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EXHIBIT 2.10
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered
into September 20, 1996, to be effective on and after July 1, 1996, by and
among ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., P.A., a Texas professional association
("Duchouquette P.A."), ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., an individual resident of
Dallas, Texas ("Seller"), and THE PHYSICIAN GROUP, P.A., a Texas professional
association ("Purchaser").
Seller desires to sell, and Purchaser desires to purchase, all of the
one thousand (1,000) outstanding shares of capital stock, $0.10 par value, of
Duchouquette P.A. ("Stock");
To facilitate the transactions contemplated by this Agreement,
Purchaser and Duchouquette P.A. entered into an Escrow Agreement on August 19,
1996 with American Title Company, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇ ("Escrow Agent"), pursuant to which Purchaser deposited $843,750.00
("Escrowed Funds") with the Escrow Agent;
On September 5, 1996, Purchaser and Seller entered into an Amended and
Restated Escrow Agreement with American Title Company which amended the
original agreement to the extent that Seller was substituted as a party to the
agreement in the place of Duchouquette P.A., a copy of which is attached as
Exhibit 1 (the "Escrow Agreement") and
Purchaser and Seller desire to set forth certain representations,
warranties, and covenants made by each to the other as a condition to the
execution, delivery, and performance of this Agreement, and to set forth
certain additional agreements relating to the transactions contemplated hereby.
In consideration of the mutual representations, warranties, and
covenants contained herein, and on the terms and subject to the conditions
herein set forth, the parties agree as follows:
1. Purchase and Sale. On the terms and subject to the conditions
set forth herein, Seller hereby sells, assigns, transfers, and delivers to
Purchaser, and Purchaser hereby purchases from Seller, all of the Stock, free
and clear of any liens, liabilities, security interests, claims, and
encumbrances. The purchase and sale of the Stock is made in exchange for and
in consideration of (i) the payment of the Purchase Price (as defined in
Section 3) and (ii) the execution and delivery of the Additional Agreements
(as described in Section 4).
2. Delivery of Stock and Conveyance Documents. Seller has taken
all steps necessary to transfer all right, title, and interest in and to the
Stock to Purchaser, free and clear of all liens, liabilities, security
interests, claims, and encumbrances of any nature whatsoever. Seller herewith
delivers to Purchaser (i) a Certificate representing the Stock, duly endorsed
for transfer or accompanied by duly executed stock powers, and (ii) such other
duly executed transfer and release documents which Purchaser has reasonably
requested to evidence the sale and transfer of the Stock by Seller to Purchaser
free and clear of any liens, liabilities, security interests, claims, and
encumbrances of any nature whatsoever.
STOCK PURCHASE AGREEMENT
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3. Purchase Price. As consideration in part for the transactions
contemplated hereby and as a condition to Closing, Purchaser herewith pays and
delivers to Seller the following consideration (in the aggregate, the "Purchase
Price"):
(a) Cash in the total amount $843,750.00, which shall be
effected by Purchaser and Duchouquette giving written notice to the Escrow
Agent immediately after this Agreement is closed to pay the Escrowed Funds to
Duchouquette pursuant to the terms of the Escrow Agreement;
(b) Secured Promissory Note in the form of Exhibit 2
attached hereto (the "Note") in the principal amount of $843,750.00, payable on
April 30, 1997 with interest at the rate of 8.5% per annum and secured by a
Stock Pledge Agreement and a Security Agreement in the form of the attached
Exhibit 3 and Exhibit 4; and
(c) 63,380 shares of unregistered Common Stock of The
Company Doctor ("TCD"), a Delaware corporation ("TCD Shares") with the actual
delivery of the TCD Shares to Seller to be effected in accordance with the
Assignment of Right to Receive Stock (herein so called) to be executed by
Purchaser and Seller at the same time this Agreement is executed in the form of
Exhibit 5 attached hereto.
4. Additional Agreements. As consideration in part for the
transactions contemplated hereby and as a condition to Closing:
(a) Building Lease. Purchaser and Seller shall, at the
same time as this Agreement is executed, execute and enter into a lease in the
form of Exhibit 6 attached hereto for certain real property located at ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ (the "Lease").
(b) Employment Agreements with Seller. Purchaser and
Seller shall, at the same time as this Agreement is executed, execute:
(1) a Physician Employment Agreement between
Purchaser and Seller in the form of the attached Exhibit 7, and
(2) a Regional Medical Director Employment
Agreement between Purchaser and Seller in the form of the attached
Exhibit 8.
(c) Employment Agreement with ▇▇. ▇▇▇▇▇. Purchaser
specifically agrees to honor and continue in force Duchouquette P.A.'s
Employment Agreement with ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, M.D., a copy of which is attached
as Exhibit 9.
(d) Stock Option Agreement. Purchaser shall, at the same
time as this Agreement is executed, cause TCD to execute and deliver to Seller
the Stock Option Agreement in the form of
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the attached Exhibit 10 which grants Seller annual stock options to acquire
$100,000 of TCD Common Stock during Seller's employment by Purchaser, either as
a "Staff Physician" or a "Regional Medical Director."
(e) Registration Rights Agreement. Purchaser shall, at
the same time as this Agreement is executed, cause TCD to execute and deliver
to Seller the Registration Rights Agreement in the form of the attached Exhibit
11 whereby upon Seller's written request made to TCD at any time after Closing
and before December 15, 1996, TCD shall file a registration statement under the
Securities Act of 1933, as amended, relating to, and shall cause to be
effective, the registration of the TCD Shares under the Securities Act not
later than February 28, 1997.
5. Closing. The transactions contemplated hereby will be
consummated at a Closing to be held at the same time as the execution of this
Agreement (the "Closing").
6. Documents to be Delivered at Closing. At Closing, the parties
shall execute and deliver, or cause to be executed and delivered, in addition
to this Agreement, the following:
(a) the stock certificate and conveyance documents
contemplated by Section 2;
(b) the Note (see Exhibit 2);
(c) the Stock Pledge Agreement (see Exhibit 3);
(d) the Security Agreement (see Exhibit 4);
(e) the Assignment of Right to Receive Stock (see Exhibit
5);
(f) the Lease (see Exhibit 6);
(g) Seller's Physician Employment Agreement (see Exhibit
7);
(h Seller's Regional Medical Director Employment
Agreement (see Exhibit 8);
(i) the ▇▇. ▇▇▇▇▇'▇ Employment Agreement (see Exhibit 9);
(j) the Stock Option Agreement (see Exhibit 10);
(k) the Registration Rights Agreement (see Exhibit 11);
and
(l) the investment letter (see Exhibit 12).
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7. Effective Date. Subject to the terms and conditions set out
in this Agreement, the consummation of the transactions referred to above shall
be effective as of 12:01 a.m. on July 1, 1996.
8. Representations and Warranties of Duchouquette P.A. and
Seller. Duchouquette P.A. and Seller hereby jointly and severally represent
and warrant to Purchaser as follows:
(a) Status. Duchouquette P.A. is a professional
association duly organized, validly existing, and in good standing under the
laws of the State of Texas.
(b) Authority. Duchouquette P.A. has all necessary power
and authority under applicable law and its Articles of Incorporation and Bylaws
to execute, deliver, and perform this Agreement and to own or lease its
properties and to carry on its business as presently conducted. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by the Board of
Directors and shareholders of Duchouquette P.A., and no other corporate
proceedings on the part of Duchouquette P.A. are necessary for Duchouquette
P.A. to enter into this Agreement or to consummate the transactions
contemplated hereby.
(c) Enforceability. This Agreement constitutes a legal,
valid, and binding obligation of Seller and Duchouquette P.A., enforceable
against Seller and Duchouquette P.A. in accordance with its terms, except to
the extent that enforcement is affected by laws pertaining to bankruptcy,
reorganization, insolvency, or creditors' rights or by the availability of
injunctive relief, specific performance, and other equitable remedies.
(d) Stock. The authorized capital stock of Duchouquette
P.A. consists of one million (1,000,000) shares, $0.10 par value, of which one
thousand (1,000) shares are issued and outstanding. All such issued and
outstanding Stock is duly authorized, validly issued, and nonassessable. All
of the Stock is owned of record and beneficially by Seller. None of the Stock
was issued or will be transferred under this Agreement in violation of any
preemptive, preferential, or other rights of any Person (as defined in Section
8(u)).
(e) Stock Rights. Seller is the true and lawful owner,
of record and beneficially, of the Stock; none of the Stock is subject to any
outstanding options, warrants, calls, or similar rights of any other person to
acquire the same; none of the Stock is subject to any restrictions on transfer
thereof; and Seller has the full power and authority to convey, and will convey
to Purchaser at Closing, good and marketable title to the Stock, free and clear
of any liens, liabilities, security interests, claims, or encumbrances.
(f) No Consents Required. There is no requirement
applicable to Duchouquette P.A. or Seller to make any filing with, or to give
any notice to or obtain any permit, authorization, consent, or approval of, any
governmental or regulatory authority as a condition to the lawful consummation
by Duchouquette P.A. and Seller of the transactions contemplated by this
Agreement (except as may be contemplated by the last sentence of Section
8(k)(4)).
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(g) Corporate Minutes. Duchouquette P.A. has delivered
or made available to Purchaser complete and accurate copies of the minutes of
all its directors and shareholders meetings, and all actions by written consent
of the directors and shareholders, of Duchouquette P.A. since its inception
(collectively, the "Minutes"). The Minutes represent all corporate actions
taken by Duchouquette P.A.
(h) Taxes. With respect to Taxes (as defined below):
(1) All returns and reports of, or relating to,
any foreign, federal, state, or local Tax that are required to be
filed for, by, or on behalf of, or with respect to, Duchouquette P.A.
or Seller, including, but not limited to, those relating to the
income, business, operations, or assets of Duchouquette P.A. or
Seller, have been timely filed with the appropriate foreign, federal,
state, and local authorities, have been properly and accurately
compiled and completed, and reflect all Tax liabilities of
Duchouquette P.A. and Seller for the periods covered thereby.
(2) All Taxes due and payable by Seller and
Duchouquette P.A. as of the Closing Date have been paid.
(3) Seller and Duchouquette P.A. have no unpaid
liability for Taxes of any nature whatsoever.
(4) For purposes of this Agreement, "Taxes"
(collectively) or "Tax" (singly) shall mean all taxes, charges, fees,
levies, or other assessments of whatever kind or nature, including,
without limitation, all net income, gross income, gross receipts,
sales, use, value-added, ad valorem, transfer, franchise, profits,
license, withholding, payroll, employment, excise, estimated,
severance, stamp, net worth, environmental, occupance, or property
taxes, custom duties, fees, assessments, or charges of any kind
whatsoever (together with any interest and any penalties, additions to
tax, or additional amounts) imposed by any taxing authority (domestic
or foreign) upon, or payable by, Duchouquette P.A. or Seller.
(i) Financial Statements. To the best knowledge of
Seller and Duchouquette P.A., all financial statements provided by Duchouquette
P.A. to Purchaser are complete and accurate in all respects, having been
prepared in accordance with the cash method of accounting applied on a
consistent basis throughout the periods indicated, and present fairly and
accurately the financial condition and results of operations of Duchouquette
P.A. and the Practice as of the date and for the periods indicated thereon.
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(j) Liabilities.
(1) Since July 1, 1996 there has not been any
material adverse change in the condition, financial or otherwise, of
the private practice of medicine conducted by Duchouquette P.A. and
Seller (the "Practice") or in the assets and liabilities of
Duchouquette P.A. nor has there been any other occurrence, event, or
condition that has adversely affected, or can reasonably be expected
to affect adversely, the ability of Seller or Duchouquette P.A. to
conduct his or its professional practice as currently conducted.
