EXHIBIT 10.19
ASSET PURCHASE AGREEMENT
Dated as of May 19, 1996
By and Among
Castle Dental Centers of Florida, Inc.
as Purchaser,
1st Dental Care, Inc.,
Hernando Dental Center-▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S., P.A.
and M&B Dental Lab, Inc.
as Seller
and
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S. and
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS............................................................1
1.1 Definitions......................................................1
ARTICLE II
THE TRANSACTION........................................................6
2.1 Purchase and Sale of Assets......................................6
2.2 Excluded Assets..................................................7
2.3 Assumption of Obligations........................................8
2.4 Nonassignable Contracts and Leases...............................8
2.5 Closing..........................................................8
ARTICLE III
PAYMENT OF PURCHASE PRICE..............................................9
3.1 Amount; Allocation; Delivery.....................................9
3.2 Purchase Price Adjustment.......................................10
3.3 Assumption of Accounts Payable..................................11
3.4 Apportionments..................................................12
3.5 Agency Relationship.............................................12
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
AND THE SHAREHOLDERS..................................................12
4.1 Representations and Warranties of Seller and the Shareholders. 12
4.2 Existence and Good Standing.....................................12
4.3 Authorization and Validity of Agreement.........................13
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4.4 Consents and Approvals; No Violations...........................13
4.5 Subsidiaries and Affiliates.....................................14
4.6 Financial Statements; No Material Adverse Change................14
4.7 Books and Records...............................................14
4.8 Title to Properties; Encumbrances; Condition....................14
4.9 Real Property...................................................15
4.10 Leases..........................................................15
4.11 Material Contracts..............................................15
4.12 Permits.........................................................16
4.13 Litigation......................................................16
4.14 Taxes...........................................................16
4.15 Insurance.......................................................17
4.16 Intellectual Properties.........................................17
4.17 Compliance with Laws............................................18
4.18 Employment Relations............................................18
4.19 Employee Benefit Plans..........................................18
4.20 Environmental Laws and Regulations..............................18
4.21 Interests in Customers, Suppliers, Etc..........................19
4.22 Compensation of Employees.......................................19
4.23 Payors. ......................................................19
4.24 Accounts Receivable; Accounts Payable...........................19
4.25 Solvency........................................................19
4.26 Disclosure......................................................20
4.27 Broker's or Finder's Fees.......................................20
4.28 Copies of Documents.............................................21
4.29 Investment Representations......................................21
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PURCHASER..........................................................22
5.1 Representations and Warranties of Purchaser.....................22
5.2 Existence and Good Standing of Purchaser; Power and Authority...22
5.3 No Violations...................................................22
5.4 Capital Stock...................................................23
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5.5 Litigation......................................................23
5.6 Compliance with Laws............................................23
5.7 Financial Statements............................................23
5.8 Broker's or Finder's Fees.......................................24
ARTICLE VI
CONDITIONS TO SELLER'S OBLIGATIONS....................................24
6.1 Truth of Representations and Warranties.........................24
6.2 Performance of Agreements.......................................24
6.3 No Litigation Threatened........................................24
6.4 Governmental Approvals..........................................24
6.5 Proceedings.....................................................25
6.6 Employment Agreement............................................25
6.7 Registration Rights Agreement...................................25
ARTICLE VII
CONDITIONS TO PURCHASER'S OBLIGATIONS.................................25
7.1 Truth of Representations and Warranties.........................25
7.2 Performance of Agreements.......................................25
7.3 Documents of Conveyance.........................................26
7.4 No Litigation Threatened........................................26
7.5 Governmental Approvals..........................................26
7.6 Consents........................................................26
7.7 Legal Opinion...................................................26
7.8 Proceedings.....................................................26
7.9 New PC..........................................................26
7.10 Execution of Management Services Agreement......................26
7.11 Stockholders Agreement..........................................27
7.12 Lease Agreement.................................................27
7.13 Accounts Payable Calculation....................................27
7.14 Subordination Agreement.........................................27
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ARTICLE VIII
COVENANTS OF SELLER AND THE SHAREHOLDERS..............................27
8.1 Cooperation by Seller...........................................27
8.2 Conduct of Business.............................................28
8.3 Exclusive Dealing...............................................28
8.4 Review of the Assets............................................28
8.5 Further Assurances..............................................28
ARTICLE IX
COVENANTS OF PURCHASER................................................29
9.1 Cooperation by Purchaser........................................29
9.2 Books and Records; Personnel....................................29
9.3 Further Assurances..............................................29
ARTICLE X
TERMINATION...........................................................30
10.1 Termination.....................................................30
10.2 Effect on Obligations...........................................30
ARTICLE XI
SURVIVAL AND INDEMNIFICATION..........................................31
11.1 Indemnification of the Seller...................................31
11.2 Indemnification of the Purchaser................................31
11.3 Demands.........................................................32
11.4 Right to Contest and Defend.....................................32
11.5 Cooperation.....................................................33
11.6 Right to Participate............................................33
11.7 Payment of Damages..............................................33
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ARTICLE XII
MISCELLANEOUS.........................................................34
12.1 Entire Agreement................................................34
12.2 Successors and Assigns..........................................34
12.3 Counterparts....................................................34
12.4 Headings........................................................34
12.5 Modification and Waiver.........................................34
12.6 No Third Party Beneficiary Rights...............................34
12.7 Sales and Transfer Taxes........................................35
12.8 Expenses........................................................35
12.9 Notice..........................................................35
12.10 Governing Law...................................................36
12.11 Confidentiality; Publicity......................................36
12.12 Consent to Jurisdiction.........................................36
12.13 Severability....................................................37
12.14 Enforcement.....................................................37
SCHEDULES
Schedule 2.2 Excluded Assets
Schedule 2.3 Assigned Contracts
Schedule 3.1 Allocation of Purchase Price
Schedule 4.4 Consents
Schedule 4.6 Material Adverse Change
Schedule 4.8 Encumbrances
Schedule 4.9 Real Property
Schedule 4.10 Leased Personal Property
Schedule 4.11 Material Contracts and Proposals
Schedule 4.12 Permits
Schedule 4.13 Litigation
Schedule 4.14 Taxes
Schedule 4.15 Insurance Policies
Schedule 4.16 Intellectual Property
Schedule 4.20 Environmental Matters
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Schedule 4.22 Employee Compensation
Schedule 4.23 Payors
Schedule 4.25 Solvency
Schedule 5.3 Required Notices
Schedule 5.7 Castle Dental Financial Statement
EXHIBITS
Exhibit A-1 Form of Promissory Note
Exhibit A-2 Form of Promissory Note
Exhibit A-3 Form of Promissory Note
Exhibit B Employment Agreement
Exhibit C Legal Opinion
Exhibit D Stockholders Agreement
Exhibit E Registration Rights Agreement
Exhibit F Management Services Agreement
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ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT dated as of May 19, 1996 by and among Castle
Dental Centers of Florida, Inc., a Florida corporation ("Purchaser"), 1st Dental
Care, Inc., a Florida corporation ("1st Dental"), Hernando Dental Center --
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S., P.A. a/k/a 1st Dental Care of Florida, a Florida
professional association ("Hernando Dental Center"), M&B Dental Lab, Inc., a
Florida corporation ("M&B Dental Lab") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S. ("▇▇.
▇▇▇▇▇▇▇▇▇"), and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, the sole shareholders of Seller (the
"Shareholders"). 1st Dental, Hernando Dental Center and M&B Dental Lab are
referred to herein collectively as "Seller", and references herein to Seller
refer severally to each of 1st Dental, Hernando Dental Center and M&B Dental
Lab.
W I T N E S S E T H:
WHEREAS, Seller wishes to sell, and Purchaser wishes to purchase,
substantially all of the property, assets and business of Seller, all upon the
terms and subject to the conditions set forth below.
NOW, THEREFORE, for the mutual covenants and other consideration described
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto covenant and
agree as follows:
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS. As used herein, the following terms have the meanings set
forth below (such meanings to be equally applicable to both the singular and
plural forms of the terms defined):
"ACCOUNTS RECEIVABLE": all notes and accounts receivable of Seller.
"ACCOUNTS PAYABLE": the payables of Seller to trade account and other
creditors as of the Closing Date as shown on Schedule 2.3.
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"ADJUSTED BASE DATE NET ASSET VALUE": as defined in Section 3.2 hereof.
"AFFILIATE": with respect to any Person, any other Person directly or
indirectly controlling (including but not limited to all directors and officers
of such Person), controlled by, or under direct or indirect common control with
such Person.
"AGREEMENT": this Asset Purchase Agreement, as amended from time to time
as provided herein.
"ASSETS": as defined in Section 2.1 hereof.
"ASSIGNED CONTRACTS": as defined in Section 2.3 hereof.
"ASSUMED OBLIGATIONS": as defined in Section 2.3 hereof.
"BALANCE SHEET DATE": as defined in Section 3.2 hereof.
"BASE DATE NET ASSET VALUE": as defined in Section 3.2 hereof
"BOOKS AND RECORDS": all books, records, books of account, files and data
(including customer and supplier lists), certificates and other documents
related to the conduct of the business or the ownership of the Assets, including
personnel records and files, except that the Books and Records shall not include
any books, records, files and other data of Seller which relate exclusively to
organizational and corporate governance proceedings of Seller.
"BUSINESS": the practice management of dentistry, including orthodontics
and periodontics and all other management and related activities currently
conducted by Seller.
"CLOSING": as defined in Section 2.6 hereof.
