in the following manner: the case
administrator for the AAA shall contact JAMS immediately on receipt of the
demand for arbitration containing the claim for injunctive relief. The case
administrator shall provider JAMS with the names of the parties to, and a copy
of, this agreement. From its then current list of qualified, licensed, but non-
practicing attorneys who are former, sitting trial judges, the Baton Rouge
national account manager (or
-20-
<PAGE>
equivalent position) of JAMS shall appoint one such individual as the arbitrator
to preside over the application for injunctive relief and all other disputes
between the parties. Except in the unlikely event of an actual conflict of
interest under the Rules of Professional Conduct or Code of Judicial Conduct,
neither party shall have any right to strike or object to the appointment of any
person so selected. The parties expressly agree and desire that the selection of
an arbitrator hereunder shall be effected within one business day of any
application for injunctive relief and agree that such application shall then be
considered at least as expeditiously as would be the case in the District Courts
for East Baton Rouge Parish. The parties further agree that any injunctive
relief granted by the arbitrator shall be separately enforceable in the District
Court for East Baton Rouge Parish, to the same extent as would be the case for a
final award of the arbitrator.
IN WITNESS WHEREOF, the parties have duly executed this Agreement effective as
of the date written in the preamble of this Agreement.
AMEDISYS ALTERNATE-SITE INFUSION AMEDISYS, INC.
THERAPY SERVICES, INC.
By: By:
----------------------------------- ---------------------------------
Stephen Taglianetti, President Name:
-------------------------------
Title:
------------------------------
INFUSIONCARE SOLUTIONS, INC.
By:
---------------------------------- -------------------------------
Daniel D. Brown, President Daniel Brown, Stockholder
-21-
<PAGE>
LIST OF SCHEDULES
Schedule No. Schedule Description
- ------------ --------------------
2.01 Stock Power
3.01 Organization and Qualification
3.03 Authorizations and Third Party Consents
3.04 Litigation
3.05 Employees and Compensation
3.07 Insurance
3.08 Contracts, Agreements and Instruments
3.11 Permits and Licenses
3.12 Properties
3.13 Hazardous Materials
3.14 Interest in Competitors
3.16 Changes or Events
3.17 Defaults
5.08 Non-Compete and Non-Solicitation Agreements
5.10 Legal Opinion of Kantrow, Spaht, Weaver & Blitzer
-22-
<PAGE>
EXHIBIT 2.10
THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED AND IS TRANSFERRABLE ONLY UPON COMPLIANCE WITH OR AN EXEMPTION FROM
ALL APPLICABLE SECURITIES AND OTHER LAWS.
PROMISSORY NOTE
$125,000.00 Baton Rouge, Louisiana February 27, 1998
FOR VALUE RECEIVED, the undersigned, AMEDISYS ALTERNATE-SITE INFUSION
THERAPY SERVICES, INC. a Louisiana corporation ("Maker"), hereby promises to pay
to the order of DANIEL D. BROWN ("Payee"), at Baton Rouge, Louisiana, the
principal sum of One Hundred Twenty Five Thousand and no/100 Dollars
($125,000.00), in lawful money of the United States of America, which shall be
legal tender, in payment of all debts and dues, public and private, at the time
of payment, bearing interest and payable as provided herein.
Interest on the unpaid balance of this Note shall accrue from the date
hereof at a rate per annum equal to 9.5% from the date hereof to February 27,
1999, and thereafter at the prime interest rate designated in the Wall Street
Journal on the anniversary date hereof, plus one percentage point; provided,
however, that such interest shall not exceed the Maximum Rate as hereinafter
defined. All past-due principal and interest shall bear interest at the maximum
rate permitted by applicable law. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
The principal amount of and accrued interest on this Note shall be due
and payable in twenty-four (24) equal monthly installments, the first
installment of which is due on March 27, 1998, and a like amount on the same day
of each month thereafter. The monthly installments through February 27, 1999,
shall be in the amount of $5,739.31 each, with the amount thereafter to be
adopted on the basis of the changes in the interest rate as provided above.
This Note may be prepaid in whole or in part, at any time and from
time to time, without premium or penalty.
If any payment of principal of or interest on this Note shall become
due on a Saturday, Sunday or any other day on which national banks are not open
for business, such payment shall be made on the next succeeding business day.
An event of default means default by the Maker (i) in the payment of
any installment of the principal of, and interest on, the Note when due,
whatever the reason for such event of default and whether it shall be voluntary
or involuntary or effected by operation of law or pursuant to any judgment,
decree or order of any Court or any order, rule or regulation of any
administrative governmental body or (ii) in the performance of its obligations
under the Stock Purchase Agreement dated as of February 1, 1998, between Payee
and Maker ("The Stock Purchase Agreement")("Event of Default").
Page 1 of 3
<PAGE>
If an Event of Default shall occur and be continuing, the Payee of
subsequent holders may, at its option, declare the unpaid principal amount of
this Note immediately due and payable.
The indebtedness of the Maker hereunder is solidarily guaranteed by
Amedisys, Inc. pursuant to a Guaranty Agreement having the same date hereof.
Notwithstanding anything to the contrary in this Note or any other
agreement entered into in connection herewith, whether now existing or hereafter
arising and whether written or oral, it is agreed that the aggregate of all
interest and any other charges constituting interest, or adjudicated as
constituting interest, and contracted for, chargeable or receivable under this
Note or otherwise in connection with this loan transaction, shall under no
circumstances exceed the Maximum Rate. In the event the maturity of this Note
is accelerated by reason of an Event of Default under this Note, other agreement
entered into in connection herewith or therewith, by voluntary prepayment by
Maker or otherwise, then earned interest may never include more than the Maximum
Rate. If from any circumstance any holder of this Note shall ever receive
interest or any other charges constituting interest, or adjudicated as
constituting interest, the amount, if any, which would exceed the Maximum Rate
shall be applied to the reduction of the principal amount owing on this Note,
and not to the payment of interest; or if such excessive interest exceeds the
unpaid balance of principal hereof, the amount of such excessive interest that
exceeds the unpaid balance of principal hereof shall be refunded to Maker. In
determining whether or not the interest paid or payable exceeds the Maximum
Rate, to the extent permitted by applicable law (i) any nonprincipal payment
shall be characterized as an expense, fee or premium rather than as interest;
and (ii) all interest at any time contracted for, charged, received or preserved
in connection herewith shall be amortized, prorated, allocated and spread in
equal parts during the period of the full stated term of this Note. The term
"Maximum Rate" shall mean the maximum rate of interest allowed by applicable
federal or state law.
Except as provided herein, Maker and any sureties, guarantors and
endorsers of this Note jointly and severally waive demand, presentment, notice
of nonpayment or dishonor, notice of intent to accelerate, notice of
acceleration, diligence in collecting, grace, notice and protest, and consent to
all extensions without notice for any period or periods of time and partial
payments, before or after maturity, without prejudice to the holder. The holder
shall similarly have the right to deal in any way, at any time, with one or more
of the foregoing parties without notice to any other party, and to grant any
such party any extensions of time for payment of any of said indebtedness, or to
grant any other indulgences or forbearance whatsoever, without notice to any
other party and without in any way affecting the personal liability of any party
hereunder. If any efforts are made to collect or enforce this Note or any
installment due hereunder, the undersigned agrees to pay all collection costs
and fees, including reasonable attorney's fees.
This Note shall be construed and enforced under and in accordance with
the laws of the State of Louisiana.
Page 2 of 3
<PAGE>
This Note is subject to off-set as provided in the Stock Purchase Agreement.
Timely payment in escrow as permitted by, and in accordance with, the terms of
the Stock Purchase Agreement shall constitute payments under this Note.
IN WITNESS WHEREOF, Maker has duly executed this Note as of the day
and year first above written.
AMEDISYS ALTERNATE-SITE INFUSION THERAPY SERVICES,
INC.
By
--------------------------------------------
--------------------------------------------
Page 3 of 3
<PAGE>
EXHIBIT 3.3
CERTIFICATE
OF
AMEDISYS, INC.
I, the undersigned, JAMES P. CEFARATTI, as President of AMEDISYS, INC., a
corporation organized and existing under the laws of the State of Delaware
(hereinafter referred to as the "Corporation") hereby certify and affirm the
following:
1. The name of the Corporation is AMEDISYS, INC.
2. The Board of Directors, pursuant to Section 151 of the Delaware
General Corporation laws adopted a resolution establishing the
Designation, Preferences Limitations, and relative Rights of the
Series A Preferred Stock, Callable, Convertible Series as set forth on
Exhibit "A" attached hereto.
3. The foregoing resolution was adopted by the Board of Directors in
accordance with (S)151 of the Delaware General Corporation Laws and
shall become effective and constitutes an amendment to the
Corporation's Certificate of Incorporation upon the proper filing of
this instrument with the Delaware Secretary of State.
4. Shareholder approval is not required pursuant to the Delaware General
Corporation Laws.
IN WITNESS WHEREOF, the undersigned has execute this Certificate of
AMEDISYS, INC., this 22nd day of December, 1997.
AMEDISYS, INC., a Delaware Corporation
By:_____________________________
JAMES P. CEFARATTI, President
I CERTIFY, that JAMES P. CEFARATTI, personally known to me to be the same
persons whose names are subscribed to the foregoing instrument, this day
personally prepared before me as the President of AMEDISYS, INC., and he
acknowledged that he has executed the foregoing instrument fully and voluntarily
for the use and purpose therein expressed.
SWORN TO AND SUBSCRIBED before me this 22nd day of December, 1997.
My Commission Expires: _______________________________
NOTARY PUBLIC, STATE OF FLORIDA
Print Name:____________________
Commission No.:________________
<PAGE>
CERTIFICATE OF ADOPTION OF RESOLUTIONS
OF THE
BOARD OF DIRECTORS
OF
AMEDYSIS, INC.
AMENDING THE AMEDYSIS, INC. CERTIFICATE OF INCORPORATION TO PROVIDE FOR THE
DESIGNATION, PREFERENCES, RIGHTS, QUALIFICATIONS, LIMITATIONS OR
RESTRICTIONS THEREOF, OF THE SERIES A PREFERRED
STOCK, CONVERTIBLE SERIES
------------------------
AMEDYSIS, INC., a Delaware corporation (the "Corporation"), hereby certifies
that pursuant to the authority vested in the Board of Directors of the
Corporation by the provisions of its Certificate of Incorporation, and by the
provisions of The General Corporation Law of the State of Delaware, the Board of
Directors adopted the following resolution:
RESOLVED, there is hereby created a series of preferred stock, $.001 par
value, of the Corporation, consisting of 1,000,000 shares of the
authorized, but unissued preferred stock and designated the "Series A
Preferred Stock" (hereinafter referred to as the "Series A"); and that to
the extent that the terms, relative rights, preferences, qualifications and
limitations of the Series A are not fixed and determined by the Articles of
Incorporation of the Corporation, as amended, they hereby are fixed and
determined as follows:
SECTION 1. DIVIDENDS.
(a) Dividends. From and after the date of issuance of any shares of
Series A, the holders of the Series A shall be entitled to receive in cash, when
and as declared by the Board of Directors, preferential dividends in such amount
as to be determined by the Board of Directors.
(b) Preference of Dividends. In the event that dividends which are
declared shall not have been fully paid or set apart for payment on all shares
of Series A, the amount of the deficiency (without interest) shall be fully paid
before any dividends shall be declared or paid on any shares of Common Stock or
any other equity security which is junior to the Series A. If any dividends are
paid on any of the Series A at any time in an aggregate amount less than the
total dividends then accumulated and payable on all shares of Series A entitled
to dividends then outstanding, the amount to be distributed shall be paid on
each series of Series A entitled to dividends in the proportion that the
dividends then accumulated and payable on each such series bear to the total
dividends accumulated and payable on all outstanding shares of Series A entitled
to dividends.
(c) Date of Payment. In any case where the due date for the payment of
dividends on the Series A shall be on a day on which banking institutions are
authorized or obligated by law to close, the payment of dividends need not be
made on such date, but may be made on the next succeeding day which is not a day
on which banking institutions are authorized or obligated by law to close, with
the same force and effect as if made on the date of such payment, and dividends
shall accrue and be paid for the period through and including the date of
payment.
SECTION 2. PRIORITY. All shares of the Series A shall rank on a parity
with each other and shall be preferred to the Common Stock of the Corporation,
and any other class of stock of the Corporation, as to payment of dividends and
the distribution of assets upon the liquidation, dissolution or winding up of
the Corporation. The Corporation shall have the right to create other classes of
preferred stock which shall rank below the Series A without the consent of the
holders of the Series A.