(2) Duchouquette P.A. has paid the debts of the
Practice in the usual and ordinary course of its business since July
1, 1996.
(3) There are no liabilities, debts, or
obligations of Duchouquette P.A. whatsoever, accrued, fixed,
contingent, or otherwise (known or unknown and asserted or
unasserted), existing on the date hereof which in the aggregate exceed
$20,000, including any future payments due on any liabilities, debts
or obligations.
(4) Duchouquette P.A. is not liable upon or with
respect to, or obligated in any other way to provide funds in respect
of, or to guarantee or assume in any manner, any Liability of any
Person.
(k) Contracts.
(1) A true and complete list of all of the
contracts, agreements, leases, licenses, plans, arrangements, or
commitments, written or oral, and otherwise as are necessary or
helpful to the Practice (including all amendments, supplements, and
modifications thereto) to which Seller or Duchouquette P.A. is a party
or is otherwise bound is set forth on Schedule 8(k) (the "Contracts").
(2) All of the Contracts are valid, binding, and
in full force and effect in accordance with their terms and conditions
and there is no existing default thereunder or breach thereof (whether
declared or undeclared) by Seller or Duchouquette P.A., or by any
other party to the Contracts, or any conditions which, with the
passage of time or the giving of notice or both, might constitute such
a default by Seller or Duchouquette P.A., or, to the best knowledge of
Seller or Duchouquette P.A. by any other party to the Contracts.
(3) True, correct, and complete copies of all the
Contracts as currently in force have been delivered by Seller or
Duchouquette P.A. to Purchaser.
(4) Except as provided in Schedule 8(k), all of
the Contracts may be assigned to Purchaser without the approval or
consent of any Person, or, if such approval or consent is required, it
has been obtained by Seller or Duchouquette P.A. and delivered to
Purchaser at or prior to the Closing.
STOCK PURCHASE AGREEMENT
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(l) Employees. A true and complete list of the names of
each employee of Duchouquette P.A., as well as their job titles, hire dates,
and current hourly compensation paid by Duchouquette P.A. to each of them in
connection with the Practice is set forth on Schedule 8(l). Other than as
provided in the Employee Manual of Duchouquette P.A. and wage increases in the
ordinary course of business, since July 1, 1996 neither Duchouquette P.A. nor
Seller have made any commitment or agreement to increase the wages or modify
the conditions or terms of employment of any of the employees of Duchouquette
P.A.
(m) Employee Benefits.
(1) A true, complete, and correct list of all
employee benefit plans as defined in section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), whether
or not subject to ERISA, and any other severance, termination, change
of control, stock based, or group insurance plan which Duchouquette
P.A. currently maintains, or has ever maintained, with respect to any
of its current or former employees is set forth in Schedule 8(m)
(collectively the "Plans").
(2) Each of the Plans is being, and has been,
maintained, operated, and administered in all material respects in
accordance with its respective terms and all applicable laws,
including, but not limited to, ERISA and the Internal Revenue Code of
1986, as amended (the "Code"), and no material liability or obligation
has been incurred (and is unsatisfied) or is expected to be incurred
by Duchouquette P.A. (either directly or indirectly, including as a
result of an indemnification obligation) under, or pursuant to, any
applicable law, including titles I and IV of ERISA and the penalty,
excise tax, or joint and several liability provisions of the Code
relating to employee benefit plans.
(3) Each Plan intended to be qualified under
section 401(a) of the Code, and the trust (if any) forming a part
thereof, has received a favorable determination letter from the
Internal Revenue Service ("IRS") as to its qualification under the
Code and to the effect that each such trust is exempt from taxation
under section 501(a) of the Code and to the best knowledge of
Duchouquette P.A. and Seller all amendments necessary to maintain the
qualification of such Plans have been made within the time allowed by
the Code and ERISA and, to the best knowledge of Duchouquette P.A. and
Seller, no event has occurred or condition exists which could
adversely affect such determination.
(4) With respect to each Plan which is an
"employee welfare benefit plan," as defined in section 3(1) of ERISA,
to the best knowledge of Duchouquette P.A. and Seller (i) no such plan
is unfunded or funded through a "welfare benefit fund," as defined in
section 419 of the Code, (ii) each such plan which is a "group health
plan," as defined in section 5000(b)(1) of the Code, is in compliance
in all material respects with the applicable requirements of section
4980B of the Code, (iii) no such plan provides retiree medical
benefits to former employees of Duchouquette P.A. or any related
entity, and (iv) there are no unpaid or overdue insurance premiums
required to be paid with respect to such plan.
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(5) There are no actions, suits, or claims, other
than routine claims for benefits, pending or, to the best knowledge of
Duchouquette P.A. or Seller, threatened with respect to any of the
Plans or against any trustee, fiduciary, or administrator of the
Plans.
(6) There are no investigations or audits of any
Plan by any governmental authority currently pending and there have
been no such investigations or audits that have been concluded that
resulted in any liability of Duchouquette P.A. that have not been
fully discharged, and no Plan has been submitted to the IRS under the
voluntary compliance resolution or closing agreement programs.
(n) Employment Laws.
(1) To their best knowledge, Duchouquette P.A.
and Seller are in compliance in all material respects with all
applicable laws relating to employment and employment practices,
including, without limitation, wages, workplace safety, equal
employment opportunity, and nondiscrimination ("Employment Laws").
(2) Neither Duchouquette P.A. nor Seller has
received any notice of noncompliance or violation of any Employment
Law that is pending or unresolved and no action is pending, or to the
best knowledge of Duchouquette P.A. and Seller, threatened before the
National Labor Relations Board, the Equal Opportunity Commission, the
U.S. Department of Labor, or any other foreign, federal, state, or
local governmental authority or court relating to employment matters
or any Employment Law.
(3) There is no pending or, to the best knowledge
of Duchouquette P.A. and Seller, threatened arbitration, suit,
litigation, or proceeding, against Duchouquette P.A., Seller, or any
current or former director, shareholder, officer, or supervisory
employee of Duchouquette P.A., alleging wrongful termination, racial,
religious, sexual, or age discrimination, improper post-termination
conduct, or breach of conduct or covenant of employment.
(o) Environmental Laws.
(1) To their best knowledge, Duchouquette P.A.
and Seller are in compliance in all material respects with all
applicable Environmental Laws, which compliance includes, but is not
limited to, the possession by Duchouquette P.A. or Seller of all
material permits and other governmental authorizations required under
applicable Environmental Laws, and material compliance with the terms
and conditions thereof.
(2) For purposes of this Agreement,
"Environmental Laws" means all federal, state, local, and foreign laws
and regulations relating to pollution or protection of human health or
the environment (including, without limitation, ambient air, surface
water, ground water, land surface, or subsurface strata), including,
without limitation, laws
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and regulations relating to emissions, discharges, releases, or
threatened releases of, or relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport, or
handling of, chemicals, pollutants, contaminants, wastes, toxic
substances, petroleum products, or any other substance that is
otherwise a danger to health, reproduction, or the environment.
(p) Assets and Properties.
(1) Duchouquette P.A. owns or has the sole right
to use (pursuant to a valid lease or license disclosed on Schedule
8(p)) all operating assets and properties necessary for Seller and
Duchouquette P.A. to carry on the Practice in the manner presently
conducted by Seller and Duchouquette P.A. (collectively, the
"Assets").
(2) Duchouquette P.A. has good and marketable
title to all the Assets, and title to the Assets is free and clear of
all mortgages, liens, pledges, conditional sales agreements, charges,
easements, covenants, assessments, options, restrictions, and other
encumbrances of any nature whatsoever.
(3) The Assets are in good operating condition
and repair, normal wear and tear excepted (except as identified by
seller to Purchaser in writing on Schedule 8(p)), and are capable of
being used for their intended purpose in the Practice as now
conducted.
(4) The Assets include all existing warranties
and service contracts with respect to any of the Assets to the extent
they are capable of being assigned to Purchaser.
(5) To the best knowledge of Duchouquette P.A.
and Seller, all the Assets and their present use conforms to all
applicable Governmental Requirements, and no notice of any violation
of any such Governmental Requirements relating to the Assets or their
use has been received by Seller.
(6) Duchouquette P.A. does not own any real
property.
(q) No Material Changes. Except as set forth in Schedule
8(q), since July 1, 1996, Duchouquette P.A. has not:
(1) sold, leased, optioned, or transferred any
material portion of the assets of Duchouquette P.A. or the Practice;
(2) suffered any material loss, or material
interruption in use, of any material asset or property (whether or not
covered by insurance), on account of fire, flood, riot, strike, or
other hazard or act of God;
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(3) made any material change in the conduct or
nature of its business or operations;
(4) waived any material rights arising out of the
conduct of, or with respect to, its business or operations;
(5) made or committed to make any capital
expenditures in an amount in excess of $10,000.00;
(6) declared or paid any dividend or other
distributions with respect to its capital shares or redeemed,
repurchased, or otherwise acquired any of its own capital shares;
(7) made any material increase in the rate or
terms of compensation payable by Duchouquette P.A. to, or any increase
in the rate or terms of, any Plan or other bonus, insurance, pension,
or employee benefit plan on behalf of any director, officer, or key
employee of Duchouquette P.A.;
(8) made any change in accounting methods,
principles, or practices, except as required by generally accepted
accounting principles;
(9) suffered any creation, occurrence, or
assumption of any material indebtedness for money borrowed other than
in the form of accounts payable for goods and services in the ordinary
course of business;
(10) assumed, guaranteed, or incurred any
liability for the obligations of any other person or suffered the
subjecting of any property or assets of Duchouquette P.A. to mortgage,
lien, pledge, or other encumbrance other than purchase money security
interests or liens for taxes yet due and payable in the ordinary
course of business;
(11) without limitation by the enumeration of any
of the foregoing, entered into any material transaction (including
borrowing, leasing, or capital financing or any lease of real
property) other than in the ordinary course of business;
(12) incurred any material liabilities other than
in the ordinary course of business;
(13) suffered or been threatened with any adverse
change which has had or could have a material adverse effect on
Duchouquette P.A.; or
(14) agreed to do any of the foregoing.
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(r) Compliance with Laws Generally.
(1) Without limiting the provisions of Sections
8(n) and 8(o), to the best knowledge of Duchouquette P.A. and Seller,
they are in compliance in all material respects with each Governmental
Requirement.
(2) As used herein, "Governmental Requirement"
shall mean any and all laws (including, but not limited to, applicable
common law principles), statutes, ordinances, codes, rules,
regulations, interpretations, guidelines, directions, orders,
judgments, writs, injunctions, procedures, decrees, decisions, or
similar items or pronouncements, promulgated, issued, passed, or
enacted by any Governmental Authority.
(3) As used herein, "Governmental Authority"
shall mean any and all federal, Texas, or local governments,
governmental institutions, public authorities, and other governmental
entities of any nature whatsoever, and any subdivisions or
instrumentalities thereof, including, but not limited to, departments,
boards, bureaus, commissions, agencies, courts, administrations, and
panels, and any divisions or instrumentalities thereof, whether
permanent or ad hoc and whether now or hereafter constituted and/or
existing).