"CLOSING DATE": as defined in Section 2.6 hereof.
"CLOSING DATE BALANCE SHEET": as defined in Section 3.2 hereof.
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"CLOSING DATE NET ASSET VALUE": as defined in Section 3.2 hereof.
"CODE": the Internal Revenue Code of 1986, as amended from time to time,
and the regulations promulgated and rulings issued thereunder. Section
references to the Code are to the Code as in effect at the date of this
Agreement and any subsequent provisions of the Code amendatory thereof,
supplemental thereto or substituted therefor.
"EMPLOYMENT AGREEMENT": the employment agreement executed pursuant hereto
substantially in the form of Exhibit B attached hereto.
"ENCUMBRANCES": liens, security interests, options, rights of first
refusal, easements, mortgages, charges, debentures, indentures, deeds of trust,
rights-of-way, restrictions, agreements, encroachments, licenses, leases,
permits, security agreements, or any other encumbrances and other restrictions
or limitations on use of real or personal property or irregularities in title
thereto that would have a Material Adverse Effect.
"ENVIRONMENTAL CLAIM": any and all administrative, regulatory or judicial
actions, suits, demands, demand letters, claims, liens, notices of noncompliance
or violations, investigations or proceedings relating in any way to any
Environmental Law (for purposes of this definition, "Claims") or any permit
issued under any such Environmental Law, including without limitation (i) any
and all Claims by governmental or regulatory authorities for enforcement,
cleanup, removal, remedial or other actions of damages pursuant to any
applicable Environmental Law and (ii) any and all Claims by any third party
seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from Hazardous Materials or arising from alleged
injury or threat of injury to health, safety or the environment.
"ENVIRONMENTAL LAW": any federal, state or local statute, law, rule,
regulation, ordinance, code, policy or rule of common law now in effect and in
each case as amended and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment,
relating to Hazardous Materials, the environment or health relating to or
arising from environmental conditions, including without limitation the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended 42 U.S.C. ss. 9601 ET SEQ.; the Hazardous Materials Transportation
Act, as amended, 49 U.S.C. ss. 1801 ET SEQ.; the Resource Conservation and
Recovery Act, as amended, 42 U.S.C. ss. 6901 ET SEQ.; the Federal Water
Pollution Control Act, as amended, 33 U.S.C. ss. 1251 ET SEQ.; the Toxic
Substances Control Act, 15 U.S.C. ss. 2601 ET SEQ.; the Clean Air Act, 42 U.S.C.
ss. 7401 ET SEQ.; the Safe Drinking Water Act, 42 U.S.C. ss. 3808 ET SEQ.; the
Oil Pollution Act of 1990, 33 U.S.C. ss. 2701 ET SEQ.; and relevant state and
local laws.
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"ERISA": the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA as in effect at the date of
this Agreement and any subsequent provisions of ERISA amendatory thereof,
supplemental thereto or substituted therefor.
"EXCLUDED ASSETS": as defined in Section 2.2 hereof.
"EXCLUDED CONTRACTS": as defined in Section 2.2(b) hereof.
"EXCLUDED LIABILITIES": as defined in Section 2.4 hereof.
"FINANCIAL STATEMENTS": as defined in Section 4.6 hereof.
"GAAP": generally accepted accounting principles consistently applied.
"HAZARDOUS MATERIALS": (i) any petroleum or petroleum products,
radioactive materials, asbestos in any form that is or could become friable,
urea formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas;
(ii) any chemicals, materials or substances defined as or included in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic pollutants," "contaminants" or "pollutants," or words of similar import
under any applicable Environmental Law; and (iii) any other chemical, material
or substance, exposure to which is prohibited, limited or regulated by an
governmental authority.
"HERNANDO DENTAL CENTER": Hernando Dental Center -- ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
D.D.S., P.A. a/k/a 1st Dental Care of Florida, a professional association
wholly-owned by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇.
"INTELLECTUAL PROPERTY": domestic and foreign patents, patent
applications, registered and unregistered trademarks, service marks, trade names
and logos, registered and unregistered copyrights, computer programs, data
bases, trade secrets and proprietary information relating to the conduct of the
Business.
"M&B DENTAL LAB": M&B Dental Lab, Inc., a Florida corporation wholly-owned
by ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇.
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"MATERIAL ADVERSE EFFECT": material adverse effect on the assets,
liabilities, Business, condition (financial or otherwise), results or operations
or prospects of the Seller, or its Affiliates.
"NEW PC": Castle 1st Dental Care, P.A., a Florida professional
association.
"PERMITS": as defined in Section 4.12 hereof.
"PERMITTED ENCUMBRANCES": as defined in Section 4.8 hereof.
"PERSON": any individual, partnership, joint venture, corporation, trust,
unincorporated organization, government or other department or agency thereof or
other entity.
"PLANS": as defined in Section 4.19 hereof.
"PRE-CLOSING PERIODS": as defined in Section 4.14(a) hereof.
"PRICE ALLOCATION": as defined in Section 3.1 hereof.
"PURCHASE PRICE": as defined in Section 3.1 hereof.
"PURCHASER": as defined in the preamble of this Agreement.
"RETURNS": as defined in Section 4.14(a) hereof.
"RELEASE": disposing, discharging, injecting, spilling, leaking, leaching,
dumping, emitting, escaping, emptying, seeping, placing and the like, into or
upon any land or water or air, or otherwise entering into the environment.
"SELLER" as defined in the preamble of this Agreement.
"SELLER PROPERTY": any real property and improvements thereon presently
owned, leased, operated or occupied by Seller.
"TAX": any net income, alternative or add-on minimum tax, advance,
corporation, gross income, gross receipts, sales, use, AD VALOREM, franchise,
profits, license, value added, withholding,
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payroll, employment, excise, stamp or occupation tax, governmental fee or other
like assessment or charge of any kind whatsoever, together with any interest or
any penalty imposed by any governmental authority with respect thereto, and any
liability for such amounts as a result either of being a member of an affiliated
group or of a contractual obligation to indemnify any other entity.
ARTICLE II
THE TRANSACTION
2.1 PURCHASE AND SALE OF ASSETS. Subject to the terms and conditions of
this Agreement, Purchaser agrees to purchase from the Seller, and Seller agrees
to sell, convey, transfer, assign and deliver, and cause to be sold, conveyed,
transferred, assigned and delivered, to Purchaser, on the Closing Date, against
the receipt by the Seller of the consideration specified in Section 3.1 hereof,
the Assets, free and clear of any Encumbrances except Permitted Encumbrances.
The term "Assets" shall mean all of the rights, title and interests of Seller in
and to the assets used in or relating to the conduct of the Business on the
Closing Date, tangible and intangible, real, personal and mixed, wheresoever
situated and whether or not specifically referred to herein or in any instrument
of conveyance delivered pursuant hereto. The Assets shall include but are not
limited to the following categories of assets:
(a) Seller's title to, interest in or rights under the leases of
real property described in Schedule 4.9 attached hereto together with all
buildings, facilities, fixtures and other leasehold improvements thereon
and all easements, rights-of-way, transferable licenses and permits and
other appurtenances thereof;
(b) plant, machinery, equipment, operating equipment, tools,
supplies, inventories, furniture, fixtures, furnishings, vehicles and
other fixed assets owned or leased by Seller and used or held for use in
the conduct of the Business;
(c) contracts, documents, instruments and general intangibles of
Seller, including the name "1st Dental Care" and derivatives thereof, and
goodwill associated therewith, other than the Excluded Contracts;
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(d) Accounts Receivable as of the Closing Date;
(e) all licenses, permits, registrations and authorizations,
proprietary information, methods, know-how, designs, processes,
procedures, goodwill and all rights held by Seller to other Intellectual
Property;
(f) Books and Records;
(g) any rights of Seller pertaining to any counterclaims, set-offs
or defenses it may have with respect to any Assumed Obligations;
(h) all prepaid claims, prepaid taxes, prepaid insurance premiums
and other prepaid expense items; and
(i) third-party indemnities, policies of insurance identified by
Purchaser, fidelity, surety or similar bonds and the coverages afforded
thereby relating to the Assets; and
2.2 EXCLUDED ASSETS. The Assets shall not include any of the following
(the "Excluded Assets"):
(a) the real property described on Schedule 2.2;
(b) cash, cash equivalents, deposits, advance payments, securities,
letters of credit naming Seller as account party, certificates of deposit,
notes, drafts, checks and similar instruments;
(c) each contract set forth on Schedule 2.2 (the "Excluded
Contracts");
(d) tax refunds related to the Business or the Assets received or
receivable by Seller or the Shareholders relating to taxes paid by Seller
or the Shareholders for all periods prior to the Closing Date;
(e) minute books and governance documents of the Seller; and
(f) the vehicles described on Schedule 2.2.
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2.3 ASSUMPTION OF OBLIGATIONS. Upon the sale of the Assets by Seller,
Purchaser shall assume and agree to pay, perform and discharge, in a timely
manner and in accordance with the terms thereof, only such of the obligations of
Seller in respect of (a) the licenses, leases, permits, contracts, notes and
other debts set forth in Schedule 2.3 (the "Assigned Contracts") which are being
assigned to Purchaser hereunder, (b) Accounts Payable set forth on Schedule 2.3
and (c) the long term debt (including automobile notes) set forth on Schedule
2.3 (collectively, "Assumed Obligations"). Notwithstanding anything contained
herein to the contrary, Purchaser does not assume, and hereby expressly
disclaims responsibility for, any obligation or liability of Seller or the
Shareholders not described on Schedule 2.3.