SECTION 3. VOLUNTARY CONVERSION RIGHTS.
<PAGE>
(a) Voluntary Conversion. Each holder of Series A shall have the right
at any time, at the holder's option, to convert all or any portion of such
holder's shares of Series A into fully paid and non-assessable full shares of
Common Stock of the corporation at the Conversion Price, determined as
hereinafter provided, in effect at the time of conversion, each share of the
Series A being taken at $10.00 per share for the purposes of such conversion.
The initial Conversion Price is equal to the product of 88% of the average
closing sale price of the Common Stock for the fifteen days immediately prior to
the initial closing of the sale of the Series A (the "Initial Conversion
Price"). The Initial Conversion Price shall be adjusted as provided below in
Section 5 (the Initial Conversion Price, and the Conversion Price as thereafter
then adjusted, shall be referred to as the "Conversion Price"). Upon each
adjustment of the Conversion Price, the holders of the Series A shall thereafter
be entitled to receive upon conversion, at the Conversion Price, resulting from
such adjustments, the number of shares of Common Stock obtained by multiplying
$10.00 times the number of shares of Series A being converted and divide such
amount by the Conversion Price, as then adjusted.
(b) Method of Conversion. In order to convert shares of the Series A
into Common stock, the holder thereof shall surrender the certificate or
certificates therefor, duly endorsed in blank at the principal office of the
Corporation or its transfer agent, if any, or at such other office or offices,
located in the United States as the Board of Directors may designate, and give
written notice to the Corporation at said office that he elects to convert said
shares. Shares of the Series A shall be deemed to have been converted as of the
date (hereinafter called the "Conversion Date") of receipt by the Corporation of
the surrender of such shares for conversion as provided above, and the person or
persons entitled to receive the Common Stock issuable on such date. As soon as
practicable on or after the Conversion Date, the Corporation will deliver to the
address of the holders who submitted the Series A for conversion, a certificate
or certificates for the number of full share of Common Stock issuable upon such
conversion, together with cash in lieu of any fraction of a share, as
hereinafter provided, to the person or persons entitled to receive the same.
SECTION 4. AUTOMATIC CONVERSION. The Series A shall be automatically
converted into shares of Common Stock at such time as the average of the closing
sale price of the Common Stock as listed on the National Association of
Securities Dealers Automated Quotation System ("NASDAQ"), the New York Stock
Exchange ("NYSE"), the American Stock Exchange ("ASE") or wherever the Company's
Common Stock then trades, is at least 135% of the Initial Conversion Price for
fifteen (15) consecutive trading days. Upon such occurrences the Company shall
provide written notice of automatic conversion to all holders. The holders
shall deliver to the address of such holder, a certificate or certificates for
full number of full shares of Common Stock issuable upon such automatic
conversion, together with cash in lieu of any fraction of a share.
SECTION 5. ANTI-DILUTION ADJUSTMENTS. The Conversion Price shall be
adjusted as follows:
(a) Amendment to the Certificate of Incorporation. In the case of any
amendment to the Certificate of Incorporation of the Corporation to change the
designation of the Common stock or the rights, privileges, restrictions or
conditions in respect to the Common Stock or division of the Common stock, the
Series A shall be adjusted so as to provide that upon conversion thereof the
registered holder shall receive, in lieu of shares of Common Stock theretofore
issuable upon such conversion, the kind and amount of shares, other securities,
money and property receivable upon such designation, change or division by such
holder issuable upon such conversion had the conversion occurred immediately
prior to such designation, change or division. The Series A shall be deemed
thereafter to provide for adjustments which shall be as nearly equivalent as may
be practicable to the adjustments provided for in this Section 5. The provisions
of this Subsection 5(a) shall apply in the same manner to successive
reclassifications, changes, consolidations and mergers.
(b) Stock Splits; Stock Dividends. If the Corporation shall at any
time subdivide its outstanding shares of Common Stock into a greater number of
shares of Common Stock, or declare a dividend or make any other distribution
upon the Common Stock payable in shares of Common Stock, the Conversion Price in
effect immediately prior to such subdivision or dividend or other distribution
shall be proportionately reduced, and conversely, in case the outstanding shares
of Common Stock shall be combined into a smaller number of shares of Common
Stock, the Conversion Price in effect immediately prior to such combination
shall be proportionately increased.
2
<PAGE>
(c) Reorganization or Reclassification. If any capital reorganization
or reclassification of the capital stock of the Corporation, or any
consolidation or merger of the Corporation with another corporation or entity,
or the sale of all or substantially all of the Corporation's assets to another
corporation or other entity shall be effected in such a way that holders of
shares of Common Stock shall be entitled to receive stocks, securities, other
evidence of equity ownership or assets with respect to or in exchange for shares
of Common Stock, then, as a condition of such reorganization, reclassification,
consolidation, merger or sale (except as otherwise provided below in this
Subsection 5(c), lawful and adequate provisions shall be made whereby the
holders shall thereafter have the right to receive upon the basis and upon the
terms and conditions specified herein, such shares of stock, securities, other
evidence of equity ownership or assets as may be issued or payable with respect
to or in exchange for a number of outstanding shares of such Common Stock equal
to the number of shares of Common Stock immediately theretofore purchasable and
receivable upon the conversion of Series A had such reorganization,
reclassification, consolidation, merger or sale not taken place, and in any such
case appropriate provisions shall be made with respect to the rights and
interests of the holders to the end that the provisions hereof (including,
without limitation, provisions for adjustments of the Conversion Price and of
the number of shares of Common Stock receivable upon the conversion of Series A)
shall thereafter be applicable, as nearly as may be, in relation to any shares
of stock, securities, other evidence of equity ownership or assets thereafter
deliverable upon the exercise hereof (including an immediate adjustment, by
reason of such consolidation or merger, of the Conversion Price to the value for
the Common Stock reflected by the terms of such consolidation or merger if the
value so reflected is less than the Conversion Price in effect immediately prior
to such consolidation or merger). Subject to the terms of the Series A, in the
event of a merger or consolidation of the Corporation with or into another
corporation or other entity as a result of which the number of shares of Common
Stock of the surviving corporation or other entity issuable to holders of Common
Stock of the Corporation, is greater or lesser than the number of shares of
Common Stock of the Corporation outstanding immediately prior to such merger or
consolidation, then the Conversion Price in effect immediately prior to such
merger or consolidation shall be adjusted in the same manner as though there
were a subdivision or combination of the outstanding shares of Common Stock of
the Corporation. The Corporation shall not effect any such consolidation, merger
or sale, unless, prior to the consummation thereof, the successor corporation
(if other than the Corporation) resulting from such consolidation or merger or
the corporation purchasing such assets shall assume by written instrument
executed and mailed or delivered to the holders, the obligation to deliver to
such holders such shares of stock, securities, other evidence of equity
ownership or assets as, in accordance with the foregoing provisions, such
holders may be entitled to receive or otherwise acquire. If a purchase, tender
or exchange offer is made to and accepted by the holders of more than fifty
(50%) percent of the outstanding shares of Common Stock of the Corporation, the
Corporation shall not effect any consolidation, merger or sale with the person
having made such offer or with any affiliate of such person, unless prior to the
consummation of such consolidation, merger or sale the holders of Series A shall
have been given a reasonable opportunity to then elect to receive upon the
conversion of Series A, the amount of stock, securities, other evidence of
equity ownership or assets then issuable with respect to the number of shares of
Common Stock of the Corporation in accordance with such offer.
(d) Change of Control. In case the Corporation shall, at any time
prior to conversion of the shares of Series A, consolidate or merge with any
other corporation or transfer all or substantially all of its assets to any
other corporation, then the Corporation shall, as a condition precedent to such
transaction, cause effective provision to be made so that the holder hereof upon
the exercise of this Series A after the effective date of such transaction shall
be entitled to receive the kind and amount of shares, evidences of indebtedness
and/or other securities or property receivable on such transaction by a holder
of the number of shares of Common Stock as to which each share of Series A was
convertible immediately prior to such transaction (without giving effect to any
restriction upon such exercise); and, in any such case, appropriate provision
shall be made with respect to the rights and interest of the holders of Series A
to the end that the provisions of the Series A shall thereafter be applicable
(as nearly as may be practicable) with respect to any shares, evidences of
indebtedness or other securities or assets hereafter deliverable upon conversion
of the Series A. Upon the occurrence of any event described in this Section
5(c), the holders of the Series A Preferred Stock shall have the right to
convert into shares of Common Stock immediately prior to the change of control
at a price equal to the lesser of (i) the Conversion Price or (ii) the price per
share of Common Stock payable in the change of control transaction.
(e) Registration Rights. The Conversion Price may be adjusted in
accordance with the provisions of that
3
<PAGE>
certain registration Rights Agreement by and between the Company and the holders
thereof executed in connection with the initial issuance of the Series A.
(f) Adjustment to Conversion Price. The term "Conversion Price" as
used herein shall mean the Conversion Price specified in this certificate, until
the occurrence of an event stated in Section 5 and thereafter shall mean said
price, as adjusted from time to time herein.
(g) Record of Conversion Price. Whenever the shares of Common Stock or
other types of securities or assets receivable upon conversion of the Series A
shall be adjusted as provided in this Section 5, the Corporation shall forthwith
obtain and file with its corporate records a certificate or letter from a firm
of independent public accountants of recognized standing setting forth the
computation and the adjusted number of shares of Common Stock or other
securities or assets resulting from such adjustments, and a copy of such
certificate or letter shall be mailed to the holders hereof. Any such
certificate or letter shall be conclusive evidence as to the correctness of the
adjustment or adjustments referred to therein and shall be available for
inspection by any holders of the Series A on any day during normal business
hours.
(h) Notice. In case:
(i) the Corporation shall declare a dividend (or any other
distribution) on its Common Stock payable in Common Stock of the Corporation; or
(ii) the Corporation shall declare a dividend (or any other
distribution) on its Common Stock payable in cash of the Corporation; or
(iii) any reclassification of Common Stock or any consolidation,
merger, conveyance of the property of the Corporation as an entirety, or
substantially as an entirety, dissolution, liquidation or winding up shall be
effected by the Corporation;
then the Corporation shall mail, or cause to be mailed by the Corporation's
transfer agent, if any, for the Series A and to the holders of record of the
outstanding shares of the Series A, at least thirty (30) days, but not more than
sixty (60) days, prior to the applicable record date hereinafter specified, a
notice stating (A) the date on which a record is to be taken for the purpose of
such dividend, distribution or rights, or, if a record is not to be taken, the
date as of which the holders of Common Stock of record to be entitled to such
dividend, distribution or rights, or, if a record is not to be taken, the date
as of which the holders of Common Stock of record to be entitled to such
dividend, distribution or right are to be determined, or (B) the date on which
such reclassification, consolidation, merger, conveyance, dissolution,
liquidation or winding up is expected to become effective, and the date as of
which it is expected that holders of Common Stock of record shall be entitled to
exchange the certificates representing their shares of Common Stock for
securities or other property deliverable upon such reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding up.
SECTION 6. RESERVATION OF SHARES OF COMMON STOCK.
(a) Reservation of Shares. The Corporation shall at all times reserve
and keep available, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion of the shares of the Series A, the full
number of shares of Common Stock then deliverable upon the conversion of all
shares of the Series A, then outstanding. If shares of the Common Stock of the
Corporation are listed on any securities exchange, the Corporation shall make
application for the listing thereon, on notice of issuance, of the shares of
Common Stock deliverable upon the conversion of the outstanding shares of the
Series A and shall use its best efforts to effect such listing.
(b) Fractional Shares. No fractional shares of Common Stock are to be
issued upon conversion. The Corporation shall pay a cash adjustment out of
surplus in respect to any fraction of a share which would otherwise be issuable,
in an amount equal to the fair market value of the Common Stock which shall be
the same fraction of the last
4
<PAGE>
price per share at which the Common Stock was sold on any principal stock
exchange on which such stock is then listed or admitted to trading, prior to the
opening of business on the conversion date, or if no sale of such stock takes
place on such day on such exchange, the average of the closing bid and asked
prices on such day as officially quoted on such exchange, or if such stock
shall not at the time be listed or admitted to trading on any stock exchange,
the average of the last bid and asked prices for such stock on such day in the
over-the-counter market as reported on NASDAQ prior to the opening of business
on the conversion date, or, if the Common Stock is not then included in NASDAQ,
as furnished by the National Quotation Bureau, Inc. or if such firm is not at
the time engaged in the business of reporting such prices, as furnished by any
firm then engaged in such business or by any member of the National Association
of Securities Dealers, Inc. selected by the Corporation. If the Common Stock is
not then publicly traded, fair market value shall be determined in good faith by
the Corporation's Board of Directors.