(4) As used herein, "Governmental Requirement"
shall specifically include applicable provisions of the federal Social
Security Act (including the federal Medicare and Medicaid Anti-Fraud
and Abuse Amendments [42 U.S.C. Section 1320a-7, 7a, and 7b] and the
federal Physician Anti-Self Referral Law [42 U.S.C. Section
1395nn]), the Texas Medical Practice Act (Article 4495b of the Texas
Revised Civil Statutes), and the Texas Illegal Remuneration Law (Texas
Health and Safety Code Section 161.091), which are sometimes
collectively referred to herein as "Health Laws").
(s) Nature of Practice. Seller conducts the Practice as
an employee of Duchouquette P.A.
(t) Licensure. Seller is duly authorized, qualified, and
appropriately licensed under all applicable Governmental Requirements to
practice medicine at the location and in the manner as now conducted.
(u) Competing Interests.
(1) Neither Seller nor any Associate (defined
below) of Seller (i) owns, directly or indirectly, any equity interest
in, or is a director, officer or employee of, or consultant to, any
entity which is a competitor, supplier or customer of Seller, or a
competitor, supplier or customer of Purchaser or an Affiliate of
Purchaser (excepting, in all cases, for ownership, if any, of less
than or equal to five percent (5%) by value of the outstanding capital
stock of any corporation the capital stock of which is traded on a
nationally recognized securities exchange); or (ii) owns, directly or
indirectly, in whole
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or in part, any property, asset, or right which is associated with the
Assets or the Practice or which Seller is presently operating or using
in connection with, or the use of which is necessary for or material
to, the Practice.
(2) For purposes of this Agreement, the term
"Associate" shall mean with respect to an individual (i) the spouse,
parents or children of the individual and his/her spouse, (ii) any
trust in which the individual or any person described in clause (i)
above has an interest or any trustee of such a trust, and (iii) any
Affiliate of the individual.
(3) For purposes of this Agreement, the term
"Associate" shall mean with respect to a Person other than an
individual, any Person that is an Affiliate of such Person, and any
director or officer of such Person and any Associate of any director
or officer.
(4) For purposes of this Agreement, the term
"Affiliate" shall mean any Person that directly, or indirectly through
one or more intermediaries, controls or is controlled by, or is under
common control with, such Person, as interpreted under Rule 405 of
Regulation C of the Securities Act of 1933.
(5) For purposes of this Agreement, the term
"Person" means an individual or a corporation, limited liability
company, partnership, trust, estate, unincorporated organization,
association, or other entity.
(6) Financial Relationships. Neither Seller nor
any immediate family member of Seller has a "financial relationship"
with any entity providing "designated health services," as such terms
are used in the ▇▇▇▇▇ ▇▇▇▇.
(v) Effect of Agreement. The execution, delivery, and
performance of this Agreement by Seller and Duchouquette P.A. and the
consummation by Seller and Duchouquette P.A. of the transactions contemplated
hereby will not:
(1) Result in any breach of any of the terms or
conditions of, constitute a default under, accelerate the performance
of any obligation required under, or give any right of termination or
cancellation under any mortgage, note, deed of trust, contract,
agreement, lease, license, or other instrument or obligation
(including the Contracts) to which Seller or Duchouquette P.A. is now
a party or by which Seller or Duchouquette P.A. may be bound or
affected; or
(2) Relieve any Person of any obligation (whether
contractual or otherwise) or enable any Person to terminate any such
obligation or any right or benefit enjoyed by Seller or Duchouquette
P.A. or to exercise any right under any agreement); or
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(3) Adversely affect the business relationships
of patients or contracted third party payors of the Practice.
(w) Intellectual Property. The Practice as now conducted
by Duchouquette P.A. does not require the use of or consist of any rights under
any patents, inventions, trademarks, trade names, brand names, or copyrights.
Duchouquette P.A. has not transferred, encumbered, or licensed to any Person
any rights to own or use any portion of any intellectual property relating to
the Practice.
(x) Suits, Actions, and Claims. Except as set forth in
Schedule 8(x) to this Agreement, there are no suits, actions, claims (including
workers compensation claims), inquiries, or investigations by any Person, or
any legal, administrative, or arbitration proceedings in which Seller or
Duchouquette P.A. is engaged or which are pending or threatened against or
affecting Seller, Duchouquette P.A., or its employees, or to which Seller,
Duchouquette P.A., or any of its employees is or might become a party, or which
question the validity or legality of the transactions contemplated hereby.
Without limiting the foregoing, there is to the best knowledge of Seller and
Duchouquette P.A. no present or potential claim against Seller, Duchouquette
P.A., or its employees related to the Practice.
(y) Insurance Policies. A list of all insurance policies
related to the Practice specifying the insurer, the amount of coverage, the
type of insurance, and the policy number maintained by Seller or Duchouquette
P.A. is set forth on Schedule 8(y). To the best knowledge of Duchouquette
P.A. and Seller, there are no special circumstances with respect to these
policies or the Practice that would lead to any liability under such insurance
policies being avoided by the insurers issuing such policies or the premiums
thereunder being increased. All professional liability policies are "claims
made" policies, and all insurance policies are in full force and effect, with
all premiums due thereon to date fully paid.
(z) Licenses and Permits, Compliance with Governmental
Requirements.
(1) Except for individual medical professional
licenses, a true and complete list of all licenses and permits
necessary for the conduct of the Practice is set forth on Schedule
8(z) (the "Licenses and Permits").
(2) Duchouquette P.A. holds all such Licenses and
Permits and they are validly issued and in full force and effect.
(3) True and correct copies of all the Licenses
and Permits were delivered to Purchaser prior to Closing.
(4) No violations are or have been recorded in
respect of such Licenses or Permits and no proceeding is pending or,
to the best knowledge of Seller and Duchouquette P.A., threatened
seeking the revocation or limitation of any of such Licenses or
Permits.
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(5) All such Licenses and Permits that are
subject to transfer are included in the Assets.
(aa) Accounts Receivable. All notes and accounts
receivable of Duchouquette P.A. and the Practice reflected on the Financial
Statements or that have arisen since the date thereof ("Accounts Receivable")
have arisen in the ordinary course of business. A true, correct, and complete
aging of the Accounts Receivable of Duchouquette P.A. as of the most recent
practicable date is set forth on Schedule 8(aa).
(ab) Records. The books, records (including patient
medical records), and other such items kept by Duchouquette P.A. with respect
to its assets and the Practice have been kept properly and to the best
knowledge of Duchouquette P.A. and Seller contain records of all matters
required to be included therein by any Governmental Requirement and by
generally accepted community and professional standards, and such books and
records are true, accurate, and complete.
(ac) Deposits. Duchouquette P.A. does not now hold any
deposits or prepayments by third parties with respect to any of the assets of
the Practice which are not reflected as liabilities in the Financial
Statements.
(ad) Telephone Numbers. All telephone and facsimile
numbers used by Duchouquette P.A. in connection with the Practice are valid and
in good working order, and may be transferred to Purchaser.
(ae) Workmen's Compensation Data. All data set forth in
the most recent workmen's compensation report of Duchouquette P.A. has been
provided to Purchaser and is true, correct, and complete as of the date
thereof.
(af) Brokers or Finders. Seller and Duchouquette
P.A., as well as the latter's officers and agents have incurred no obligation
or liability, contingent or otherwise, for brokerage or finders' fees or
agents' commissions or other similar payment in connection with this Agreement
and will indemnify and hold Purchaser harmless from any such payment alleged to
be due by or through Seller and Duchouquette P.A. as a result of the action of
Seller or Duchouquette P.A. or the latter's officers or agents.
(ag) No Untrue Statements. The statements,
representations, and warranties of Seller and Duchouquette P.A. set forth in
this Agreement and the Schedules hereto and in all other documents and
information furnished to Purchaser and its representatives in connection
herewith do not include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements, representations, and
warranties made not misleading.
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9. Representations and Warranties of Purchaser. Purchaser
represents and warrants to Seller as follows:
(a) Status. Purchaser is a professional association duly
organized, validly existing, and in good standing under the laws of the State
of Texas.
(b) Authority. Purchaser has all necessary power and
authority under applicable law and its Articles of Incorporation and Bylaws to
execute, deliver, and perform this Agreement and to own or lease its properties
and to carry on its business as presently conducted. The execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by the Board of
Directors of Purchaser and no other corporate proceedings on the part of
Purchaser are necessary for Purchaser to authorize this Agreement or to
consummate the transactions contemplated hereby.
(c) Enforceability. This Agreement constitutes a legal,
valid, and binding obligation of Purchaser, enforceable against Purchaser in
accordance with its terms, except to the extent that enforcement is affected by
laws pertaining to bankruptcy, reorganization, insolvency, or creditors' rights
or by the availability of injunctive relief, specific performance, and other
equitable remedies.
(d) No Consents Required. There is no requirement
applicable to Purchaser to make any filing with, or to give any notice to or
obtain any permit, authorization, consent, or approval of, any governmental or
regulatory authority as a condition to the lawful consummation by Purchaser of
the transactions contemplated by this Agreement.
(e) Suits, Actions, and Claims. There are no suits,
actions, inquiries, or investigations by any Person, or any legal,
administrative, or arbitration proceedings in which Purchaser is engaged or
which are pending or threatened against or affecting Purchaser, or to which
Purchaser is or might become a party, which question the validity or legality
of the transactions contemplated by this Agreement.
(f) Investment Intent. Purchaser is acquiring the
Stock for its own account and not with a view to the distribution of the Stock
within the meaning of Section 2(11) of the Securities Act of 1933.
(g) Brokers or Finders. Purchaser and its officers
and agents have incurred no obligation or liability, contingent or otherwise,
for brokerage or finders' fees or agents' commissions or other similar payment
in connection with this Agreement and will indemnify and hold Seller harmless
from any such payment alleged to be due by or through Purchaser as a result of
the action of Purchaser or its officers or agents.
(h) TCD Shares. The TCD Shares which will be issued to
Seller in accordance with Section 3(c) and the Assignment of Right to Receive
Stock (see the attached Exhibit 3) will, upon issuance to Seller, be duly
authorized, validly issued, and nonassessable. The transfer of
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the TCD Shares to Seller will not violate any preemptive, preferential, or
other rights of any Person (as defined in Section 8(u)).
(i) No Untrue Statements. The statements,
representations, and warranties of Purchaser set forth in this Agreement and
the Schedules hereto and in all other documents and information furnished to
Seller and his representatives in connection herewith do not include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements, representations, and warranties made not misleading.
10. Covenants of Seller. Seller hereby covenants and agrees as
follows:
(a) Seller is subject to, and agrees to be bound by, the
provisions, restrictions, conditions, obligations, and/or requirements
contained in the investment letter from Seller to Purchaser, a copy of which is
attached as Exhibit 10.
(b) For a period of one year beginning on the earlier of
the date of Registration or February 28, 1997, Seller shall not sell, assign,
transfer, deliver, burden, pledge, or encumber in any one month more than one-
twelfth (1/12th) of the TCD Shares.
(c) Seller agrees to keep his current professional
liability insurance policy with Texas Medical Liability Trust, a copy of which
is attached as Exhibit 11, in effect. The parties acknowledge that the
professional liability insurance policy attached as Exhibit 11 is being
assumed by Purchaser contemporaneously with the execution and delivery of this
Agreement. Purchaser agrees that in the event it determines after Closing that
a new professional liability insurance policy is appropriate for the
Purchaser's protection, Seller and Purchaser shall share equally in the cost of
securing any necessary tail coverage for Seller.