2.4 NONASSIGNABLE CONTRACTS AND LEASES. In the case of any Assigned
Contracts which are not by their terms assignable or with respect to which a
consent to assignment is not obtained by the Closing Date, Seller agrees to use
its best efforts to obtain, or cause to be obtained, prior to the Closing Date,
any written consents necessary to convey to Purchaser the benefit thereof.
Purchaser shall cooperate with Seller, in such manner as may be reasonably
requested, in connection therewith, including without limitation, active
participation in visits to and meetings, discussions and negotiations with all
Persons with the authority to grant or withhold consent. If Seller is unable to
obtain such necessary written consents for the remaining term of such Assigned
Contract, Purchaser shall act as such Seller's agent in the performance of all
obligations and liabilities under such Assigned Contract and such Seller shall
act as Purchaser's agent in the receipt of any benefits, rights or interests
which inure to such Seller under such Assigned Contract.
2.5 CLOSING. Subject to the satisfaction of the conditions to closing set
forth herein, the closing (the "Closing") of the transactions contemplated
hereby shall be held at the offices of Macfarlane ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇, on or before May 22, 1996, or
such other place, date and time as may be mutually agreed upon by the parties
hereto; provided, however that for accounting purposes the Closing Date shall be
May 19, 1996. Such time and date are referred to herein as the "Closing Date."
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ARTICLE III
PAYMENT OF PURCHASE PRICE
3.1 AMOUNT; ALLOCATION; DELIVERY. At the Closing, in addition to
Purchaser's assumption of the Assumed Obligations, Purchaser shall pay to Seller
the sum of $6,054,613 in cash and notes, plus an aggregate of 145,242 shares of
Common Stock, $.001 par value ("Common Stock"), of Castle Dental Centers, Inc
("Castle Dental"), a Delaware corporation (the "Purchase Price"), subject to
adjustment as provided in Section 3.2 hereof, which Purchase Price shall be
remitted by Purchaser to Seller in the following manner:
(a) $3,323,312 less liabilities assumed on Schedule 2.3, in cash on
the Closing Date, which shall be paid by wire transfer of immediately
available funds to an account or accounts of Seller identified by Seller;
and
(b) a five year subordinated promissory note of Castle Dental
payable to 1st Dental Care, Inc. in the original principal amount of
$1,787,938, payable in equal quarterly installments of principal and
interest at the rate of 10% per annum, convertible in part into Common
Stock substantially in the form of Exhibit A-1 attached hereto;
(c) a four year subordinated convertible promissory note of Castle
Dental payable to 1st Dental Care, Inc. in the original principal amount
of $656,588 with interest accruing quarterly on the unpaid balance at the
rate of 6.36% per annum, convertible in whole or in part into Common
Stock, substantially in the form of Exhibit A-2 attached hereto;
(d) a four year subordinated promissory note of Castle Dental
payable to M&B Dental Lab, Inc. in the original principal amount of
$286,775, with interest accruing quarterly on the unpaid balance at the
rate of 6.36% per annum, substantially in the form of Exhibit A-3 attached
hereto; and
(e) 145,242 shares of Common Stock, $.001 par value, of Castle
Dental, issued in the name of 1st Dental Care, Inc.
Purchaser and Seller hereby agree to allocate the Purchase Price in
accordance with Section 1060 of the Code among the Assets in accordance with
Schedule 3.1 attached hereto (the "Price
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Allocation"). The parties hereby undertake and agree to file timely any
information that may be required to be filed pursuant to regulations promulgated
under Section 1060(b) of the Code. The parties further agree that they will
report the federal, state, municipal, foreign and local and other tax
consequences of the purchase and sale hereunder in a manner consistent with the
Price Allocation, as so adjusted, and that they will not take any position
inconsistent therewith.
3.2 PURCHASE PRICE ADJUSTMENT.
(a) Seller previously has delivered to Purchaser a combined
unaudited balance sheet of the Seller as of December 31, 1995 (the "Balance
Sheet Date"), (the book value of the Assets included in such balance sheet less
the book value of the Assumed Obligations included in such balance sheet is
hereinafter referred to as the "Base Date Net Asset Value").
(b) Within 60 days following the Closing Date, Seller shall prepare
and deliver to Purchaser a combined balance sheet of the Seller as of the
Closing Date (the "Closing Date Balance Sheet"), together with a calculation of
the book value of the Assets and Assumed Obligations determined on the same
basis as the December 31, 1995 balance sheet (such book value of such Assets
less such book value of such Assumed Obligations is hereinafter referred to as
the "Closing Date Net Asset Value"). Purchaser and its representatives shall
have the right to review all work papers and procedures used to prepare the
Closing Date Balance Sheet and the calculation of the Closing Date Net Asset
Value, and shall have the right to perform any other reasonable procedures
necessary to verify the accuracy thereof. Unless Purchaser, within 20 days after
delivery to Purchaser of the Closing Date Balance Sheet, notifies Seller in
writing that it objects to the Closing Date Balance Sheet or the calculation of
the Closing Date Net Asset Value, and specifies the basis for such objection,
the Closing Date Balance Sheet and the calculation of the Closing Date Net Asset
Value shall become final and binding upon the parties for purposes of this
Agreement. If Purchaser and Seller are unable to resolve such objections within
10 days after any such notification has been given, the dispute shall be
submitted to Coopers & ▇▇▇▇▇▇▇, L.L.P. (or, if Coopers & ▇▇▇▇▇▇▇, L.L.P. is
unavailable, to another nationally recognized public accounting firm mutually
agreed upon by Purchaser and Seller). Such accounting firm shall make a final
and binding determination as to the matter or matters in dispute. Purchaser and
Seller agree to cooperate with each other and with each other's authorized
representatives in order to resolve any and all matters in dispute as soon as
practicable.
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(c) Seller has covenanted with Purchaser that Seller will generate
not less than $300,000 of pre-tax earnings for the period commencing January 1,
1996 to the Closing Date. The Base Date Net Asset Value, as adjusted to reflect
the additional $300,000 of pre-tax earnings, is hereinafter referred to as the
Adjusted Base Date Net Asset Value.
(d) Within 10 days after the Closing Date Net Asset Value has been
finally determined, the difference, if any, between the Adjusted Base Date Net
Asset Value and the Closing Date Net Asset Value shall be added to the principal
amount of the promissory note described in Section 3.1(b) (if the Closing Date
Net Asset Value exceeds the Adjusted Base Date Net Asset Value) or deducted from
the principal amount of the promissory note described in Section 3.1(b) (if the
Adjusted Base Date Net Asset Value exceeds the Closing Date Net Asset Value).
(e) Purchaser and Seller, in the aggregate, each shall bear one-half
of the fees, costs and expenses of the accounting firm retained under subsection
(c) to resolve any dispute.
3.3 ASSUMPTION OF ACCOUNTS PAYABLE. On the Closing Date, Purchaser, Seller
and the Shareholders will agree as to the projected amount of accounts payable
which are being assumed by Purchaser pursuant to Section 3.1(a). At the same
time as the Purchase Price Adjustment contemplated by Section 3.2 is made,
Purchaser will certify to Seller the actual amount of accounts payable
attributable to periods prior to the Closing Date which have been paid or
accrued by Purchaser. To the extent the actual amount of accounts payable
attributable to periods prior to the Closing Date which have been paid or
accrued by Purchaser exceeds the amount projected to have been assumed by the
Purchaser, the excess will be paid to Purchaser by Seller as a part of the
purchase price adjustment described in Section 3.2. To the extent the actual
amount of accounts payable attributable to periods prior to the Closing Date
which have been paid or accrued by Purchaser is less than the amount projected
to have been assumed by the Purchaser, the shortfall will be paid to Seller by
Purchaser as a part of the purchase price adjustment described in Section 3.2.
3.4 APPORTIONMENTS. The following items shall be apportioned as of 11:59
p.m., on the day preceding the Closing Date: (a) personal property taxes, sewer
rents and charges and other state, county, metropolitan and municipal taxes and
assessments and charges affecting the Assets; (b) rents and other payments under
any of the Assigned Contracts; (c) charges for water, electricity, gas, oil,
steam and all other utilities (except to the extent disposed of by final billing
to Seller); and (d) such other items as are customarily apportioned in
connection with the sale of similar property, all such items prior to such time
being for the account of Seller and all such times after such time being the
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account of Purchaser. At the Closing, Seller or Purchaser, as the case may be,
shall deliver to the other a check for the net amount owing under this Section
3.3. If any such item cannot accurately be apportioned at the Closing or
subsequent thereto, such item shall be apportioned or reapportioned, as the case
may be, as soon as practicable after the Closing Date or the date on which the
apportionment error is discovered, as applicable.
3.5 AGENCY RELATIONSHIP. In the event that, following the Closing Date,
Seller receives any funds, documents or instruments which constitute or are
delivered in respect of Assets transferred to Purchaser pursuant to this
Agreement, Seller agrees to hold such funds, documents or instruments in trust
for Purchaser and as Purchaser's agent therefor.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
AND THE SHAREHOLDERS
4.1 REPRESENTATIONS AND WARRANTIES OF SELLER AND THE SHAREHOLDERS. Seller
and the Shareholders, jointly and severally, hereby represent and warrant to
Purchaser as follows:
4.2 EXISTENCE AND GOOD STANDING. Seller is a corporation duly organized
and validly existing under the laws of the State of Florida. Seller has the full
corporate power and authority to own, lease and operate its property and to
carry on the Business as now being conducted and to own or lease the Assets
owned or leased by it. Seller is duly qualified or licensed to do business in
each jurisdiction in which the character or location of the properties owned or
leased by Seller or the nature of the business conducted by Seller makes such
qualification necessary and the absence of which would have a Material Adverse
Effect.