(c) Transfer Taxes. The Corporation will pay any and all transfer
taxes that may be payable in respect of the issue or delivery of shares of
Common Stock on conversion of shares of the Series A pursuant hereto. The
Corporation shall not, however, be required to pay any tax which may be payable
in respect of transfer involved in the issue and delivery of shares of Common
Stock in a name other than that in which the shares of the Series A so
converted were registered, and no such issue or delivery shall be made unless
and until the person requesting such issue has paid to the Corporation the
amount of any such tax, or has established, to the satisfaction of the
Corporation, that such tax has been paid.
(d) Common Stock. For the purpose of this Section, the term "Common
Stock" shall include any stock of any class of the Corporation which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, and which is not subject redemption by the Corporation. Shares of
Common Stock shall be only such shares which have no preference in respect of
dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation and which are not
subject to redemption by the Corporation; provided that if at any time there
shall be more than one such resulting class, the shares of each such class then
so issuable shall be substantially in the proportion which the total number of
shares of such class resulting from all such reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassification.
(e) Status of Common Stock. All Common Stock that may be issued upon
conversion of the Series A will, upon issuance, be duly issued, fully paid and
non-assessable and free from all taxes, liens and charges with respect to the
issuance thereof.
SECTION 7. VOTING
(a) Voting. The holders of the Series A shall be entitled to vote, on
all matters in which holders of Common Stock are entitled to vote, voting
together with the Common Stock without regard to class. The holders of the
Series A shall have the number of votes that they would have had assuming
conversion of the Series A into Common Stock as of the record date for the
meeting of the Corporation's holders of Common Stock. The holders of the Series
A shall be entitled to receive all communications sent by the Corporation to the
holders of Common Stock. Except as provided in Section 7(c) or by Delaware law,
holders of shares of the Series A shall not be entitled to vote as a separate
class.
(b) No Cumulative Voting. The holders of shares of the Series A shall
not have the right of cumulative voting in an election of directors.
(c) Voting as a Separate Class. The Corporation shall not, without the
consent (given by vote at a meeting called for that purpose) of the holders of
two-thirds of the shares of the Series A then outstanding, voting as a separate
class:
(i) create, authorize or issue any stock ranking equal to or
senior to the Series A as to dividends, distributions or
liquidation, or any obligation or security
5
<PAGE>
convertible into shares of any such senior stock; or
(ii) amend, alter, change, or repeal any of the express terms
of the Series A.
SECTION 8. LIQUIDATION.
(a) Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation
(hereinafter collectively called "liquidation"), before any amount shall be paid
to or set aside for, or any assets shall be distributed among, the holders of
shares of Common Stock or any other equity security of the Corporation, each
holder of a share of the Series A shall be entitled to receive out of the assets
of the Corporation or the proceeds thereof a preferential payment in an amount
equal to $10.00 per share, plus the amount of accrued and unpaid dividends on
such share, if any, and no more.
(b) Proportional Rights. In the event the amount available for
distribution as liquidation preference payments to holders of the Series A and
any other stock ranking on a parity therewith is insufficient to pay the full
amount of their respective preferences, such amount shall be divided among and
paid to such holders ratably in proportion to the respective amounts which would
be payable to such holders if their respective liquidation preferences were to
be paid in full.
(c) Insufficient Funds. In the event any liquidation preference
payment to be made on the shares of the Series A shall amount in the aggregate
to less than $10.00 per share plus accrued and unpaid dividends, the Corporation
in its discretion may require the surrender of certificates for shares of the
Series A and issue a replacement certificate or certificates, or it may require
the certificates evidencing the shares in respect of which such payments are to
be made to be presented to the Corporation, or its agent, for notation thereon
of the amounts of the liquidation preference payments made in respect of such
shares. In the event a certificate for shares of the Series A on which payment
of one or more partial liquidation preferences has been made is presented for
exchange or transfer shall bear an appropriate notation as to the aggregate
amount of liquidation preference payments theretofore made in respect thereof.
(d) Merger or Sale. Neither the consolidation or merger of the
Corporation with or into any other corporation or corporations, nor the sale or
transfer by the Corporation of all or any part of its assets, shall be deemed to
be a liquidation of the Corporation for the purposes of this Section 9.
SECTION 9. REPLACEMENT CERTIFICATES.
(a) Mutilated Certificate. If any mutilated certificate of Series A is
surrendered to the Corporation, the Corporation shall execute and deliver in
exchange therefor a new certificate for Series A of like tenor and principal
amount, bearing a number not contemporaneously outstanding.
(b) Destroyed, Lost or Stolen Certificate. If there is delivered to
the Corporation (i) evidence to its reasonable satisfaction of the destruction,
loss or theft of any certificate of Series A and (ii) such reasonable security
or indemnity as may be required by it to save it harmless, then, in the absence
of notice to the Corporation that such certificate of Series A has been acquired
by a bona fide purchaser, the Corporation shall execute and deliver in lieu of
any such destroyed, lost or stolen certificate of Series A, a new certificate of
Series A of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
(c) Status of New Certificate. Upon the issuance of any new
certificate of Series A under this Section 10, the Corporation may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses connected therewith.
Every new certificate of Series A issued pursuant to this Section 10 in lieu of
any destroyed, lost or stolen certificate of Series A, shall constitute an
original additional contractual obligation of the Corporation, whether or not
the destroyed, lost or stolen certificate of Series A shall be at any time
enforceable by anyone. A new certificate for Series A delivered pursuant to
this Section 10 shall be so dated neither gain nor loss in interest shall result
from such exchange. The provisions of this Section 10 are
6
<PAGE>
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of mutilated, destroyed,
lost or stolen certificate of Series A.
7
<PAGE>
NUMBER SHARES
AMEDISYS, INC.
SERIES A PREFERRED STOCK CONVERTIBLE SERIES
THIS CERTIFIES THAT ___________________________________________ is the owner of
______________________________________ fully paid and non-assessable Shares
transferable only on the books of the Corporation by the holder hereof in person
or by duly authorized Attorney upon surrender of this Certificate properly
endorsed.
IN WITNESS WHEREOF, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and to be sealed with the Seal of the
Corporation.
Dated _____________________________ William F. Borne
[SEAL]
<PAGE>
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT
AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
THE SECURITIES LAWS OF ANY STATE. SUCH SECURITIES MAY NOT BE SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED AT ANY TIME WHATSOEVER EXCEPT UPON
REGISTRATION OR UPON DELIVERY TO THE CORPORATION OF AN OPINION OF COUNSEL
SATISFACTORY TO THE CORPORATION OR ITS COUNSEL THAT REGISTRATION IS NOT REQUIRED
FOR SUCH TRANSFER, OR THE SUBMISSION TO THE CORPORATION OF SUCH OTHER EVIDENCE
AS MAY BE SATISFACTORY TO THE CORPORATION TO THE EFFECT THAT ANY SUCH TRANSFER
SHALL NOT BE IN VIOLATION OF THE SECURITIES ACT OF 1933, AS AMENDED, APPLICABLE
STATE SECURITIES LAWS OR ANY RULE OR REGULATION PROMULGATED THEREUNDER.
THE TERMS, RELATIVE RIGHTS, PREFERENCES, QUALIFICATIONS, AND LIMITATIONS OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE GOVERNED BY THE CERTIFICATE OF
DESIGNATION OF THE SERIES A PREFERRED STOCK, CONVERTIBLE SERIES, ON FILE WITH
THE SECRETARY OF STATE OF DELAWARE. THE CORPORATION WILL FURNISH TO THE HOLDER
OF THIS CERTIFICATE, WITHOUT CHARGE UPON WRITTEN REQUEST TO THE CORPORATION AT
ITS PRINCIPAL PLACE OF BUSINESS OR REGISTERED OFFICE, A COPY OF THE CERTIFICATE
OF DESIGNATION.
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations. Additional abbreviations may also
be used though not in the list.
<TABLE>
<S> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT - _________________ Custodian ____________ (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to Minors Act ________________________ (State)
JT TEN - as joint tenants with right of
survivorship and not as tenants
in common
PLEASE INSERT SOCIAL SECURITY OR OTHER
For value received, the undersigned hereby sells, assigns and transfers unto IDENTIFYING NUMBER OF ASSIGNEE
_____________________________________________________________________________ [ ]
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
__________________________________________________________________________________________________________________
___________________________________________________________________________________________________________ Shares
represented by the within Certificate, and hereby irrevocably constitutes and appoints ___________________________
____________________________________________________________________________________ Attorney to transfer the said
Shares on the books of the within-named Corporation with full power of substitution in the premises.
Dated, _______________________________
In Presence of ______________________________________________________________
____________________________________________________
NOTICE: The signature to this assignment must correspond with the name as written upon the face of the certificate in every
particular without alteration or enlargement, or any change whatever.
</TABLE>
<PAGE>
EXHIBIT 4.3
WARRANT AGREEMENT dated as of December 29, 1997 between Amedisys, Inc., a
Delaware corporation (the "Company"), and Hudson Capital Partners, L.P.
(hereinafter referred to as the "Placement Agent").
W I T N E S S E T H:
WHEREAS, the Company proposes to issue to the Placement Agent warrants (the
"Warrants") to purchase up to 56,000 (as such number may be adjusted from time
to time pursuant to Article 8 of this Agreement) shares (the "Shares") of
preferred stock, par value $.001 per share (the "Preferred Shares"), of the
Company; and
WHEREAS, the Placement Agent has agreed, pursuant to the placement agent
agreement (the "Placement Agent Agreement") dated as of December 8, 1997 between
the Placement Agent and the Company, to act as the placement agent in connection
with the Company's proposed private offering (the "Private Placement") of up to
80 Units (the "Units"), each Unit consisting of 10,000 Preferred Shares, at an
offering price of $100,000 per Unit; and
WHEREAS, the Warrants issued pursuant to this Agreement are being issued by
the Company to the Placement Agent and/or to its designees, in consideration
for, and as part of the Placement Agent's compensation in connection with, the
Placement Agent acting as the placement agent pursuant to the Placement Agent
Agreement;
NOW, THEREFORE, in consideration of the premises, the agreements herein set
forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
<PAGE>
1. Grant.
The Placement Agent, and/or its designees are hereby granted the right to
purchase, at any time from December 29, 1997 until 5:00 P.M., New York time, on
December 29, 2002 (the "Warrant Exercise Term"), up to 56,000 fully-paid and
non-assessable Shares (700 Shares for each Unit sold (and such pro rata number
of shares for each partial Unit sold) in the Private Placement) at an initial
exercise price (subject to adjustment as provided in Article 8 hereof) of $10.00
per Share. The terms, preferrences, privileges and rights of the Preferred
Shares are as set forth in the Confidential Private Term Sheet dated December 8,
1997.
2. Warrant Certificates.
The warrant certificates delivered and to be delivered pursuant to this
Agreement (the "Warrant Certificates") shall be in the form set forth in Exhibit
A attached hereto and made a part hereof, with such appropriate insertions,
omissions, substitutions and other variations as required or permitted by this
Agreement.
3. Exercise of Warrant.
The Warrants initially are exercisable at a price of $10.00 per Share,
payable in cash or by check to the order of the Company, or any combination
thereof, subject to adjustment as provided in Article 7 hereof. Upon surrender
of the Warrant Certificate with the annexed Form of Election to Purchase duly
executed, together with payment of the Exercise Price (as hereinafter defined)
for the Shares purchased, at the Company's principal offices (currently located
at 3029 S. Sherwood Forest Blvd., Suite 300, Baton Rouge, Louisiana 70816) the
registered holder of a Warrant Certificate ("Holder" or "Holders") shall be
entitled to receive a certificate or certificates for the Shares so purchased.
The purchase rights represented by each Warrant Certificate are exercisable at
the option of the Holder thereof, in whole or in part (but not as to fractional
Shares). In the case of the purchase of less than all the Shares purchasable
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<PAGE>
under any Warrant Certificate, the Company shall cancel said Warrant Certificate
upon the surrender thereof and shall execute and deliver a new Warrant
Certificate of like tenor for the balance of the Shares purchasable thereunder.
In the event that the Shares automatically convert into shares of Common Stock
(the "Conversion Shares"), par value $.001 per share of the Company (the "Common
Shares"), upon exercise of the Warrants as provided for in this Section 3, the
Holder of a Warrant Certificate shall be entitled to receive a certificate or
certificates for the number of Conversion Shares issuable upon exercise of the
Shares so purchased.