(d) As a condition to Closing, Seller shall have
delivered to Purchaser an assignment of contract rights in form and substance
satisfactory to Purchaser, assigning to Purchaser all rights of Duchouquette
P.A. and physicians employed by it, as applicable, under managed care contracts
and each managed care company shall have consented to such assignment, all as
and to the extent required (if at all) under such managed care contracts.
11. Covenants of Purchaser. Purchaser hereby covenants and agrees
as follows:
(a) All of the artwork displayed throughout the offices
and clinic of Duchouquette P.A., as well as the desk, credenza, office chair
and other office furniture presently located in Seller's office at the clinic
of Duchouquette P.A. are the personal property of Seller and may be removed by
Seller at any time at his option.
(b) Purchaser will cause the current refurbishing of the
offices and clinic of Duchouquette P.A., which includes painting the interior
of the offices and clinic and installing
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new carpet throughout the offices and clinic, to be completed at no cost to
Seller on or before April 30, 1997.
(c) All of Seller's legal fees and other costs related to
(i) the negotiation and execution of this Agreement and the related documents
and (ii) the transactions contemplated by this Agreement shall be paid by
Duchouquette P.A., either prior to Closing and within five business days after
Closing.
(d) This section and the covenants and agreements of the
Purchaser made in subsections (a), (b) and (c) of this section shall survive
the Closing and the consummation of the transactions contemplated in this
Agreement.
12. Indemnification and Remedies.
(a) Survival. Subject to the limitations set out in this
section, the representations and warranties set forth in Sections 8 and 9 shall
survive the Closing and the consummation of the transactions contemplated in
this Agreement.
(b) Indemnification By Seller. Seller shall, and hereby
does, indemnify and hold harmless Purchaser, its Affiliates (as defined in
Section 8(u)) and officers, trustees, directors, shareholders, employees,
agents, representatives, and consultants (collectively, the "Purchaser
Indemnitees") at all times from and after the date of this Agreement, from and
against any and all penalties, demands, damages, punitive damages, losses
(excluding lost profits), liabilities, suits, costs, costs of any settlement or
judgment, claims of any and every kind whatsoever, recovery, repayment or
refund of amounts received with respect to any claim for payment under the
Medicare, CHAMPUS or Medicaid programs (including without limitation interest
and penalties thereon), remediation costs, and expenses (including, without
limitation, reasonable attorneys' fees) (collectively "Damages") of or to any
of the Purchaser Indemnitees, which may now or in the future be paid, incurred,
or suffered by or asserted by any Person against any of the Purchaser
Indemnitees resulting or arising from or incurred in connection with any one or
more of the following ("Proceeding"):
(1) any liability or claim for liability related
to any lawsuit (whether in contract, in tort, or otherwise, and
whether or not successful) or threatened lawsuit or claim involving
Seller, the Stock, or the Practice including, but not limited to, any
liability or claim for liability that arises in connection with any
fraud, intentional misconduct, or professional negligence, based on
any act, omission, event, or occurrence occurring or alleged to have
occurred on or prior to the Closing;
(2) any liability or claim for liability (whether
in contract, in tort, or otherwise, and whether or not successful)
related to any liens, obligations, or encumbrances of any nature
whatsoever impressed against or in any way related to the Stock or the
Practice;
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(3) any liability or claim for liability (whether
in contract, in tort, or otherwise, and whether or not successful)
related to Taxes of Seller or Duchouquette P.A.;
(4) any misrepresentation, breach of warranty set
forth in Section 8, or nonfulfillment of any covenant or agreement on
the part of Seller or Duchouquette P.A. under this Agreement, or any
misrepresentation in or omission from any list, Schedule, certificate,
or other instrument furnished to Purchaser by Seller pursuant to the
terms of this Agreement; and
(5) any liability or claim for liability under
any Plan offered by Seller, including any liability or claim for
liability resulting from Seller's failure to continue such Plans.
(c) Time Limitation on Seller's Indemnification. Seller
shall have no liability for indemnification or otherwise with respect to any
representation or warranty set out in Section 8 unless, on or before June 30,
1998, Purchaser notifies Seller in writing of a claim specifying the factual
basis of that claim in reasonable detail to the extent then known by Purchaser.
(d) Dollar Limitation on Seller's Indemnification.
Seller shall have no liability for indemnification or otherwise with respect to
the matters described in subsection (b) of this section until the total Damages
with respect to such matters exceeds $10,000, and then only for the amount by
which the Damages exceed $10,000.
(e) Knowledge and Intentional Breach by Seller. The
limitations set out in subsections (c) and (d) of this section will not apply
to any breach of Seller's representations and warranties set forth in Section 8
knowingly made by him or any intentional breach by Seller of any covenant or
obligation contained in this Agreement.
(f) Indemnification By Purchaser. Purchaser shall, and
hereby does, indemnify and hold harmless Seller, and his personal
representatives, heirs, and successors (collectively, the "Seller Indemnitees")
at all times from and after the date of this Agreement, from and against any
and all Damages which may now or in the future be paid, incurred, or suffered
by, or asserted by any Person against any of the Seller Indemnitees resulting
or arising from or incurred in connection with any one or more of the following
("Proceeding"):
(1) any liability or claim for liability (whether
in contract, in tort, or otherwise and whether or not successful)
related in any way to the operation of the Practice to the extent such
liability arises in connection with any action, omission, or event
(other than actions or omissions of Seller) occurring after the
Closing; and
(2) any misrepresentation, breach of warranty set
forth in Section 9, or nonfulfillment of any covenant or agreement on
the part of Purchaser under this Agreement, or any misrepresentation
in or omission from any list, Schedule, certificate,
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or other instrument furnished to Seller by Purchaser pursuant to the
terms of this Agreement.
(g) Time Limitations on Purchaser's Indemnification.
Purchaser shall have no liability (for indemnification or otherwise) with
respect to any representation or warranty unless, on or before June 30, 1998,
Seller notifies Purchaser in writing of a claim specifying the factual basis of
that claim in reasonable detail to the extent then known by Seller.
(h) Dollar Limitation on Purchaser's Indemnification.
Purchaser shall have no liability for indemnification or otherwise with respect
to the matters described in subsection (f) of this section until the total
Damages with respect to such matters exceeds $25,000.00, and then only for the
amount by which the Damages exceed $25,000.00.
(i) Limitation as to Tax Liability. Notwithstanding
anything herein to the contrary, Purchaser shall not indemnify any of the
Seller Indemnitees for any Tax liability, legal fees, or other Damages incurred
by the Seller Indemnitees as a result of a challenge of the federal or state
tax effects or consequences of this Agreement or any of the transactions
contemplated herein.
(j) Knowledge and Intentional Breach by Purchaser. The
limitations set out in subsections (g) and (h) of this section will not apply
to any breach of Purcher's representations and warranties set forth in Section
9 knowingly made by it or any intentional breach by Purchaser of any covenant
or obligation contained in this Agreement.
(k) Procedure for Indemnification from Third Party
Claims. For purposes of this section, the term "Indemnifying Party" or
"Indemnified Party" shall mean any one of the Seller Indemnitees or the
Purchaser Indemnitees, as the case may be.
(1) Promptly after receipt by an Indemnified
Party of notice of the commencement of any Proceeding against him, her
or it, the Indemnified Party will, if a claim is to be made against
another Indemnifying Party pursuant to this section, give written
notice to the Indemnifying Party of the commencement of the claim
specifying the factual basis of that claim in reasonable detail to the
extent then known by the Indemnified Party.
(2) Failure by an Indemnified Party to notify
the Indemnifying Party in writing will not relieve the Indemnifying
Party of any liability that he, she or it may have to any Indemnified
Party, except to the extent the Indemnifying Party demonstrates that
the defense of such action is prejudiced by the Indemnifying Party's
failure to give notice.
(3) If any Proceeding referred to in this section
is brought against an Indemnified Party and he, she or it gives
written notice to the Indemnifying Party of the commencement of the
Proceeding, the Indemnifying Party will, unless the claim involves
STOCK PURCHASE AGREEMENT
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Taxes, be entitled to participate in the Proceeding and, to the extent
he, she or it wishes, to assume the defense of the Proceeding with
counsel satisfactory to the Indemnified Party.
(4) Subsection (3) of this section shall not
apply if (i) the Indemnifying Party is also a party to the Proceeding
and the Indemnified Party determines in good faith that joint
representation would be inappropriate, or (ii) the Indemnifying Party
fails to provide reasonable assurance to the Indemnified Party of his,
her or its financial capacity to defend the Proceeding and provide
indemnification with respect to such Proceeding.
(5) After the Indemnified Party receives written
notice from the Indemnified Party of the latter's election to assume
the defense of the Proceeding, the Indemnifying Party will not, as
long as it diligently conducts such defense, be liable to the
Indemnified Party under this section for any fees of other counsel or
any other expenses with respect to the defense of the Proceeding, in
each case subsequently incurred by the Indemnified Party in connection
with the defense of the Proceeding, other than reasonable costs of
investigation.
(6) If the Indemnifying Party assumes the defense
of a Proceeding, (i) it will be conclusively established for purposes
of this Agreement that the claims made in that Proceeding are within
the scope of and subject to indemnification; (ii) no compromise or
settlement of such claims may be effected by the Indemnifying Party
without the Indemnified Party's consent unless there is no finding or
admission of any violation of legal requirements or any violation of
the rights of any Person and no effect on any other claims that may be
made against the Indemnified Party, and the sole relief provided is
monetary damages that are paid in full by the Indemnifying Party; and
(iii) the Indemnified Party will have no liability with respect to any
compromise or settlement of such claims effected without its consent.
(7) If written notice is given to an Indemnifying
Party of the commencement of any Proceeding and the Indemnifying Party
does not, within ten (10) days after the Indemnified Party's notice is
given, give written notice to the Indemnified Party of his, her or its
election to assume the defense of the Proceeding, the Indemnifying
Party will be bound by any determination made in the Proceeding or any
compromise or settlement effected by the Indemnified Party.
(8) Notwithstanding the foregoing, if an
Indemnified Party determines in good faith that there is a reasonable
probability that a Proceeding may adversely affect him, her or it
other than as a result of monetary damages for which he, she or it
would be entitled to indemnification under this Agreement, the
Indemnified Party may, by written notice to the Indemnifying Party,
assume the exclusive right to defend, compromise, or settle the
Proceeding, but the Indemnifying Party will not be bound by any
determination of a Proceeding so defended or any compromise or
settlement effected without its written consent (which may not be
unreasonably withheld).
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(l) Procedure for Indemnification from Other Claims. A
claim for indemnification for any matter not involving a third-party claim may
be asserted by written notice to the party from whom indemnification is sought.
13. Employment of Duchouquette P.A. Employees.
(1) After the Closing and continuing through
April 30, 1997, Purchaser shall cause Duchouquette P.A. to continue
the employment of all the employees of Duchouquette, P.A. who are not
parties to written employment agreements (the "Non-Contract
Employees") at no less than the same compensation paid by Duchouquette
P.A. immediately prior to Closing and shall not (i) discharge or
otherwise terminate such employees or (ii) relocate them from their
present place of employment at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
without the written consent of Seller, which consent will not be
unreasonably withheld.
(2) After Closing and continuing through April
30, 1997, Purchaser shall not change the compensation of any
Non-Contract Employee without the written consent of Seller, which
consent will not be unreasonably withheld.
(3) It is acknowledged by Duchouquette P.A.,
Seller and Purchaser that the employees of Duchouquette P.A. which are
subject to written agreements are being hired as provided in Section
4(b),
(4) The Non-Contract Employees are not to be
considered as third party beneficiaries of this section.