4.3 AUTHORIZATION AND VALIDITY OF AGREEMENT. Seller has full corporate
power and authority, and the Shareholders have full power and authority to
execute and deliver this Agreement, to perform their respective obligations
hereunder and to consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement by Seller and the consummation by it
of the transactions contemplated hereby, have been duly authorized and approved
by the Board of Directors and the Shareholders of Seller, and no other action on
the part of Seller or its Shareholders is necessary to authorize the execution,
delivery and performance of this Agreement
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by Seller and the consummation of the transactions contemplated hereby. This
Agreement has been duly executed and delivered by Seller and the Shareholders
and is a valid and binding obligation of Seller and the Shareholders enforceable
against each in accordance with its terms, except to the extent that its
enforceability may be subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles.
4.4 CONSENTS AND APPROVALS; NO VIOLATIONS. Except as set forth on Schedule
4.4, the execution, delivery and performance of this Agreement by Seller and the
Shareholders and the consummation by Seller and the Shareholders of the
transactions contemplated hereby will not, with or without the giving of notice
or the lapse of time or both: (a) violate, conflict with, or result in a breach
or default under any provision of the organizational documents of Seller; (b)
violate any statute, ordinance, rule, regulation, order, judgment or decree of
any court or of any governmental or regulatory body, agency or authority
applicable to Seller or the Shareholders or by which any of Seller's properties
or assets may be bound; (c) require any filing by Seller or the Shareholders
with, or require Seller or the Shareholders to obtain any permit, consent or
approval of, or require Seller or the Shareholders to give any notice to, any
governmental or regulatory body, agency or authority other than as set forth in
Schedule 4.4 attached hereto; or (d) result in a violation or breach by Seller
or the Shareholders of, conflict with, constitute (with or without due notice or
lapse of time or both) a default by Seller or the Shareholders (or give rise to
any right of termination, cancellation, payment or acceleration) under or result
in the creation of any Encumbrance upon any of the properties or assets of
Seller or the Shareholders under any of the terms, conditions, or provisions of
any note, bond, mortgage, indenture, license, franchise, permit, agreement,
lease franchise agreement or other instrument or obligation to which Seller or
the Shareholders is a party, or by which Seller or any of its properties or
assets may be bound.
4.5 SUBSIDIARIES AND AFFILIATES. Seller has no subsidiaries. Except as set
forth on Schedule 4.5, all of the Assets used in the Business are owned by
Seller, and on consummation of the transactions contemplated hereby Purchaser
will have acquired all of the Assets used in the Business. Purchaser is not
acquiring the assets of Florida Academy of Dental Assistants, Inc. or Bay Area
Dental Supply, Inc., none of which are used in the Business.
4.6 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE CHANGE. Seller has
heretofore furnished Purchaser with the unaudited balance sheet of Seller as of
the Balance Sheet Date and the unaudited statements of operations and cash flows
for the year then ended (the "Financial Statements"). The
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Financial Statements fairly present in all material respects the financial
position of Seller at the date thereof and the results of operations of Seller
and its cash flows for the period indicated. Except as set forth in Schedule 4.6
attached hereto, since the Balance Sheet Date there has been no material adverse
change in the assets or liabilities, or in the business or condition, financial
or otherwise, or in the results of operations of Seller.
4.7 BOOKS AND RECORDS. The minute books of Seller, as previously made
available to Purchaser and its representatives, contain accurate records in all
material respects of the meetings of, the shareholders and Board of Directors of
Seller, to the extent set forth therein.
4.8 TITLE TO PROPERTIES; ENCUMBRANCES; CONDITION. Except as set forth in
Schedule 4.8 or 4.9, and except for properties and assets reflected in the
Financial Statements or acquired since the Balance Sheet Date which have been
sold or otherwise disposed of in the ordinary course of business, Seller has
good and valid title to the Assets, in each case subject to no Encumbrances
except for (i) Encumbrances consisting of easements, permits and other
restrictions or limitations on the use of real property or irregularities in
title thereto that do not materially detract from the value of, or materially
impair the use of, such property by Seller in the operation of the Business,
(ii) Encumbrances for current taxes, assessments or governmental charges or
levies on property not yet due or delinquent, (iii) Encumbrances created by
Purchaser, and (iv) Encumbrances relating to Assumed Obligations (liens of the
type described in clauses (i), (ii), (iii) and (iv) above are hereinafter
sometimes referred to as "Permitted Encumbrances"). Seller has heretofore
furnished Purchaser with a fixed asset ledger which sets forth all fixed assets
owned by Seller as of the Balance Sheet Date. Seller and the Shareholders are
not aware of any defects in such assets that would have a Material Adverse
Effect on the ability of Purchaser to use such assets in the Business, ordinary
wear and tear excepted.
4.9 REAL PROPERTY. Schedule 4.9 identifies all leases relating to
properties used by the Seller and includes the name of the record title holder
thereof. All of the buildings, structures and appurtenances situated on the real
property leased by Seller are in good operating condition, and in a state of
good maintenance and repair, subject to ordinary wear and tear, except where
such condition or maintenance would not have a Material Adverse Effect. The real
property has adequate rights of ingress and egress for operation of the Business
in the ordinary course. No condemnation or similar proceeding is pending or, to
the best knowledge of Seller and the Shareholders, threatened, which would
preclude or impair the use of any such property, except where such proceeding
would not have a Material Adverse Effect.
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4.10 LEASES. Schedule 4.10 contains an accurate and complete list of all
personal property leases to which Seller is a party (as lessee or lessor) and a
description of all such leases to which Seller is a party as lessee. Each lease
set forth in Schedule 4.10 is in full force and effect, and no event has
occurred that with the giving of notice, the passage of time or both would
constitute a default thereunder.
4.11 MATERIAL CONTRACTS. Except as set forth in Schedule 4.11, the
Assigned Contracts do not include (a) any agreement, contract or commitment
relating to the employment of any person by Seller, (b) any agreement, indenture
or other instrument which contains restrictions with respect to payment of
profits, dividends or any other distributions, (c) any agreement, contract or
commitment relating to capital expenditures in excess of $5,000 (d) any loan or
advance to, or investment in, any Person or any agreement, contract or
commitment relating to the making of any such loan, advance or investment, (e)
any guarantee or other contingent liability in respect of any indebtedness or
obligation of any Person, (f) any management service, consulting or any other
similar type contract, (g) any agreement, contract or commitment limiting the
freedom of Seller to engage in any line of business or to compete with any
Person, (h) any agreement, contract or commitment which involves $5,000 or more
and is not cancelable without penalty within 30 days, or (i) any other
agreement, contract or commitment which would have a Material Adverse Effect.
Also set forth in Schedule 4.12 is a list of all proposals submitted by Seller
to any third party that, if accepted by such third party, would require
disclosure on Schedule 4.11. Except where it would not have a Material Adverse
Effect, each contract or agreement set forth in Schedule 4.11 is in full force
and effect and there exists no default or event of default or event, occurrence,
condition or act (including the purchase of the Assets hereunder) which, with
the giving of notice, the lapse of time or the happening of any other event or
condition, would become a default or event of default thereunder.
4.12 PERMITS. Schedule 4.12 attached hereto lists all of the governmental
and other third party permits (including occupancy permits), licenses, consents
and authorizations ("Permits") required, to the knowledge of Seller and the
Shareholders, in connection with the use, operation or ownership of the Assets
and the conduct of the Business as currently conducted. Seller holds all of the
Permits listed on Schedule 4.12, and none is presently subject to revocation or
challenge.
4.13 LITIGATION. Except as set forth in Schedule 4.13, there is no action,
suit, proceeding at law or in equity, arbitration or administrative or other
proceeding by or before (or any investigation by) any governmental or other
instrumentality or agency, pending, or, to the knowledge of Seller and the
Shareholders, threatened, against or affecting the properties, rights or
goodwill of
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Seller, the Shareholders, or employees of Seller, and Seller and the
Shareholders do not know of any valid basis for any such action, proceeding or
investigation. There are no such suits, actions, claims, proceedings or
investigations pending or to the knowledge of Seller and the Shareholders
threatened, seeking to prevent or challenge the transactions contemplated by
this Agreement. Purchaser will assume no liability whatsoever with respect to
any matter described on Schedule 4.13.
4.14 TAXES. (a) All returns and reports for Taxes for all taxable years or
periods that end on or before the Closing Date and, with respect to any taxable
year or period beginning before and ending after the Closing Date the portion of
such taxable year or period ending on and including the Closing Date
("Pre-Closing Periods"), which are required to be filed by or with respect to
Seller (collectively, the "Returns") have been or will be filed when due in a
timely fashion and such Returns as filed are or will be accurate in all material
respects.
(b) Except as provided in Schedule 4.14 there is no material action,
suit, proceeding, investigation, audit, or claim now pending or, to the
knowledge of Seller or the Shareholders, threatened by any authority regarding
any Taxes relating to Seller for any Pre-Closing Period.
(c) There are no liens or security interests on any of the assets of
Seller that arose in connection with any failure (or alleged failure) to pay any
Taxes.
