CONTRACTS AND EQUIPMENT. (a) Schedule 3.10(a)(1) identifies all Assumed Contracts as of the date hereof. Schedule 3.10(a)(2) identifies all other contracts, agreements or arrangements, including without limitation, notes, mortgages, deeds of trust, indentures, payor and vendor agreements, leases, licenses, and physician agreements (collectively, with the Assumed Contracts, the “Contracts”), Table of Contents in effect as of December 31, 2001 (except as otherwise specified below) (A) to which any of the Seller Entities is a party, (B) with respect to which any payment obligations remain unsatisfied as of the date hereof, and (C) which are used in or useful to the operation of the Business at the Acquired Centers, listed by category as set forth below: (i) any lease of personal property involving any annual expense in excess of $25,000 that is not cancelable without liability within 60 days; (ii) any contract for the purchase of materials, supplies, goods, services, consulting, equipment or other assets that provides for either annual or aggregate payments from and after December 31, 2001 of $25,000 or more; (iii) any sales, distribution or similar contract providing for the sale by any Seller Entity of materials, supplies, goods, services, equipment or other assets that provide for either annual or aggregate payments of $25,000 or more; (iv) any contract to indemnify or pay contribution to any other Person that provides for indemnification of any person by any Acquired Subsidiary, other than pursuant to an agreement entered into in the ordinary course of business consistent with past practice; (v) any contract containing provisions or covenants which (A) are reasonably likely to limit the freedom of any Acquired Subsidiary to engage in any line of business or compete with any Person or prohibit or limit the ability of any Person to compete with any Seller Entity, or (B) prohibiting or limiting disclosure of confidential or proprietary information related to the Business; (vi) any contract relating to indebtedness for borrowed money, the issuance of any debt security or the assumption, guarantee or endorsement of the obligations of any Person; (vii) any contract with any Affiliate of any Seller Entity other than the Acquired Subsidiaries; (viii) (A) all contracts, whether written, oral or effective by virtue of custom and practice, providing for a commitment of employment or consultation services for a specified or unspecified term (excluding at-will employment), the name, position and rate of compensation of each Person to such contract and the expiration date of each such contract (or period of notice of termination required, as applicable); and (B) all severance agreements or any contracts or written or unwritten representations, commitments, promises, communications or courses of conduct involving an obligation to make payments (with or without notice, passage of time, or both) to any Person in connection with, or as a consequence of, the transactions contemplated hereby; (ix) all partnership, joint venture, shareholders’ or other similar contracts with any Person; Table of Contents (x) all contracts relating to (A) the future disposition or acquisition of any asset, other than dispositions or acquisitions in the ordinary course of business consistent with past practice and not material individually or in the aggregate, and (B) any business combination; (xi) all contracts with any current or former officer, director, or shareholder of Seller or any Acquired Subsidiary in effect on or after January 1, 2000; (xii) all contracts relating to the sharing, allocation or indemnification for Taxes in respect of one or more Acquired Centers or Acquired Subsidiaries; (xiii) all contracts that contain a right of first refusal in favor of any person with respect to any assets or properties held by any Seller Entity which is to be transferred to Purchaser hereunder; (xiv) all contracts that provide for future payment or receipt of any licensing fee, royalty payment or the like, other than licenses or leases for incidental personal property such as copiers and postal meters; (xv) all contracts that provide for hedging or any similar financial arrangement; (xvi) all Leased Real Property leases (“Real Property Leases”) and equipment leases other than leases for incidental personal property such as copiers and postage meters; and (xvii) all material licenses with respect to computer software used in the Business other than “shrink wrap” or “off the shelf” software. (xviii) If a disclosure is made in Schedule 3.10(a)(2) by specific reference to a certain subsection of this Section 3.10(a), it shall be deemed to have been disclosed with respect to all the other representations and warranties in Section 3.10(a) to which it relates, and not only to the particular subsection to which individual reference is made in Schedule 3.10(a)(2). (b) Except as set forth on Schedule 3.10(b), (i) as of the date hereof each Contract is in full force and effect and constitutes a legal, valid and binding agreement, enforceable in accordance with its terms, of each Seller Entity that is a party thereto and, to the Knowledge of the Seller Entities, no such Contract is unenforceable against any other party thereto; and (ii) no Seller Entity is, or with notice or lapse of time or both, would be, in violation or breach of, or default under, any payment obligation in any Assumed Contract. Except as set forth on Schedule 3.10(b), no “cure” amount will be payable with respect to any Assumed Contract. Table of Contents (c) True and complete copies (or written summaries in the case of oral contracts) of all of the Contracts material to the Business have been provided or made available to the Purchaser. (d) Except as set forth in Schedule 3.10(d): (i) to the Knowledge of the Seller Entities, since the date which is the later of the date of its incorporation or formation and the date of its acquisition by Seller, no Seller Entity has made any payment, directly or indirectly, to any person in violation of applicable laws, including (but not limited to) laws relating to bribes, gratuities, kickbacks, lobbying expenditures, political contributions and contingent fee payments; (ii) no Governmental Entity, prime contractor or higher-tier subcontractor under a Government Contract or any other Person has notified any Seller Entity of any actual or alleged violation or breach of, and no Seller Entity has Knowledge of any fact or occurrence that could give rise to a violation or breach of, any (A) statute or regulation relating to the Medicare and Medicaid Acts, as amended, or any other government payment program in which the Acquired Centers participate applicable