4. Issuance of Certificates.
Upon the exercise of the Warrants, the issuance of certificates for the
Shares or Conversion Shares, as the case may be, purchased shall be made
forthwith (and in any event within three (3) business days thereafter) without
charge to the Holder thereof including, without limitation, any tax which may be
payable in respect of the issuance thereof, and such certificates shall be
issued in the name of, or in such names as may be directed by, the Holder
thereof; provided, however, that the Company shall not be required to pay any
tax which may be payable in respect of any transfer involved in the issuance and
delivery of any such certificates in a name other than that of the Holder and
the Company shall not be required to issue or deliver such certificates unless
or until the person or persons requesting the issuance thereof shall have paid
to the Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid.
The Warrant Certificates and the certificates representing the Shares
and/or Conversion Shares shall be executed on behalf of the Company by the
manual or facsimile signature of the present or any future Chairman or Vice
Chairman of the Board of Directors, Chief Executive Officer or President or Vice
President of the Company under its corporate seal
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<PAGE>
reproduced thereon, attested to by the manual or facsimile signature of the
present or any future Secretary or Assistant Secretary of the Company. Warrant
Certificates shall be dated the date of execution by the Company upon initial
issuance, division, exchange, substitution or transfer.
Upon exercise, in part or in whole, of the Warrants, certificates
representing the Shares or Conversion Shares, as the case may be, shall bear a
legend substantially similar to the following:
"The securities represented by this certificate have not been registered
for purposes of public distribution under the Securities Act of 1933, as
amended (the "Act"), and may not be offered or sold except (i) pursuant to
an effective regis tration statement under the Act, (ii) to the extent
applicable, pursuant to Rule 144 under the Act (or any similar rule under
such Act relating to the disposition of securities), or (iii) upon the
delivery by the holder to the Company of an opinion of counsel, reasonably
satisfactory to counsel to the Company, stating that an exemption from
registration under such Act is available."
5. Price.
5.1. Initial and Adjusted Exercise Price. The initial exercise price of
each Warrant shall be $10.00 per Share (or per the number of Conversion Shares
issuable upon exercise of one Share).
5.2. Exercise Price. The term "Exercise Price" herein shall mean the
initial exercise price or the adjusted exercise price, depending upon the
context.
6. Registration Rights.
6.1. Registration Under the Securities Act of 1933; Restriction on
Transfer. None of the Warrants, Shares or Conversion Shares have been registered
for purposes of public distribution under the Securities Act of 1933, as amended
(the "Act"). The Holders agree not to sell, transfer, pledge, hypothecate or
otherwise dispose of any of the Shares or
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<PAGE>
Conversion Shares pursuant to a registration statement or otherwise until 120
days following the final closing date of the Private Placement.
6.2. Registrable Securities. As used herein the term "Registrable Security"
means each of the Conversion Shares and any Common Shares issued upon any stock
split or stock dividend in respect of such Shares; provided, however, that with
respect to any particular Registrable Security, such security shall cease to be
a Registrable Security when, as of the date of determination, (i) it has been
effectively registered under the Act and disposed of pursuant thereto, (ii)
registration under the Act is no longer required for the subsequent public
distribution of such security or (iii) it has ceased to be outstanding. The term
"Registrable Securities" means any and/or all of the securities falling within
the foregoing definition of a "Registrable Security." In the event of any
merger, reorganization, consolidation, recapitalization or other change in
corporate structure affecting the Common Shares, such adjustment shall be
made in the definition of "Registrable Security" as is appropriate in order to
prevent any dilution or enlargement of the rights granted pursuant to this
Article 6.
6.3. Piggyback Registration. If, at any time during the five years
following the final closing date of the Private Placement, the Company proposes
to prepare and file one or more registration statements (including in connection
with an initial public offering of its securities) or post-effective amendments
thereto covering equity or debt securities of the Company, or any such
securities of the Company held by its shareholders (in any such case, other than
in connection with a merger, acquisition or pursuant to Form S-8 or successor
form), (for purposes of this Article 6, collectively, the "Registration
Statement"), it will give written notice of its intention to do so by registered
mail ("Notice"), at least thirty (30) days prior to the filing of each such
Registration Statement, to all holders of the Registrable Securities. Upon the
written
-5-
<PAGE>
request of such a holder (a "Requesting Holder"), made within twenty (20) days
after receipt of the Notice, that the Company include any of the Requesting
Holder's Registrable Securities in the proposed Registration Statement, the
Company shall, as to each such Requesting Holder, use its best efforts to effect
the registration under the Act of the Registrable Securities which it has been
so requested to register ("Piggyback Registration"), at the Company's sole cost
and expense and at no cost or expense to the Requesting Holders (except as
provided in Section 6.5(b) hereof); provided, however, that if, in the written
opinion of the Company's managing underwriter, if any, for such offering, the
inclusion of all or a portion of the Registrable Securities requested to be
registered, when added to the securities being registered by the Company or the
selling shareholder(s), will exceed the maximum amount of the Company's
securities which can be marketed (i) at a price reasonably related to their then
current market value, or (ii) without otherwise materially adversely affecting
the entire offering, then the Company may exclude from such offering all or a
portion of the Registrable Securities which it has been requested to register.
If securities are proposed to be offered for sale pursuant to such
Registration Statement by other security holders of the Company and the total
number of securities to be offered by the Requesting Holders and such other
selling security holders is required to be reduced pursuant to a request from
the managing underwriter (which request shall be made only for the reasons and
in the manner set forth above) the aggregate number of Registrable Securities to
be offered by Requesting Holders pursuant to such Registration Statement shall
equal the number which bears the same ratio to the maximum number of securities
that the underwriter believes may be included for all the selling security
holders (including the Requesting Holders) as the original number of Registrable
Securities proposed to
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<PAGE>
be sold by the Requesting Holders bears to the total original number of
securities proposed to be offered by the Requesting Holders and the other
selling security holders.
If, subsequent to exercise of the demand registration right referred to in
Section 6.4 below, any Registrable Securities requested to be included in a
Piggyback Registration are not so included because of the operation of the
proviso of the first paragraph of this Section 6.3, then the holders of such
excluded Registrable Securities shall have the right to require the Company, at
its expense, to prepare and file another Registration Statement under the Act
covering such Registrable Securities, provided that, if the underwriter so
requests, such Registrable Securities shall not be sold until the expiration of
120 days from the effective date of the offering that gave rise to the piggyback
registration rights that are the subject of this Section 6.3.
6.4 Demand Registration.
(a) At any time following the initial closing date of the Private
Placement, any "Majority Holder" (as such term is defined in Section 6.4(c)
below) of the Registrable Securities shall have the right (which right is in
addition to the piggyback registration rights provided for under Section 6.3
hereof), exercisable by written notice to the Company (the "Demand Registration
Request"), to have the Company prepare and file with the Securities and Exchange
Commission (the "Commission"), on one occasion, at the sole expense of the
Company (except as provided in Section 6.5(b) hereof), a Registration Statement
and such other documents, including a prospectus, as may be necessary (in the
opinion of both counsel for the
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<PAGE>
Company and counsel for such Majority Holder), in order to comply with the
provisions of the Act, so as to permit a public offering and sale of the
Registrable Securities by the holders thereof. The Company shall use its best
efforts to cause the Registration Statement to become effective under the Act,
so as to permit a public offering and sale of the Registrable Securities by the
holders thereof. Once effective, the Company will use its best efforts to
maintain the effectiveness of the Registration Statement until the earlier of
(i) the date that all of the Registrable Securities have been sold or (ii) the
date that the holders of the Registrable Securities receive an opinion of
counsel to the Company that all of the Registrable Securities may be freely
traded (without limitation or restriction as to quantity or timing and without
registration under the Act) under rule 144(k) promulgated under the Act or
otherwise.
(b) The Company covenants and agrees to give written notice of any Demand
Registration Request to all holders of the Registrable Securities within ten
(10) business days from the date of the Company's receipt of any such Demand
Registration Request. After receiving notice from the Company as provided in
this Section 6.4(b), holders of Registrable Securities may request the Company
to include their Registrable Securities in the Registration Statement to be
filed pursuant to Section 6.4(a) hereof by notifying the Company of their
decision to have such securities included within ten (10) days of their receipt
of the Company's notice. Any Demand Registration Request by a Majority Holder
shall be binding on all other Holders, whether or not such Holders include their
Registrable Securities.
(c) The term "Majority Holder" as used in Section 6.4 hereof shall mean any
holder or any combination of holders of Registrable Securities, if included in
such holders' Registrable Securities are that aggregate number of Common Shares
(including Common Shares already issued and Common Shares issuable upon
conversion of Shares outstanding and
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<PAGE>
upon conversion of Shares issuable pursuant to the exercise of outstanding
Warrants) as would constitute a majority of the aggregate number of Conversion
Shares (including Shares or Conversion Shares already issued and Shares or
Conversion Shares issuable pursuant to the exercise of outstanding Warrants)
included in all the Registrable Securities.
6.5. Covenants of the Company With Respect to Registration. The Company
covenants and agrees as follows:
(a) In connection with any registration under Section 6.4 hereof, the
Company shall file the Registration Statement as expeditiously as possible, but
in any event no later than thirty (30) business days following receipt of any
demand therefor, shall use its best efforts to have any such Registration
Statement declared effective at the earliest possible time, and shall furnish
each holder of Registrable Securities such number of prospectuses as shall
reasonably be requested.
(b) The Company shall pay all costs, fees and expenses (other than
underwriting fees, discounts and nonaccountable expense allowance applicable to
the Registrable Securities and the fees and expenses of counsel retained by the
holders of Registrable Securities) in connection with all Registration
Statements filed pursuant to Sections 6.3 and 6.4(a) hereof including, without
limitation, the Company's legal and accounting fees, printing expenses, and blue
sky fees and expenses.
(c) The Company will take all necessary action which may be required in
qualifying or registering the Registrable Securities included in the
Registration Statement for offering and sale under the securities or blue sky
laws of such states as are reasonably requested by the holders of such
securities.
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<PAGE>
(d) The Company hereby agrees to indemnify any holder of the Registrable
Securities to be sold pursuant to any Registration Statement and any underwriter
or person deemed to be an underwriter under the Act and each person, if any, who
controls such holder or underwriter or person deemed to be an underwriter within
the meaning of Section 15 of the Act or Section 20(a) of the Securities Exchange
Act of 1934, as amended ("Exchange Act"), against all loss, claim, damage,
expense or liability (including all expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which any
of them may become subject under the Act, the Exchange Act or otherwise, arising
from such registration statement to the same extent and with the same effect as
the provisions pursuant to which the Company has agreed to indemnify the
Placement Agent as set forth in Section 11 of the Placement Agent Agreement and
to provide for just and equitable contribution as set forth in Section 11 of the
Placement Agent Agreement.
(e) Any holder of Registrable Securities to be sold pursuant to a
registration statement, and such Holder's successors and assigns, shall
severally, and not jointly, indemnify, the Company, its officers and directors
and each person, if any, who controls the Company within the meaning of Section
15 of the Act or Section 20(a) of the Exchange Act, against all loss, claim,
damage or expense or liability (including all expenses reasonably incurred in
investigating, preparing or defending against any claim whatsoever) to which
they may become subject under the Act, the Exchange Act or otherwise, arising
from information furnished by or on behalf of such holder, or such Holder's
successors or assigns, for specific inclusion in such Registration Statement to
the same extent and with the same effect as the provisions pursuant to which the
Placement Agent has agreed to indemnify the Company as set
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<PAGE>
forth in Section 11 of the Placement Agent Agreement and to provide for just and
equitable contribution as set forth in Section 11 of the Placement Agent
Agreement.
(f) Nothing contained in this Agreement shall be construed as requiring
any Holder to exercise the Warrants held by such Holder prior to the initial
filing of any registration statement or the effectiveness thereof.
(g) If the Company shall fail to comply with the provisions of this
Article 6, the Company shall, in addition to any other equitable or other relief
available to the holders of Registrable Securities, be liable for any or all
incidental, special and consequential damages sustained by the holders of
Registrable Securities, requesting registration of their Registrable Securities.