(d) Except as provided in Schedule 4.14, there are no agreements for
the extension or waiver of the time for assessment of any Taxes relating to
Seller for any Pre-Closing Period and Seller has not been requested to enter
into any such agreement or waiver.
(e) All Taxes relating to Seller which Seller is required by law to
withhold or collect have been duly withheld or collected, and have been timely
paid over to the proper authorities to the extent due and payable.
(f) Seller is not now nor has ever been a party to any Tax
allocation or sharing agreement that could result in any liability to Purchaser.
4.15 INSURANCE. Set forth in Schedule 4.15 is a complete list of insurance
policies that Seller maintains with respect to its Business and properties that
are included in the Assets, or on its employees. Such policies are in full force
and effect and are free from any right of termination on
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the part of the insurance carriers. In the judgment of Seller, such policies,
with respect to their amounts and types of coverage, are adequate to insure
against risks to which Seller and its property and assets are normally exposed
in the operation of the Business, subject to customary deductibles and policy
limits.
4.16 INTELLECTUAL PROPERTIES. Schedule 4.16 sets forth all material
Intellectual Property used in the Business and the name of the Seller which owns
such Intellectual Property. The operation of the business as conducted by Seller
as of the Closing Date requires no rights under Intellectual Property other than
rights under Intellectual Property listed on Schedule 4.16 and rights granted to
Seller pursuant to agreements listed on Schedule 4.16. Except as otherwise set
forth in Schedule 4.16, Seller owns all right, title and interest in the
Intellectual Property listed in Schedule 4.16. No litigation is pending or, to
the knowledge of Seller or the Shareholders, threatened wherein Seller is
accused of infringing or otherwise violating the Intellectual Property rights of
another, or of breaching a contract conveying rights under Intellectual
Property.
4.17 COMPLIANCE WITH LAWS. Seller is in compliance with all applicable
laws, regulations, orders, judgments and decrees applicable to the Business,
except where any noncompliance would not have a Material Adverse Effect.
4.18 EMPLOYMENT RELATIONS. (a) Seller is not and has not engaged in any
unfair labor practice; (b) to the knowledge of Seller and the Shareholders, no
representation question exists respecting the employees of Seller; (c) Seller
has not been notified of any grievance that might have a Material Adverse Effect
and no arbitration proceeding arising out of or under any collective bargaining
agreement is pending; and (f) no collective bargaining agreement is currently
being negotiated by Seller.
4.19 EMPLOYEE BENEFIT PLANS. Seller has delivered to Purchaser true and
complete copies of all employee benefit plans, policies, programs and
arrangements and all related contracts, agreements and other descriptions
thereof with respect to the employee benefits provided to the employees of the
Business prior to the Closing Date (the "Plans"). Each of the Plans has, to the
knowledge of Seller and the Shareholders, been maintained in compliance with its
terms and the requirements of all applicable laws. None of the Plans are subject
to Title IV of ERISA or the minimum funding obligations of Section 412 of the
Code, and Seller and any entity required to be aggregated therewith pursuant to
Section 414(b) or (c) of the Code have no liability under Title IV of ERISA or
under Section 412(f) or 412(n) of the Code.
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4.20 ENVIRONMENTAL LAWS AND REGULATIONS. Except as set forth in Schedule
4.20, and except where it would not have a Material Adverse Effect (a) Hazardous
Materials have not been generated, used, treated or stored on, or transported to
or from, any Seller Property by Seller, its authorized agents or its independent
contractors (including suppliers) or any property adjoining any Seller Property,
(b) Hazardous Materials have not been Released or disposed of by Seller, its
authorized agents or its independent contractors (including suppliers) on any
Seller Property or any property adjoining any Seller Property except such
Releases which do not violate any Environmental Laws, (c) Seller is, to its and
the Shareholders' knowledge, in compliance with all applicable Environmental
Laws and the requirements of any Permits issued under such Environmental Laws
with respect to any Seller Property, (d) there are no pending or, to the
knowledge of Seller and the Shareholders, threatened Environmental Claims
against Seller or any Seller Property, (e) there are no facts or circumstances,
conditions, pre-existing conditions or occurrences on any Seller Property known
to Seller or the Shareholders that could reasonably be anticipated (A) to form
the basis of an Environmental Claim against Seller or any Seller Property, or
(B) to cause such Seller Property to be subject to any restrictions on the
ownership, occupancy use or transferability of such Seller Property under any
Environmental Law, (f) there are not now and there never have been any
underground storage tanks located on any Seller Property, and (g) Seller has not
in the ordinary course of business transported or stored Hazardous Materials.
4.21 INTERESTS IN CUSTOMERS, SUPPLIERS, ETC. Except for relationships with
Affiliates, Seller does not possess, directly or indirectly, any financial
interest in, and neither Shareholder is a director, officer or employee of, any
corporation, firm, association or business organization which is a supplier,
customer, lessor, lessee, or competitor of Seller.
4.22 COMPENSATION OF EMPLOYEES. Set forth in Schedule 4.22 is an accurate
and complete list showing the names of all persons whose compensation from
Seller collectively for the fiscal year ended on the Balance Sheet Date exceeded
an annualized rate of $20,000, together with a statement of the full amount paid
or payable to each such person for services rendered during the current fiscal
year to date.
4.23 PAYORS. Schedule 4.23 sets forth the ten largest payors of Seller for
the most recently completed fiscal year. The relationship of Seller with each of
such payors as of the date of this Agreement is a good commercial working
relationship, and except as set forth in Schedule 4.23 no significant payor has
canceled or otherwise terminated or, to the knowledge of Seller or the
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Shareholders threatened to cancel or otherwise terminate its relationship with
Seller within the last three years.
4.24 ACCOUNTS RECEIVABLE; ACCOUNTS PAYABLE. Except as set forth on
Schedule 4.24, the Accounts Receivable on the Closing Date Balance Sheet are
collectible in the ordinary course of business, net of the reserves established
with respect thereto. Except as set forth on Schedule 4.24, there has been no
change since the Balance Sheet Date (other than in the ordinary course of
business) in the amount of the Accounts Receivable or other fees or debts due to
Seller or the allowances with respect thereto, or Accounts Payable by Seller,
from that reflected in the Balance Sheet.
4.25 SOLVENCY. Seller is not entering into this Agreement with actual
intent to hinder, delay or defraud creditors. Immediately prior to and
immediately subsequent to the Closing Date:
(a) the present fair salable value of the Assets of Seller (on a
going concern basis) will exceed the liability of Seller on its debts
(including its contingent obligations);
(b) Seller has not incurred, nor does it intend to or believe that
it will incur, debts (including contingent obligations) beyond its ability
to pay such debts as such debts mature (taking into account the timing and
amounts of cash to be received from any source, and of amounts to be
payable on or in respect of debts); and the amount of cash available to
Seller after taking into account all other anticipated uses of funds is
anticipated to be sufficient to pay all such amounts on or in respect of
debts, when such amounts are required to be paid; and
(c) Seller will have sufficient capital with which to conduct its
business, and the property of Seller does not constitute unreasonably
small capital with which to conduct its business.
For purposes of this Section 4.25 "debt" means any liability or a (i)
right to payment whether or not such a right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable secured, or unsecured; or (ii) right to an equitable remedy for
breach of performance if such breach gives rise to a payment, whether or not
such a right to an equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured, or unsecured.
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4.26 DISCLOSURE. None of this Agreement, the Financial Statements, any
Schedule, Exhibit or certificate attached hereto or delivered in accordance with
the terms hereof contains any untrue statement of a material fact, or omits any
statement of a material fact necessary in order to make the statements contained
herein or therein not misleading in light of the circumstances under which they
were made.
4.27 BROKER'S OR FINDER'S FEES. No agent, broker, Person or firm acting on
behalf of Seller is, or will be, entitled to any fee, commission or broker's or
finder's fees in connection with this Agreement or any of the transactions
contemplated hereby.
4.28 COPIES OF DOCUMENTS. Seller has caused to be made available for
inspection and copying by Purchaser and its advisers, true, complete and correct
copies of all documents referred to in this Article IV or in any Schedule
attached hereto.
4.29 INVESTMENT REPRESENTATIONS.
(a) 1st Dental understands that the Common Stock has not been
registered under the Securities Act of 1933, as amended (the "Securities
Act"). 1st Dental also understands that the Common Stock is being offered
and sold pursuant to an exemption from registration contained in the
Securities Act based in part upon its representations contained in this
Agreement.
(b) 1st Dental, in consultation with its accountants, attorneys and
financial advisors has, the requisite experience in evaluating and
investing in private placement transactions of securities so that it is
capable of evaluating the merits and risks of its investment in Castle
Dental and has the capacity to protect its own interests. 1st Dental
understands that it must bear the economic risk of this investment
indefinitely unless the Common Stock is registered pursuant to the
Securities Act, or an exemption from registration is available. 1st Dental
also understands that there is no assurance that any exemption from
registration under the Securities Act will be available and that, even if
available, such exemption may not allow it to transfer all or any portion
of the Common Stock under the circumstances, in the amounts or at the
times it might propose.
(c) 1st Dental is acquiring the Common Stock for its own account for
investment only, and not with a view towards distribution.
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(d) 1st Dental represents that by reason of its business or
financial experience, it has the capacity to protect its own interests in
connection with the transactions contemplated in this Agreement.
