EXHIBIT 2.2
FORM OF ASSET CONTRIBUTION AGREEMENT
BY AND AMONG
PENTEGRA DENTAL GROUP, INC.,
__________________________________ [target entity]
and
_______________________________[partners]
TABLE OF CONTENTS
Page
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Section 1. TERMS OF THE CONTRIBUTION
1.2 CONTRIBUTION OF ASSETS . . . . . . . . . . . . . . . . . . . . . . . . .1
1.3 EXCLUDED ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
1.4 PURCHASE PRICE; ASSUMPTION OF LIABILITIES. . . . . . . . . . . . . . . .2
1.5 SUBSEQUENT ACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . .2
Section 2. REPRESENTATIONS AND WARRANTIES OF CONTRIBUTOR AND PARTNERS.
2.1 EXISTENCE; GOOD STANDING . . . . . . . . . . . . . . . . . . . . . . . .2
2.2 POWER AND AUTHORITY FOR TRANSACTIONS . . . . . . . . . . . . . . . . . .3
2.3 PERMITS, LICENSES AND GOVERNMENTAL AUTHORIZATIONS. . . . . . . . . . . .3
2.4 CONSENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
2.5 DISTRIBUTIONS AND REPURCHASES. . . . . . . . . . . . . . . . . . . . . .3
2.6 CORPORATE RECORDS. . . . . . . . . . . . . . . . . . . . . . . . . . . .3
2.7 CONTRIBUTOR'S FINANCIAL INFORMATION. . . . . . . . . . . . . . . . . . .3
2.8 LEASES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
2.9 CONDITION OF ASSETS. . . . . . . . . . . . . . . . . . . . . . . . . . .4
2.10 TITLE TO AND ENCUMBRANCES ON PROPERTY. . . . . . . . . . . . . . . . . .4
2.11 INVENTORIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
2.12 INTELLECTUAL PROPERTY RIGHTS; NAMES. . . . . . . . . . . . . . . . . . .4
2.13 PAYROLL INFORMATION; EMPLOYEES . . . . . . . . . . . . . . . . . . . . .4
2.14 LEGAL PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . .4
2.15 CONTRACTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
2.16 SUBSEQUENT EVENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . .5
2.17 TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
2.18 COMMISSIONS AND FEES . . . . . . . . . . . . . . . . . . . . . . . . . .7
2.19 LIABILITIES; DEBT. . . . . . . . . . . . . . . . . . . . . . . . . . . .7
2.20 INSURANCE POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . .7
2.21 EMPLOYEE BENEFIT PLANS . . . . . . . . . . . . . . . . . . . . . . . . .7
2.22 ADVERSE AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . .7
2.23 COMPLIANCE WITH LAWS IN GENERAL. . . . . . . . . . . . . . . . . . . . .8
2.24 THIRD PARTY PAYORS . . . . . . . . . . . . . . . . . . . . . . . . . . .8
2.25 NO UNTRUE REPRESENTATIONS. . . . . . . . . . . . . . . . . . . . . . . .8
2.26 BANKING RELATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . .8
2.27 OWNERSHIP INTERESTS OF INTERESTED PERSONS; COMPETITORS . . . . . . . . .8
2.28 PAYORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
Section 3. REPRESENTATIONS AND WARRANTIES OF PENTEGRA
3.1 CORPORATE EXISTENCE: GOOD STANDING . . . . . . . . . . . . . . . . . . .9
3.2 POWER AND AUTHORITY; CONSENTS. . . . . . . . . . . . . . . . . . . . . .9
3.3 PERMITS, LICENSES AND GOVERNMENTAL AUTHORIZATIONS. . . . . . . . . . . .9
3.4 LEGAL PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . .9
3.5 TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
3.6 COMMISSIONS AND FEES . . . . . . . . . . . . . . . . . . . . . . . . . .9
3.7 CAPITAL STOCK. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
3.8 NO UNTRUE REPRESENTATIONS. . . . . . . . . . . . . . . . . . . . . . . 10
Section 4. COVENANTS OF CONTRIBUTOR AND PARTNERS.
4.1 CONSUMMATION OF AGREEMENT; EXHIBITS. . . . . . . . . . . . . . . . . . 10
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4.2 BUSINESS OPERATIONS. . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.3 ACCESS AND NOTICE. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
4.4 APPROVALS OF THIRD PARTIES AND PERMITS AND CONSENTS. . . . . . . . . . 10
4.5 ACQUISITION PROPOSALS. . . . . . . . . . . . . . . . . . . . . . . . . 10
4.6 FUNDING OF ACCRUED EMPLOYEE BENEFITS . . . . . . . . . . . . . . . . . 10
4.7 EMPLOYEE MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.8 DISTRIBUTIONS AND REPURCHASES. . . . . . . . . . . . . . . . . . . . . 11
4.9 REQUIREMENTS TO EFFECT ACQUISITION . . . . . . . . . . . . . . . . . . 11
4.10 ACCOUNTING AND TAX MATTERS . . . . . . . . . . . . . . . . . . . . . . 11
4.11 WAIVER OF BULK TRANSFER COMPLIANCE . . . . . . . . . . . . . . . . . . 11
4.12 LEASE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.13 HIRING OF EMPLOYEES. . . . . . . . . . . . . . . . . . . . . . . . . . 11
4.14 EMPLOYEE BENEFIT PLANS . . . . . . . . . . . . . . . . . . . . . . . . 11
4.15 INSURANCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 5. COVENANTS OF PENTEGRA
5.1 CONSUMMATION OF AGREEMENT; EXHIBITS. . . . . . . . . . . . . . . . . . 12
5.2 APPROVALS OF THIRD PARTIES AND PERMITS AND CONSENTS. . . . . . . . . . 12
Section 6. COVENANTS OF PENTEGRA AND CONTRIBUTOR AND PARTNERS
6.1 FILINGS; OTHER ACTIONS . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 7. PENTEGRA CONDITIONS PRECEDENT
7.1 REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . 12
7.2 COVENANTS AND CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . 13
7.3 PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.4 NO MATERIAL ADVERSE CHANGE . . . . . . . . . . . . . . . . . . . . . . 13
7.5 DUE DILIGENCE REVIEW . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.6 APPROVAL BY THE BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . 13
7.7 SERVICE AGREEMENT; GUARANTY AGREEMENT. . . . . . . . . . . . . . . . . 13
7.8 EMPLOYMENT ARRANGEMENTS. . . . . . . . . . . . . . . . . . . . . . . . 13
7.9 CONSENTS AND APPROVALS . . . . . . . . . . . . . . . . . . . . . . . . 13
7.10 CLOSING DELIVERIES . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.11 DEBT AND RECEIVABLES . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.12 INSURANCE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
7.13 NO CHANGE IN WORKING CAPITAL . . . . . . . . . . . . . . . . . . . . . 13
7.14 SECURITIES APPROVAL. . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 8. CONTRIBUTOR'S AND PARTNERS' CONDITIONS PRECEDENT
8.1 REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . . . . . . . . . 14
8.2 COVENANTS AND CONDITIONS . . . . . . . . . . . . . . . . . . . . . . . 14
8.3 PROCEEDINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
8.4 CLOSING DELIVERIES . . . . . . . . . . . . . . . . . . . . . . . . . . 14
8.5 SECURITIES APPROVAL. . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 9. CLOSING DELIVERIES
9.1 DELIVERIES OF CONTRIBUTOR AND PARTNERS . . . . . . . . . . . . . . . . 14
9.2 DELIVERIES OF PENTEGRA . . . . . . . . . . . . . . . . . . . . . . . . 15
Section 10. NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION
10.1 NATURE AND SURVIVAL. . . . . . . . . . . . . . . . . . . . . . . . . . 16
10.2 INDEMNIFICATION BY PENTEGRA. . . . . . . . . . . . . . . . . . . . . . 16
10.3 INDEMNIFICATION BY CONTRIBUTOR AND PARTNERS. . . . . . . . . . . . . . 17
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10.4 INDEMNIFICATION PROCEDURE. . . . . . . . . . . . . . . . . . . . . . . 18
10.5 RIGHT OF SETOFF. . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 11. TERMINATION
Section 12. TRANSFER REPRESENTATIONS
12.1 TRANSFER RESTRICTIONS. . . . . . . . . . . . . . . . . . . . . . . . . 19
12.2 INVESTMENTS; COMPLIANCE WITH LAW . . . . . . . . . . . . . . . . . . . 19
12.3 ECONOMIC RISK; SOPHISTICATION. . . . . . . . . . . . . . . . . . . . . 19
Section 13. NONDISCLOSURE OF CONFIDENTIAL INFORMATION
Section 14. MISCELLANEOUS
14.1 TAX COVENANT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
14.2 NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
14.3 FURTHER ASSURANCES . . . . . . . . . . . . . . . . . . . . . . . . . . 21
14.4 EACH PARTY TO BEAR COSTS . . . . . . . . . . . . . . . . . . . . . . . 21
14.5 PUBLIC DISCLOSURES . . . . . . . . . . . . . . . . . . . . . . . . . . 21
14.6 GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
14.7 CAPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
14.8 INTEGRATION OF EXHIBITS. . . . . . . . . . . . . . . . . . . . . . . . 21
14.9 ENTIRE AGREEMENT/AMENDMENT . . . . . . . . . . . . . . . . . . . . . . 21
14.10 COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
14.11 BINDING EFFECT/ASSIGNMENT. . . . . . . . . . . . . . . . . . . . . . . 21
14.12 COSTS OF ENFORCEMENT . . . . . . . . . . . . . . . . . . . . . . . . . 21
14.13 PRORATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
14.14 AMENDMENTS; WAIVERS. . . . . . . . . . . . . . . . . . . . . . . . . . 22
14.15 ARBITRATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
14.16 SEVERABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
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ASSET CONTRIBUTION AGREEMENT
This ASSET CONTRIBUTION AGREEMENT (this "Agreement"), made and executed
as ________________, 1997, is by and among PENTEGRA DENTAL GROUP, INC., a
Delaware corporation ("Pentegra"), _____________________________________________
("Contributor") and __________________________________, partners of Contributor
(referred to herein as "Partner" or "Partners").
WITNESSETH:
WHEREAS, Contributor operates a dental practice ("Business") and Pentegra
is engaged in the business of managing certain non-dentistry aspects of
dental practices;
WHEREAS, Contributor desires to contribute to Pentegra, and Pentegra
desires to receive from Contributor, certain assets of Contributor;
WHEREAS, Pentegra or its affiliated designee has entered into or intends
to enter into Agreements and Plans of Reorganization, Asset Contribution
Agreements and other acquisition agreements (collectively, the "Other
Agreements") with such persons or entities or the stockholders of such
entities listed on EXHIBIT A (together with Contributor, the "Target
Companies");
WHEREAS, it is intended for Federal income tax purposes that the
transfers contemplated by this Agreement, the Other Agreements and Pentegra's
initial public offering ("Initial Public Offering") of shares of its common
stock, par value $.01 per share ("Pentegra Common Stock") shall qualify as an
exchange within the meaning of Section 351 of the Internal Revenue Code of
1986, as amended ("IRC" or "Code");
WHEREAS, the consummation of the transfers to Pentegra pursuant to this
Agreement is intended to occur in connection with, and is conditioned upon,
the simultaneous consummation of the transfers contemplated by the Other
Agreements and the Initial Public Offering.
NOW THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, and for other good and valuable consideration, the
sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION
1. TERMS OF THE CONTRIBUTION.
1.1 THE CLOSING. The closing of the transactions contemplated hereby
shall take place at 10:00 am local time, at the offices of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
L.L.P., on the day on which the Initial Public Offering of Pentegra Common
Stock is consummated. The date on which the Closing occurs is hereinafter
referred to as the "Closing Date".
1.2 CONTRIBUTION OF ASSETS. Subject to and upon the terms and
conditions contained herein, on the Closing Date, Contributor shall convey,
transfer, deliver and assign to Pentegra or any affiliate of Pentegra
designated by Pentegra all of Contributor's right, title and interest in and
to those certain assets described on EXHIBIT 1.1 attached hereto
(individually, "Asset", and collectively "Assets"), free and clear of all
obligations, security interests, claims, liens and encumbrances, except as
specifically assumed, or taken subject to, by Pentegra pursuant to SECTION
1.3(b) hereof.