14. Further Assurances. Consistent with the terms and conditions
hereof, each party hereto will execute and deliver such instruments,
certificates, and other documents and take such other action as any other party
hereto may reasonably require in order to carry out this Agreement and the
transactions contemplated hereby.
15. Assignment of Contracts.
(1) Notwithstanding any other provision of this
Agreement, nothing in this Agreement or any related document shall be
construed as an attempt to assign (i) any Contract which, as a matter
of law or by its terms, is nonassignable without the consent of the
other parties thereto unless such consent has been given, or (ii) any
contract or claim as to which all of the remedies for the enforcement
thereof enjoyed by Seller would not, as a matter of law or by its
terms, pass to Purchaser as an incident of the transfers and
assignments to be made under this Agreement.
(2) In order, however, that the full value of
every contract and claim of the character described in clauses (i) and
(ii) of subsection (1) immediately above and all claims and demands on
such contracts may be realized for the benefit of Purchaser,
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Seller, at the request and under the direction of Purchaser, shall
take all such reasonable action and do or cause to be done all such
reasonable things as will, in the opinion of Purchaser, be necessary
or proper in order that the obligations of Seller under such contracts
may be performed in such manner that the value of such contract will
be preserved and will inure to the benefit of Purchaser, and for, and
to facilitate, the collection of the moneys due and payable and to
become due and payable thereunder to Purchaser in and under every such
contract and claim.
(3) Seller shall promptly pay over to Purchaser
all moneys collected by or paid to it in respect of every such
contract, claim or demand.
(4) Nothing in this section shall relieve Seller
of the obligation to obtain any consents required for the transfer of
the Assets and all rights thereunder to Purchaser, nor relieve Seller
from any liability to Purchaser for failure to obtain such consents.
16. Miscellaneous.
(a) Entire Agreement. This Agreement and the other
agreements expressly contemplated herein supersede any and all other
agreements, either oral or written, between the parties hereto with respect to
the subject matter hereof and contain all of the covenants, agreements,
representations, and warranties between the parties with respect thereto.
(b) Modification and Waiver. No change or modification
of this Agreement shall be valid or binding upon the parties hereto unless such
change or modification shall be in writing and signed by all the parties
hereto. No waiver of any term or condition of this Agreement shall be
enforceable unless it shall be in writing signed by the party against which or
whom it is sought to charged. The waiver by either party of a breach of any
provision of this Agreement by any other shall not operate or be construed as a
waiver of any subsequent breach by such other party.
(c) Notices. Any notices, consents, demands, requests,
approvals, and other communications to be given under this Agreement by any
party to the other shall be deemed to have been duly given if given in writing
and personally delivered, sent by courier, sent by telegram, telex, or
telecopy, or sent by mail, registered or certified, postage prepaid with return
receipt requested, at the address specified beside each party's signature at
the end of this Agreement. Notices delivered personally or by telegram, telex,
or telecopy shall be deemed communicated as of actual receipt; mailed notices
shall be deemed communicated as of 10:00 a.m. on the third business day after
mailing. Any party may change its or his address for notice hereunder by
giving notice of such change in the manner provided in this Section.
(d) Governing Law. The laws of the State of Texas shall
govern the validity or enforceability and the interpretation or construction of
all provisions of this Agreement and all issues hereunder.
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(e) Agreement Subject to State and Federal Law. The
parties to this Agreement recognize that this Agreement at all times is subject
to applicable state, local and federal law, including but not limited to the
Health Laws. The parties further recognize that this Agreement shall be
subject to amendments of such laws and regulations and to new legislation. Any
provisions of law that invalidate, or otherwise are inconsistent with the terms
of this Agreement, or that would cause any of the parties to be in violation of
any of such laws, shall be deemed to have superseded the terms of this
Agreement; provided however, that the parties shall exercise their best efforts
to accommodate the terms and intent of this Agreement to the greatest extent
possible consistent with the requirements of applicable laws and regulations.
(f) Corporate Practice of Medicine. Nothing contained
herein is intended to (a) constitute the use of a medical license for the
practice of medicine by anyone other than a licensed physician; (b) aid any
corporation to practice medicine when in fact such corporation is not
authorized to practice medicine; or (c) constitute any other arrangement in
violation of the Texas Medical Practice Act (Tex. Rev. Civ. Stat. ▇▇▇. art.
4495b).
(g) Fraud and Abuse Law and Texas Health & Safety Code.
The parties enter into this Agreement with the intent of conducting their
relationship in full compliance with applicable state, local and federal law,
including the Health Laws. Notwithstanding any unanticipated effect of any of
the provisions herein, no party to this Agreement will intentionally conduct
itself under the terms of this Agreement in a manner to constitute a violation
of the Health Laws.
(h) Referral Policy. Nothing contained in this Agreement
shall require (directly or indirectly, explicitly or implicitly) either party
to refer or direct any patients to the other party or its or his Affiliates as
a precondition to receiving the benefits set forth herein or in establishing
the valuation of the Practice.
(i) Severability. If any provision of this Agreement is
held to be illegal, invalid, or unenforceable under present or future laws
effective during the term hereof, such provision shall be fully severable and
this Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision never comprised a part of this Agreement; and the
remaining provisions of this Agreement shall remain in full force and effect
and shall not be affected by the illegal, invalid, or unenforceable provision
or by its severance here from. Furthermore, in lieu of such illegal, invalid,
or unenforceable provision, there shall be added automatically as part of this
Agreement, a provision as similar in its terms to such illegal, invalid, or
unenforceable provision as may be possible and be legal, valid, and
enforceable.
(j) Language; Captions; References. Whenever the context
requires, references in this Agreement to the singular number shall include the
plural, the plural number shall include the singular, and words denoting gender
shall include the masculine, feminine, and neuter. Section headings in this
Agreement are for convenience of reference only and shall not be considered in
construing or interpreting this Agreement. "Hereof," "hereto," "herein," and
words of similar import used in this Agreement shall be deemed references to
this Agreement as a
STOCK PURCHASE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 23
24
whole, and not to any particular Section, paragraph, or other provision of this
Agreement unless the context specifically indicates to the contrary. Any
reference to a particular "Section" shall be construed as referring to the
indicated Section of this Agreement unless the context indicates to the
contrary. Whenever the term "including" is used herein, it shall mean
including without limitation.
(k) Counterparts. This Agreement may be executed in
counterparts, each of which shall constitute an original, but all of which
shall constitute one and the same document. Faxed signatures to this Agreement
will be binding and enforceable without the requirement that the manually
executed signature page be delivered.
(l) Costs. Subject to Section 11(c), the parties hereto
shall pay all of their own expenses relating to the negotiation, documentation,
and closing of the transactions contemplated by this Agreement, including
(without limitation) the fees and expenses of their respective counsel,
accountants, and financial advisors. If any action at law or in equity is
necessary to enforce or interpret the terms of this Agreement, the prevailing
party shall be entitled to reasonable attorneys' fees, costs, and necessary
disbursements in addition to any other relief to which the prevailing party may
be entitled.
(m) Assignment. No party to this Agreement may assign
this Agreement without the prior, express, and written consent of the other
party hereto, which consent may be withheld in such other party's sole
discretion.
(n) Binding Effect. This Agreement shall be binding upon
the parties hereto, together with their respective personal representatives,
heirs, successors, and permitted assigns.
(o) No Third Party Beneficiaries. This Agreement does
not create, and shall not be construed as creating, any right enforceable by
any person not a party to this Agreement.
The parties hereto have caused this Agreement to be executed as of the
Effective Date.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D.
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., Individually
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
STOCK PURCHASE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 24
25
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., P.A.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D.
------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., President
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
The Physician Group, P.A.
By: /s/ ▇▇▇▇▇▇ ▇. Angle, M.D.
------------------------------------------
▇▇▇▇▇▇ ▇. Angle, President
▇▇▇▇ ▇▇▇▇▇ ▇'▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
STOCK PURCHASE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 25
26
SECURED PROMISSORY NOTE
$843,750.00 Dallas, Texas September 20, 1996
FOR VALUE RECEIVED, the undersigned, THE PHYSICIAN GROUP, P.A., a
Texas professional association ("Maker"), hereby promises to pay to the order
of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. ("Payee"), in lawful money of the United States
of America, the principal sum of Eight Hundred Forty Three Thousand Seven
Hundred Fifty Dollars ($843,750.00) plus interest as set forth below.
1. Both principal and interest, if any, shall be payable in
accordance with the terms of this Note at such location in Dallas County, Texas
or such other place as the legal holder of this Note may from time to time
designate in writing.
2. Interest on the principal amount of this Note remaining unpaid
from time to time shall accrue at a per annum rate equal to eight and one-half
percent (8.5%). Interest shall be calculated on the basis of a year of 365 or
366 days, as applicable, and charged for the actual number of days elapsed.
3. The interest on, and principal of, this Note shall be due and
payable in the following manner:
a. All unpaid interest accrued from the date of this
Note through January 31, 1997, shall be due and payable on January 31, 1997;
b. All unpaid interest accrued from February 1, 1997
through April 30, 1997, shall be due and payable on April 30, 1997; and
c. All unpaid principal shall be due and payable on
April 30, 1997.
4. Time is of the essence in the payment of this Note. Upon the
occurrence of any Event of Default (as defined below), the holder may, at his
option, declare the entire unpaid balance of the principal on this Note,
together with accrued and unpaid interest thereon and all other sums due from
Maker hereunder, to be immediately due and payable, without notice, notice
hereby being expressly waived, and/or pursue any and all other rights and
remedies under this Note or any agreement securing this Note, or at law or in
equity.
SECURED PROMISSORY NOTE
PHYSICIAN GROUP/DUCHOUQUETTE 1
27
5. Each of the following events shall constitute an "Event of
Default" as that term is used in this Note:
a. Failure of Maker to timely pay any installment of
principal or interest, or any other amount due, under this Note or any
agreement securing this Note, and such default shall continue for a period of
ten Business Days after the giving of written notice by the holder of this Note
to Maker of such event;
b. Failure of Maker to promptly and timely perform any
of the terms, agreements, or covenants contained in this Note or in any
agreement securing this Note, other than those relating to the obligation of
Maker to pay money to the holder hereof, and such default shall continue for a
period of thirty Business Days after the giving of written notice by the holder
of this Note to Maker of such event;
c. Dissolution or liquidation of Maker;
d. Dissolution or liquidation of the undersigned
guarantor, The Company Doctor ("TCD"); or
e. Maker or TCD:
(1) Makes a general assignment for the benefit of
creditors;
(2) Is declared insolvent in any state insolvency
proceeding;
(3) Becomes the subject of an order for relief under
Chapter 7 of the United States Bankruptcy Code, 11 U.S.C. Section 101
et. seq., or successor statute (the "Bankruptcy Code");
(4) Becomes a voluntary debtor in a case under
Chapter 11 of the Bankruptcy Code and fails to achieve confirmation of
a plan of reorganization within 180 calendar days;
(5) Becomes an involuntary debtor in a case under
either Chapter 7 or 11 of the Bankruptcy Code and fails to achieve a
dismissal of the case within 90 calendar days, or, with respect to a
Chapter 11 case in which an order for relief is entered prior to the
expiration of 90 calendar days, fails to achieve confirmation of a
plan of reorganization within 180 calendar days of the commencement of
the involuntary case;
(6) Consents to or is subjected to the appointment
of a trustee, receiver or liquidator with respect to all or
substantially all of Maker's or TCD's properties, as the case may be,
and, where such appointment was contested by Maker or TCD, as the case
may be, there has been a failure to vacate such appointment within 90
calendar days of appointment; or
SECURED PROMISSORY NOTE
PHYSICIAN GROUP/DUCHOUQUETTE 2
28
(7) A judgement for the payment of money shall be
outstanding against the Maker or TCD, as the case may be, the payment
of which could have a material adverse effect on the business or
financial condition of Maker or TCD, and such judgment shall remain
unstayed and in effect and unpaid for more than 30 calendar days.