(e) 1st Dental represents that it is an accredited investor within
the meaning of Regulation D under the Securities Act.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF PURCHASER
5.1 REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser represents and
warrants to Seller and the Shareholders as follows:
5.2 EXISTENCE AND GOOD STANDING OF PURCHASER; POWER AND AUTHORITY.
Purchaser is a corporation duly organized, validly existing and in good standing
under the laws of the State of Florida. Purchaser has full corporate power and
authority to make, execute, deliver and perform this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated hereby.
This Agreement has been duly authorized and approved by all required corporate
action of Purchaser. This Agreement has been duly executed and delivered by
Purchaser and is a valid and binding obligation of Purchaser enforceable against
Purchaser in accordance with its terms, except to the extent that its
enforceability may be subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles.
5.3 NO VIOLATIONS. The execution, delivery and performance of this
Agreement by Purchaser and the consummation by Purchaser of the transactions
contemplated hereby will not, with or without the giving of notice or the lapse
of time or both; (a) violate, conflict with, or result in a breach or default
under any provision of the certificate of incorporation or by-laws of Purchaser;
(b) to the knowledge of Purchaser, violate any statute, ordinance, rule,
regulation, order, judgment or decree of any court or of any governmental or
regulatory body, agency or authority applicable to Purchaser or by which any of
its properties or assets may be bound; (c) to the knowledge of Purchaser,
require any filing by Purchaser with, or require Purchaser to obtain any permit,
consent
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or approval of, or require Purchaser to give any notice to, any governmental or
regulatory body, agency or authority or any third party other than as set forth
in Schedule 5.3; or (d) result in a violation or breach by Purchaser of,
conflict with, constitute (with or without due notice or lapse of time or both)
a default by Purchaser (or give rise to any right of termination, cancellation,
payment or acceleration) under, or result in the creation of any Encumbrance
upon any of the properties or assets of Purchaser pursuant to, any of the terms,
conditions or provision of any note, bond, mortgage, indenture, license,
franchise, permit, agreement, lease, franchise agreement or other instrument or
obligation to which Purchaser is a party, or by which it or any of its
properties or assets may be bound, except in the case of Subsections 5.3(b),
(c), and (d), for such violations, consents, breaches, defaults, terminations
and accelerations which in the aggregate would not have a Material Adverse
Effect.
5.4 CAPITAL STOCK. The authorized capital stock of Castle Dental consists
solely of 18,755,263 shares of Common Stock of which 4,000,000 shares have been
issued, and 1,244,737 shares of Preferred Stock, $.001 par value per share
("Preferred Stock"), all of which shares have been issued. All of the shares of
Common Stock of Castle Dental delivered pursuant to Section 3.1 hereof shall be
duly and validly authorized, and, following the Closing, will be validly issued,
fully paid, nonassessable and free of any liens or encumbrances.
5.5 LITIGATION. Except as set forth in Schedule 5.5 hereto, there is no
action, suit, proceeding at law or in equity, arbitration or administrative or
other proceeding by or before (or any investigation by) any governmental or
other instrumentality or agency, pending, or, to the knowledge of Purchaser,
threatened, against or affecting the properties, rights or goodwill of Castle
Dental, Purchaser or their employees, except where such Proceeding would not
have a material adverse effect on the assets, liabilities, business, condition
(financial or otherwise), results of operations or prospects of Castle Dental or
Purchaser, and Purchaser does not know of any valid basis for any such action,
proceeding or investigation. There are no such Proceedings pending or, to the
knowledge of Purchaser, threatened, seeking to prevent or challenge the
transactions contemplated by this Agreement.
5.6 COMPLIANCE WITH LAWS. To the knowledge of Purchaser, Castle Dental and
Purchaser are in compliance with all applicable laws, regulations, orders,
judgments and decrees applicable to their respective business, except where any
noncompliance would not have a material adverse effect on the assets,
liabilities, business, condition (financial or otherwise), results of operations
or prospects of Castle Dental or Purchaser.
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5.7 FINANCIAL STATEMENTS. The audited financial statements of Castle as of
December 31, 1995, attached hereto as Schedule 5.7 (to be attached prior to the
Closing Date), are complete and correct in all material respects and present
fairly in accordance with generally accepted accounting principles consistently
applied, the financial condition of Castle Dental and the results of operations
of Castle Dental as of the dates thereof and for the periods indicated.
5.8 BROKER'S OR FINDER'S FEES. Except for The GulfStar Group, no agent,
broker, Person or firm acting on behalf of Purchaser is, or will be, entitled to
any fee, commission or broker's or finder's fee in connection with this
Agreement or any of the transactions contemplated hereby.
ARTICLE VI
CONDITIONS TO SELLER'S OBLIGATIONS
The obligations of Seller under this Agreement to sell, or cause to be
sold, the Assets and to consummate the other transactions contemplated hereby
shall be subject to the satisfaction (or waiver by Seller) on or prior to the
Closing Date of all of the following conditions:
6.1 TRUTH OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Purchaser contained in this Agreement shall be true and correct in
all material respects on and as of the Closing Date with the same effect as
though such representations and warranties had been made on and as of the
Closing Date, and Purchaser shall have delivered to Seller on the Closing Date a
certificate of an authorized officer of Purchaser, dated the Closing Date, to
such effect.
6.2 PERFORMANCE OF AGREEMENTS. Each and all of the agreements and
covenants of Purchaser to be performed on or before the Closing Date pursuant to
the terms hereof shall have been duly performed in all material respects, and
Purchaser shall have delivered to Seller a certificate of an authorized officer
of Purchaser, dated the Closing Date, to such effect.
6.3 NO LITIGATION THREATENED. No action or proceedings shall have been
instituted before a court or other governmental body or by any public authority
to restrain or prohibit any of the transactions contemplated hereby, and
Purchaser shall have delivered to Seller a certificate of an authorized officer
of Purchaser, dated the Closing Date, to such effect to the best knowledge of
such officer.
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6.4 GOVERNMENTAL APPROVALS. All governmental consents and approvals, if
any, necessary to permit the consummation of the transactions contemplated by
this Agreement shall have been received.
6.5 PROCEEDINGS. All proceedings to be taken in connection with the
transactions contemplated by this Agreement and all documents incident thereto
shall be reasonably satisfactory in form and substance to Seller and the
Shareholders and their counsel, and Seller and the Shareholders shall have
received copies of all such documents and other evidence as its or its counsel
may reasonably request in order to establish the consummation of such
transactions and the taking of all proceedings in connection therewith.
6.6 EMPLOYMENT AGREEMENT. ▇▇. ▇▇▇▇▇▇▇▇▇ shall have received an Employment
Agreement, substantially in the form of Exhibit B, executed by the Purchaser.
6.7 REGISTRATION RIGHTS AGREEMENT. 1st Dental Care, Inc. shall have
received a Registration Rights Agreement, substantially in the form of Exhibit E
hereto, executed by Castle Dental.
ARTICLE VII
CONDITIONS TO PURCHASER'S OBLIGATIONS
The obligations of Purchaser under this Agreement to purchase the Assets
and to consummate the other transactions contemplated hereby shall be subject to
the satisfaction (or waiver by Purchaser) on or prior to the Closing Date of all
of the following conditions:
7.1 TRUTH OF REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Seller and the Shareholders contained herein shall be true and
correct in all material respects on and as of the Closing Date with the same
effect as though such representations and warranties had been made on and as of
the Closing Date; and Seller and the Shareholders shall have delivered to
Purchaser on the Closing Date a certificate of an authorized representative of
Seller and the Shareholders, dated the Closing Date, to such effect.
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7.2 PERFORMANCE OF AGREEMENTS. Each and all of the agreements and
covenants of Seller to be performed on or before the Closing Date pursuant to
the terms hereof shall have been duly performed in all material respects, and
Seller shall have delivered to Purchaser a certificate of an authorized
representative of Seller, dated the Closing Date, to such effect.
7.3 DOCUMENTS OF CONVEYANCE. Purchaser shall have received from Seller
fully executed documents of conveyance vesting in Purchaser good and valid title
to the Assets, free and clear of any Encumbrances except Permitted Encumbrances.
7.4 NO LITIGATION THREATENED. No action or proceedings shall have been
instituted before a court or other governmental body or by any public authority
to restrain or prohibit any of the transactions contemplated hereby, and Seller
shall have delivered to Purchaser a certificate of an authorized representative
of Seller, dated the Closing Date, to such effect to the best knowledge of such
officer.
7.5 GOVERNMENTAL APPROVALS. All governmental consents and approvals, if
any, necessary to permit the consummation of the transactions contemplated by
this Agreement shall have been received.
7.6 CONSENTS. Each of the consents referred to in Schedule 4.4 attached
hereto shall have been obtained.
7.7 LEGAL OPINION. Seller shall have delivered to Purchaser the opinion of
Macfarlane ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, their counsel, substantially in the form
of Exhibit C attached hereto.
7.8 PROCEEDINGS. All proceedings to be taken in connection with the
transactions contemplated by this Agreement and all documents incident thereto
shall be reasonably satisfactory in form and substance to Purchaser and its
counsel, and Purchaser shall have received copies of all such documents and
other evidence as it or its counsel may reasonably request in order to establish
the consummation of such transactions and the taking of all proceedings in
connection therewith.
7.9 NEW PC. The Shareholders shall have organized New PC and New PC shall
have entered into Employment Agreements with the dentists presently employed by
Seller and Seller shall have duly and validly assigned to New PC all
reimbursement contracts with third party insurance companies, managed care
companies and other reimbursement sources referred to in Section 2.2(f).
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7.10 EXECUTION OF MANAGEMENT SERVICES AGREEMENT. Purchaser and New PC
shall have entered into a Management Services Agreement substantially in the
form of Exhibit F attached hereto.