1.3 EXCLUDED ASSETS. There shall be excluded from the Assets to be
transferred and contributed hereunder, and Contributor shall retain all of
its right, title and interest in and to, the assets not specifically
transferred hereunder, including without limitation, the assets described on
EXHIBIT 1.2 (the "Excluded Assets").
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1.4 PURCHASE PRICE; ASSUMPTION OF LIABILITIES. As consideration for
the Assets and the representations, warranties and agreements of Contributor
contained herein, Pentegra shall, on the Closing Date:
(a) Cause to be transferred to Contributor the consideration
specified in ANNEX I attached hereto (the "Acquisition Consideration"); and.
(b) Except as otherwise provided herein, assume and perform or
discharge on or after the Closing Date, the contracts, leases, obligations,
commitments, liabilities and indebtedness of Contributor listed on EXHIBIT
1.3(b) attached hereto to the extent that such obligations, commitments,
liabilities and indebtedness are current and not otherwise in default. (the
"Assumed Liabilities"). Notwithstanding any contrary provision contained
herein, Pentegra shall not be deemed to have assumed, nor shall Pentegra
assume: (i) any liability, commitment or obligation or trade payable or
indebtedness not specifically disclosed on EXHIBIT 1.3(b), (ii) any liability
set forth on EXHIBIT 1.3(b) which may be incurred by reason of any breach of
or default under such contracts, leases, commitments or obligations which
occurred on or before the Closing Date; (iii) any liability for any employee
benefits payable to employees of Contributor, including, but not limited to,
liabilities arising under any Contributor Plan (as defined in SECTION 2.21
hereof); (iv) any liability based upon or arising out of a violation of any
antitrust or similar restraint-of-trade laws by Contributor or any Partner,
including, without limiting the generality of the foregoing, any such
antitrust liability which may arise in connection with agreements, contracts,
commitments or orders for the sale of goods or provision of services by
Contributor reflected on the books of Contributor at or prior to the Closing
Date; (v) any liability based upon or arising out of any tortious or wrongful
actions of Contributor, any licensed professional employee or independent
contractor of Contributor or any Partner, (vi) any liability for the payment
of any taxes of Contributor or any Partner, including without limitation,
sales, use and other transfer taxes and income taxes arising from or by
reason of the transactions contemplated by this Agreement; (vii) any
indebtedness secured by deeds of trust or mortgages on real property; nor
(viii) any liability incurred or to be incurred pursuant to any malpractice
or other suits or actions pending against Contributor or any Partner.
1.5 SUBSEQUENT ACTIONS. If, at any time after the Closing Date,
Pentegra shall consider or be advised that any deeds, bills of sale,
assignments, assurances or any other actions or things are necessary or
desirable to vest, perfect or confirm of record or otherwise in Pentegra its
right, title or interest in, to or under any of the Assets or otherwise to
carry out this Agreement, in return for the consideration set forth in this
Agreement, Contributor and Partners shall execute and deliver all such deeds,
bills of sale, assignments and assurances and take and do all such other
actions and things as may be necessary or desirable to vest, perfect or
confirm any and all right, title and interest in, to and under the Assets in
Pentegra or otherwise to carry out this Agreement.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF CONTRIBUTOR AND PARTNERS.
Contributor and Partners, jointly and severally, hereby represent and
warrant to Pentegra as follows:
2.1 EXISTENCE; GOOD STANDING. Contributor is a partnership duly
organized, validly existing and in good standing under the laws of the State
of ___________. Contributor has all necessary partnership power to own all
of its assets and to carry on its business as such business is now being
conducted. Contributor does not own stock in or control, directly or
indirectly, any other corporation, association or business organization, nor
is Contributor a party to any joint venture or partnership. The Partners are
the sole partners of Contributor and own all outstanding partnership
interests free of all security interests, claims, encumbrances and liens in
the amounts set forth on EXHIBIT 2.1. Each partnreship interest of
Contributor has been legally and validly issued and fully paid and
nonassessable. There are no outstanding (a) bonds, debentures, notes or
other obligations the holders of which have the right to vote with the
partners of Contributor on any matter, (b) securities of Contributor
convertible into equity interests in Contributor, or (c) commitments,
options, rights or warrants to issue any such equity interests in
Contributor, to issue securities of Contributor convertible into such equity
interests, or to redeem any securities of Contributor. No partnership
interests of Contributor have been issued or disposed of in violation of the
preemptive rights, rights of first refusal or similar rights of any of
Contributor's partners. Contributor is not required to qualify to do
business as a foreign corporation in any other state or jurisdiction by
reason of its business, properties or activities in or relating to such other
state or
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jurisdiction. Contributor does not have any assets, employees or offices in
any state other than the state set forth in the first sentence of this
SECTION 2.1.
2.2 POWER AND AUTHORITY FOR TRANSACTIONS. Contributor has the
partnership power to execute, deliver and perform this Agreement and all
agreements and other documents executed and delivered by it pursuant to this
Agreement or to be executed and delivered on the Closing Date, and has taken
all action required by law, its Partnership Agreement or otherwise, to
authorize the execution, delivery and performance of this Agreement and such
related documents. Each Partner has the legal capacity to enter into and
perform this Agreement and the other agreements to be executed and delivered
in connection herewith. Contributor has obtained the approval of its
partners necessary to the consummation of the transactions contemplated
herein. This Agreement and all agreements and documents executed and
delivered in connection herewith have been, or will be as of the Closing
Date, duly executed and delivered by Contributor and Partners, as
appropriate, and constitute or will constitute the legal, valid and binding
obligations of Contributor and Partners, enforceable against Contributor and
Partners in accordance with their respective terms, except as may be limited
by applicable bankruptcy, insolvency or similar laws affecting creditors'
rights generally or the availability of equitable remedies. The execution and
delivery of this Agreement, and the agreements executed and delivered
pursuant to this Agreement or to be executed and delivered on the Closing
Date, do not, and, subject to the receipt of consents described on EXHIBIT
2.4, the consummation of the actions contemplated hereby will not, violate
any provision of the Partnership Agreement of Contributor or any provisions
of, or result in the acceleration of, any obligation under any mortgage,
lien, lease, agreement, rent, instrument, order, arbitration award, judgment
or decree to which Contributor or any Partner is a party or by which
Contributor or any Partner is bound, or violate any material restrictions of
any kind to which Contributor is subject, or result in any lien or
encumbrance on any of Contributor's assets or the Assets.
2.3 PERMITS, LICENSES AND GOVERNMENTAL AUTHORIZATIONS. All building
or other permits, certificates of occupancy, concessions, grants, franchises,
licenses, certificates of need and other governmental authorizations and
approvals required for the conduct of the Business or the use of the Assets,
or waivers thereof, have been duly obtained and are in full force and effect
and are described on EXHIBIT 2.3. There are no proceedings pending or, to
the knowledge of Contributor and Partners, threatened, which may result in
the revocation, cancellation or suspension, or any adverse modification, of
any such licenses or permits.
2.4 CONSENTS. Except as set forth on EXHIBIT 2.4, no consent,
authorization, permit, license or filing with any governmental authority, any
lender, lessor, any manufacturer or supplier or any other person or entity is
required to authorize, or is required in connection with, the execution,
delivery and performance of this Agreement and the agreements and documents
contemplated hereby on the part of Contributor or Partners.
2.5 DISTRIBUTIONS AND REPURCHASES. No distribution, payment or
dividend of any kind has been declared or paid by Contributor on any of its
partnership interests since the Balance Sheet Date. No repurchase of any of
Contributor's partnership interests has been approved, effected or is
pending, or is contemplated by Contributor.
2.6 CORPORATE RECORDS. True and correct copies of the Partnership
Agreement and minutes of Contributor and all amendments thereto have been
delivered to Pentegra. The books of account of Contributor have been kept
accurately in the ordinary course of business and the revenues, expenses,
assets and liabilities of Contributor have been properly recorded in such
books.
2.7 CONTRIBUTOR'S FINANCIAL INFORMATION. Contributor has heretofore
furnished Pentegra with copies of its unaudited balance sheet and related
unaudited statements of income, retained earnings and cash flows for its
prior two full fiscal years, as well as copies of its unaudited balance sheet
as of December 31, 1996 and June 30, 1997 (collectively, the "Balance Sheet"
and the latest date thereof shall be referred to as the "Balance Sheet Date")
and any related unaudited statements of income, retained earnings, schedule
of accounts receivable, accounts payable and accrued liabilities, and cash
flows for the twelve months then ended (collectively, with the related notes
thereto, the "Financial Statements"). The Financial Statements fairly
present the financial condition and results of operations of Contributor as
of the dates and for the periods indicated and reflect all fixed and
contingent liabilities of Contributor.
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2.8 LEASES. EXHIBIT 2.8 attached hereto sets forth a list of all
leases pursuant to which Contributor or any Partner leases, as lessor or
lessee, real or personal property used in operating the Business, related to
the Assets or otherwise. All such leases listed on EXHIBIT 2.8 are valid and
enforceable in accordance with their respective terms, and there is not under
any such lease any existing default by Contributor, as lessor or lessee, or
any condition or event of which any Partner or Contributor has knowledge
which with notice or lapse of time, or both, would constitute a default, in
respect of which Contributor or Partners have not taken adequate steps to
cure such default or to prevent a default from occurring.
2.9 CONDITION OF ASSETS. All of the Assets are in good condition
and repair subject to normal wear and tear and conform with all applicable
ordinances, regulations and other laws, and Contributor and Partners have no
knowledge of any latent defects therein.
2.10 TITLE TO AND ENCUMBRANCES ON PROPERTY. Contributor has good,
valid and marketable title to all of the Assets, free and clear of any liens,
claims, charges, exceptions or encumbrances, except for those, if any, which
are set forth in EXHIBIT 2.10 attached hereto. Contributor shall cause all
encumbrances set forth on EXHIBIT 2.10 (other than those encumbrances
indicated on EXHIBIT 1.3(b)) to be released or terminated prior to the
Closing Date and evidence of such releases of liens and claims shall be
provided to Pentegra on the Closing Date and the Assets shall not be used to
satisfy such liens, claims or encumbrances.
2.11 INVENTORIES. All of the Assets constituting inventory are
owned or used by Contributor, are in good, current, standard and merchantable
condition and are not obsolete or defective.
2.12 INTELLECTUAL PROPERTY RIGHTS; NAMES. Except as set forth on
EXHIBIT 2.12, Contributor has no right, title or interest in or to patents,
patent rights, corporate names, assumed names, manufacturing processes, trade
names, trademarks, service marks, inventions, specialized treatment
protocols, copyrights, formulas and trade secrets or similar items. Set
forth in EXHIBIT 2.12 is a listing of all names of all predecessor companies
of Contributor, including the names of any entities from whom Contributor
previously acquired significant assets. Except for off-the-shelf software
licenses and except as set forth on EXHIBIT 2.12, Contributor is not a
licensee in respect of any patents, trademarks, service marks, trade names,
copyrights or applications therefor, or manufacturing processes, formulas or
trade secrets or similar items and no such licenses are necessary for the
conduct of the Business or the use of the Assets. No claim is pending or has
been made to the effect that the Assets or the present or past operations of
Contributor in connection with the Assets or Business infringe upon or
conflict with the asserted rights of others to any patents, patent rights,
manufacturing processes, trade names, trademarks, service marks, inventions,
licenses, specialized treatment protocols, copyrights, formulas, know-how and
trade secrets. Contributor has the sole and exclusive right to use all
Assets constituting proprietary rights without infringing or violating the
rights of any third parties and no consents of any third parties are required
for the use thereof by Pentegra.
2.13 PAYROLL INFORMATION; EMPLOYEES. Set forth on EXHIBIT 2.13
attached hereto is a true and complete list, as of the date of this Agreement
of: (a) the most recent payroll report of Contributor, showing all current
employees of Contributor and their current levels of compensation, (b)
promised increases in compensation of employees of Contributor that have not
yet been effected, (c) oral or written employment agreements, consulting
agreements or independent contractor agreements (and all amendments thereto)
to which Contributor is a party, copies of which have been delivered to
Pentegra, and (d) all employee manuals, materials, policies, procedures and
work-related rules, copies of which have been delivered to Pentegra.