to the Acquired Centers, (B) statute or regulation relating to any Government Contract (including without limitation, the Armed Services Procurement Act of 1947, as amended, the Federal Property and Administrative Services Act of 1949, as amended, the Federal Acquisition Regulations (“FAR”) (including the FAR cost principles), the False Claims Act, as amended, the Truth in Negotiations Act, as amended, and the applicable regulations issued by the Cost Accounting Standards Board of the Office of Federal Procurement Policy, as applicable), other than those referred to in subclause (A) above or this subclause (B), where such breach or violation would have a Material Adverse Effect, (C) representation, certification or disclosure obligation in connection with any such Government Contract where such breach or violation would have a Material Adverse Effect, or (D) any term, condition, clause, provision, specification or quality assurance, testing or inspection requirement of any such Government Contract, in each such case by a Acquired Subsidiary or related to the Business where such breach or violation would have a Material Adverse Effect; (iii) to the Knowledge of the Seller Entities, each Seller Entity’s respective cost accounting, purchasing, inventory and quality control systems are in compliance in all material respects with all applicable government procurement statutes and regulations and with the requirements of all of the Government Contracts that are currently in force (collectively, the “Current Government Contracts”); and (iv) to the Knowledge of the Seller Entities, the Current Government Contracts (or, where applicable, the prime Government Contracts under which the Current Government Contracts were awarded) are not currently the subject of bid protest or award protest proceedings, and to the Knowledge of the Seller Entities, that such Government Contracts (or, where applicable, the prime Government Contracts under which the Current Government Contracts were awarded) are not expected to become the subject of bid protest or award protest proceedings.
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Sources: Acquisition Agreement (Dvi Inc)
CONTRACTS AND EQUIPMENT. (a) Schedule 3.10(a)(1) identifies all Assumed Contracts as of the date hereof. Schedule 3.10(a)(2) identifies all other contracts, agreements or arrangements, including without limitation, notes, mortgages, deeds of trust, indentures, payor and vendor agreements, leases, licenses, and physician agreements (collectively, with the Assumed Contracts, the “"Contracts”"), Table of Contents in effect as of December 31, 2001 (except as otherwise specified below) (A) to which any of the Seller Entities is a party, (B) with respect to which any payment obligations remain unsatisfied as of the date hereof, and (C) which are used in or useful to the operation of the Business at the Acquired Centers, listed by category as set forth below:
(i) any lease of personal property involving any annual expense in excess of $25,000 that is not cancelable without liability within 60 days;
(ii) any contract for the purchase of materials, supplies, goods, services, consulting, equipment or other assets that provides for either annual or aggregate payments from and after December 31, 2001 of $25,000 or more;
(iii) any sales, distribution or similar contract providing for the sale by any Seller Entity of materials, supplies, goods, services, equipment or other assets that provide for either annual or aggregate payments of $25,000 or more;
(iv) any contract to indemnify or pay contribution to any other Person that provides for indemnification of any person by any Acquired Subsidiary, other than pursuant to an agreement entered into in the ordinary course of business consistent with past practice;
(v) any contract containing provisions or covenants which (A) are reasonably likely to limit the freedom of any Acquired Subsidiary to engage in any line of business or compete with any Person or prohibit or limit the ability of any Person to compete with any Seller Entity, or (B) prohibiting or limiting disclosure of confidential or proprietary information related to the Business;
(vi) any contract relating to indebtedness for borrowed money, the issuance of any debt security or the assumption, guarantee or endorsement of the obligations of any Person;
(vii) any contract with any Affiliate of any Seller Entity other than the Acquired Subsidiaries;
(viii) (A) all contracts, whether written, oral or effective by virtue of custom and practice, providing for a commitment of employment or consultation services for a specified or unspecified term (excluding at-will employment), the name, position and rate of compensation of each Person to such contract and the expiration date of each such contract (or period of notice of termination required, as applicable); and (B) all severance agreements or any contracts or written or unwritten representations, commitments, promises, communications or courses of conduct involving an obligation to make payments (with or without notice, passage of time, or both) to any Person in connection with, or as a consequence of, the transactions contemplated hereby;
(ix) all partnership, joint venture, shareholders’ ' or other similar contracts with any Person; Table of Contents;
(x) all contracts relating to (A) the future disposition or acquisition of any asset, other than dispositions or acquisitions in the ordinary course of business consistent with past practice and not material individually or in the aggregate, and (B) any business combination;
(xi) all contracts with any current or former officer, director, or shareholder of Seller or any Acquired Subsidiary in effect on or after January 1, 2000;
(xii) all contracts relating to the sharing, allocation or indemnification for Taxes in respect of one or more Acquired Centers or Acquired Subsidiaries;
(xiii) all contracts that contain a right of first refusal in favor of any person with respect to any assets or properties held by any Seller Entity which is to be transferred to Purchaser hereunder;
(xiv) all contracts that provide for future payment or receipt of any licensing fee, royalty payment or the like, other than licenses or leases for incidental personal property such as copiers and postal meters;
(xv) all contracts that provide for hedging or any similar financial arrangement;
(xvi) all Leased Real Property leases (“"Real Property Leases”") and equipment leases other than leases for incidental personal property such as copiers and postage meters; and
(xvii) all material licenses with respect to computer software used in the Business other than “"shrink wrap” " or “"off the shelf” " software.