7.11 STOCKHOLDERS AGREEMENT. 1st Dental Care, Inc. shall have entered into
a Stockholders Agreement with Castle Dental and certain of its other
shareholders, substantially in the form of Exhibit D attached hereto.
7.12 LEASE AGREEMENT. Purchaser and ▇▇. ▇▇▇▇▇▇▇▇▇ shall have entered into
a Lease Agreement with respect to certain real property owned by ▇▇. ▇▇▇▇▇▇▇▇▇
and used in the Business, in form and substance satisfactory to Purchaser and
▇▇. ▇▇▇▇▇▇▇▇▇.
7.13 ACCOUNTS PAYABLE CALCULATION. Purchaser, Seller and the Shareholder
shall have agreed in writing as to the amount of the Assumed Accounts Payable
assumed by Purchaser.
7.14 SUBORDINATION AGREEMENT. Seller shall have executed and delivered a
Subordination Agreement with respect to the promissory notes described in
Sections 3.1(b) and (c) in form and substance satisfactory to the senior and
senior subordinated lenders of Castle Dental.
ARTICLE VIII
COVENANTS OF SELLER AND THE SHAREHOLDERS
Seller and the Shareholders hereby covenant and agree with Purchaser as
follows:
8.1 COOPERATION BY SELLER. Seller and the Shareholders shall use their
reasonable best efforts to cooperate with Purchaser to secure all necessary
consents, approvals, authorizations, exemptions and waivers from third parties
as shall be required in order to enable Seller and the Shareholders to effect
the transactions contemplated on its or his part hereby, and Seller and the
Shareholders shall otherwise use their reasonable best efforts to cause the
consummation of such transactions in accordance with the terms and conditions
hereof and to cause all conditions contained in this Agreement over which it has
control to be satisfied. Seller and the Shareholders further agree to deliver to
Purchaser prompt written notice of any event or condition which if it existed on
the date
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of this Agreement, would result in any of the representations and warranties of
Seller or the Shareholders contained herein being untrue in any material
respect.
8.2 CONDUCT OF BUSINESS. Except as Purchaser may otherwise consent to in
writing, between the date hereof and the Closing Date, Seller shall, (a) conduct
the Business only in the ordinary course, (b) use its reasonable efforts to keep
available the services of its employees and maintain satisfactory relationships
with licensors, suppliers, lessors, distributors, customers, clients and others,
(c) maintain, consistent with past practice and good business judgment, all the
Assets in customary repair, order and condition, ordinary wear and tear
excepted, and insurance upon all the Assets used in the conduct of the Business
in such amounts and of such kinds comparable to that in effect on the date
hereof, to the extent available at current premiums, and (d) maintain the Books
and Records in the usual, regular and ordinary manner, on a basis consistent
with past practice.
8.3 EXCLUSIVE DEALING. During the period from the date of this Agreement
to the earlier of the Closing Date or the termination of this Agreement, neither
Seller nor the Shareholders shall take any action to, directly or indirectly,
encourage, initiate or engage in discussions or negotiations with, or provide
any information to, any Person other than Purchaser, concerning any sale of the
Assets or any material part thereof or a similar transaction involving Seller or
the Shareholders.
8.4 REVIEW OF THE ASSETS. Purchaser may, prior to the Closing Date,
through its representatives, review (a) the Assets, (b) the complete working
papers of Seller's certified public accountants used in their preparation of
financial statements for Seller and (c) the Books and Records of Seller and to
otherwise review the financial and legal condition of Seller as Purchaser deems
necessary or advisable to familiarize itself with the Business and related
matters; such review shall not, however, affect the representations and
warranties made by Seller and the Shareholders hereunder or the remedies of
Purchaser for breaches of those representations and warranties. Such review
shall occur only during normal business hours upon reasonable notice by
Purchaser. Seller and the Shareholders shall permit Purchaser and its
representatives to have, after the execution of this Agreement, full access to
employees of any Seller who can furnish Purchaser with financial and operating
data and other information with respect to the Business as Purchaser shall from
time to time reasonably request.
8.5 FURTHER ASSURANCES. At any time or from time to time after the Closing
Date, Seller and the Shareholders shall, at the reasonable request of Purchaser
and at Purchaser's expense, execute and deliver any further instruments or
documents and take all such further action as Purchaser may
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reasonably request in order to consummate and make effective the sale of the
Assets and the assumption of the Assumed Obligations pursuant to this Agreement.
ARTICLE IX
COVENANTS OF PURCHASER
Purchaser hereby covenants and agrees with Seller and the Shareholders as
follows:
9.1 COOPERATION BY PURCHASER. Purchaser will use its reasonable best
efforts, and will cooperate with Seller and the Shareholders, to secure all
necessary consents, approvals, authorizations, exemptions and waivers from third
parties as shall be required in order to enable Purchaser to effect the
transactions contemplated on its part hereby, and Purchaser will otherwise use
its reasonable best efforts to cause the consummation of such transactions in
accordance with the terms and conditions hereof and to cause all conditions
contained in this Agreement over which it has control to be satisfied. Purchaser
further agrees to deliver to Seller and the Shareholders prompt written notice
of any event or condition, which if it existed on the date of this Agreement,
would result in any of the representations and warranties of Purchaser contained
herein being untrue in any material respect.
9.2 BOOKS AND RECORDS; PERSONNEL. At all times after the Closing Date,
Purchaser shall allow Seller and any agents of any Seller, upon reasonable
advance notice to Purchaser, access to all Books and Records of Seller which are
transferred to Purchaser in connection herewith, to the extent necessary or
desirable in anticipation of, or preparation for, existing or future litigation,
employment matters, tax returns or audits, or reports to or filings with
governmental agencies, during normal working hours at Purchaser's principal
places of business or at any location where such Books and Records are stored,
and Seller shall have the right, at Seller's sole cost, to make copies of any
such Books and Records.
9.3 FURTHER ASSURANCES. At any time or from time to time after the Closing
Date, Purchaser shall, at the request of Seller or the Shareholders and at such
Seller's expense, execute and deliver any further instruments or documents and
take all such further action as Seller may reasonably request in order to
consummate and make effective the sale of the Assets and the assumption of the
Assumed Obligations pursuant to this Agreement.
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ARTICLE X
TERMINATION
10.1 TERMINATION. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Closing Date:
(a) by the mutual written consent of Purchaser, the Shareholders and
Seller; or
(b) by Purchaser, the Shareholders, or Seller in writing without
liability on the part of the terminating party on account of such
termination (provided the terminating party is not otherwise in default or
in breach of this Agreement), if the Closing Date shall not have occurred
on or before May 22, 1996; or
(c) by either Purchaser, on the one hand, or the Shareholders and
Seller, on the other hand, in writing, without liability on the part of
the terminating party on account of such termination (provided the
terminating party is not otherwise in default or breach of this
Agreement), if the other party shall (i) fail to perform its or their
covenants or agreements contained herein required to be performed prior to
the Closing Date, or (ii) breach or have breached any of its
representations or warranties contained herein.
10.2 EFFECT ON OBLIGATIONS. Termination of this Agreement pursuant to this
Article shall terminate all obligations of the parties hereunder, except for the
obligations under Sections 12.8 and 12.11 hereof and the obligations set forth
in the next succeeding sentence of this Section 10.2. Upon any termination of
this Agreement each party hereto will redeliver all documents, work papers and
other material of any other party relating to the transactions contemplated
hereby, and all copies of such materials, whether so obtained before or after
the execution hereof, to the party furnishing the same.
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ARTICLE XI
SURVIVAL AND INDEMNIFICATION
11.1 INDEMNIFICATION OF THE SELLER. The Purchaser, from and after the
Closing Date, shall indemnify and hold Seller and the Shareholders and their
respective Affiliates (the "Seller Indemnitees") harmless from and against any
and all damages (including exemplary damages and penalties, losses,
deficiencies, costs, expenses, obligations, fines, expenditures, claims and
liabilities, including reasonable counsel fees and reasonable expenses of
investigation, defending and prosecuting litigation (collectively, the
"Damages"), suffered by any Seller Indemnitee as a result of, caused by, arising
out of, or in any way relating to (a) any misrepresentation, breach of warranty,
or nonfulfillment of any agreement or covenant on the part of the Purchaser
under this Agreement or any misrepresentation in or omission from any list,
schedule, certificate, or other instrument furnished or to be furnished to the
Seller by the Purchaser pursuant to the terms of this Agreement or (b) any
liability or obligation (other than those for which Purchaser are being
indemnified by Seller and the Shareholders hereunder) which pertains to the
ownership, operation or conduct of the Business or Assets arising from any acts,
omissions, events, conditions or circumstances occurring on or after the Closing
Date.
11.2 INDEMNIFICATION OF THE PURCHASER. Seller and the Shareholders,
jointly and severally, shall indemnify and hold Purchaser and its Affiliates
(the "Purchaser Indemnitees") harmless from and against any and all Damages
suffered by any Purchaser Indemnitee as a result of, caused by, arising out of,
or in any way relating to (a) any misrepresentation, breach of warranty, or
nonfulfillment of any agreement or covenant on the part of the Seller or the
Shareholders under this Agreement or any misrepresentation in or omission from
any list, schedule, certificate, or other instrument furnished or to be
furnished to the Purchaser by the Seller pursuant to the terms of this
Agreement, or any misrepresentation, breach of warranty or nonfulfillment of any
agreement or covenant contained in the Hernando Agreement or the M&B Agreement
(b) any liability or obligation (other than those for which Seller and the
Shareholders are being indemnified by Purchaser hereunder and other than those
relating to or arising from the Assumed Obligations) which pertains to the
ownership, operation or conduct of the Business or Assets (including assets
acquired pursuant to the Hernando Agreement or the M&B Agreement) arising from
any acts, omissions, events, conditions or circumstances occurring before the
Closing Date, or (c) the uncollectibility of any Account Receivable, including
accounts receivable acquired pursuant to the Hernando Agreement or the M&B
Agreement (net of applicable reserve), after six months.