Contributor is in compliance with all applicable laws, rules, regulations and
ordinances respecting employment and employment practices. Contributor has
not engaged in any unfair labor practice. There are no unfair labor practices
charges or complaints pending or threatened against Contributor, and
Contributor has never been a party to any agreement with any union, labor
organization or collective bargaining unit.
2.14 LEGAL PROCEEDINGS. Neither any Partner, Contributor nor the
Business nor any of the Assets is subject to any pending, nor does
Contributor or any Partner have knowledge of any threatened, litigation,
governmental investigation, condemnation or other proceeding against or
relating to or affecting Contributor, any Partner, the Business, the Assets
or the transactions contemplated by this Agreement, and, to the knowledge of
Contributor and Partners, no basis for any such action exists, nor is there
any legal impediment of which Contributor or any Partner has
4
knowledge to the continued operation of its business or the use of the Assets
in the ordinary course, subject to consents set forth on EXHIBIT 2.4.
2.15 CONTRACTS. Contributor has delivered to Pentegra true copies of
all written, and disclosed to Pentegra all oral, outstanding contracts,
obligations and commitments of Contributor ("Contracts"), entered into in
connection with and related to the Assets or the Business, all of which are
listed or incorporated by reference on EXHIBIT 2.8 (in the case of leases),
EXHIBIT 2.13 (in the case of employment agreements) and EXHIBIT 2.15 (in the
case of Contracts other than leases) attached hereto. Except as otherwise
indicated on such Exhibits, all of such Contracts are valid, binding and
enforceable in accordance with their terms and are in full force and effect,
and no defenses, offsets or counterclaims have been asserted or may be made
by any party thereto. Except as indicated on such Exhibits, there is not
under any such Contract any existing default by Contributor or any Partner,
or any condition or event of which Contributor or any Partner has knowledge
which with notice or lapse of time, or both, would constitute a default.
Contributor and Partners have no knowledge of any default by any other party
to such Contracts. Contributor and Partners have not received notice of the
intention of any party to any Contract to cancel or terminate any Contract
and have no reason to believe that any amendment or change to any Contract is
contemplated by any party thereto. Other than those contracts, obligations
and commitments listed on EXHIBIT 2.8, EXHIBIT 2.13 and EXHIBIT 2.15,
Contributor are not a party to any material written or oral agreement
contract, lease or arrangement, including without limitation, any is:
(a) Contract related to the Assets other than this Agreement;
(b) Employment, consulting or compensation agreement or
arrangement;
(c) Labor or collective bargaining agreement;
(d) Lease agreement with respect to any property, whether as
lessor or lessee;
(e) Deed, ▇▇▇▇ of sale or other document evidencing an interest
in or agreement to purchase or sell real or personal property;
(f) Contract for the purchase of materials, supplies or equipment
(i) which is in excess of the requirements of the Business now booked or for
normal operating inventories, or (ii) which is not terminable upon notice of
thirty (30) days or less;
(g) Agreement for the purchase from a supplier of all or
substantially all of the requirements of the Business of a particular product
or service;
(h) Loan agreement or other contract for money borrowed or
lent or to be borrowed or lent to another;
(i) Contracts containing non-competition covenants;
(j) Financial or similar contracts or agreements with patients
of Contributor or Partners, oral or written, that provide for prepayments or
deferred installment payments; or
(k) Other contracts or agreements that involve either an
unperformed commitment in excess of $1,000 or that terminate or can only be
terminated by Contributor on more than 30 days after the date hereof.
2.16 SUBSEQUENT EVENTS. Other than as set forth on EXHIBIT 2.16,
Contributor has not, since the Balance Sheet Date:
(a) Incurred any material obligation or liability (absolute,
accrued, contingent or otherwise) or entered into any contract, lease,
license or commitment, except in connection with the performance of this
Agreement;
5
(b) Discharged or satisfied any material lien or encumbrance,
or paid or satisfied any material obligation or liability (absolute, accrued,
contingent or otherwise) other than (i) liabilities shown or reflected on the
Balance Sheet, (ii) liabilities incurred since the Balance Sheet Date in the
ordinary course of business;
(c) Formed or acquired or disposed of any interest in any
corporation, partnership, joint venture or other entity;
(d) Made any payments to or loaned any money to any person or
entity other than in the ordinary course of business;
(e) Lost or terminated any employee, patient, customer or
supplier that has or may have, individually or in the aggregate, a material
adverse effect on the Business;
(f) Increased or established any reserve for taxes or any
other liability on its books or otherwise provided therefor, except as may
have been required due to income or operations of Contributor since the
Balance Sheet Date;
(g) Mortgaged, pledged or subjected to any lien, charge or
other encumbrance any of the Assets, tangible or intangible;
(h) Sold or contracted to sell or transferred or contracted to
transfer any of the Assets or any other assets used in the conduct of the
Business, canceled any debts or claims or waived any rights, except in the
ordinary course of business;
(i) Except in the ordinary course or business consistent with
past practices, granted any increase in the rates of pay of employees,
consultants or agents, or by means of any bonus or pension plan, contract or
other commitment, increased the compensation of any officer, employee,
consultant or agent;
(j) Authorized or incurred any capital expenditures in excess
of Five Thousand and No/100 Dollars ($5,000.00);
(k) Except for this Agreement and any other agreement executed
and delivered pursuant to this Agreement, entered into any material
transaction other than in the ordinary course of business or permitted
hereunder;
(l) Redeemed, purchased, sold or issued any stock, bonds or
other securities;
(m) Experienced damage, destruction or loss (whether or not
covered by insurance) materially and adversely affecting any of its
properties, assets or business or the Business or the Assets, or experienced
any other material adverse change in its financial condition, assets,
prospects, liabilities or business;
(n) Declared or paid a distribution, payment or dividend of
any kind on the equity interests of Contributor;
(o) Repurchased, approved any repurchase or agreed to
repurchase any of Contributor's partnership interests; or
(p) Suffered any material adverse change in the Business or to
the Assets.
2.17 TAXES. (a) Contributor has filed all tax returns (including tax
reports and other statements) required to have been filed by it, and has paid
all taxes (including any interest, penalty or additions thereto) required to
have been paid by it. All such tax returns are complete and accurate in all
respects and properly reflect the relevant taxes for the periods covered
thereby. Contributor has not received any notice that any tax deficiency
or delinquency has been or may be asserted against Contributor. There are
no audits relating to taxes of Contributor pending or in process or, to the
knowledge of Contributor, threatened. Contributor is not currently the
beneficiary of any waiver of any statute of
6
limitations in respect of taxes nor of any extension of time within which to
file any tax return or to pay any tax assessment or deficiency. There are no
liens or encumbrances relating to taxes on or threatened against any of the
assets of Contributor. Contributor has withheld and paid all taxes required
by law to have been withheld and paid by it. Neither Contributor nor any
predecessor of Contributor is or has been a party to any tax allocation or
sharing agreement or a member of an affiliated group of corporations filing a
consolidated Federal income tax return. Contributor has delivered to
Pentegra correct and complete copies of Contributor's three most recently
filed annual state, local and Federal income tax returns, together with all
examination reports and statements of deficiencies assessed against or agreed
to by Contributor during the three calendar year period preceding the date of
this Agreement. Contributor has neither made any payments, is obligated to
make any payments, or is a party to any agreement that under any circumstance
could obligate it to make any payments that will not be deductible under Code
section 280G.
(b) Contributor does not intend to dispose of any of the shares of
Pentegra Common Stock to be received hereunder and is not a party to any
plan, arrangement or agreement for the disposition of such shares.
Contributor and Partners have no knowledge, after due inquiry, of any such
intent, plan, arrangement or agreement by any Partner. Nothing contained
herein shall prohibit Contributor from selling such shares of Pentegra Common
Stock after the designated holding period and in accordance with SECTION 12.1
hereof.
2.18 COMMISSIONS AND FEES. There are no claims for brokerage
commissions or finder's or similar fees in connection with the transactions
contemplated by this Agreement which may be now or hereafter asserted against
Pentegra, Contributor or Contributor's Partners resulting from any action
taken by Contributor or any Partner or their respective agents or employees,
or any of them.
2.19 LIABILITIES; DEBT. Except to the extent reflected or reserved
against on the Balance Sheet, Contributor did not have, as of the Balance
Sheet Date, and has not incurred since that date and will not have incurred
as of the Closing Date, any liabilities or obligations of any nature, whether
accrued, absolute, contingent or otherwise, and whether due or to become due,
other than those incurred in the ordinary course of business or as set forth
on EXHIBIT 2.16. Contributor and Partners do not know, or have reasonable
grounds to know, of any basis for the assertion against Contributor or any
Partner as of the Balance Sheet Date, of any claim or liability of any nature
in any amount not fully reflected or reserved against on the Balance Sheet,
or of any claim or liability of any nature arising since that date other than
those incurred in the ordinary course of business or contemplated by this
Agreement. All indebtedness of Contributor (including without limitation,
indebtedness for borrowed money, guaranties and capital lease obligations) is
described on EXHIBIT 2.19 attached hereto.
2.20 INSURANCE POLICIES. Contributor, each Partner and each licensed
professional of Contributor carries property, liability, malpractice,
workers' compensation and such other types of insurance as is customary in
the industry. Valid and enforceable policies in such amounts are outstanding
and duly in force and will remain duly in force through the Closing Date.
All such policies are described in EXHIBIT 2.20 attached hereto and true and
correct copies have been delivered to Pentegra. Neither Partners nor
Contributor have not received notice or other communication from the issuer
of any such insurance policy cancelling or amending such policy or
threatening to do so. Neither Contributor, nor any Partner nor any licensed
professional employee of Contributor has any outstanding claims, settlements
or premiums owed against any insurance policy.
2.21 EMPLOYEE BENEFIT PLANS. Except as set forth on EXHIBIT 2.21
attached hereto, Contributor has neither established, nor maintains, nor is
obligated to make contributions to or under or otherwise participate in, (a)
any bonus or other type of compensation or employment plan, program,
agreement, policy, commitment, contract or arrangement (whether or not set
forth in a written document); (b) any pension, profit-sharing, retirement or
other plan, program or arrangement; or (c) any other employee benefit plan,
fund or program, including, but not limited to, those described in SECTION
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). All such plans listed on EXHIBIT 2.20 (individually "Contributor
Plan," and collectively "Contributor Plans") have been operated and
administered in all material respects in accordance with all applicable laws,
rules and regulations, including without limitation, ERISA, the Internal
Revenue Code of 1986, as amended, Title VII of the Civil Rights Act of 1964,
as amended, the Equal Pay Act of 1967, as amended, the Age Discrimination in
Employment Act of 1967, as amended, and the related rules and regulations
adopted by those Federal agencies responsible for the administration of such
laws. No act or failure to act by Contributor has resulted in a "prohibited
transaction" (as defined in ERISA) with respect to
7
the Contributor Plans. No "reportable event" (as defined in ERISA) has
occurred with respect to any of the Contributor Plans. Contributor has not
previously made, is not currently making, and is not obligated in any way to
make, any contributions to any multiemployer plan within the meaning of the
Multi-Employer Pension Plan Amendments Act of 1980. With respect to each
Contributor Plan, either (i) the value of plan assets (including commitments
under insurance contracts) is at least equal to the value of plan liabilities
or (ii) the value of plan liabilities in excess of plan assets is disclosed
on the Balance Sheet, all as of the Closing Date.
2.22 ADVERSE AGREEMENTS. Contributor is not, and will not be as of
the Closing Date, a party to any agreement or instrument or subject to any
charter or other corporate restriction or any judgment, order, writ,
injunction, decree, rule or regulation that materially and adversely affects
the condition (financial or otherwise), operations, assets, liabilities,
business or prospects of Contributor, the Business or the Assets.