(h) The Company shall promptly deliver copies of all correspondence
between the Commission and the Company, its counsel or auditors and all
memoranda relating to discussions with the Commission or its staff with respect
to the Registration Statement to each holder of Registrable Securities included
for such registration in such Registration Statement pursuant to Section 6.3
hereof or Section 6.4 hereof requesting such correspondence and memoranda and to
the managing underwriter, if any, of the offering in connection with which such
Holder's Registrable Securities are being registered and shall permit each
holder of Registrable Securities and such underwriter to do such reasonable
investigation, upon reasonable advance notice, with respect to information
contained in or omitted from the Registration Statement as it deems reasonably
necessary to comply with applicable securities laws or rules of the National
Association of Securities Dealers, Inc. Such investigation shall include access
to books, records and properties and opportunities to discuss the business of
the Company with its officers and independent auditors, all to such
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<PAGE>
reasonable extent and at such reasonable times and as often as any such holder
of Registrable Securities or underwriter shall reasonably request.
7. Exchange and Replacement of Warrant Certificates.
Each Warrant Certificate is exchangeable without expense, upon the
surrender thereof by the registered Holder at the principal executive office of
the Company, for a new Warrant Certificate of like tenor and date representing
in the aggregate the right to purchase the same number of securities in such
denominations as shall be designated by the Holder thereof at the time of such
surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or mutilation of any Warrant Certificate, and, in
case of loss, theft or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Warrant
Certificate, if mutilated, the Company will make and deliver a new Warrant
Certificate of like tenor, in lieu thereof.
8. Elimination of Fractional Interests.
The Company shall not be required to issue certificates representing
fractions of Shares, nor shall it be required to issue scrip or pay cash in lieu
of fractional interests, it being the intent of the parties that all fractional
interests shall be eliminated by rounding any fraction up to the nearest whole
number of Shares.
9. Reservation and Listing of Securities.
The Company shall at all times reserve and keep available out of its
authorized Preferred Shares, solely for the purpose of issuance upon the
exercise of the Warrants, such number of Preferred Shares as shall be issuable
upon the exercise thereof. The Company
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<PAGE>
covenants and agrees that, upon exercise of the Warrants and payment of the
Exercise Price therefor, all Shares issuable upon such exercise shall be duly
and validly issued, fully paid, non-assessable and not subject to the preemptive
rights of any shareholder. For as long as the Warrants shall be outstanding, the
Company shall use its best efforts to cause all Common Shares issuable upon
conversion of the Shares issuable upon the exercise of the Warrants to be listed
on or quoted by NASDAQ or listed on such national securities exchange, in the
event the Common Shares are listed on a national securities exchange.
10. Notices to Warrant Holders.
Nothing contained in this Agreement shall be construed as conferring upon
the Holder or Holders the right to vote or to consent or to receive notice as a
shareholder in respect of any meetings of shareholders for the election of
directors or any other matter, or as having any rights whatsoever as a
shareholder of the Company. If, however, at any time prior to the expiration of
the Warrants and their exercise, any of the following events shall occur:
(a) the Company shall take a record of the holders of its Common
Shares or Preferred Shares for the purpose of entitling them to
receive a dividend or distribution payable otherwise than in cash, or
a cash dividend or distribution payable otherwise than out of current
or retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
(b) the Company shall offer to all the holders of its Common
Shares or Preferred Shares any additional shares of capital stock of
the Company or securities convertible into or exchangeable for shares
of capital stock of the Company, or any option, right or warrant to
subscribe therefor; or
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<PAGE>
(c) a dissolution, liquidation or winding up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets and business as an
entirety shall be proposed; or
(d) reclassification or change of the outstanding Common Shares
or Preferred Shares (other than a change in par value to no par value,
or from no par value to par value, or as a result of a subdivision or
combination), consolidation of the Company with, or merger of the
Company into, another corporation (other than a consolidation or
merger in which the Company is the surviving corporation and which
does not result in any reclassification or change of the outstanding
Common Shares, except a change as a result of a subdivision or
combination of such shares or a change in par value, as aforesaid), or
a sale or conveyance to another corporation of the property of the
Company as an entirety is proposed; or
(e) The Company or an affiliate of the Company shall propose to
issue any rights to subscribe for Common Shares or any other
securities of the Company or of such affiliate to all the shareholders
of the Company;
then, in any one or more of said events, the Company shall give written notice
to the Holder or Holders of such event at least twenty (20) days prior to the
date fixed as a record date or the date of closing the transfer books for the
determination of the shareholders entitled to such dividend, distribution,
convertible or exchangeable securities or subscription rights, options or
warrants, or entitled to vote on such proposed dissolution, liquidation, winding
up or sale. Such notice shall specify such record date or the date of closing
the transfer books, as the case may be. Failure to
-14-
<PAGE>
give such notice or any defect therein shall not affect the validity of any
action taken in connection with the declaration or payment of any such dividend
or distribution, or the issuance of any convertible or exchangeable securities
or subscription rights, options or warrants, or any proposed dissolution,
liquidation, winding up or sale.
11. Notices.
All notices, requests, consents and other communications hereunder
shall be in writing and shall be deemed to have been duly made when delivered,
or mailed by registered or certified mail, return receipt requested:
(a) If to a registered Holder of the Warrants, to the address of
such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in Section 3 of
this Agreement or to such other address as the Company may designate
by notice to the Holders.
12. Supplements and Amendments.
The Company and the Placement Agent may from time to time supplement
or amend this Agreement without the approval of any Holders of Warrant
Certificates in order to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or inconsistent with any
provisions herein, or to make any other provisions in regard to matters or
questions arising hereunder which the Company and the Placement Agent may deem
necessary or desirable and which the Company and the Placement Agent deem not to
adversely affect the interests of the Holders of Warrant Certificates.
-15-
<PAGE>
13. Successors.
All the covenants and provisions of this Agreement by or for the
benefit of the Company and the Holders inure to the benefit of their respective
successors and assigns hereunder.
14. Termination.
This Agreement shall terminate at the close of business on December
29, 2005. Notwithstanding the foregoing, this Agreement will terminate on any
earlier date when all Warrants have been exercised and all the Shares issuable
upon exercise of the Warrants have been resold to the public; provided, however,
that the provisions of Section 6 shall survive any termination pursuant to this
Section 15 until the close of business on December 29, 2008.
15. Governing Law.
This Agreement and each Warrant Certificate issued hereunder shall be
deemed to be a contract made under the laws of the State of New York and for all
purposes shall be construed in accordance with the laws of said State, except to
the extent that the Delaware General Corporation Law mandatorily applies.
16. Benefits of This Agreement.
Nothing in this Agreement shall be construed to give to any person or
corporation other than the Company and the Placement Agent and any other
registered holder or holders of the Warrant Certificates, Warrants or the Shares
any legal or equitable right, remedy or claim under this Agreement; and this
Agreement shall be for the sole and exclusive benefit of the Company and the
Placement Agent and any other holder or holders of the Warrant Certificates,
Warrants or the Shares.
-16-
<PAGE>
17. Counterparts.
This Agreement may be executed in any number of counterparts and each
of such counterparts shall for all purposes be deemed to be an original, and
such counterparts shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
AMEDISYS, INC.
By:
------------------------------------
Name:
Title:
Attest:
- -------------------------
HUDSON CAPITAL PARTNERS, L.P.
By: HCP Management Corp.,
General Partner
By:
------------------------------------
Name:
Title:
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<PAGE>
EXHIBIT A
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE
UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED FOR PURPOSES OF PUBLIC
DISTRIBUTION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY
NOT BE OFFERED OR SOLD EXCEPT (i) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT, (ii) TO THE EXTENT APPLICABLE, PURSUANT TO RULE 144
UNDER SUCH ACT (OR ANY SIMILAR RULE UNDER SUCH ACT RELATING TO THE DISPOSITION
OF SECURITIES), OR (iii) UPON THE DELIVERY BY THE HOLDER TO THE COMPANY OF AN
OPINION OF COUNSEL, REASONABLY SATISFACTORY TO COUNSEL FOR THE COMPANY, STATING
THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
THE TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE IS
RESTRICTED IN ACCORDANCE WITH THE WARRANT AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:00 P.M., NEW YORK TIME, _________, 2002
No. W- _______ Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that _______________ ____________
or registered assigns, is the registered holder of _______ Warrants to purchase,
at any time from _______, 1997 until 5:00 P.M. New York City time on ________,
2002 ("Expiration Date"), up to _____ fully-paid and non-assessable shares
("Shares") of the preferred stock, par value $.001 per share (the "Preferred
Shares"), of Amedisys, Inc., a Delaware corporation (the "Company"), at the
initial exercise price, subject to adjustment in certain events (the "Exercise
Price"), of $10.00 per Share upon surrender of this Warrant Certificate and
payment of the Exercise Price at an office or agency of the Company, but subject
to the conditions set forth herein and in the warrant agreement dated as of
____________, 1997 between the Company and Hudson Capital Partners, L.P. (the
"Warrant Agreement"). Payment of the Exercise Price may be made in cash, or by
certified or official bank check in New York Clearing House funds payable to the
order of the Company, or any combination thereof.
No Warrant may be exercised after 5:00 P.M., New York City time, on
the Expiration Date, at which time all Warrants evidenced hereby, unless
exercised prior thereto, shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, which
Warrant Agreement is hereby incorporated by reference in and made a part of this
instrument and is hereby referred to in a description of the rights, limitation
of rights, obligations, duties and immunities thereunder of the
<PAGE>
Company and the holders (the words "holders" or "holder" meaning the registered
holders or registered holder) of the Warrants.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency of the Company, a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided herein and in the Warrant
Agreement, without any charge except for any tax, or other governmental charge
imposed in connection therewith.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such number of unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Dated: ___________, 1997 AMEDISYS, INC.
By:
--------------------------------------
Name:
Title:
Attest:
- -----------------------------
<PAGE>
[FORM OF ELECTION TO PURCHASE]
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase _________ Preferred Shares
and herewith tenders in payment for such securities cash or a certified or
official bank check payable in New York Clearing House Funds to the order of
Amedisys, Inc. in the amount of $ , all in accordance with the terms
hereof. The undersigned requests that a certificate for such securities be
registered in the name of , whose address is
__________________, and that such Certificate be delivered to
__________________, whose address is _____________.
Dated: Signature:
-----------------------------------
(Signature must conform in all respects to name of
holder as specified on the face of the Warrant
Certificate.)
________________________________
________________________________
(Insert Social Security or Other
Identifying Number of Holder)
<PAGE>
[FORM OF ASSIGNMENT]
(To be executed by the registered holder if such holder
desires to transfer the Warrant Certificate.)
FOR VALUE RECEIVED
----------------------------------------------
hereby sells, assigns and transfers unto
- --------------------------------------------------------------------------
(Please print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _______________, Attorney, to
transfer the within Warrant Certificate on the books of the within-named
Company, with full power of substitution.
Dated: Signature:
--------------------------------------
(Signature must conform in all respects to name of
holder as specified on the face of the Warrant
Certificate)
_______________________________
_______________________________
(Insert Social Security or Other
Identifying Number of Assignee)
<PAGE>
EXHIBIT 5.1
March 10, 1998
Mr. William Borne
Amedisys, Inc.
3029 S. Sherwood Forest Blvd., Suite 300
Baton Rouge, Louisiana 70816
Dear Mr. Borne:
As counsel for Amedisys, Inc., a Delaware corporation ("Company"), you have
requested our firm to render this opinion in connection with the Registration
Statement of the Company on Form S-3 filed under the Securities Act of 1933, as
amended ("Act"), with the Securities and Exchange Commission relating to the
registration of the resale of (i) 1,621,622 shares of Common Stock issuable upon
conversion of series A preferred stock ("Preferred Stock"), and (ii) 113,514
shares of Common Stock underlying Preferred Stock pursuant to currently
exercisable warrants ("Placement Agent Warrants").
We are familiar with the registration statement and the registration
contemplated thereby. In giving this opinion, we have reviewed the registration
statement and such other documents and certificates of public officials and of
officers of the Company with respect to the accuracy of the factual matters
contained therein as we have felt necessary or appropriate in order to render
the opinions expressed herein. In making our examination, we have assumed the
genuineness of all signatures, the authenticity of all documents presented to us
as originals, the conformity to original documents of all documents presented to
us as copies thereof, and the authenticity of the original documents from which
any such copies were made, which assumptions we have not independently verified.
Based upon all the foregoing, we are of the opinion that:
1. The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware.
2. The shares of Preferred Stock underlying the Placement Agent Warrants to
be issued upon exercise of such Placement Agent Warrants are validly
authorized and, upon exercise of the Warrants in accordance with their
terms, will be validly issued, fully paid and nonassessable.