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11.3 DEMANDS. Each indemnified party hereunder agrees that promptly upon
its discovery of facts giving rise to a claim for indemnity under the provisions
of this Agreement, including receipt by it of notice of any demand, assertion,
claim, action or proceeding, judicial or otherwise, by any third party (such
third party actions being collectively referred to herein as the "Claim"), with
respect to any matter as to which it claims to be entitled to indemnity under
the provisions of this Agreement, it will give prompt notice thereof in writing
to the indemnifying party, together with a statement of such information
respecting any of the foregoing as it shall have. Such notice shall include a
formal demand for indemnification under this Agreement. The indemnifying party
shall not be obligated to indemnify the indemnified party with respect to any
Claim if the indemnified party knowingly failed to notify the indemnifying party
thereof in accordance with the provisions of this Agreement in sufficient time
to permit the indemnifying party or its counsel to defend against such matter
and to make a timely response thereto including, without limitation, any
responsive motion or answer to a complaint, petition, notice or other legal,
equitable or administrative process relating to the Claim, only insofar as such
knowing failure to notify the indemnifying party has actually resulted in
prejudice or damage to the indemnifying party.
11.4 RIGHT TO CONTEST AND DEFEND. The indemnifying party shall be entitled
at its cost and expense to contest and defend by all appropriate legal
proceedings any Claim with respect to which it is called upon to indemnify the
indemnified party under the provisions of this Agreement; provided, that notice
of the intention so to contest shall be delivered by the indemnifying party to
the indemnified party within 20 days from the date of receipt by the
indemnifying party of notice by the indemnified party of the assertion of the
Claim. Any such contest may be conducted in the name and on behalf of the
indemnifying party or the indemnified party as may be appropriate. Such contest
shall be conducted by reputable counsel employed by the indemnifying party, but
the indemnified party shall have the right but not the obligation to participate
in such proceedings and to be represented by counsel of its own choosing at its
sole cost and expense. The indemnifying party shall have full authority to
determine all action to be taken with respect thereto; provided, however, that
the indemnifying party will not have the authority to subject the indemnified
party to any obligation whatsoever, other than the performance of purely
ministerial tasks or obligations not involving material expense. If the
indemnifying party does not elect to contest any such Claim, the indemnifying
party shall be bound by the result obtained with respect thereto by the
indemnified party. At any time after the commencement of the defense of any
Claim, the indemnifying party may request the indemnified party to agree in
writing to the abandonment of such contest or to the payment or compromise by
the indemnified party of the asserted Claim, whereupon such action shall be
taken unless the indemnified party determines that the contest should be
continued, and so notifies
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the indemnifying party in writing within 15 days of such request from the
indemnifying party. If the indemnified party determines that the contest should
be continued, the indemnifying party shall be liable hereunder only to the
extent of the amount that the other party to the contested Claim had agreed
unconditionally to accept in payment or compromise as of the time the
indemnifying party made its request therefor to the indemnified party.
11.5 COOPERATION. If requested by the indemnifying party, the indemnified
party agrees to cooperate with the indemnifying party and its counsel in
contesting any Claim that the indemnifying party elects to contest or, if
appropriate, in making any counterclaim against the person asserting the Claim,
or any cross-complaint against any person, and the indemnifying party will
reimburse the indemnified party for any expenses incurred by it in so
cooperating. At no cost or expense to the indemnified party, the indemnifying
party shall cooperate with the indemnified party and its counsel in contesting
any Claim.
11.6 RIGHT TO PARTICIPATE. The indemnified party agrees to afford the
indemnifying party and its counsel the opportunity to be present at, and to
participate in, conferences with all persons, including governmental
authorities, asserting any Claim against the indemnified party or conferences
with representatives of or counsel for such persons.
11.7 PAYMENT OF DAMAGES. The indemnifying party shall pay to the
indemnified party in immediately available funds any amounts to which the
indemnified party may become entitled by reason of the provisions of this
Agreement, such payment to be made within five days after any such amounts are
finally determined either by mutual agreement of the parties hereto or pursuant
to the final unappealable judgment of a court of competent jurisdiction.
ARTICLE XII
MISCELLANEOUS
12.1 ENTIRE AGREEMENT. This Agreement (including the Exhibits and
Schedules) set forth the entire understanding of the parties with respect to the
subject matter hereof. Any previous agreements or understandings (whether oral
or written) between the parties regarding the subject matter hereof are merged
into and superseded by this Agreement.
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12.2 SUCCESSORS AND ASSIGNS. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors of
the parties hereto; provided that this Agreement, including the representations
and warranties herein, may not be assigned by Seller or the Shareholders without
the prior written consent of Purchaser or by Purchaser to any Person without the
prior written consent of Seller.
12.3 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall constitute the same instrument.
12.4 HEADINGS. The headings of the Articles, Sections and paragraphs of
this Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction hereof.
12.5 MODIFICATION AND WAIVER. No amendment, modification or alteration of
the terms or provisions of this Agreement shall be binding unless the same shall
be in writing and duly executed by the parties hereto, except that any of the
terms or provisions of this Agreement may be waived in writing at any time by
the party which is entitled to the benefits of such waived terms or provisions.
No waiver of any of the provisions of this Agreement shall be deemed to or shall
constitute a waiver of any other provision hereof (whether or not similar). No
delay on the part of either party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof.
12.6 NO THIRD PARTY BENEFICIARY RIGHTS. This Agreement is not intended to
and shall not be construed to give any Person (other than the parties signatory
hereto any interest or rights (including, without limitation, any third party
beneficiary rights) with respect to or in connection with any agreement or
provision contained herein or contemplated hereby.
12.7 SALES AND TRANSFER TAXES. Purchaser shall be responsible for and pay
all applicable sales, stamp, transfer, documentary, use, registration, filing
and other taxes and fees (including any penalties and interest) that may become
due or payable in connection with this Agreement and the transactions
contemplated hereby.
12.8 EXPENSES. Except as otherwise provided in this Agreement, Seller, the
Shareholders and Purchaser shall each pay all costs and expenses incurred by
them or on their behalf in connection with this Agreement and the transactions
contemplated hereby.
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12.9 NOTICE. Any notice, request, instruction or other document to be
given hereunder by any party hereto to any other party shall be sufficiently
given if delivered in person or sent by telecopier or registered or certified
mail, postage prepaid, return receipt requested, addressed as follows:
if to Purchaser, to:
Castle Dental Centers of Florida, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
with a copy to:
▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Bracewell & ▇▇▇▇▇▇▇▇▇, L.L.P.
South Tower Pennzoil Place
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
if to Seller or the Shareholders to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
1st Dental Care, Inc.
▇▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
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with a copy to:
▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
or at such other address for a party as shall be specified by like notice, and
such notice or communication shall be deemed to have been duly given as of the
date so delivered, mailed or sent by telecopier.
12.10 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida without regards to conflict of
law rules thereof.
12.11 CONFIDENTIALITY; PUBLICITY. The terms and conditions of this
Agreement shall not be disclosed by any party hereto without the prior written
consent of the other parties; provided, however, that Purchaser may disclose
such information as is required to comply with the requirements of its lenders
and investors and to comply with applicable securities laws. No party hereto
shall issue any press release or make any other public statement, in each case
relating to or connected with or arising out of this Agreement or the matters
contained herein, without obtaining the prior approval of the other party hereto
to the contents and the manner of presentation and publication thereof.
12.12 CONSENT TO JURISDICTION. Any judicial proceeding brought against any
of the parties to this Agreement on any dispute arising out of this Agreement or
any matter related hereto shall be brought in any federal or state court located
in Tampa, Florida, and, by execution and delivery of this Agreement, each of the
parties to this Agreement accepts for itself the exclusive jurisdiction of the
aforesaid courts, and irrevocably agrees to be bound by any judgment rendered
thereby in connection with this Agreement.
12.13 SEVERABILITY. If any provision of this Agreement is invalid, illegal
or incapable of being enforced by any rule of law or public policy, all other
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party.
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Upon such determination that any provision is invalid, illegal or incapable of
being enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that the transactions contemplated
hereby are fulfilled.
12.14 ENFORCEMENT. The parties hereto agree that the remedy at law for any
breach of this Agreement is inadequate and that should any dispute arise
concerning the sale of the Assets or any other matter hereunder, this Agreement
shall be enforceable in a court of equity by an injunction or a decree of
specific performance. Such remedies shall, however, be cumulative and
nonexclusive, and shall be in addition to any other remedies which the parties
hereto may have.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be executed on its behalf as of the date first above written.
CASTLE DENTAL CENTERS OF FLORIDA, INC.
By:_____________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Title: President
1ST DENTAL CARE, INC.
By:_____________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S.
Title: President
HERNANDO DENTAL CENTER -- ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, D.D.S., P.A.
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By:______________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S.
Title: President
M&B DENTAL LAB, INC.
By:______________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
President
________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, D.D.S.
________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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