2.23 COMPLIANCE WITH LAWS IN GENERAL. Contributor, Partners and
Contributor's licensed professional employees, and the conduct of the
Business and use of the Assets, have complied with all applicable laws,
rules, regulations and licensing requirements, including, without limitation,
the Federal Environmental Protection Act, the Occupational Safety and Health
Act, the Americans with Disabilities Act and any environmental laws and
medical waste laws, and there exist no violations by Contributor, any Partner
or any licensed professional employee of Contributor of any Federal, state or
local law or regulation. Contributor and Partners have not received any
notice of a violation of any Federal, state and local laws, regulations and
ordinances relating to the operations of the Business and Assets and no
notice of any pending inspection or violation of any such law, regulation or
ordinance has been received by Contributor.
2.24 THIRD PARTY PAYORS. Contributor, Partners and each licensed
professional employee or independent contractor of Contributor has timely
filed all claims or other reports required to be filed with respect to the
purchase of services by third-party payors, and all such claims or reports
are complete and accurate, and has no liability to any payor with respect
thereto. There are no pending appeals, overpayment determinations,
adjustments, challenges, audit, litigation or notices of intent to open
Medicare or Medicaid claim determinations or other reports required to be
filed by Contributor, any Partner and each licensed professional employee of
Contributor. Neither Contributor, nor any Partner, nor any licensed
professional employee of Contributor has been convicted of, or pled guilty or
nolo contendere to, patient abuse or negligence, or any other Medicare or
Medicaid program related offense and none has committed any offense which may
serve as the basis for suspension or exclusion from the Medicare and Medicaid
programs or any other third party payor program. With respect to payors,
Contributor, Partners and Contributor's licensed professional employees has
not (a) knowingly and willfully making or causing to be made a false
statement or representation of a material fact in any application for any
benefit or payment; (b) knowingly and willfully making or causing to be made
any false statement or representation of a material fact for use in
determining rights to any benefit or payment; (c) failed to disclose
knowledge of the occurrence of any event affecting the initial or continued
right to any benefit or payment on its own behalf or on behalf of another,
with the intent to fraudulently secure such benefit or payment; and (d)
violated any applicable state anti-remuneration or self-referral statutes,
rules or regulations.
2.25 NO UNTRUE REPRESENTATIONS. No representation or warranty by
Contributor or Partners in this Agreement, and no Exhibit or certificate
issued or executed by, or information furnished by, officers or directors of
Contributor or any Partner and furnished or to be furnished to Pentegra
pursuant hereto, or in connection with the transactions contemplated hereby,
contains or will contain any untrue statement of a material fact, or omits or
will omit to state a material fact necessary to make the statements or facts
contained therein not misleading.
2.26 BANKING RELATIONS. Set forth in EXHIBIT 2.26 is a complete and
accurate list of all arrangements that Contributor has with any bank or other
financial institution, indicating with respect to each relationship the type
of arrangement maintained (such as checking account, borrowing arrangements,
safe deposit box, etc.) and the person or persons authorized in respect
thereof.
2.27 OWNERSHIP INTERESTS OF INTERESTED PERSONS; COMPETITORS. No
officer, employee, director or stockholder of Contributor, or their
respective spouses, children or affiliates, owns directly or indirectly, on
an individual or joint basis, any interest in, has a compensation or other
financial arrangement with, or serves as an officer or director
8
of, any customer or supplier or competitor of Contributor or any organization
that has a material contract or arrangement with Contributor.
2.28 PAYORS. EXHIBIT 2.28 sets forth a true, complete and correct
list of the names and addresses of each payor of Contributor's services which
accounted for more than 10% of revenues of Contributor in the preceding
fiscal year. Contributor has good relations with all such payors and other
material payors of Contributor and none of such payors has notified
Contributor that it intends to discontinue its relationship with Contributor
or to deny any claims submitted to such payor for payment.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF PENTEGRA.
Pentegra hereby represents and warrants to Contributor and Partners as
follows:
3.1 CORPORATE EXISTENCE: GOOD STANDING. Pentegra is a corporation
duly organized and existing and in good standing under the laws of the State
of Delaware.
3.2 POWER AND AUTHORITY; CONSENTS. Pentegra has corporate power to
execute, deliver and perform this Agreement and all agreements and other
documents executed and delivered by it pursuant to this Agreement or to be
executed and delivered on the Closing Date, and has taken all actions
required by law, its Certificate of Incorporation, its Bylaws or otherwise,
to authorize the execution, delivery and performance of this Agreement and
such related documents. This Agreement and all agreements and documents
executed and delivered in connection herewith have been, or will be as of the
Closing Date, duly executed and delivered by Pentegra and constitute or will
constitute the legal, valid and binding obligations of Pentegra, enforceable
against Pentegra in accordance with their respective terms, except as may be
limited by applicable bankruptcy, insolvency or similar laws affecting
creditors' rights generally or the availability of equitable remedies. The
execution and delivery of this Agreement, and the agreements executed and
delivered pursuant to this Agreement or to be executed and delivered on the
Closing Date, do not, and, the consummation of the actions contemplated
hereby will not, violate any provision of the Certificate of Incorporation or
Bylaws of Pentegra or any provisions of, or result in the acceleration of,
any obligation under any mortgage, lien, lease, agreement, rent, instrument,
order, arbitration award, judgment or decree to which Pentegra is a party or
by which Pentegra is bound, or violate any material restrictions of any kind
to which Pentegra is subject, or result in any lien or encumbrance on any of
Pentegra's assets. Other than as have been obtained or as would not have a
material adverse effect, there are no consents of any person or entity
required for the transaction contemplated hereby on behalf of Pentegra.
3.3 PERMITS, LICENSES AND GOVERNMENTAL AUTHORIZATIONS. All building
or other permits, certificates of occupancy, concessions, grants, franchises,
licenses, certificates of need and other governmental authorizations and
approvals required for the conduct of the business of Penegra or waivers
thereof, have been duly obtained and are in full force and effect, except as
would not have a material adverse effect upon Pentegra. Other than as would
not have a material adverse effect, there are no proceedings pending or, to
the knowledge of Pentegra, threatened, which may result in the revocation,
cancellation or suspension, or any adverse modification, of any such licenses
or permits.
3.4 LEGAL PROCEEDINGS. Other than as would not have a material
adverse effect, neither Pentegra nor its business or assets is subject to any
pending, nor does Pentegra have knowledge of any threatened, litigation,
governmental investigation, condemnation or other proceeding against or
relating to or affecting Pentegra, its business, assets or the transactions
contemplated by this Agreement, and, to the knowledge of Pentegra, no basis
for any such action exists, nor is there any legal impediment of which
Pentegra has knowledge to the continued operation of its business or the use
of its Assets in the ordinary course.
3.5 TAXES. Pentegra has filed all tax returns (including tax reports
and other statements) required to have been filed by it, and has paid all
taxes (including any interest, penalty or additions thereto) required to have
been paid by it, other than as would not have a material adverse effect.
Pentegra has not received any notice that any tax deficiency or delinquency
has been or may be asserted against Pentegra. There are no audits relating
to taxes of Pentegra pending or in process or, to the knowledge of Pentegra,
threatened. Pentegra is not currently the beneficiary
9
of any waiver of any statute of limitations in respect of taxes nor of any
extension of time within which to file any tax return or to pay any tax
assessment or deficiency.
3.6 COMMISSIONS AND FEES. Pentegra has not incurred any obligation
for any finder's, broker's or similar fees in connection with the
transactions contemplated hereby.
3.7 CAPITAL STOCK. The issuance and delivery by Pentegra of shares
of Pentegra Common Stock in connection with the acquisition contemplated
hereby will be as of the Closing Date duly and validly authorized by all
necessary corporate action on the part of Pentegra. The Pentegra Common
Stock to be issued in connection with the acquisition contemplated hereby,
when issued in accordance with the terms of this Agreement, will be validly
issued, fully paid and nonassessable.
3.8 NO UNTRUE REPRESENTATIONS. No representation or warranty by
Pentegra in this Agreement, and no Exhibit or certificate issued by officers
or directors of Pentegra and furnished or to be furnished to Contributor or
any Partner pursuant hereto, or in connection with the transactions
contemplated hereby, contains or will contain any untrue statement of a
material fact, or omits or will omit to state a material fact necessary to
make the statements or facts contained therein not misleading.
SECTION 4. COVENANTS OF CONTRIBUTOR AND PARTNERS.
Contributor and Partners, jointly and severally, agree that between the
date hereof and the Closing Date:
4.1 CONSUMMATION OF AGREEMENT; EXHIBITS. Contributor and Partners
shall use their best efforts to cause the consummation of the transactions
contemplated hereby in accordance with their terms and conditions.
Contributor and Partners agree to complete the Exhibits hereto to be provided
by them in form and substance satisfactory to Pentegra.
4.2 BUSINESS OPERATIONS. Contributor and Partners shall operate the
Business and use the Assets in the ordinary course. Contributor and Partners
shall not enter into any lease, contract, indebtedness, commitment, purchase
or sale or acquire or dispose of any capital asset relating to the Business
or the Assets except in the ordinary course of business. Contributor and
Partners shall use their best efforts to preserve the Business and Assets
intact and shall not take any action that would have an adverse effect on the
Business or Assets. Contributor and Partners shall use their best efforts to
preserve intact the relationships with payors, customers, suppliers, patients
and others having significant business relations with Contributor.
Contributor and Partners shall collect its receivables and pay its trade
payables in the ordinary course of business. Contributor and Partners shall
not introduce any new method of management, operations or accounting.
4.3 ACCESS AND NOTICE. Contributor and Partners shall permit
Pentegra and its authorized representatives access to, and make available for
inspection, all of the assets and business of Contributor, the Business and
the Assets, including employees, customers and suppliers and permit Pentegra
and its authorized representatives to inspect and make copies of all
documents, records and information with respect to the business or assets of
Contributor, the Business or the Assets as Pentegra or its representatives
may request. Contributor and Partners shall promptly notify Pentegra in
writing of (a) any notice or communication relating to a default or event
that, with notice or lapse of time or both, could become a default, under any
contract, commitment or obligation to which Contributor is a party or
relating to the Business or the Assets, and (b) any adverse change in
Contributor's or the Business' financial condition or the Assets.
4.4 APPROVALS OF THIRD PARTIES AND PERMITS AND CONSENTS. Contributor
and Partners shall use their best efforts to secure all necessary approvals
and consents of third parties to the consummation of the transactions
contemplated hereby, including consents described on EXHIBIT 2.4.
Contributor and Partners shall use their best efforts to obtain all licenses,
permits, approvals or other authorizations required under any law, rule,
regulation, or otherwise to provide the services of Contributor contemplated
by the Service Agreement and to conduct the intended business of Contributor
and operate the Business and use the Assets.
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4.5 ACQUISITION PROPOSALS. From the execution of this Agreement
until the earlier of the Closing or the termination of this Agreement in
accordance with the provisions hereof, Contributor and Partners shall not,
and shall use its best efforts to cause Contributor's employees, agents and
representatives not to, initiate, solicit or encourage, directly or
indirectly, any inquiries or the making or implementation of any proposal or
offer, including without limitation, any proposal or offer to any Partner,
with respect to a merger, acquisition, consolidation or similar transaction
involving, or the purchase of all or any significant portion of the assets or
any equity securities of Contributor or engage in any negotiations
concerning, or provide any confidential information or data to, or have any
discussions with, any person relating to such proposal or offer, and
Contributor and Partners will immediately cease any such activities,
discussions or negotiations heretofore conducted with respect to any of the
foregoing. Contributor and Partners shall immediately notify Pentegra if any
such inquiries or proposals are received.
4.6 FUNDING OF ACCRUED EMPLOYEE BENEFITS. Contributor hereby
covenants and agrees that it will take whatever steps are necessary to pay or
fund completely for any accrued benefits, where applicable, or vested accrued
benefits for which Contributor or any entity might have any liability
whatsoever arising from any insurance, pension plan, employment tax or
similar liability of Contributor to any employee or other person or entity
(including, without limitation, any Contributor Plan and any liability under
employment contracts with Contributor) allocable to services performed prior
to the Closing Date. Contributor and Partners acknowledge that the purpose
and intent of this covenant is to assure that Pentegra shall have no unfunded
liability whatsoever at any time after the Closing Date with respect to any
of Contributor's employees or similar persons or entities, including, without
limitation, any Contributor Plan for the period prior to the Closing Date.