<PAGE>
Mr. William Borne
March 10, 1998
Page 2
3. The shares of Common Stock underlying the Preferred Stock to be issued
upon conversion of such Preferred Stock are validly authorized and, upon
conversion of the Preferred Stock in accordance with their terms, will
be validly issued, fully paid and nonassessable.
We consent to the use in the registration statement of the reference to
Brewer & Pritchard, P.C. under the heading "Legal Matters."
This opinion is conditioned upon the registration statement being declared
effective and upon compliance by the Company with all applicable provisions of
the Act and such state securities rules, regulations and laws as may be
applicable.
Very truly yours,
BREWER & PRITCHARD, P.C.
<PAGE>
EXHIBIT 10.4
AMEDISYS, INC.
AMENDED AND RESTATED STOCK OPTION PLAN
1. ADOPTION AND PURPOSE
AMEDISYS, INC., f/k/a Analytical Nursing Management Corporation, a Delaware
corporation (the "Company"), adopted its Statutory Stock Option Plan for
Employees ("Plan") effective May 5, 1994. The Company hereby amends and
restates the Plan in its entirety, effective August 6, 1997 as hereinafter
set forth, subject to stockholder approval. The purpose of the Plan is to
foster and promote the financial success of the Company and materially
increase stockholder value by enabling eligible key employees and others to
participate in the long-term growth and financial success of the Company.
The Plan is intended to provide "incentive stock options" within the
meaning of that term under Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), as well as non-qualified stock options. Any
proceeds of cash or property received by the Company for the sale of
AMEDISYS, INC. common stock, $.001 par value (the "Common Stock") pursuant
to Options granted under this Plan will be used for general corporate
purposes.
2. ADMINISTRATION
2.1 The Plan shall be administered by a committee (the "Compensation
Committee") appointed by the Board of Directors of the Company (the
"Board") and composed of at least two Board members. The Compensation
Committee shall meet the plan administration requirements described under
Rule 16b-3(c)(2) promulgated under the Securities Exchange Act of 1934, as
amended ("Exchange Act"), or any similar rule which may subsequently be in
effect. Any vacancy on the Compensation Committee shall be filled by the
Board.
2.2 Subject to the express provisions of the Plan, the Compensation
Committee shall have the sole and complete authority to (i) determine key
employees and others to whom awards hereunder shall be granted, (ii make
awards in such form and amounts as it shall determine, (ii impose such
limitations and conditions upon such awards as it shall deem appropriate,
(iv interpret the Plan, prescribe, amend and rescind rules and regulations
relating to it, (v) determine the terms and provisions of the respective
participants' agreements (which need not be identical), and (vi make such
other determinations as it deems necessary or advisable for the
administration of the Plan. The decisions of the Compensation Committee on
matters within their jurisdiction under the Plan shall be conclusive and
binding on the Company and all other persons. No members of the Board or
the Compensation Committee shall be liable for any action taken or
determination made in good faith.
2.3 All expenses associated with the Plan shall be paid by the Company or
its Subsidiaries.
3. DEFINITIONS
3.1 "Cause" when used in connection with the termination of a
Participant's employment with the Company, shall mean the termination of
the Participant's employment by the Company by reason of (i) the conviction
of the Participant of a crime involving moral turpitude by a court of
competent jurisdiction as to which no further appeal can be taken; (ii) the
proven commission by the Participant of an act of fraud upon the Company;
(iii) the willful and proven misappropriation of any funds or property of
the Company by the Participant; (iv) the willful, continued and
unreasonable failure by the Participant to perform duties assigned to him
and agreed to by him; (v) the knowing engagement by the Participant in any
direct, material conflict of interest with the Company without compliance
with the Company's conflict of interest policy, if any, then in effect;
(vi) the knowing engagement by the Participant, without the written
approval of the Board of Directors of the Company, in any activity which
competes with the business of the Company or which would result in a
material injury to the Company; or (vii) the knowing engagement in any
activity which would constitute a material violation
<PAGE>
of the provisions of the Company's insider trading policy or business
ethics policy, if any, then in effect.
3.2 "Change in Control" shall mean the occurrence of any of the following
events:
(i) any Person becomes, after the effective date of this Plan, the
"beneficial owner" (as defined in Rule 13d-3 promulgated under the
Exchange Act), directly or indirectly, of securities of the Company
representing 30% or more of the combined voting power of the Company's
then outstanding securities, unless the Board (as constituted
immediately prior to such Change in Control) determines in its sole
absolute discretion that no Change in Control has occurred;
(ii) Individuals who constitute the Board on the effective date of the
Plan cease, for any reason, to constitute at least a majority of the
Board of Directors; provided, however, that any person becoming a
director subsequent to the effective date of the Plan who was
nominated for election by at least 66-2/3% of the Board as constituted
on the effective date of the Plan (other than the nomination of an
individual whose initial assumption of office is in connection with an
actual or threatened election contest relating to the election of the
Board of Directors, as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act) shall be, for
purposes of this Plan, considered a member of the Board as constituted
on the effective date of the Plan; or
(iii) the Board of Directors determines in its sole and absolute
discretion that there has been a Change in Control of the Company.
3.3 "Consultant" shall mean any person who is engaged by the Company or
any parent or Subsidiary of the Company to render consulting services and
is compensated for such consulting services.
3.4 "Continuous Service" shall mean the absence of any interruption or
termination of employment with or service to the Company or any parent or
Subsidiary of the Company that now exists or hereinafter is organized or
acquires the Company for a period of 12 months. Continuous Service shall
not be considered interrupted in the case of sick leave, military leave or
any other leave of absence approved by the Company provided that such
interruption shall not be longer than 90 consecutive days.
3.5 "Eligible Employee" shall mean an Employee that has provided
continuous service to the Company or to any parent or Subsidiary of the
Company that now exists or hereafter is organized or acquires the Company.
3.6 "Employee" shall mean any person employed on an hourly or salaried
basis by the Company or any parent or Subsidiary of the Company that now
exists or hereafter is organized or acquires the Company.
3.7 The "Fair Market Value" of a share of Common Stock on any date shall
be (i) the closing sales price on the immediately preceding business day of
a share of Common Stock as reported on the principal securities exchange on
which shares of Common Stock are then listed or admitted to trading or (ii)
if not so reported, the average of the closing bid and asked prices for a
share of Common Stock on the immediately preceding business day as quoted
on the National Association of Securities Dealers Automated Quotation
System ("Nasdaq") or (iii) if not quoted on Nasdaq, the average of the
closing bid and asked prices for a share of Common Stock as quoted by the
National Quotation Bureau's "Pink Sheets" or the National Association of
Securities Dealers' OTC Bulletin Board System. If the price of a share of
Common Stock shall not be so reported, the Fair Market Value of a share of
-2-
<PAGE>
Common Stock shall be determined by the Compensation Committee in its
absolute discretion. In no event shall the Fair Market Value of any share
of Common Stock be less than its par value.
3.8 "Incentive Stock Option" shall mean an Option which is an "incentive
stock option" within the meaning of Section 422 of the Code and which is
identified as an Incentive Stock Option in the agreement by which it is
evidenced.
3.9 "Non-Qualified Stock Option" shall mean an Option which is not an
Incentive Stock Option and which is identified as a Non-Qualified Stock
Option in the agreement by which it is evidenced.
3.10 "Option" shall mean an Option to purchase shares of Common Stock of
the Company granted pursuant to this Plan. Each Option shall be identified
either as an Incentive Stock Option or a Non-Qualified Stock Option in the
agreement by which it is evidenced.
3.11 "Subsidiary" shall mean a corporation (other than the Company) in
which the Company directly or indirectly controls 50% or more of the
combined voting power of all stock of that corporation.
4. ELIGIBILITY
The Compensation Committee may grant Options to purchase Common Stock under
this Plan to Eligible Employees of the Company or its Subsidiaries, as well
as to non-employee directors and Consultants. Employees of the Company, as
well as non-employee directors and Consultants who are granted Options
pursuant to this Plan shall be referred to as "Participants." The
Compensation Committee shall determine, within the provisions of the Plan,
those persons to whom, and the times at which, Options shall be granted. In
making such determinations, the Compensation Committee may take into
account the nature of the services rendered by such person, his or her
present and potential contributions to the Company's success, and such
other factors as the Compensation Committee in its discretion shall deem
relevant. Grants may be made to the same individual on more than one
occasion.
5. GRANTING OF OPTIONS
5.1 Powers of the Compensation Committee. The Compensation Committee
shall determine, in accordance with the provisions of the Plan, the
duration of each Option, the exercise price of each Option, the time or
times within which (during the term of the Option) all or portions of each
Option may be exercised, and whether cash, Common Stock, or other property
may be accepted in full or partial payment upon exercise of an Option.
5.2 Number of Options. As soon as practicable after the date an
individual is determined to be eligible under Section 4 hereof, the
Compensation Committee may, in its discretion, grant to such person a
number of Options determined by the Compensation Committee.
6. COMMON STOCK
Each Option granted under the Plan shall be convertible into one share of
Common Stock, unless adjusted in accordance with the provisions of Section
8 hereof. Options may be granted for a number of shares not to exceed, in
the aggregate, 1,000,000 shares of Common Stock, subject to adjustment
pursuant to Section 8 hereof. For purposes of calculating the maximum
number of shares of Common Stock that may be issued under the Plan, (i) all
the shares issued (including the shares, if any, withheld for tax
withholding requirements) shall be counted when cash is used as full
payment for shares issued upon the exercise of an Option, and (ii) shares
tendered by a Participant as payment for shares issued upon exercise of an
Option shall be available for issuance under the Plan. Upon the exercise
of an Option, the Company may deliver either authorized but unissued
shares, treasury shares, or any combination thereof. In the event that any
Option granted under the
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<PAGE>
Plan expires unexercised, or is surrendered by a Participant for
cancellation, or is terminated or ceases to be exercisable for any other
reason without having been fully exercised, the Common Stock subject to
such Option shall again become available for new Options to be granted
under the Plan to any eligible person (including the holder of such former
Option) at an exercise price determined in accordance with Section 7.2
hereof, which price may then be greater or less than the exercise price of
such former Option. No fractional shares of Common Stock shall be issued,
and the Compensation Committee shall determine the manner in which
fractional share value shall be treated.
7. REQUIRED TERMS AND CONDITIONS OF OPTIONS
7.1 Award of Options. The Compensation Committee may, from time to time
and subject to the provisions of the Plan and such other terms and
conditions as the Compensation Committee may prescribe, grant to any
Participant in the Plan one or more Incentive Stock Options or Non-
Qualified Stock Options to purchase for cash or shares the number of shares
of Common Stock allotted by the Compensation Committee. However, subject
to the provisions of Sections 7.4 and 7.5, Incentive Stock Options may be
granted only to Eligible Employees. The date an Option is granted shall
mean the date selected by the Compensation Committee as of which the
Compensation Committee allots a specific number of shares to a Participant
pursuant to the Plan.
7.2 Exercise Price. The exercise price of any Non-Qualified Stock Option
granted under the Plan shall be such price as the Compensation Committee
shall determine on the date on which such Non-Qualified Stock Option is
granted; provided, that such price may not be less than 85% of the Fair
Market Value of a share of Common Stock on the date the Option is granted.
Except as provided in Section 7.4 hereof, the exercise price of any
Incentive Stock Option granted under the Plan shall be not less than 100%
of the Fair Market Value of a share of Common Stock on the date on which
such Incentive Stock Option is granted.
7.3 Term and Exercise. Each Option shall be exercisable on such date or
dates, during such period and for such number of shares of Common Stock as
shall be determined by the Compensation Committee on the day on which such
Option is granted and set forth in the agreement evidencing the Option;
provided, however, that (A) no Option shall be exercisable after the
expiration of 10 years from the date such Option was granted, and (B) no
Incentive Stock Option granted to a 10% shareholder as set forth in Section
7.4 hereof shall be exercisable after the expiration of five years from the
date such Incentive Stock Option was granted, and, provided, further, that
each Option shall be subject to earlier termination, expiration or
cancellation as provided in the Plan. Each Option shall be exercisable in
whole or in part with respect to whole shares of Common Stock. The partial
exercise of an Option shall not cause the expiration, termination or
cancellation of the remaining portion thereof. On the partial exercise of
an Option, the agreement evidencing such Option shall be returned to the
Participant exercising such Option together with the delivery of the
certificates described in Section 7.7 hereof.
7.4 Ten Percent Shareholder. Notwithstanding anything to the contrary in
this Plan, Incentive Stock Options may not be granted to any owner of 10%
or more of the total combined voting power of the Company and its
Subsidiaries unless (i) the exercise price is at least 110% of the Fair
Market Value of a share of Common Stock on the date the Option is granted,
and (ii) the Option by its terms is not exercisable after the expiration of
five years from the date such Incentive Stock Option is granted.