6. All sums which become past due according to the terms of this
Note shall bear interest from maturity until paid at the rate of 18% per annum.
7. If any payment of principal or interest on this Note is due on
a day which is not a Business Day, the payment shall be due on the next
succeeding Business Day, and the extension of time shall be taken into account
in calculating the amount of interest payable pursuant to this Note. "Business
Day," means any day other than a Saturday, Sunday or legal holiday in the State
of Texas.
8. The indebtedness evidenced by this Note may be prepaid in
whole or in part at any time prior to maturity without premium or penalty. Any
optional prepayment shall be applied first to accrued but unpaid interest
hereon, with the remainder of such prepayment being applied to the reduction of
principal.
9. Maker and all endorsers, sureties and guarantors of this Note
severally waive demand, presentment for payment, protest, notice of dishonor,
notice of nonpayment, notice of intention to accelerate, notice of
acceleration, notice of protest and any and all lack of diligence or delay in
collection or the filing of suit on this Note which may occur, and agree to all
extensions, partial payments and substitutions of any security, before or after
maturity, without prejudice to the holder of this Note.
10. This Note is secured by that certain Pledge Agreement ("Pledge
Agreement") of even date herewith, executed and delivered by Maker to Payee.
Reference is hereby made to the Pledge Agreement for a description of certain
rights, limitations of rights, obligations and duties of the parties and for a
description of the nature and extent of the security provided by the Pledge
Agreement and the rights of the parties thereto in respect of such security.
11. This Note is also secured by that certain Security Agreement
("Security Agreement") of even date herewith, executed and delivered by ▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., P.A. to Payee, granting to Payee a security interest in
all of the assets of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., P.A., as more fully
described in the Security Agreement. Reference is hereby made to the Security
Agreement for a description of certain rights, limitation on rights,
obligations and duties of the parties to it and the nature and extent of the
security.
12. All agreements between Maker and the holder of this Note,
whether now existing or hereafter arising and whether written or oral, are
hereby expressly limited so that in no contingency or event whatsoever, shall
the amount paid, or agreed to be paid, to the holder of this Note for the use,
forbearance, or detention of the funds advanced pursuant to this Note, or
otherwise, or for the payment or performance of any covenant or obligation
contained in this
SECURED PROMISSORY NOTE
PHYSICIAN GROUP/DUCHOUQUETTE 3
29
Note or document or instrument evidencing, securing, or pertaining to this
Note, exceed the maximum amount permissible under applicable law.
13. If from any circumstances whatsoever fulfillment of any
provision of this Note or of any other document or instrument described in this
Note, at the time performance of such provision shall be due, shall involve
transcending the limit of validity prescribed by law, then, ipso facto, the
obligation to be fulfilled shall be reduced to the limit of such validity, and
if from any such circumstances the holder of this Note shall ever receive
anything of value deemed interest by applicable law, which would exceed
interest at the highest lawful rate, such amount which would be excessive
interest shall be applied to the reduction of the unpaid principal balance of
this Note or on account of any other principal indebtedness of Maker to the
holder of this Note, and not to the payment of interest, or if such excessive
interest exceeds the unpaid principal balance of this Note and such other
indebtedness, such excess shall be refunded to Maker.
14. All sums paid, or agreed to be paid, by Maker for the use,
forbearance, or detention of the indebtedness of Maker to the holder of this
Note shall, to the extent permitted by applicable law, be amortized, prorated,
allocated, and spread throughout the full term of such indebtedness until
payment in full so that the actual rate of interest on account of such
indebtedness is uniform throughout the term thereof.
15. The terms and provisions of paragraphs 12, 13 and 14 of this
Note shall control and supersede every other provision of all agreements
between Maker and the holder of this Note.
16. In the event any one or more of the provisions contained in
this Note shall for any reason be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not
affect any other provision of this Note, and this Note shall be construed as if
such invalid, illegal or unenforceable provision had never been contained in
this Note.
17. This Note and all the covenants, promises, and agreements
contained herein shall be binding upon and inure to the benefit of the
respective legal and personal representatives, devisees, heirs, successors, and
assigns of Maker and the holder of this Note.
18. Maker represents and warrants to the holder of this Note that
the loan evidenced hereby is a "contract under which credit is extended for
business, commercial investment, or other similar purpose," and is not a loan
for "personal, family, household, or agricultural use," within the meaning of
applicable Texas statutes.
19. As used in this Note, the word "holder" means the Payee(s) or
other endorsee(s) of this Note who is in possession of it, or the bearer(s) of
this Note, if this Note is at the time payable to the bearer(s).
SECURED PROMISSORY NOTE
PHYSICIAN GROUP/DUCHOUQUETTE 4
30
20. THIS NOTE IS EXECUTED AND DELIVERED IN TEXAS AND SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.
THIS NOTE IS PERFORMABLE IN DALLAS COUNTY, TEXAS, AND VENUE IN ANY LITIGATION
PURSUANT TO THIS NOTE SHALL BE IN DALLAS COUNTY, TEXAS.
21. In the event that one or more Events of Default shall occur,
and in the event that thereafter this Note is placed in the hands of an
attorney for collection, or in the event that this Note is collected in whole
or in part through legal proceedings of any nature, the Maker and all
endorsers, sureties and guarantors of this Note jointly and severally agree
there shall be added to the unpaid principal balance of this Note all
reasonable costs of collection, including but not limited to reasonable
attorneys' fees and all reasonable expenses incurred in connection with the
foreclosure of the lien of the Pledge Agreement by the holder hereof, on
account of such collection, whether or not suit is filed.
22. The rights and remedies of Payee granted Payee pursuant to
this Note shall be cumulative and not alternative.
23. Neither the failure nor any delay in exercising any right,
power or privilege and no single or partial exercise of any such right, power
or privilege by Payee shall preclude any other or further exercise of such
right, power or privilege or the exercise of any other right, power or
privilege.
24. To the maximum extent permitted by applicable law, (i) no
claim or right of Payee arising out of this Note can be discharged by Payee, in
whole or in part, by a renunciation or waiver of the claim or right unless in
writing, signed by Payee; (ii) no waiver that may be given by Payee will be
acceptable except in the specific instance for which it is given; and (iii) no
notice to or demand on Maker will be deemed to be a waiver of any obligation of
Maker or of the right of Payee to take further action without notice or demand
as provided in this Note.
EXECUTED as of the day and year first above written.
The Physician Group, P.A., Maker
By:
----------------------------------------
▇▇▇▇▇▇ ▇. Angle, M.D., President
▇▇▇▇ ▇▇▇▇▇ ▇'▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
SECURED PROMISSORY NOTE
PHYSICIAN GROUP/DUCHOUQUETTE 5
31
To induce Payee to accept this Note, and for good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
undersigned hereby unconditionally guarantees to Payee that the principal of,
and interest on, and fees and expenses provided in (including, without
limitation, attorneys' fees), this Note will be promptly paid when due in
accordance with its terms.
THE COMPANY DOCTOR
By:
-----------------------------------------
▇▇▇ ▇▇▇▇▇, Vice President
▇▇▇▇ ▇▇▇▇▇ ▇'▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
SECURED PROMISSORY NOTE
PHYSICIAN GROUP/DUCHOUQUETTE 6
32
STOCK PLEDGE AGREEMENT
THIS STOCK PLEDGE AGREEMENT (the "Agreement"), is made and entered
into on September 20, 1996, by THE PHYSICIAN GROUP, P.A., a Texas professional
association ("Pledgor") and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. ("Pledgee").
In consideration of the mutual covenants and agreements set forth
below, and intending to be legally bound by this Agreement, the parties agree
as follows:
1. Pursuant to that one certain Stock Purchase Agreement (the
"Stock Purchase Agreement") entered into on September 20, 1996, by Pledgor,
Pledgee and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., P.A., a Texas professional
association ("Duchouquette P.A."), Pledgor acquired 1,000 shares of the issued
and outstanding capital stock, par value $0.10 per share, of Duchouquette P.A.
(the "Pledged Stock") which represents all of the issued and outstanding shares
of stock of Duchouquette P.A.
2. As consideration for the Pledged Stock acquired by Pledgor
pursuant to the Stock Purchase Agreement, Pledgor:
(a) Paid Pledgee $843,750.00 (the "Cash Consideration");
(b) Executed and delivered that one certain Secured
Promissory Note dated September 20, 1996 in the principal amount of
$843,750.00 (the "Note") to Pledgee (a copy of the Note is attached as Exhibit
1); and
(c) Caused certain shares of unregistered common stock of
The Company Doctor, a Delaware corporation, ("TCD") valued at $562,500.00 to be
delivered to Pledgee (the "TCD Shares").
3. As an inducement to Pledgee to accept the Note as part of the
consideration for the Pledged Stock and as additional security for the prompt
satisfaction of all the terms and conditions of the Note, Pledgor hereby
executes this Agreement and pledges the Pledged Stock to Pledgee and grants
Pledgee a lien on and security interest in the Pledged Stock.
4. In order to perfect Pledgee's security interest in the Pledged
Stock, as provided in Texas UCC Sec. 9.115(d)(1), and insure Pledgee's
priority over any other security interest or claim in or to the Pledged Stock,
as provided in Texas UCC Sec. 9.115(e)(1), Pledgor herewith delivers a
certificate evidencing the Pledged Stock to Pledgee effectively indorsed in
blank. A copy of the certificate evidencing the Pledged Stock is attached as
Exhibit 2.
STOCK PLEDGE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 1
33
5. For purposes of this Agreement, the term "Event of Default"
shall have the same meaning as assigned to that term in paragraph 5 of the
Note.
6. At any time after the occurrence and during the continuation
of an Event of Default Pledgee, at his option, may have any or all of the
Pledged Stock registered on the books of the association in his name or that of
his nominee, and Pledgor hereby covenants that, upon Pledgee's written request
to Pledgor, Pledgor will cause Duchouquette P.A. to effect such registration
on the books of the association.
7. Upon the occurrence of an Event of Default, Pledgee shall
either exercise the remedies normally available to a secured party under the
Texas Uniform Commercial Code or exercise the following remedies:
(a) Retain all of the Cash Consideration and all payments
of principal and interest previously paid to him by Pledgor pursuant to the
Note;
(b) Have the right to require that Pledgor convey the
Pledged Stock and the medical practice then being conducted by Duchouquette
P.A. to Pledgee or such Professional Association as Pledgee may elect free and
clear of any and all liabilities or obligations of any type, upon (i)
forgiveness of the remaining unpaid principal balance of the Note and delivery
to Pledgor of a full and complete written release thereof, (ii) transfer and
return the TCD Shares then held by Pledgee to Pledgor, free and clear of all
liens, liabilities, security interests, claims, and encumbrances, (iii) written
release of the Non-Qualified Stock Option Agreement entered into pursuant to
Section 4(d) of the Stock Purchase Agreement, (iv) written release of the
Registration Rights Agreement entered into pursuant to Section 4(e) of the
Stock Purchase Agreement, (v) written termination of the Security Agreement and
security interest granted thereby, which was entered into pursuant to Section
3(b) of the Stock Purchase Agreement, (vi) written release by ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇, M.D. of the obligations of Pledgor under Section 4(c) of the Stock
Purchase Agreement, and (vii) written release by Pledgee of the obligations of
Pledgor under Section 13 of the Stock Purchase Agreement (relating to
employees).