4.7 EMPLOYEE MATTERS. Contributor shall not, without the prior
written approval of Pentegra, except as required by law, increase the cash
compensation of any Partner (other than in the ordinary course of business)
or other employee or an independent contractor of Contributor, adopt, amend
or terminate any compensation plan, employment agreement, independent
contractor agreement, employee policies and procedures or employee benefit
plan, take any action that could deplete the assets of any employee benefit,
or fail to pay any premium or contribution due or file any report with
respect to any employee benefit plan, or take any other actions with respect
to its employees or employee matters which might have an adverse effect upon
Contributor, its business, assets or prospects.
4.8 DISTRIBUTIONS AND REPURCHASES. No distribution, payment or
dividend of any kind will be declared or paid by Contributor, nor will any
repurchase of any of Contributor's partnership interests be approved or
effected.
4.9 REQUIREMENTS TO EFFECT ACQUISITION. Contributor and Partners
shall use their best efforts to take, or cause to be taken, all actions
necessary to effect the acquisition contemplated hereby under applicable law.
4.10 ACCOUNTING AND TAX MATTERS. Contributor and Partners will not
change in any material respect the tax or financial accounting methods or
practices followed by Contributor (including any material change in any
assumption underlying, or any method of calculating, any bad debt,
contingency or other reserve), except as may be required by law or generally
accepted accounting principles. Contributor and Partners will duly,
accurately and timely (without regard to any extensions of time) file all
returns, information statements and other documents relating to taxes of
Contributor required to be filed by it, and pay all taxes required to be paid
by it, on or before the Closing Date.
4.11 WAIVER OF BULK TRANSFER COMPLIANCE. Pentegra, Partners and
Contributor hereby waive any compliance with the applicable state Bulk
Transfers Act, if any. Contributor and Partners covenant and agree that all
of the creditors with respect to the Business and the Assets will be paid in
full by Contributor prior to the Closing Date, except to extent that any
liability to such creditors is assumed by Pentegra pursuant to this
Agreement. If required by Pentegra, Contributor and Partners shall furnish
Pentegra with proof of payment of all creditors with respect to the Business
and the Assets. Notwithstanding the foregoing, Contributor and Partners may
dispute the validity or amount of any such creditor's claim without being
deemed to be in violation of this SECTION 4.11, provided that such dispute is
in good faith and does not unreasonably delay the resolution of the claim and
provided, further that Contributor and Partners agree to indemnify and bond
Pentegra for such amounts as is satisfactory to Pentegra.
4.12 LEASE. If Contributor leases any of its premises from any
Partner or other affiliate of Contributor or any Partner of Contributor,
Pentegra shall have entered into a building lease (the "Building Lease") with
the owner of
11
such premises on terms and conditions satisfactory to Pentegra, the terms and
conditions of which shall include, without limitation, (i) a five year
initial term plus three five-year renewal options, (ii) a lease rate equal to
the fair market value lease rate, as agreed to by Pentegra, and (iii) such
other provisions to be acceptable to Pentegra.
4.13 HIRING OF EMPLOYEES. Contributor and Partners shall cooperate
with all requests made by Pentegra for the purpose of allowing Pentegra to
hire those non-dentist employees of Contributor designated by Pentegra, such
employment to be effective as of the Closing Date. Notwithstanding the
above, Contributor and Partners shall remain liable under any Contributor
Plans for any claims incurred by any employees or their spouses or
dependents, and for all compensation, bonuses, benefits and other such items
and other liabilities related to Contributor's employees incurred by
Contributor prior to the Closing Date.
4.14 EMPLOYEE BENEFIT PLANS. Contributor agrees and acknowledges that
all employees of Contributor hired by Pentegra pursuant to SECTION 4.13
above, shall be treated as "leased employees" (as defined in Code Section
414(n)) of Contributor and shall be treated as Clinic employees for purposes
of eligibility and participation in Contributor Plans.
4.15 INSURANCE. Contributor shall cause Pentegra and its affiliates
to be named as an additional insured on its liability insurance programs,
effective as of the Closing Date.
SECTION 5. COVENANTS OF PENTEGRA.
Pentegra agrees that between the date hereof and the Closing:
5.1 CONSUMMATION OF AGREEMENT; EXHIBITS. Pentegra shall use its best
efforts to cause the consummation of the transactions contemplated hereby in
accordance with their terms and provisions. Pentegra agrees to complete the
Exhibits hereto to be provided by it.
5.2 APPROVALS OF THIRD PARTIES AND PERMITS AND CONSENTS. Pentegra
shall use its best efforts to secure all necessary approvals and consents of
third parties to the consummation of the transactions contemplated hereby.
SECTION 6. COVENANTS OF PENTEGRA AND CONTRIBUTOR AND PARTNERS.
Pentegra, Partners and Contributor agree as follows:
6.1 FILINGS; OTHER ACTIONS. Pentegra, Contributor and Partners
shall cooperate to promptly prepare and file with the Securities Exchange
Commission ("SEC") the Registration Statement on Form S-1 (or other
appropriate Form) to be filed by Pentegra in connection with its Initial
Public Offering (including the prospectus constituting a part thereof, the
"Registration Statement"). Pentegra shall obtain all necessary state
securities laws or "Blue Sky" permits and approvals required to carry out the
transactions contemplated by this Agreement and the Contributor and Partners
shall furnish all information concerning Contributor and Partners as may be
reasonable requested in connection with any such action.
Contributor and Partner represent and warrant that none of the
information or documents supplied or to be supplied by it specifically for
inclusion in the Registration Statement, by exhibit or otherwise, will, at
the time the Registration Statement and each amendment or supplement thereto,
if any, becomes effective under the Securities Act of 1933, contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading.
Contributor and Partners shall be entitled to review the Registration
Statement and each amendment thereto, if any, prior to the time each becomes
effective under the Securities Act of 1933.
Contributor and Partners shall furnish Pentegra will all information
concerning themselves, their subsidiaries, if any, directors, officers and
stockholders and such other matters as may be reasonable requested by
Pentegra in
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connection with the preparation of the Registration Statement and each
amendment or supplement thereto, or any other statement, filing, notice or
application made by or on behalf of each such party or any of its subsidiaries
to any governmental entity in connection with the transactions contemplated by
the Other Agreements or this Agreement.
SECTION 7. PENTEGRA CONDITIONS PRECEDENT.
The obligations of Pentegra hereunder are subject to the fulfillment at
or prior to the Closing of each of the following conditions:
7.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Contributor and Partners contained herein shall have been true
and correct in all respects when initially made and shall be true and correct
in all respects as of the Closing Date.
7.2 COVENANTS AND CONDITIONS. Contributor and Partners shall have
performed and complied with all covenants and conditions required by this
Agreement to be performed and complied with by Contributor and Partners prior
to the Closing Date.
7.3 PROCEEDINGS. No action, proceeding or order by any court or
governmental body shall have been threatened orally or in writing, asserted,
instituted or entered to restrain or prohibit the carrying out of the
transactions contemplated hereby.
7.4 NO MATERIAL ADVERSE CHANGE. No material adverse change in the
condition (financial or otherwise), operations, assets, liabilities, business
or prospects of Contributor shall have occurred since the Balance Sheet Date.
7.5 DUE DILIGENCE REVIEW. By the Closing Date, Pentegra shall have
completed a due diligence review of the business, operations and financial
statements of Contributor, the Business and the Assets, the results of which
shall be satisfactory to Pentegra in its sole discretion.
7.6 APPROVAL BY THE BOARD OF DIRECTORS. This Agreement and the
transactions contemplated hereby shall have been approved by the Board of
Directors of Pentegra or a committee thereof.
7.7 SERVICE AGREEMENT; GUARANTY AGREEMENT. Contributor and Pentegra
shall have executed and delivered a Service Agreement (the "Service
Agreement"), in substantially the form attached hereto as EXHIBIT 7.7,
pursuant to which Pentegra will provide management services to the
Contributor. Each Partner shall have executed and delivered a Guaranty
Agreement in substantially the form attached as EXHIBIT 4.10 of the Service
Agreement pursuant to which Partner shall, among other things, guaranty the
obligations of Contributor under the Service Agreement.
7.8 EMPLOYMENT ARRANGEMENTS. Contributor shall have terminated, and
caused each Partner of Contributor that has an existing employment agreement
with Contributor to have terminated his or her employment agreement with
Contributor and shall have executed an employment agreement ("Employment
Agreement") with Contributor in form and substance attached hereto as EXHIBIT
7.8 and otherwise satisfactory to Contributor and Pentegra.
7.9 CONSENTS AND APPROVALS. Contributor and Partners shall have
obtained all necessary government and other third-party approvals and consents.
7.10 CLOSING DELIVERIES. Pentegra shall have received all documents,
duly executed in form satisfactory to Pentegra and its counsel, referred to
in SECTION 9.1.
7.11 DEBT AND RECEIVABLES. There shall be no indebtedness,
receivables or payables between Contributor and its Partners or affiliates
and Contributor shall not have any liabilities, including indebtedness,
guaranties and capital leases, that are not set forth on EXHIBIT 2.19.
7.12 INSURANCE. Contributor and Partners shall have named Pentegra as
an additional insured on their liability insurance program in accordance with
SECTION 4.15.
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7.13 NO CHANGE IN WORKING CAPITAL. There shall have been no material
change in the working capital of Contributor since the Balance Sheet Date.
7.14 SECURITIES APPROVAL. The Registration Statement shall have
become effective under the Securities Act and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the
SEC. At or prior to the date that the Registration Statement is declared
effective by the SEC, Pentegra shall have received all state securities and
"Blue Sky" permits necessary to consummate the transactions contemplated
hereby. The Pentegra Common Stock shall have been approved for listing on
Nasdaq or other exchange selected by Pentegra, subject only to official
notification of issuance.
SECTION 8. CONTRIBUTOR'S AND PARTNERS' CONDITIONS PRECEDENT.
The obligations of Contributor and Partners hereunder are subject to
fulfillment at or prior to the Closing of each of the following conditions:
8.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Pentegra contained herein shall have been true and correct in
all respects when initially made and shall be true and correct in all
respects as of the Closing Date.
8.2 COVENANTS AND CONDITIONS. Pentegra shall have performed and
complied with all covenants and conditions required by this Agreement to be
performed and complied with by Pentegra prior to the Closing Date.
8.3 PROCEEDINGS. No action, proceeding or order by any court or
governmental body shall have been threatened orally or in writing, asserted,
instituted or entered to restrain or prohibit the carrying out of the
transactions contemplated hereby.
8.4 CLOSING DELIVERIES. Contributor shall have received all
documents, duly executed in form satisfactory to Contributor and its counsel,
referred to in SECTION 9.2.
8.5 SECURITIES APPROVAL. The Registration Statement shall have
become effective under the Securities Act and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the
SEC. At or prior to the date that the Registration Statement is declared
effective by the SEC, Pentegra shall have received all state securities and
"Blue Sky" permits necessary to consummate the transactions contemplated
hereby. The Pentegra Common Stock shall have been approved for listing on
Nasdaq or other exchange selected by Pentegra, subject only to official
notification of issuance.
SECTION 9. CLOSING DELIVERIES.