7.5 Maximum Amount of Option Grant. To the extent that the aggregate Fair
Market Value (determined on the date the Option is granted) of Common Stock
subject to Incentive Stock Options exercisable for the first time by a
Participant during any calendar year exceeds $100,000, such Options shall
be treated as Non-Qualified Stock Options.
-4-
<PAGE>
7.6 Method of Exercise. An Option shall be exercised by delivering notice
to the Company's principal office, to the attention of its Secretary, no
fewer than five business days in advance of the effective date of the
proposed exercise. Such notice shall be accompanied by the agreement
evidencing the Option, shall specify the number of shares of Common Stock
with respect to which the Option is being exercised and the effective date
of the proposed exercise, and shall be signed by the Participant. The
Participant may withdraw such notice at any time prior to the close of
business on the business day immediately preceding the effective date of
the proposed exercise, in which case such agreement shall be returned to
the Participant. Payment for shares of Common Stock purchased upon the
exercise of an Option shall be made on the effective date of such exercise
either (i) in cash, by certified check, bank cashier's check or wire
transfer or (ii) subject to the approval of the Compensation Committee, in
shares of Common Stock owned by the Participant and valued at their Fair
Market Value on the effective date of such exercise, or partly in shares of
Common Stock with the balance in cash, by certified check, bank cashier's
check or wire transfer. Any payment in shares of Common Stock shall be
effected by the delivery of such shares to the Secretary of the Company,
duly endorsed in blank or accompanied by stock powers duly executed in
blank, together with any other documents and evidences as the Secretary of
the Company shall require from time to time.
7.7 Delivery of Stock Certificates. Certificates for shares of Common
Stock purchased on the exercise of an Option shall be issued in the name of
the Participant and delivered to the Participant as soon as practicable
following the effective date on which the Option is exercised; provided,
however, that such delivery shall be effected for all purposes when the
stock transfer agent of the Company shall have deposited such certificates
in the United States mail, addressed to the Participant.
8. ADJUSTMENTS
8.1 The aggregate number or type of shares of Common Stock with respect to
which Options may be granted hereunder, the number or type of shares of
Common Stock subject to each outstanding Option, and the exercise price per
share for each such Option may all be appropriately adjusted, as the
Compensation Committee may determine, for any increase or decrease in the
number of shares of issued Common Stock resulting from a subdivision or
consolidation of shares whether through reorganization, recapitalization,
consolidation, payment of a share dividend, or other similar increase or
decrease.
8.2 Subject to any required action by the stockholders, if the Company
shall be a party to a transaction involving a sale of substantially all its
assets, a merger, or a consolidation, any Option granted hereunder shall
pertain to and apply to the securities to which a holder of Common Stock
would be entitled to receive as a result of such transaction; provided,
however, that all unexercised Options under the Plan may be cancelled by
the Company as of the effective date of any such transaction by giving
notice to the holders of such Options of its intention to do so, and by
permitting the exercise of such Options during the 30-day period
immediately after the date such notice is given.
8.3 In the case of dissolution of the Company, every Option outstanding
hereunder shall terminate; provided, however, that each Option holder shall
have 30 days' prior written notice of such event, during which time he
shall have a right to exercise his partly or wholly unexercised Options.
8.4 On the basis of information known to the Company, the Compensation
Committee shall make all determinations under this Section 8, including
whether a transaction involves a sale of substantially all the Company's
assets; and all such determinations shall be conclusive and binding on the
Company and all other persons.
8.5 Upon the occurrence of a Change in Control, the Compensation Committee
(as constituted immediately prior to the Change in Control) shall
determine, in its absolute discretion, whether each
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Option granted under the Plan and outstanding at such time shall become
fully and immediately exercisable and shall remain exercisable until its
expiration, termination or cancellation pursuant to the terms of the Plan
or whether each such Option shall continue to vest according to its terms.
9. OPTION AGREEMENTS
Each award of Options shall be evidenced by a written agreement, executed
by the Participant and the Company, which shall contain such restrictions,
terms and conditions as the Compensation Committee may require in
accordance with the provisions of this Plan. Option agreements need not be
identical. The certificates evidencing the shares of Common Stock acquired
upon exercise of an Option may bear a legend referring to the terms and
conditions contained in the respective Option agreement and the Plan, and
the Company may place a stop transfer order with its transfer agent against
the transfer of such shares. If requested to do so by the Compensation
Committee at the time of exercise of an Option, each Participant shall
execute a certificate indicating that he is purchasing the Common Stock
under such Option for investment and not with any present intention to sell
the same.
10. LEGAL AND OTHER REQUIREMENTS
10.1 The Company shall be under no obligation to effect the registration
pursuant to the Securities Act of 1933, as amended, of any shares of Common
Stock to be issued hereunder or to effect similar compliance under any
state laws. Notwithstanding anything herein to the contrary, the Company
shall not be obligated to cause to be issued or delivered any certificates
evidencing shares of Common Stock pursuant to the Plan unless and until the
Company is advised by its counsel that the issuance and delivery of such
certificates is in compliance with all applicable laws, regulations of
governmental authority and the requirements of any securities exchange on
which shares of Common Stock are traded. The Compensation Committee may
require, as a condition of the issuance and delivery of certificates
evidencing shares of Common Stock pursuant to the terms hereof, that the
recipient of such shares make such covenants, agreements and
representations, and that such certificates bear such legends, as the
Compensation Committee, in its sole discretion, deems necessary or
desirable. The exercise of any Option granted hereunder shall only be
effective at such time as counsel to the Company shall have determined that
the issuance and delivery of shares of Common Stock pursuant to such
exercise is in compliance with all applicable laws, regulations of
governmental authorities and the requirements of any securities exchange on
which shares of Common Stock are traded. The Company may, in its sole
discretion, defer the effectiveness of any exercise of an Option granted
hereunder in order to allow the issuance of shares of Common Stock pursuant
thereto to be made pursuant to registration or an exemption from
registration or other methods for compliance available under federal or
state securities laws. The Company shall inform the Participant in writing
of its decision to defer the effectiveness of the exercise of an Option
granted hereunder. During the period that the effectiveness of the exercise
of an Option has been deferred, the Participant may, by written notice,
withdraw such exercise and obtain the refund of any amount paid with
respect thereto.
10.2 With respect to persons subject to Section 16 of the Securities
Exchange Act of 1934, as amended ("Exchange Act"), transactions under this
Plan are intended to comply with all applicable conditions of Rule 16b-3 or
its successors under the Exchange Act. To the extent any provisions of the
Plan or action by the Compensation Committee fails to so comply, it shall
be deemed null and void, to the extent permitted by law and deemed
advisable by the Compensation Committee. Moreover, in the event the Plan
does not include a provision required by Rule 16b-3 to be stated therein,
such provision (other than one relating to eligibility requirements, or the
price and amount of Options) shall be deemed automatically to be
incorporated by reference into the Plan insofar as Participants subject to
Section 16 are concerned. The Compensation Committee may at any time impose
any limitations upon the exercise, delivery and payment of any Option
which, in the Compensation Committee's
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discretion, are necessary in order to comply with Section 16(b) and the
rules and regulations thereunder.
10.3 A Participant shall have no rights as a stockholder with respect to
any shares covered by an Option, or exercised by him, until the date of
delivery of a stock certificate to him for such shares. No adjustment,
other than pursuant to Section 8 hereof, shall be made for dividends or
other rights for which the record date is prior to the date such stock
certificate is delivered.
11. NON-TRANSFERABILITY
During the lifetime of a Participant, any Option granted to him shall be
exercisable only by him or by his guardian or legal representative. No
Option shall be assignable or transferable, except by will, by the laws of
descent and distribution, or pursuant to certain domestic relations orders.
The granting of an Option shall impose no obligation upon the holder
thereof to exercise such Option or right.
12. NO CONTRACT OF EMPLOYMENT
The adoption of this Plan or the grant of any Option shall not be construed
as giving a Participant the right to continued employment with the Company
or any Subsidiary of the Company. Furthermore, the Company or any
Subsidiary of the Company may at any time dismiss a Participant from
employment, free from any liability or claim under the Plan, unless
otherwise expressly provided in the Plan or any Option agreement.
13. EFFECT OF TERMINATION OF EMPLOYMENT
13.1 If the employment or consulting, service or similar relationship of a
Participant with the Company shall terminate for any reason other than
Cause, "permanent and total disability" (within the meaning of Section
22(e)(3) of the Code) or the death of the Participant (a) Options granted
to such Participant, to the extent that they were exercisable at the time
of such termination, shall remain exercisable until the expiration of one
month after such termination, on which date they shall expire, and (b)
Options granted to such Participant, to the extent that they were not
exercisable at the time of such termination, shall expire at the close of
business on the date of such termination; provided, however, that no Option
shall be exercisable after the expiration of its term.
13.2 If the employment or consulting, service or similar relationship of a
Participant with the Company shall terminate on account of the "permanent
and total disability" (within the meaning of Section 22(e)(3) of the Code)
or the death of the Participant (a) Options granted to such Participant, to
the extent that they were exercisable at the time of such termination,
shall remain exercisable until the expiration of one year after such
termination, on which date they shall expire, and (b) Options granted to
such Participant, to the extent that they were not exercisable at the time
of such termination, shall expire at the close of business on the date of
such termination; provided, however, that no Option shall be exercisable
after the expiration of its term.
13.3 In the event of the termination of a Participant's employment or other
relationship for Cause, all outstanding Options granted to such Participant
shall expire at the commencement of business on the date of such
termination.
14. INDEMNIFICATION OF COMPENSATION COMMITTEE
In addition to such other rights of indemnification as they may have as
members of the Board or the Compensation Committee, the members of the
Compensation Committee shall be indemnified by the Company against the
reasonable expenses, including attorneys' fees actually and necessarily
incurred in connection with the defense of any action, suit or proceeding
(or in connection with any appeal therein), to which they or any
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of them may be a party by reason of any action taken or failure to act
under or in connection with the Plan or any Option granted hereunder, and
against all amounts paid by them in settlement thereof (provided such
settlement is approved by independent legal counsel selected by the
Company) or paid by them in satisfaction of a judgment in any such action,
suit or proceeding, except in relation to matters as to which it shall be
adjudged in such action, suit or proceeding that such Compensation
Committee member is liable for gross negligence or misconduct in the
performance of his duties; provided that within 60 days after institution
of any such action, suit or proceeding a Compensation Committee member
shall in writing offer the Company the opportunity, at its own expense, to
handle and defend the same.
15. WITHHOLDING TAXES
Whenever the Company proposes or is required to issue or transfer shares of
Common Stock under the Plan, the Company shall have the right to require
the Participant to remit to the Company an amount sufficient to satisfy any
federal, state and/or local withholding tax requirements prior to the
delivery of any certificate or certificates for such shares.
Alternatively, the Company may issue or transfer such shares of Common
Stock net of the number of shares sufficient to satisfy the withholding tax
requirements. For withholding tax purposes, the shares of Common Stock
shall be valued on the date the withholding obligation is incurred.
16. NEWLY ELIGIBLE EMPLOYEES
Except as otherwise provided herein, the Compensation Committee shall be
entitled to make such rules, regulations, determinations and awards as it
deems appropriate in respect of any employee who becomes eligible to
participate in the Plan.
17. TERMINATION AND AMENDMENT OF PLAN
The Board of Directors may at any time suspend or discontinue the Plan or
revise or amend it in any respect whatsoever, provided, however, that
without approval of the holders of a majority of the outstanding shares of
Common Stock present in person or by proxy at an annual or special meeting
of stockholders, no revision or amendments shall (i) increase the number of
shares of Common Stock that may be issued under the Plan, except as
provided in Section 8 hereof, (ii) materially increase the benefits
accruing to individuals holding Options granted pursuant to the Plan or
(iii) materially modify the requirements as to eligibility for
participation in the Plan.
18. GENDER AND NUMBER
Except when otherwise indicated by the context, words in the masculine
gender when used in the Plan shall include the feminine gender and vice
versa, and the singular shall include the plural and the plural shall
include the singular.
19. GOVERNING LAW
The Plan, and all agreements hereunder, shall be construed in accordance
with and governed by the laws of the State of Delaware.
20. EFFECTIVE DATE OF PLAN
The effective date of the Plan is August 6, 1997. The Plan, each amendment
to the Plan, and each Option granted under the Plan is conditioned on and
shall be of no force or effect until approval of the Plan and each
amendment of the Plan by the holders of a majority of the shares of Common
Stock of the Company.