(c) Have the right to terminate any employment agreements
made as a condition of the Stock Purchase Agreement thereby voiding any
restrictive covenants contained in the Stock Purchase Agreement and the
employment agreements.
8. Immediately and without further notice, upon the occurrence of
an Event of Default, whether or not the Pledged Stock has been registered in
the name of Pledgee or his nominee, Pledgee or his nominee shall have, with
respect to the Pledged Stock, the right to exercise all voting rights as to all
of the Pledged Stock and to, all other corporate rights and all conversion,
exchange, subscription or other rights, privileges or options pertaining
thereto as if he were the absolute owner of the Pledged Stock. However,
Pledgee shall have no duty to exercise any of the aforesaid rights, privileges
or options and shall not be responsible for any failure to do so or delay in so
doing.
STOCK PLEDGE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 2
34
9. Notwithstanding anything contained in this Agreement or in the
Note to the contrary, unless and until an Event of Default shall occur.
(i) Pledgor shall be entitled to receive all cash
dividends paid to Pledgor in respect of or attributable to the Pledged Stock.
(ii) Pledgor shall have the right to vote and give
consents with respect to all of the Pledged Stock and to consent to, ratify, or
waive notice of any and all meetings; provided that such right shall in no case
be exercised for any purpose contrary to, or in violation of, any of the terms
or their provisions of this Agreement or the Note.
10. Pledgor represents and warrants that:
(a) It has, and has duly exercised, all requisite power
and authority to enter into this Agreement, to pledge the Pledged Stock for the
purposes described above, and to carry out the transactions contemplated by
this Agreement;
(b) It is the legal and beneficial owner of all of the
Pledged Stock;
(c) The shares of the Pledged Stock constitute all of the
issued and outstanding shares of Duchouquette P.A.;
(d) All of the shares of the Pledged Stock are owned by
Pledgor free of any pledge, mortgage, hypothecation, lien, charge, encumbrance
or security interest in such shares or the proceeds thereof, except for that
granted pursuant to this Agreement;
(e) The execution and delivery of this Agreement, and
the performance of its terms, will not result in any violation of any provision
of Pledgor's certificate of incorporation or by-laws, or violate or constitute
a default under the terms of any agreement, indenture or other instrument,
license, judgment, decree, order, law, statute, ordinance or other governmental
rule or regulation, applicable to Pledgor or any of its property; and
(f) Upon delivery of the Pledged Stock to Pledgee or its
agent, this Agreement shall create a valid first lien upon and perfected
security interest in the Pledged Stock and the proceeds thereof, subject to no
prior security interest, lien, charge or encumbrance, or agreement purporting
to grant to any third party a security interest in the property or assets of
Pledgor which would include the Pledged Stock.
11. Pledgor hereby covenants that, until all of the Note has been
satisfied in full, it will not:
(a) Sell, convey, or otherwise dispose of any of the
Pledged Stock or any interest therein, including any type of merger or other
corporate consolidation, or create, incur,
STOCK PLEDGE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 3
35
or permit to exist any pledge, mortgage, lien, charge, encumbrance or any
security interest whatsoever in or with respect to any of the Pledged Stock or
the proceeds thereof, other than that created hereby; or
(b) Consent to or approve the issuance of any additional
shares of any class of capital stock in Duchouquette P.A. or any securities
convertible voluntarily by the holder thereof or automatically upon the
occurrence or nonoccurrence of any event or condition into, or exchangeable
for, any such shares; or any warrants, options, rights, or other commitments
entitling any person to purchase or otherwise acquire any such shares.
12. Pledgor warrants and will, at its own expense, defend
Pledgee's right, title, special property and security interest in and to the
Pledged Stock against the claims of any person, firm, corporation or other
entity (other than claimants by, through or under Pledgee).
13. Pledgor will promptly deliver to Pledgee all written notices,
and will promptly give Pledgee written notice of any other notices, received by
it with respect to Pledged Stock, and Pledgee will promptly give like notice to
Pledgor of any such notices received by it or its nominee.
14. Pledgor shall at any time, and from time to time, upon the
written request of Pledgee, execute and deliver such further documents and take
such further action as Pledgee may reasonably request to effect the purposes of
this Agreement, including, without limitation, delivering to Pledgee upon the
occurrence of an Event of Default irrevocable proxies with respect to the
Pledged Stock in form satisfactory to Pledgee. Until receipt thereof, this
Agreement shall constitute Pledgor's proxy to Pledgee or its nominee to vote
all shares of Pledged Stock then registered in Pledgor's name.
15. Upon the satisfaction in full of all obligations and the
satisfaction of all additional costs and expenses of Pledgee as provided in
this Agreement, this Agreement shall terminate and Pledgee shall deliver to
Pledgor, such of the Pledged Stock as shall not have been sold or otherwise
applied pursuant to this Agreement.
16. Beyond the exercise of reasonable care to assure the safe
custody of the Pledged Stock while held pursuant to this Agreement, Pledgee
shall have no duty or liability to preserve rights pertaining to the Pledged
Stock and shall be relieved of all responsibility for the Pledged Stock upon
surrendering it or tendering surrender of it to Pledgor.
17. No course of dealing between Pledgor and Pledgee, nor any
failure to exercise, nor any delay in exercising, any right, power or privilege
of Pledgee granted by this Agreement or by the Note shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege granted by this Agreement or the Note preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
STOCK PLEDGE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 4
36
18. Except as provided in Section 7 hereof, the rights and
remedies provided in this Agreement and in the Note and in all other
agreements, instruments, and documents delivered pursuant to or in connection
with the Note, are cumulative and are in addition to and not exclusive of any
rights or remedies provided by law, including, but without limitation, the
rights and remedies of a secured party under the Texas Uniform Commercial Code.
19. The provisions of this Agreement are severable, and if any
clause or provision shall be held invalid or unenforceable in whole or in part
in any jurisdiction, then such invalidity or unenforceability shall affect only
such clause or provision or part thereof in such jurisdiction and shall not in
any manner affect such clause or provision in any other jurisdiction or any
other clause or provision in this Agreement in any jurisdiction.
20. This Agreement supersedes any and all other agreements, either
oral or written, between the Pledgor and Pledgee with respect to the subject
matter of this Agreement and contains all of the covenants and agreements
between them with respect to this Agreement.
21. Any notices, consents, demands, requests, approvals, and other
communications to be given under this Agreement by any party to the other shall
be deemed to have been duly given if given in writing and personally delivered,
sent by telegram, telex, or telecopy, or sent by mail, registered or certified,
postage prepaid with return receipt requested, at the address specified beside
each party's signature at the end of this Agreement. Notices delivered
personally or by telegram, telex, or telecopy shall be deemed communicated as
of actual receipt; mailed notices shall be deemed communicated as of 10:00 a.m.
on the third business day after mailing. Any party may change its or his
address for notice hereunder by giving notice of such change in the manner
provided in this paragraph.
22. No change or modification of this Agreement shall be valid or
binding upon the Pledgor or Pledgee unless such change or modification shall be
in writing and signed by both of them. No waiver of any term or condition of
this Agreement shall be enforceable unless it shall be in writing signed by the
party against which or whom it is sought to charged. The waiver by either
party of a breach of any provision of this Agreement by the other shall not
operate or be construed as a waiver of any subsequent breach by such other
party.
23. This Agreement, and the rights and obligations of the parties
to it, shall be governed by and construed in accordance with the laws of the
State of Texas and shall be performable in Dallas County, Texas. Venue of any
litigation arising pursuant to this Agreement shall be in a court of competent
jurisdiction in Dallas County, Texas.
24. If any action at law or in equity is necessary to enforce or
interpret the terms of this Agreement, the prevailing party shall be entitled
to reasonable attorneys' fees, costs, and necessary disbursements in addition
to any other relief to which he or it may be entitled.
25. Neither Pledgor nor Pledgee may assign this Agreement without
the prior written consent of the other party, which consent may be withheld in
its or his sole discretion.
STOCK PLEDGE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 5
37
26. This Agreement shall inure to the benefit of and shall be
binding upon the successors and assigns of Pledgor and Pledgee.
27. This Agreement may be executed in counterparts, each of which
shall constitute an original, but all of which shall constitute one and the
same document.
The parties hereto have duly executed this Agreement as of the date
and year first above written.
The Physician Group, P.A., Pledgor
▇▇▇▇ ▇▇▇▇▇ ▇'▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
By:
-------------------------------------
▇▇▇▇▇▇ ▇. Angle, M.D., President
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., Pledgee
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D.
STOCK PLEDGE AGREEMENT
DUCHOUQUETTE/PHYSICIAN GROUP 6
38
SECURITY AGREEMENT
This Security Agreement (this "Agreement") is made and entered into
effective as of September 20, 1996, by and between, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇,
M.D., P.A., a Texas professional association, ("Grantor"), and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇▇▇, M.D., an individual resident of Texas ("Secured Party").
Pursuant to that one certain Stock Purchase Agreement (the "Stock
Purchase Agreement") entered into on September 20, 1996, by Grantor, Secured
Party and The Physician Group, P.A., a Texas professional association
("Physician Group"), Physician Group acquired 1,000 shares of the issued and
outstanding capital stock, par value $0.10 per share, of Grantor (the
"Duchouquette P.A. Stock") which represents all of the issued and outstanding
shares of stock of Duchouquette P.A.
As part of the consideration for the Duchouquette P.A. Stock acquired
by Physician Group pursuant to the Stock Purchase Agreement, Physician Group
executed and delivered that one certain Secured Promissory Note dated September
20, 1996 in the principal amount of $843,750.00 (the "Note") to Secured Party
(a copy of the Note is attached as Exhibit 1).
As an additional inducement to Secured Party to accept the Note as
part of the consideration for the Duchouquette P.A. Stock and as additional
security for the prompt satisfaction of all the terms and conditions of the
Note, Physician Group executed a Pledge Agreement of even date herewith (the
"Pledge Agreement") and pledged the Duchouquette P.A. Stock to Secured Party
and granted Secured Party a lien on and security interest in the Duchouquette
P.A. Stock (a copy of the Pledge Agreement is attached as Exhibit 2).
As a result of Physician Group's execution and delivery of the Note to
Secured Party, Physician Group is indebted to Secured Party in the principal
amount of Eight Hundred Forty Three Thousand Seven Hundred Fifty Dollars
($843,750.00) pursuant to Note.
It is a condition to acceptance by Secured Party of the Note that
Physician Group, as the new sole shareholder of Grantor, cause Grantor grant a
security interest to Secured Party in all of the assets and property of Grantor
(Duchouquette P.A.).
In consideration of the foregoing recitals and the mutual covenants
and obligations of the parties set forth in this Agreement, and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties, intending to be legally bound, agree as follows:
1. Defined Terms. Unless otherwise defined herein, the following
terms shall have the following meanings:
(a) "Collateral" has the meaning assigned in Section 2 of
this Agreement.
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 1
39
(b) "Employment Agreements" has the meaning assigned in
the Stock Purchase Agreement.
(c) "Event of Default" has the same meaning as assigned
to that term in paragraph 5 of the Note.