9.1 DELIVERIES OF CONTRIBUTOR AND PARTNERS. Within five business days
after requested by Pentegra, Contributor and Partners shall deliver to
Pentegra the following, all of which shall be in a form satisfactory to
counsel to Pentegra and shall be held by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ L.L.P. (counsel for
Pentegra) in escrow pending Closing, pursuant to an escrow agreement or
letter agreement in form and substance mutually acceptable to the parties
hereto:
(a) an executed original Service Agreement and executed
originals of all documents required by that agreement, including but not
limited to the Guaranty Agreement and security agreement referred to therein;
(b) executed Employment Agreements;
(c) a copy of the resolutions of the Partners authorizing the
execution, delivery and performance of this Agreement, the Service Agreement,
the Employment Agreements and all related documents and agreements each
certified by the Secretary as being true and correct copies of the original
thereof;
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(d) a ▇▇▇▇ of sale conveying the Assets to Pentegra;
(e) an assignment of each contract, agreement and lease being
assigned to and assumed by Pentegra;
(f) certificates of the Partners and a duly authorized officer
of Contributor dated as of the Closing Date, (i) as to the truth and
correctness of the representations and warranties of Contributor and Partners
contained herein; (ii) as to the performance of and compliance by Contributor
and Partner with all covenants contained herein; and (iii) certifying that
all conditions precedent of Contributor and Partners to the Closing have been
satisfied;
(g) a certificate, dated within 30 days of the Closing Date,
of the Secretary of the State of incorporation of Contributor and any state
of required foreign qualification of Contributor establishing that
Contributor is in existence and is in good standing to transact business in
its state of incorporation;
(h) an opinion of counsel to Contributor and Partner opining
as to the execution and delivery of this Agreement and the other documents
and agreements to be executed pursuant hereto, the good standing and
authority of Contributor, the enforceability of this Agreement and the other
agreements and documents to be executed in connection herewith, and other
matters reasonably requested by Pentegra;
(i) non-foreign affidavits executed by Contributor;
(j) all authorizations, consents, approvals, permits and
licenses referred to in SECTIONS 2.3 and 2.4;
(k) an executed Registration Rights Agreement between Pentegra
and Contributor, in substantially the form attached hereto as EXHIBIT 9.1(l)
(the "Registration Rights Agreement"); and
(l) such other instruments and documents as reasonably
requested by Pentegra to carry out and effect the purpose and intent of this
Agreement.
9.2 DELIVERIES OF PENTEGRA. On or before the Closing Date, Pentegra
shall deliver to Contributor and Partner, the following, all of which shall
be in a form satisfactory to counsel to Contributor and Partners and shall be
held by ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ L.L.P. (counsel for Pentegra) in escrow pending
Closing, pursuant to an escrow agreement or letter agreement in form and
substance mutually acceptable to the parties hereto:
(a) the Acquisition Consideration;
(b) an executed Service Agreement;
(c) an assumption of each contract, agreement and lease being
assigned to and assumed by Pentegra;
(d) a copy of the resolutions of the Board of Directors of
Pentegra (or a committee thereof) authorizing the execution, delivery and
performance of this Agreement and all related documents and agreements each
certified by the Secretary as being true and correct copies of the original
thereof;
(e) certificates of the President of Pentegra, dated as of the
Closing Date, (i) as to the truth and correctness of the representations and
warranties of Pentegra contained herein; (ii) as to the performance of and
compliance by Pentegra with all covenants contained herein; and (iii)
certifying that all conditions precedent of Pentegra to the Closing have been
satisfied;
(f) a certificate of the Secretary of Pentegra certifying as
to the incumbency of the directors and officers of Pentegra and as to the
signatures of such directors and officers who have executed documents
delivered at the Closing on behalf of Pentegra;
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(g) certificates, dated within 30 days of the Closing Date, of
the Secretary of the State of Delaware establishing that Pentegra is in
existence and are in good standing to transact business in the State of
Delaware and the State of incorporation of Contributor;
(h) an opinion of counsel to Pentegra opining as to the
execution and delivery of this Agreement and the other documents and
agreements to be executed pursuant hereto, the good standing and authority of
Pentegra, the enforceability of this Agreement and the other agreements and
documents to be executed in connection herewith, and other matters reasonably
requested by Contributor;
(i) the executed Registration Rights Agreement; and
(j) such other instruments and documents as reasonably
requested by Contributor to carry out and effect the purpose and intent of
this Agreement.
SECTION 10. NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
INDEMNIFICATION.
10.1 NATURE AND SURVIVAL. All statements contained in this Agreement
or in any Exhibit attached hereto, any agreement executed pursuant hereto,
and any certificate executed and delivered by any party pursuant to the terms
of this Agreement, shall constitute representations and warranties of
Contributor and Partners, jointly and severally, or of Pentegra, as the case
may be. All such representations and warranties, and all representations and
warranties expressly labeled as such in this Agreement shall survive the date
of this Agreement and the Closing Date for a period of five (5) years
following the Closing Date, except that (i) the representations and
warranties with respect to environmental and medical waste laws and health
care laws and matters shall survive for a period of fifteen (15) years and
tax representations shall survive until one year after the expiration of the
applicable statute of limitations. Each party covenants with the other
parties not to make any claim with respect to such representations and
warranties, against any party after the date on which such survival period
shall terminate. No party shall be entitled to claim indemnity from any
other party pursuant to SECTION 10.2 or 10.3 hereof, unless such party has
timely given the notice required in SECTION 10.2, 10.3 or 10.4 hereof, as the
case may be. Each party hereby releases, acquits and discharges the other
party from any and all claims and demands, actions and causes of action,
damages, costs, expenses and rights of setoff with respect to which the
notices required by SECTION 10.2, 10.3 or 10.4, as applicable, are not timely
provided.
10.2 INDEMNIFICATION BY PENTEGRA. PENTEGRA (FOR PURPOSES OF THIS
SECTION 10.2 AND, TO THE EXTENT APPLICABLE, SECTION 10.4, "INDEMNITOR"),
SHALL INDEMNIFY AND HOLD CONTRIBUTOR AND ITS PartnerS, AGENTS AND EMPLOYEES
(EACH OF THE FOREGOING, INCLUDING CONTRIBUTOR AND PartnerS, FOR PURPOSES OF
THIS SECTION 10.2 AND, TO THE EXTENT APPLICABLE, SECTION 10.4, AN
"INDEMNIFIED PERSON"), HARMLESS FROM AND AGAINST ANY AND ALL LIABILITIES,
LOSSES, DAMAGES, ACTIONS, SUITS, COSTS, DEFICIENCIES AND EXPENSES (INCLUDING,
BUT NOT LIMITED TO, REASONABLE FEES AND DISBURSEMENTS OF COUNSEL THROUGH
APPEAL) ARISING FROM OR BY REASON OF OR RESULTING FROM:
(A) ANY BREACH BY INDEMNITOR OF ANY REPRESENTATION, WARRANTY,
AGREEMENT OR COVENANT CONTAINED IN THIS AGREEMENT (INCLUDING THE EXHIBITS
HERETO) AND EACH DOCUMENT, CERTIFICATE OR OTHER INSTRUMENT FURNISHED OR TO BE
FURNISHED BY INDEMNITOR HEREUNDER, AND
(B) AFTER THE CLOSING DATE, INDEMNITOR'S OWNERSHIP OF THE ASSETS, AND
(C) ANY LIABILITY UNDER THE SECURITIES ACT, THE EXCHANGE ACT OR ANY
OTHER FEDERAL OR STATE "BLUE SKY" OR SECURITIES LAWS OR REGULATION, AT COMMON
LAW OR OTHERWISE, ARISING OUT OF OR BASED UPON ANY UNTRUE STATEMENT OR
ALLEGED UNTRUE STATEMENT OF A MATERIAL FACT RELATING TO PENTEGRA CONTAINED IN
ANY PRELIMINARY PROSPECTUS, THE REGISTRATION STATEMENT OR ANY PROSPECTUS
FORMING A PART THEREOF, OR ANY AMENDMENT THEREOF OR SUPPLEMENT THERETO,
ARISING OUT OF OR BASED UPON ANY
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OMISSION OR ALLEGED OMISSION TO STATE THEREIN A MATERIAL FACT RELATING TO
PENTEGRA REQUIRED TO BE STATED THEREIN OR NECESSARY TO MAKE THE STATEMENTS
THEREIN NOT MISLEADING.
IN CONNECTION WITH INDEMNITOR'S OBLIGATION TO INDEMNIFY FOR EXPENSES, INDEMNITOR
SHALL REIMBURSE EACH INDEMNIFIED PERSON FOR ALL SUCH EXPENSES AS THEY ARE
INCURRED BY SUCH INDEMNIFIED PERSON, PROVIDED THAT SUCH INDEMNIFIED PERSON
AGREES IN WRITING TO REFUND ALL SUCH REIMBURSED EXPENSES IF AND TO THE EXTENT
THAT IT IS FINALLY JUDICIALLY DETERMINED THAT SUCH INDEMNIFIED PERSON IS NOT
ENTITLED TO INDEMNIFICATION HEREUNDER.
10.3 INDEMNIFICATION BY CONTRIBUTOR AND PARTNERS. CONTRIBUTOR AND
PARTNERS (FOR PURPOSES OF THIS SECTION 10.3 AND, TO THE EXTENT APPLICABLE,
SECTION 10.4, "INDEMNITOR"), JOINTLY AND SEVERALLY, SHALL INDEMNIFY AND HOLD
PENTEGRA AND ITS AFFILIATES, OFFICERS, DIRECTORS, PARTNERS, AGENTS AND
EMPLOYEES (EACH OF THE FOREGOING, INCLUDING PENTEGRA, FOR PURPOSES OF THIS
SECTION 10.3 AND, TO THE EXTENT APPLICABLE, SECTION 10.4, AN "INDEMNIFIED
PERSON") HARMLESS FROM AND AGAINST ANY AND ALL LIABILITIES, LOSSES, CLAIMS,
DAMAGES, ACTIONS, SUITS, COSTS, DEFICIENCIES AND EXPENSES (INCLUDING, BUT NOT
LIMITED TO, REASONABLE FEES AND DISBURSEMENTS OF COUNSEL THROUGH APPEAL)
ARISING FROM OR BY REASON OF OR RESULTING FROM OR WITH RESPECT TO:
(A) ANY BREACH BY INDEMNITOR OF ANY REPRESENTATION, WARRANTY,
AGREEMENT OR COVENANT CONTAINED IN THIS AGREEMENT (INCLUDING THE EXHIBITS
HERETO) AND EACH DOCUMENT, CERTIFICATE, OR OTHER INSTRUMENT FURNISHED OR TO BE
FURNISHED BY INDEMNITOR HEREUNDER,
(B) PRIOR TO AND AFTER THE CLOSING DATE, THE INDEMNITOR'S MANAGEMENT
AND CONDUCT OF THE BUSINESS AND OWNERSHIP OR OPERATION OF THE ASSETS,
(C) ANY ALLEGED ACT OR NEGLIGENCE OF INDEMNITOR OR ITS EMPLOYEES,
AGENTS AND INDEPENDENT CONTRACTORS IN OR ABOUT CONTRIBUTOR'S BUSINESS WHETHER
ON OR AFTER THE CLOSING DATE,
(D) ANY VIOLATION BY CONTRIBUTOR OR ITS PARTNERS OR THEIR
CONSULTANTS, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND AFFILIATES OF STATE
OR FEDERAL LAWS GOVERNING HEALTHCARE FRAUD AND ABUSE, OR ANY OVERPAYMENT OR
OBLIGATION ARISING OUT OF OR RESULTING FROM ACTIONS OF THE CONTRIBUTOR OR
PARTNERS RELATING TO CLAIMS SUBMITTED TO ANY THIRD PARTY PAYOR, WHETHER ON OR
AFTER THE CLOSING DATE,
(E) TAXES OF CONTRIBUTOR OR ANY PARTNER OR ANY OTHER PERSON OR ENTITY
RELATED TO OR AFFILIATED WITH THE CONTRIBUTOR OR ANY PARTNER ARISING FROM OR
AS A RESULT OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT,
(F) ANY LIABILITY OF CONTRIBUTOR OR THE PARTNERS FOR COSTS AND
EXPENSES (INCLUDING, WITHOUT LIMITATION, ATTORNEYS' FEES) INCURRED IN
CONNECTION WITH THE NEGOTIATION, PREPARATION OF CLOSING OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR THE OTHER DOCUMENTS TO BE EXECUTED IN
CONNECTION HEREWITH,
(G) ANY ACCRUED UNFUNDED RETIREMENT OR PENSION PLAN LIABILITIES,
(H) ANY LIABILITIES THAT ARE NOT SET FORTH ON EXHIBIT 1.3(b), OR
(I) ANY LIABILITY UNDER THE SECURITIES ACT, THE EXCHANGE ACT OR ANY
OTHER FEDERAL OR STATE "BLUE SKY" OR SECURITIES LAWS OR REGULATION, AT COMMON
LAW OR
17
OTHERWISE, ARISING OUT OF OR BASED UPON ANY UNTRUE STATEMENT OR ALLEGED
UNTRUE STATEMENT OF A MATERIAL FACT RELATING TO CONTRIBUTOR OR ITS PARTNERS
AND PROVIDED TO PENTEGRA, OR ITS COUNSEL BY THE CONTRIBUTOR OR ITS PARTNERS
SPECIFICALLY FOR INCLUSION IN ANY PRELIMINARY PROSPECTUS, THE REGISTRATION
STATEMENT OR ANY PROSPECTUS FORMING A PART THEREOF, OR ANY AMENDMENT THEREOF
OR SUPPLEMENT THERETO, ARISING OUT OF OR BASED UPON ANY OMISSION OR ALLEGED
OMISSION TO STATE THEREIN A MATERIAL FACT RELATING TO CONTRIBUTOR OR ITS
PARTNERS REQUIRED TO BE STATED THEREIN OR NECESSARY TO MAKE THE STATEMENTS
THEREIN NOT MISLEADING.