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EXHIBIT 10.5
REGISTRATION RIGHTS AGREEMENT
AGREEMENT, dated as of the ____ day of December 1997, between the person
whose name and address appears on the signature page hereto (individually, a
"Holder" or, collectively with the holders of the Units issued in the Offering,
each as defined below, the "Holders") and Amedisys, Inc., a Delaware
corporation having its principal executive office at 3029 S. Sherwood Forest
Blvd., Suite 300, Baton Rouge, Louisiana 70816 (the "Company").
WHEREAS, simultaneously or in connection with the execution and delivery of
this Agreement, the Holders are purchasing from the Company in a private
offering (the "Offering") pursuant to a Confidential Private Term Sheet (the
"Term Sheet") an aggregate of up to eighty (80) units (the "Units") each Unit
consisting of ten thousand (10,000) shares (the "Preferred Shares") of
convertible preferred stock, par value $.001 per share, of the Company;
WHEREAS, each of the Preferred Shares is convertible into a number of
shares of common stock, par value $.001 per share, of the Company (the
"Conversion Shares") equal to the face value of the Preferred Shares ($10.00)
divided by 88% (the "Conversion Factor") of the average closing sale price of
the Common Stock for the 15 trading days immediately prior to an initial closing
of the Offering.
WHEREAS, the Company desires to grant to the Holder the registration rights
set forth herein with respect to the Conversion Shares;
NOW, THEREFORE, the parties hereto mutually agree as follows:
1. REGISTRABLE SECURITIES. As used herein the term "Registrable Security"
means each of the shares of Common Stock, Conversion Shares; provided, however,
that with respect to any particular Registrable Security, such security shall
cease to be a Registrable Security when, as of the date of determination, (i) it
has been effectively registered under the Securities Act of 1933, as amended
(the "Securities Act"), and disposed of pursuant thereto, (ii) registration
under the Securities Act is no longer required for the immediate public
distribution of such security, or (iii) it has ceased to be outstanding. In the
event of any merger, reorganization, consolidation, recapitalization or other
change in corporate structure affecting the Common Stock, such adjustment shall
be made in the definition of "Registrable Security" as is appropriate in order
to prevent any dilution or enlargement of the rights granted pursuant to this
Article 1.
2. AUTOMATIC REGISTRATION.
(a) The Company shall prepare and file with the Commission, within 30 days
following the final closing of the Offering (the "Final Closing"), at the sole
expense of the Company, in respect of all holders of Registrable Securities, a
Registration Statement so as to permit a public offering and sale of the
Registrable Securities. The Company
<PAGE>
shall use its best efforts to cause the Registration Statement to become
effective within four months following the Final Closing.
(b) If the Registration Statement is not declared effective by the
Commission within four months following the Final Closing, then, commencing on
the first day of the fifth month following the Final Closing, the Conversion
Factor (as defined in the Term Sheet) shall decrease by .5% on the first day of
each month that any of the Registrable Securities continue not to be publicly
tradeable pursuant to an effective Registration Statement under the Act (e.g.,
the Conversion Factor will decrease to 87.5% and 87% on the first day of the
fifth and sixth month, respectively, following the Final Closing) and the
Company will continue to use its best efforts to cause the Commission to declare
the effectiveness of the Registration Statement as to permit the public trading
of the Registrable Securities pursuant thereto.
(c) Once effective, the Company will be required to maintain the
effectiveness of the Registration Statement until the earlier of (i) the date
that all of the Registrable Securities have been sold or (ii) the date that all
holders of Registrable Securities receive an opinion of counsel to the Company
that all of the Registrable Securities may be freely traded without registration
under the Securities Act, under Rule 144(k) promulgated under the Securities Act
or otherwise.
3. COVENANTS OF THE COMPANY WITH RESPECT TO REGISTRATION. The Company
covenants and agrees as follows:
(a) If any stop order shall be issued by the Commission in connection with
the Registration Statement or, following its effectiveness, the Company will use
its best efforts to obtain the removal of such order. Following the effective
date of a Registration Statement, the Company shall, upon the request of the
Holder, forthwith supply such reasonable number of copies of the Registration
Statement, preliminary prospectus and prospectus meeting the requirements of the
Act, and other documents necessary or incidental to the public offering of the
Registrable Securities, as shall be reasonably requested by the Holder to permit
the Holder to make a public distribution of the Holder's Registrable Securities.
The obligations of the Company hereunder with respect to the Holder's
Registrable Securities are expressly conditioned on the Holder's furnishing to
the Company such appropriate information concerning the Holder, the Holder's
Registrable Securities and the terms of the Holder's offering of such
Registrable Securities as the Company may reasonably request.
(b) The Company shall pay all costs, fees and expenses in connection with
all Registration Statements filed pursuant to Article 2 hereof including,
without limitation, the Company's legal and accounting fees, printing expenses,
and blue sky fees and expenses; provided, however, that the Holder shall be
solely responsible for the fees of any counsel retained by the Holder in
connection with such registration and any transfer taxes or underwriting
discounts, commissions or fees applicable to the Registrable Securities sold by
the Holder pursuant thereto.
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(c) The Company will use reasonable efforts to qualify or register the
Registrable Securities included in a Registration Statement for offering and
sale under the securities or blue sky laws of such states as are requested by
the holders of such securities, provided that the Company shall not be obligated
to execute or file any general consent to service of process or to qualify as a
foreign corporation to do business under the laws of any such jurisdiction.
(d) Nothing contained in this Agreement shall be construed as requiring
any Holder to convert its Preferred Shares prior to the initial filing of any
Registration Statement or the effectiveness thereof.
4. ADDITIONAL TERMS.
(a) The Company shall indemnify and hold harmless the Holder and each
underwriter, within the meaning of the Securities Act, who may purchase from or
sell for the Holder, any Registrable Securities, from and against any and all
losses, claims, damages and liabilities caused by any untrue statement of a
material fact contained in the Registration Statement, any other registration
statement filed by the Company under the Securities Act, any post-effective
amendment to such registration statements, or any prospectus included therein or
caused by any omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages or liabilities are caused by any such
untrue statement or omission based upon information furnished or required to be
furnished in writing to the Company by any Holder or underwriter expressly for
use therein, which indemnification shall include each person, if any, who
controls either the Holder or underwriter within the meaning of the Securities
Act and each officer, director, employee and agent of the Holder and
underwriter; provided, however, that the indemnification in this Section 5(a)
with respect to any prospectus shall not inure to the benefit of the Holder or
underwriter (or to the benefit of any person controlling the Holder or
underwriter) on account of any such loss, claim, damage or liability arising
from the sale of Registrable Securities by the Holder or underwriter, if a copy
of a subsequent prospectus correcting the untrue statement or omission in such
earlier prospectus was provided to the Holder or underwriter by the Company
prior to the subject sale and the subsequent Prospectus was not delivered or
sent by the Holder or underwriter to the purchaser prior to such sale.
(b) If for any reason the indemnification provided for in the preceding
section is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, claim, damage, liability or expense
referred to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
the indemnified party as a result of such loss, claim, damage or liability in
such proportion as is appropriate to reflect not only the relative benefits
received by the indemnified party and the indemnifying party, but also the
relative fault of the indemnified party and the indemnifying party, as well as
any other relevant equitable considerations.
(c) Neither the filing of a Registration Statement by the Company pursuant
to this Agreement nor the making of any request for prospectuses by the Holder
shall
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impose upon the Holder any obligation to sell the Holder's Registrable
Securities, except as may be required in accordance with Section 2 hereof.
(d) The Holder, upon receipt of notice from the Company that an event has
occurred which requires a post-effective amendment to the Registration Statement
or a supplement to the prospectus included therein, shall promptly discontinue
the sale of Registrable Securities until the Holder receives a copy of a
supplemented or amended prospectus from the Company, which the Company shall
provide as soon as practicable after such notice.
(e) If the Company fails to keep the Registration Statement referred to in
Article 2 above continuously effective during the requisite period, then the
Company shall use its best efforts to promptly update the Registration Statement
or file a new registration statement covering the Registrable Securities
remaining unsold, subject to the terms and provisions hereof.
5. PROHIBITION ON SALES. The Holders agree that they will not sell,
transfer, pledge, hypothecate or otherwise dispose of the Preferred Shares or
Conversion Shares pursuant to the Registration Statement or otherwise until 120
days following the Final Closing. The Company agrees to provide to each Holder
written notice of the date of the Final Closing within 60 days following the
Final Closing.
6. GOVERNING LAW.
(a) The Registrable Securities will be, if and when issued, delivered in
New York. This Agreement shall be deemed to have been made and delivered in the
State of New York and shall be governed as to validity, interpretation,
construction, effect and in all other respects by the internal substantive laws
of the State of New York, without giving effect to the choice of law rules
thereof.
(b) The Company and the Holder each (a) agrees that any legal suit, action
or proceeding arising out of or relating to this Agreement shall be instituted
exclusively in New York State Supreme Court, County of New York, or in the
United States District Court for the Southern District of New York, (b) waives
any objection which the Company or such Holder may have now or hereafter to the
venue of any such suit, action or proceeding, and (c) irrevocably consents to
the jurisdiction of the New York State Supreme Court, County of New York and the
United States District Court for the Southern District of New York in any such
suit, action or proceeding. The Company and the Holder each further agrees to
accept and acknowledge service of any and all process which may be served in any
such suit, action or proceeding in the New York State Supreme Court, County of
New York or in the United States District Court for the Southern District of New
York and agrees that service of process upon the Company or the Holder mailed by
certified mail to their respective addresses shall be deemed in every respect
effective service of process upon the Company or the Holder, as the case may be,
in any suit, action or proceeding. Each of the Company and the Holder waived
trial by jury in any action to enforce the Holder's rights hereunder.
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7. AMENDMENT. This Agreement may only be amended by a written instrument
executed by the Company and the Holder.
8. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement of
the parties hereto with respect to the subject matter hereof, and supersedes all
prior agreements and understandings of the parties, oral and written, with
respect to the subject matter hereof.
9. EXECUTION IN COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same document.
10. NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed duly given when delivered by
hand or mailed by registered or certified mail, postage prepaid, return receipt
requested, as follows:
If to the Holder, to his or her address set forth on the signature page of
this Agreement.
If to the Company, to the address set forth on the first page of this
Agreement.
11. BINDING EFFECT; BENEFITS. The Holder may not assign his or her rights
hereunder. This Agreement shall inure to the benefit of, and be binding upon,
the parties hereto and their respective heirs, legal representatives and
successors. Nothing herein contained, express or implied, is intended to confer
upon any person other than the parties hereto and their respective heirs, legal
representatives and successors, any rights or remedies under or by reason of
this Agreement.
12. HEADINGS. The headings contained herein are for the sole purpose of
convenience of reference, and shall not in any way limit or affect the meaning
or interpretation of any of the terms or provisions of this Agreement.
13. SEVERABILITY. Any provision of this Agreement which is held by a court
of competent jurisdiction to be prohibited or unenforceable in any
jurisdiction(s) shall be, as to such jurisdiction(s), ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
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IN WITNESS WHEREOF, this Agreement has been executed and delivered by the
parties hereto as of the date first above written.
AMEDISYS, INC.
By:
-------------------------------------------
Name:
Title:
HOLDER:
---------------------------------------
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EXHIBIT 21.1
LIST OF SUBSIDIARIES
1. Amedisys Staffing Services, Inc.
2. Amedisys Nursing Services, Inc.
2. Amedisys Specialized Medical Services, Inc.
4. Amedisys Surgery Centers, L.C.
3. Alliance Home Health, Inc.
6. Amedisys Management Services Organization, Inc.
4. Amedisys Home Health, Inc.
8. Amedisys, Alternate-Site Infusion Therapy Services, Inc.
5. Amedisys Durable Medical Equipment, Inc.
10. Amedisys Physician Services, Inc.
11. Analytical Nursing Management Corporation of Texas
12. MedAmerica, Inc. of Texas
13. MedAmerica, Inc.
13. Hammond Surgical Care Center, L.C.
15. Infusioncare Solutions, Inc.
16. PRN, Inc.
17. St. Luke's SurgiCenter
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EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-3 of our report dated
March 18, 1997 included in Amedisys, Inc.'s Form 10-K for the year ended
December 31, 1996.
ARTHUR ANDERSEN LLP HANNIS T. BOURGEOIS & CO., LLP
New Orleans, Louisiana
March 10, 1998