(xviii) If a disclosure is made in Schedule 3.10(a)(2) by specific reference to a certain subsection of this Section 3.10(a), it shall be deemed to have been disclosed with respect to all the other representations and warranties in Section 3.10(a) to which it relates, and not only to the particular subsection to which individual reference is made in Schedule 3.10(a)(2).
(b) Except as set forth on Schedule 3.10(b), (i) as of the date hereof each Contract is in full force and effect and constitutes a legal, valid and binding agreement, enforceable in accordance with its terms, of each Seller Entity that is a party thereto and, to the Knowledge of the Seller Entities, no such Contract is unenforceable against any other party thereto; and (ii) no Seller Entity is, or with notice or lapse of time or both, would be, in violation or breach of, or default under, any payment obligation in any Assumed Contract. Except as set forth on Schedule 3.10(b), no “"cure” " amount will be payable with respect to any Assumed Contract. Table of Contents
(c) True and complete copies (or written summaries in the case of oral contracts) of all of the Contracts material to the Business have been provided or made available to the Purchaser.
(d) Except as set forth in Schedule 3.10(d): (i) to the Knowledge of the Seller Entities, since the date which is the later of the date of its incorporation or formation and the date of its acquisition by Seller, no Seller Entity has made any payment, directly or indirectly, to any person in violation of applicable laws, including (but not limited to) laws relating to bribes, gratuities, kickbacks, lobbying expenditures, political contributions and contingent fee payments; (ii) no Governmental Entity, prime contractor or higher-tier subcontractor under a Government Contract or any other Person has notified any Seller Entity of any actual or alleged violation or breach of, and no Seller Entity has Knowledge of any fact or occurrence that could give rise to a violation or breach of, any (A) statute or regulation relating to the Medicare and Medicaid Acts, as amended, or any other government payment program in which the Acquired Centers participate applicable to the Acquired Centers, (B) statute or regulation relating to any Government Contract (including without limitation, the Armed Services Procurement Act of 1947, as amended, the Federal Property and Administrative Services Act of 1949, as amended, the Federal Acquisition Regulations (“FAR”) (including the FAR cost principles), the False Claims Act, as amended, the Truth in Negotiations Act, as amended, and the applicable regulations issued by the Cost Accounting Standards Board of the Office of Federal Procurement Policy, as applicable), other than those referred to in subclause (A) above or this subclause (B), where such breach or violation would have a Material Adverse Effect, (C) representation, certification or disclosure obligation in connection with any such Government Contract where such breach or violation would have a Material Adverse Effect, or (D) any term, condition, clause, provision, specification or quality assurance, testing or inspection requirement of any such Government Contract, in each such case by a Acquired Subsidiary or related to the Business where such breach or violation would have a Material Adverse Effect; (iii) to the Knowledge of the Seller Entities, each Seller Entity’s respective cost accounting, purchasing, inventory and quality control systems are in compliance in all material respects with all applicable government procurement statutes and regulations and with the requirements of all of the Government Contracts that are currently in force (collectively, the “Current Government Contracts”); and (iv) to the Knowledge of the Seller Entities, the Current Government Contracts (or, where applicable, the prime Government Contracts under which the Current Government Contracts were awarded) are not currently the subject of bid protest or award protest proceedings, and to the Knowledge of the Seller Entities, that such Government Contracts (or, where applicable, the prime Government Contracts under which the Current Government Contracts were awarded) are not expected to become the subject of bid protest or award protest proceedings.
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