IN CONNECTION WITH INDEMNITOR'S OBLIGATION TO INDEMNIFY FOR EXPENSES,
INDEMNITOR SHALL REIMBURSE EACH INDEMNIFIED PERSON FOR ALL SUCH EXPENSES AS
THEY ARE INCURRED BY SUCH INDEMNIFIED PERSON, PROVIDED THAT SUCH INDEMNIFIED
PERSON AGREES IN WRITING TO REFUND ALL SUCH REIMBURSED EXPENSES IF AND TO THE
EXTENT THAT IT IS FINALLY JUDICIALLY DETERMINED THAT SUCH INDEMNIFIED PERSON
IS NOT ENTITLED TO INDEMNIFICATION HEREUNDER.
10.4 INDEMNIFICATION PROCEDURE. Within sixty (60) days after
Indemnified Person receives written notice of the commencement of any action
or other proceeding in respect of which indemnification or reimbursement may
be sought hereunder, or within such lesser time as may be provided by law for
the defense of such action or proceeding, such Indemnified Person shall
notify Indemnitor thereof. If any such action or other proceeding shall be
brought against any Indemnified Person, Indemnitor shall, upon written notice
given within a reasonable time following receipt by Indemnitor of such notice
from Indemnified Person, be entitled to assume the defense of such action or
proceeding with counsel chosen by Indemnitor and reasonably satisfactory to
Indemnified Person; provided, however, that any Indemnified Person may at its
own expense retain separate counsel to participate in such defense.
Notwithstanding the foregoing, Indemnified Person shall have the right to
employ separate counsel at Indemnitor's expense and to control its own
defense of such action or proceeding if, in the reasonable opinion of counsel
to such Indemnified Person, (a) there are or may be legal defenses available
to such Indemnified Person or to other Indemnified Persons that are different
from or additional to those available to Indemnitor and which could not be
adequately advanced by counsel chosen by Indemnitor, or (b) a conflict or
potential conflict exists between Indemnitor and such Indemnified Person that
would make such separate representation advisable; provided, however, that in
no event shall Indemnitor be required to pay fees and expenses hereunder for
more than one firm of attorneys of Indemnified Person in any jurisdiction in
any one action or proceeding or group of related actions or proceedings.
Indemnitor shall not, without the prior written consent of any Indemnified
Person, settle or compromise or consent to the entry of any judgment in any
pending or threatened claim, action or proceeding to which such Indemnified
Person is a party unless such settlement, compromise or consent includes an
unconditional release of such Indemnified Person from all liability arising
or potentially arising from or by reason of such claim, action or proceeding.
10.5 RIGHT OF SETOFF. In the event of any breach of warranty,
representation, covenant or agreement by Contributor or any Partner giving
rise to indemnification under SECTION 10.3 or SECTION 10.4 hereof, Pentegra
shall be entitled to offset the amount of damages incurred by it as a result
of such breach of warranty, representation, covenant or agreement against any
amounts payable by Pentegra, including the amounts payable under the Service
Agreement.
SECTION 11. TERMINATION. This Agreement may be terminated:
(a) at any time by mutual agreement of all parties;
(b) at any time by Pentegra if any representation or warranty of
Contributor or any Partner contained in this Agreement or in any certificate
or other document executed and delivered by Contributor or any Partner
pursuant to this Agreement is or becomes untrue or breached in any material
respect or if Contributor or any Partner fails to comply in any material
respect with any covenant or agreement contained herein, and any such
misrepresentation, noncompliance or breach is not cured, waived or eliminated
within twenty (20) days after receipt of written notice thereof;
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(c) at any time by Contributor or any Partner if any representation
or warranty of Pentegra contained in this Agreement or in any certificate or
other document executed and delivered by Pentegra pursuant to this Agreement
is or becomes untrue or breached in any material respect or if Pentegra fails
to comply in any material respect with any covenant or agreement contained
herein and such misrepresentation, noncompliance or breach is not cured,
waived or eliminated within twenty (20) days after receipt of written notice
thereof;
(d) by Pentegra, Partners or Contributor if the transaction
contemplated hereby shall not have been consummated by December 31, 1997; or
(e) by Pentegra at any time prior to the Closing Date if Pentegra
determines in its sole discretion as the result of its legal, financial and
operational due diligence with respect to Contributor, that such termination
is desirable and in the best interests of Pentegra.
SECTION 12. TRANSFER REPRESENTATIONS.
12.1 TRANSFER RESTRICTIONS. For a period of one year from the Closing
Date, Contributor shall not voluntarily (a) sell, assign, exchange, transfer,
encumber, pledge, distribute, appoint or otherwise dispose of (i) any shares
of Pentegra Common Stock received by such party hereunder, (ii) any interest
(including without limitation, an option to buy or sell) in any shares of
Pentegra Common Stock, in whole or in part, and no such attempted transfer
shall be treated as effective for any purpose or (b) engage in any
transaction, whether or not with respect to any shares of Pentegra Common
Stock or any interest therein, the intent or effect of which is to reduce the
risk of owning shares of Pentegra Common Stock. The certificates evidencing
the Pentegra Common Stock delivered to Contributor pursuant to the terms
hereof will bear a legend substantially in the form set forth below and
containing such other information as Pentegra may deem necessary or
appropriate:
The shares represented by this certificate may not be voluntarily sold,
assigned, exchanged, transferred, encumbered, pledged, distributed,
appointed or otherwise disposed of, and the issuer shall not be required to
give effect to any attempted voluntary sale, assignment, exchange,
transfer, encumbrance, pledge, distribution, appointment or other
disposition prior to _________ [date that is one year from the Closing
Date]. Upon the written request of the holder of this certificate, the
issuer agrees to remove this restrictive legend (and any stop order placed
with the transfer agent) after the date specified above.
12.2 INVESTMENTS; COMPLIANCE WITH LAW. Contributor and Partners
acknowledge that the shares of Pentegra Common Stock to be delivered to
Contributor pursuant to this Agreement have not been and will not be
registered under the Securities Act of 1933 and may not be resold without
compliance with the Securities Act of 1933. The Pentegra Common Stock to be
acquired by Contributor pursuant to this Agreement is being acquired solely
for its own account, for investment purposes only and with no present
intention of distributing, selling or otherwise disposing of it in connection
with a distribution. Contributor covenants, warrants and represents that
none of the shares of Pentegra Common Stock issued to it will be offered,
sold, assigned, pledged, hypothecated, transferred or otherwise disposed of
except after full compliance with all of the applicable provisions of the
Securities Act, as amended, and the rules and regulations of the Securities
Exchange Commission and applicable state securities laws and regulations.
All certificates evidencing shares of Pentegra Common Stock shall bear the
following legend in addition to the legend referenced in SECTION 12.1.
The shares represented hereby have not been registered under the Securities
Act of 1933 (the "Act") and may only be sold or otherwise transferred if
the holder hereof complies with the Act and applicable securities laws.
In addition, certificates evidencing shares of Pentegra Common Stock shall
bear any legend required by the securities or blue sky laws of any state where
Contributor resides.
12.3 ECONOMIC RISK; SOPHISTICATION. Contributor and Partners are able
to bear the economic risk of an investment in Pentegra Common Stock acquired
pursuant to this Agreement and can afford to sustain a total loss of such
investment and have such knowledge and experience in financial and business
matters that they are capable of
19
evaluating the merits and risks of the proposed investment and therefore have
the capacity to protect their own interests in connection with the
acquisition of the Pentegra Common Stock. Contributor, Partners and their
representatives have had an adequate opportunity to ask questions and receive
answers from the officers of Pentegra concerning any and all matters relating
to the background and experience of the officers and directors of Pentegra,
the plans for the operations of the business of Pentegra, and any plans for
additional acquisitions and the like. Contributor, Partners and their
representatives have asked any and all questions in the nature described in
the preceding sentence and all questions have been answered to their
satisfaction. Contractor and Partners are "accredited investors" as defined
in Regulation D of the Securities Act of 1933, as amended.
SECTION 13. NONDISCLOSURE OF CONFIDENTIAL INFORMATION. Contributor and
Partners recognize and acknowledge that they had in the past, currently have,
and in the future may possibly have, access to certain confidential
information of Pentegra that is valuable, special and unique assets of
Pentegra's businesses. Contributor and Partners agree that it will not
disclose such confidential information to any person, firm, corporation,
association or other entity for any purpose or reason whatsoever, unless (i)
such information becomes available to or known by the public generally
through no fault of Contributor or Partners, (ii) disclosure is required by
law or the order of any governmental authority under color of law, provided,
that prior to disclosing any information pursuant to this clause (ii),
Contributor and Partners shall, if possible, give prior written notice
thereof to the other parties hereto, and provide such other parties hereto
with the opportunity to contest such disclosure, (iii) Contributor and
Partners reasonably believe that such disclosure is required in connection
with the defense of a lawsuit against the disclosing party, or (iv)
Contributor and Partners are the sole and exclusive owner of such
confidential information as a result of the transactions contemplated
hereunder or otherwise. In the event of a breach or threatened breach by
Contributor or Partners of the provisions of this SECTION 13, Pentegra shall
be entitled to an injunction restraining Contributor and Partners from
disclosing, in whole or in part, such confidential information. Nothing
herein shall be construed as prohibiting Pentegra from pursuing any other
available remedy for such breach or threatened breach, including the recovery
of damages. The obligations of the parties under this SECTION 13 shall
survive the termination of this Agreement.
SECTION 14. MISCELLANEOUS.
14.1 TAX COVENANT. The parties intend that the transactions
contemplated by this Agreement, together with the transactions contemplated
by the Other Agreement and the Initial Public Offering, will qualify as an
exchange meeting the requirements of Section 351 of the Code. The tax
returns (and schedules thereto) of Partners, Contributor and Pentegra shall
be filed in a manner consistent with such intention and Contributor and
Pentegra shall each provide the other with such tax information, reports,
returns or schedules as may be reasonably required to assist the other in so
reporting the transactions contemplated hereby.
14.2 NOTICES. Any communications required or desired to be given
hereunder shall be deemed to have been properly given if sent by hand
delivery, or by facsimile AND overnight courier, to the parties hereto at the
following addresses, or at such other address as either party may advise the
other in writing from time to time:
If to Pentegra:
Pentegra Dental Group, Inc.
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy of each notice directed to Pentegra to:
▇▇▇▇▇ ▇. ▇▇▇▇, III, Esquire
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ L.L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Contributor or Partners:
To address set forth on EXHIBIT 14.2
with a copy to:
Person and address set forth on EXHIBIT 14.2
All such communications shall be deemed to have been delivered on the date of
hand delivery or on the next business day following the deposit of such
communications, properly addressed and postage prepaid with the overnight
courier.
14.3 FURTHER ASSURANCES. Each party hereby agrees to perform any
further acts and to execute and deliver any documents which may be reasonably
necessary to carry out the provisions of this Agreement.
14.4 EACH PARTY TO BEAR COSTS. Subject to SECTION 14.12, each of the
parties to this Agreement shall pay all of the costs and expenses incurred by
such party in connection with the transactions contemplated by this
Agreement, whether or not such transactions are consummated. Without
limiting the generality of the foregoing and whether or not such liabilities
may be deemed to have been incurred in the ordinary course of business,
Pentegra shall not be liable to or required to pay, either directly or
indirectly, any fees and expenses of legal counsel, accountants, auditors or
other persons or entities retained by Contributor or any Partner for services
rendered in connection with negotiating and closing the transactions
contemplated by this Agreement or the documents to be executed in connection
herewith, whether or not such costs or expenses are incurred before or after
the Closing Date.
14.5 PUBLIC DISCLOSURES. Each party shall keep this Agreement and its
terms confidential, and shall make no press release or public disclosure,
either written or oral, regarding the transactions contemplated by this
Agreement without the prior written consent of the other party, provided that
the foregoing shall not prohibit any disclosure (a) by press release, filing
or otherwise that Pentegra has determined in good faith judgment to be
required by Federal securities laws or the rules of the National Association
of Securities Dealers, (b) to attorneys, accountants, investment bankers or
other agents of the parties assisting the parties in connection with the
transactions contemplated by this Agreement, and (c) by Pentegra in
connection with the conduct of its Initial Public Offering and conducting an
examination of the operations and assets of Contributor.
14.6 GOVERNING LAW. THIS AGREEMENT SHALL BE INTERPRETED, CONSTRUED
AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF INCORPORATION OF
CONTRIBUTOR AND APPLIED WITHOUT GIVING EFFECT TO ANY CONFLICTS OF LAWS
PRINCIPLES.
14.7 CAPTIONS. The captions or headings in this Agreement are made for
convenience and general reference only and shall not be construed to
describe, define or limit the scope or intent of the provisions of this
Agreement.
14.8 INTEGRATION OF EXHIBITS. All Exhibits attached to this Agreement
are integral parts of this Agreement as if fully set forth herein, and all
statements appearing therein shall be deemed disclosed for all purposes and
not only in connection with the specific representation in which they are
explicitly referenced.
14.9 ENTIRE AGREEMENT/AMENDMENT. THIS INSTRUMENT, INCLUDING ALL
EXHIBITS ATTACHED HERETO, CONTAINS THE ENTIRE AGREEMENT OF THE PARTIES AND
SUPERSEDES ANY
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AND ALL PRIOR OR CONTEMPORANEOUS AGREEMENTS BETWEEN THE PARTIES, WRITTEN OR
ORAL, WITH RESPECT TO THE TRANSACTIONS CONTEMPLATED HEREBY.
14.10 COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which when so executed shall be deemed to be an
original, and such counterparts shall together constitute and be one and the
same instrument
14.11 BINDING EFFECT/ASSIGNMENT. This Agreement shall be binding on,
and shall inure to the benefit of, the parties hereto, and their respective
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement. No party may assign any right or
obligation hereunder without the prior written consent of the other parties;
provided, however, that Pentegra may assign its rights and delegate its
obligations hereunder to any entity that is an affiliate of Pentegra. For
purposes of this Agreement an "affiliate" of Pentegra shall include any
entity that, through one or more intermediaries is, controlled, controlled by
or under common control with, Pentegra. Upon any such assignment prior to
the Closing, all references herein to Pentegra (including those to Pentegra
Common Stock) shall be deemed to include references to the assignee and the
assignee's common stock. Notwithstanding any such assignment, Pentegra shall
not, absent a written release from Contributor, be relieved from its
obligations to Contributor under this Agreement.
14.12 COSTS OF ENFORCEMENT. In the event that Pentegra, on the one
hand, or Contributor, on the other hand, file suit in any court against any
other party to enforce the terms of this Agreement against the other party or
to obtain performance by it hereunder, the prevailing party will be entitled
to recover all reasonable costs, including reasonable attorneys' fees, from
the other party as part of any judgment in such suit. The term "prevailing
party" shall mean the party in whose favor final judgment after appeal (if
any) is rendered with respect to the claims asserted in the Complaint.
"Reasonable attorneys' fees" are those reasonable attorneys' fees actually
incurred in obtaining a judgment in favor of the prevailing party.
14.13 PRORATIONS. Contributor agrees to reimburse Pentegra at Closing
a pro rata portion of all taxes levied upon the Assets for the calendar year
in which the Closing occurs. Such taxes shall be estimated, apportioned and
pro-rated among Contributor and Pentegra as of the Closing Date, and the
prorated amount due Pentegra shall be credited to the cash portion of the
Purchase Consideration. Upon payment by Pentegra of such taxes actually
assessed and paid on the Assets, Pentegra shall calculate the apportionment
of such taxes and shall pay Contributor or may demand from Contributor, and
Contributor agrees to pay, the amount necessary to correct the estimate and
proration made at Closing.
14.14 AMENDMENTS; WAIVERS. This Agreement may be amended, modified or
supplemented only by an instrument in writing executed by all the parties
hereto. Any waiver of the terms and conditions hereof must be in writing,
and signed by the parties hereto. The waiver of any of the terms and
conditions of this Agreement shall not be construed as a waiver of any other
terms and conditions hereof.
14.15 ARBITRATION. Upon the request of either Pentegra or the
Contributors or Partners (hereinafter referred to as a "Party"), whether made
before or after the institution of any legal proceeding, any dispute among
the parties hereto in any way arising out of, related to, or in connection
with this Agreement (hereinafter a "Dispute"), shall be resolved by binding
arbitration in accordance with the terms of this Section (hereinafter the
"Arbitration Program").
All Disputes between the Parties shall be resolved by binding arbitration
administered by the American Arbitration Association (the "AAA") in
accordance with the terms of this Arbitration Program, the Commercial
Arbitration Rules of the AAA. In the event of any inconsistency between this
Arbitration Program and those rules or statutes, then the terms of this
Arbitration Program shall control.
The parties hereto agree to adhere to all warranties and covenants (as
described herein) until such time as the arbitration process has been
completed and the arbitrators have determined each party's post-arbitration
obligations and responsibilities as it relates to such warranties and
covenants. No provision of, nor the exercise of any rights under, this
Arbitration Program shall limit the right of any Party at any time to seek or
use ancillary or preliminary
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judicial or non-judicial self help remedies for the purposes of obtaining,
perfecting, preserving, or foreclosing upon any personal property in which
there has been granted a security interest or lien by a Party in the
Documents. In Disputes involving indebtedness or other monetary obligations,
each Party agrees that the other Party may proceed against all liable
persons, jointly and severally against one or more of them, without impairing
rights against other liable persons. Nor shall a Party be required to join
the principal obligor or any other liable persons (e.g., sureties or
guarantors) in any proceeding against a particular person. A Party may
release or settle with one or more liable persons as the Party deems fit
without releasing or impairing rights to proceed against any persons not so
released. All statutes of limitation that would otherwise be applicable
shall apply to any arbitration proceeding.
The party seeking arbitration shall notify the other Party, in writing,
of that Party's desire to arbitrate a dispute; and each Party shall, within
twenty (20) days from the date such notification is received, select an
arbitrator, and those two arbitrators shall select a third arbitrator within
ten (10) days thereafter. The issues or claims in dispute shall be committed
to writing, separately stated and numbered, and each party's proposed answers
or contentions shall be signed below the questions. Failure by a party to
select an arbitrator within the prescribed time period shall serve as that
Party's acquiescence and acceptance of the other party's selection of
arbitrator. The arbitrators shall resolve all Disputes in accordance with the
applicable substantive law. Any Dispute shall be decided by a majority vote
of three arbitrators, unless the claim or amount in controversy does not
exceed $100,000.00, in which case a single arbitrator (who shall have
authority to render a maximum award of $100,000.00, including all damages of
any kind, costs and fees) may decide the Dispute. The arbitrators may grant
any remedy or relief that the arbitrators deem just and equitable and within
the scope of this Arbitration Program. The arbitrators may also grant such
ancillary relief as is necessary to make effective the award. In all
arbitration proceedings the arbitrators shall make specific and written
findings of fact and conclusions of law. In all arbitration proceedings in
which the amount in controversy exceeds $100,000.00, in the aggregate, the
Parties shall have in addition to the statutory right to seek vacation or
modification of any award pursuant to applicable law, the right to seek
vacation or modification of any award that is based in whole, or in part, on
an incorrect or erroneous ruling of law by appeal to an appropriate court
having jurisdiction; provided, however, that any such application for
vacation or modification of an award based on an incorrect ruling of law must
be filed in a court having jurisdiction over the Dispute within 15 days from
the date the award in rendered. The arbitrators' findings of fact shall be
binding on all Parties and shall not be subject to further review except as
otherwise allowed by applicable law.
To the maximum extent practicable, an arbitration proceeding hereunder
shall be concluded within 180 days of the filing of the Dispute with AAA.
Arbitration proceedings hereunder shall be conducted where agreed to in
writing by the Parties or, in the absence of such agreement in Phoeniz,
Arizona or the headquarters of Pentegra if other than Phoeniz, Arizona. The
provisions of this Arbitration Program shall survive any termination,
amendment, or expiration of the Documents, unless the Parties otherwise
expressly agree in writing making specific reference to this Arbitration
Program. To the extent permitted by applicable law, the arbitrator shall
have the power to award recovery of all costs and fees (including attorney's
fees, administrative fees, and arbitrators' fees) to the prevailing Party.
This Arbitration Program may be amended, changed, or modified only by a
writing which specifically refers to this Arbitration Program and which is
signed by all the Parties. If any term, covenant, condition or provision of
the Arbitration Program is found to be unlawful or invalid or unenforceable,
such illegality or invalidity or unenforceable shall not affect the legality,
validity or enforceability of the remaining parts of this Arbitration
Program, and all such remaining parts hereof shall be valid and enforceable
and have full force and effect as if the illegal, invalid or unenforceable
part had not been included. Each Party agrees to keep all Disputes and
arbitration proceedings strictly confidential, except for disclosures of
information required in the ordinary course of business of the Parties or by
applicable law or regulation.
14.16 SEVERABILITY. If any provision of this Agreement shall be found to
be illegal, invalid or unenforceable under present or future laws, such
provision shall be fully severable and this Agreement shall be construed and
enforced as if such provision never comprised a part hereof; and the remaining
provisions hereof shall remain in full force and effect. In lieu of such
provision, there shall be added automatically as part of this Agreement, a
provision as similar in its terms to such provision as may be possible and be
legal, valid and enforceable.
[End of Page]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first above written.
-----------------------------------------
By:
--------------------------------------
Its:
-------------------------------------
PENTEGRA DENTAL GROUP, INC.
By:
--------------------------------------
It:
--------------------------------------
-----------------------------------------
, D.D.S.
----------------------------
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INDEX TO EXHIBITS
Exhibit Description
------- -----------
Annex I Acquisition Consideration
A Target Companies
1.1 Assets
1.2(b) Excluded Assets
1.3(b) Assumed Liabilities
2.1 Existence; Good Standing; Partners/Ownership
2.3 Permits and Licenses
2.4 Consents
2.8 Leases
2.10 Real and Personal Property; Encumbrances
2.12 Patents and Trademarks; Names
2.13 Payroll Information; Employment Agreements
2.15 Contracts (other than Leases and Employment Agreements)
2.16 Subsequent Events
2.19 Debt
2.20 Insurance Policies
2.21 Employee Benefit Plans
2.26 Banking Relations
2.28 Payors
7.7 Form of Service Agreement
7.8 Form of Employment Agreement
9.1(l) Form of Registration Rights Agreement
14.2 Addresses for Notice
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ANNEX I
ACQUISITION CONSIDERATION
The aggregate consideration to be received by the Contributor pursuant to
the Agreement (the "Acquisition Consideration") is the following:
Shares of Pentegra Common Stock equal to $_________ divided by the initial
public offering price of Pentegra.
Cash in the amount of $________________________.
No fractional shares of Pentegra Common Stock will be issued; rather,
shares of Pentegra Common Stock to be issued to Contributor shall be rounded to
the nearest whole share.
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