(d) "Lien" means with respect to any asset, mortgage,
pledge, charge, security interest, or encumbrance of any kind in respect of
such asset, including (without limitation) the rights of a lessor under any
lease of property, real or personal, which would be capitalized on a balance
sheet of the lessee prepared as of such date in accordance with generally
accepted accounting principles (in this definition, a "Capital Lease") to the
asset which is the subject of such Capital Lease. For purposes of this
Agreement, a person or entity shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a vendor or
lessor under any conditional sale agreement, Capital Lease or other title
retention agreement relating to such asset.
(e) "Loan Documents" means the Note, the Pledge
Agreement, this Agreement, and all other agreements and instruments relating to
the indebtedness evidenced thereby.
(f) "Maximum Lawful Rate" means the maximum rate (or, if
the context so permits or requires, an amount calculated at such rate) of
interest which, at the time in question would not cause the interest charged on
the loan evidenced by the Loan Documents at such time to exceed the maximum
amount which Secured Party would be allowed to contract for, charge, take,
reserve, or receive under applicable law after taking into account, to the
extent required by applicable law, any and all relevant payments or charges
under the Loan Documents.
(g) "Obligations" means all present and future
indebtedness, obligations, and liabilities, and all renewals and extensions
thereof, or any part thereof, of Grantor to Secured Party arising pursuant to
the Loan Documents, and all interest accrued thereon and reasonable costs,
expenses, and attorneys' fees incurred in the enforcement or collection
thereof.
(h) "Proceeds" means all "Proceeds" as such term is
defined in Section 9.306(a) of the UCC.
(i) "UCC" means the Uniform Commercial Code as from time
to time in effect in the State of Texas.
2. The Collateral. The Collateral of this Security Agreement is
all of the assets and property of Grantor, including, but not necessarily
limited to, the following (collectively the "Collateral"):
(a) All furniture and equipment, whether now owned or
hereafter acquired, including, but not limited to fixtures, furnishings and
machinery;
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 2
40
(b) All present and future attachments, accessories,
replacements and proceeds of the equipment, furnishings and machinery described
in clause (a) of this paragraph;
(c) All receivables, whether now existing or hereafter
acquired;
(d) All inventory of every nature, description or type
whatsoever in which Grantor now has, or hereafter acquires an interest;
(e) All accounts, contract rights, general intangibles,
chattel paper, and proceeds arising from or by virtue of, or from the sale or
other disposition of or collections with respect to, all or any part of the
property or other rights described in the foregoing clauses (a), (b), (c) or
(d) above; and
(f) All the patient records and other related information
of the medical practice carried on by Secured Party at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
The Collateral covered by this Security Agreement also includes the
proceeds of any and all property described above, including, but not limited to
(i) any and all proceeds of any insurance, causes and rights of action,
settlements thereof, judicial and arbitration judgments and awards, indemnity,
warranty or guaranty payable to Grantor from time to time with respect to any
of the Collateral, (ii) any and all payments (in any form whatsoever) made or
due and payable to Grantor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Collateral by any governmental department, commission, board,
bureau, authority, agency or body (domestic or foreign), and (iii) any and all
other amounts from time to time paid or payable under or in connection with any
of the Collateral.
3. Grant of Security Interest. As collateral security for the
prompt and complete payment and performance when due (whether at the stated
maturity, by acceleration, or otherwise) of the Obligations, Grantor hereby
assigns, mortgages, pledges, and hypothecates to Secured Party, and hereby
grants to Secured Party a continuing first and prior lien and security
interest, in the Collateral."
4. Representations and Warranties. Grantor hereby represents and
warrants that:
(a) Location of Tangible Property. The Assets of Grantor
are kept and will continue to be kept at its place of business, which is
located at ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇.
(b) Chief Executive Office. Grantor's chief executive
office is located at ▇▇▇▇ ▇▇▇▇▇ ▇'▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇.
(c) Power and Authority; Authorization. Grantor has the
power and authority and the legal right to execute and deliver, to perform its
obligations under, and to grant the Liens
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 3
41
and security interests in the Collateral pursuant to, this Agreement and has
taken all necessary association action to authorize its execution, delivery,
and performance of, and grant of the Liens and security interests in the
Collateral pursuant to, this Agreement.
5. Covenants. Grantor covenants and agrees with Secured Party
that from and after the date of this Agreement and until the Obligations are
paid in full:
(a) Further Documentation. At any time and from time to
time, upon the written request of Secured Party, Grantor will promptly and duly
execute and deliver such further assignments, certificates, supplemental
writings, instruments, and documents and take such further action as Secured
Party may reasonably request for the purpose of obtaining or preserving the
full benefits of this Agreement and of the rights and powers granted in this
Agreement, including, without limitation, the filing of any financing or
continuation statements under the Uniform Commercial Code in effect in any
jurisdiction with respect to the Liens and security interests evidenced by this
Agreement. A carbon, photographic, or other reproduction of this Agreement
shall be sufficient as a financing statement for filing in any jurisdiction.
(b) Right of Inspection. Secured Party and his
representatives shall also have the right upon reasonable notice and during
normal business hours to enter into and upon any premises where any of the
Collateral is located for the purpose of inspecting the same, observing its use
or otherwise protecting his interests in the Collateral. Grantor shall pay the
costs incurred by Secured Party in connection with any such exercise of his
rights pursuant to this subsection.
(c) Changes in Locations, Name, etc. Grantor will not
(i) change the location of its chief executive office from that specified in
Section 4(b), (ii) permit any of the Collateral to be kept at a location other
than those specified in Section 4(a), or (iii) change its name, identity, or
corporate structure to such an extent that any financing statement filed by
Secured Party in connection with this Agreement would become seriously
misleading, unless it shall give prior written notice as soon as practicable
thereof and prior to effecting any such change take such steps as Secured Party
may deem necessary or advisable to continue the perfection and priority of the
security interest granted pursuant to this Agreement.
(d) Sale, Lease, etc. Grantor will not, without written
consent of Secured Party, sell, contract to sell, lease, encumber or dispose of
the Collateral, or any interest in it, other than in the ordinary course of
business, until this Security Agreement and the Obligations have been fully
satisfied.
(e) Maintenance of Collateral. Grantor will keep the
Collateral in good condition and free from liens and other security interests
other than those granted by the Loan Documents to Secured Party, will not
encumber the Collateral or permit it to be affixed to real or personal property
without the prior written consent of Secured Party and will not use the
Collateral illegally.
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 4
42
(f) Insurance. Grantor or any affiliate will insure the
Collateral against such casualties and in such amounts as Secured Party may
from time to time reasonably require. All insurance policies shall be written
for the benefit of Grantor and Secured Party as their interests may appear, and
copies of such policies shall be furnished to Secured Party at its request.
All policies of insurance shall provide at least ten (10) days' prior written
notice of cancellation to Secured Party.
(g) Taxes. Grantor will pay promptly when due all taxes
and assessments upon the Collateral.
(h) Records. Grantor will, at all times, maintain
accurate books and records with respect to the Collateral.
(i) Material Adverse Changes. Grantor will notify the
Secured Party of any material adverse change occurring in or to the Collateral
or in any fact or circumstance warranted or represented by Grantor in this
Security Agreement or furnished to the Secured Party, or if any Event of
Default occurs, prior to or immediately following the occurrence of the latter.
6. Remedies.
(a) If an Event of Default shall occur, Secured Party may
exercise, in addition to all other rights and remedies granted to it in this
Agreement and in the other Loan Documents, all rights and remedies of a secured
party under the UCC.
(b) Without limiting the generality of the foregoing, or
any other right available to Secured Party pursuant to this Agreement, Secured
Party, without demand of performance or other demand, presentment, protest,
advertisement, or notice of any kind (except any notice required by law or by
any of the Loan Documents) to or upon Grantor or any other party (all and each
of which demands, offenses, advertisements, and notices are hereby waived,
except as provided for in the Loan Documents), may in such circumstances
forthwith collect, receive, appropriate, and realize upon the Collateral, or
any part thereof, and/or may forthwith sell, lease, assign, give option or
options to purchase, or otherwise dispose of, and deliver the Collateral or any
part thereof (or contract to do any of the foregoing), in one or more parcels
at public or private sale or sales, at any exchange, broker's board or office
of Secured Party or elsewhere.
(c) Secured Party shall have the right upon any such
public sale or sales, and, to the extent permitted by law, upon any such
private sale or sales, to purchase the whole or any part of the Collateral so
sold.
(d) Grantor further agrees, at Secured Party's request,
to assemble, or cause the assembly of, the Collateral and make it available to
Secured Party at Grantor's premises.
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 5
43
(e) If any notice of a proposed sale or other disposition
of Collateral shall be required by law, such notice shall be deemed reasonable
and proper if given at least ten (10) days before such sale or other
disposition.
7. Rights Cumulative. All rights and remedies granted to the
Secured Party by this Agreement are cumulative of each other and of every other
right or remedy which the Secured Party may otherwise have at law or in equity
or under any other contract or other writing for the enforcement of the
Security Interests granted in this Agreement or in the payment of the Note or
the Obligations, and the exercise of one or more rights or remedies shall not
prejudice or impair the concurrent or subsequent exercise of other rights or
remedies.
8. Severability. If any provision of this Agreement is held to be
illegal, invalid, or unenforceable under present or future laws effective
during the term hereof, such provision shall be fully severable, this Agreement
shall be construed and enforced as if such illegal, invalid, or unenforceable
provision had never comprised a part thereof, and the remaining provisions
thereof shall remain in full force and effect and shall not be affected by the
illegal, invalid, or unenforceable provision or by its severance therefrom so
as to achieve the original intent of Grantor and Secured Party. Furthermore,
in lieu of such illegal, invalid, or unenforceable provision there shall be
added automatically as part of this Agreement a provision as similar in terms
to such illegal, invalid, or unenforceable provision as may be possible and be
legal, valid, and enforceable.
9. Section Headings. The Section headings used in this Agreement
are for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
10. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; except that Grantor may not assign or
otherwise transfer any of its rights under this Agreement.
11. Limitation on Interest.
(a) Regardless of any provision contained in this
Agreement or in the other Loan Documents, Secured Party shall never be entitled
to receive, collect, or apply, as interest on the loan evidenced thereby, any
amount in excess of the Maximum Lawful Rate, and in the event Secured Party
ever receives, collects, or applies as interest any such excess, such amount
which would be deemed excessive interest shall be deemed a partial prepayment
of principal and treated hereunder as such; and if the loan is paid in full,
any remaining excess shall promptly be paid to Grantor.
(b) In determining whether or not the interest paid or
payable under any specific contingency exceeds the Maximum Lawful Rate, Grantor
and Secured Party shall, to the extent permitted under applicable law, (i)
characterize any non-principal payment as an expense, fee, or premium rather
than as interest, (ii) exclude voluntary prepayments and the effects thereof,
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 6
44
and (iii) amortize, prorate, allocate, and spread, in equal parts, the total
amount of the interest throughout the entire contemplated term of the Note, so
that the interest rate is the Maximum Lawful Rate throughout the entire term of
the Note.
(c) If the unpaid principal balance of the Note is paid
and performed in full prior to the end of the full contemplated term thereof,
and if the interest received for the actual period of existence thereof exceeds
the Maximum Lawful Rate, Secured Party shall refund to Grantor the amount of
such excess and, in such event, Secured Party shall not be subject to any
penalties provided by any laws for contracting for, charging, taking,
reserving, or receiving interest in excess of the Maximum Lawful Rate.
12. Applicable Law. THIS AGREEMENT IS BEING EXECUTED AND
DELIVERED, AND IS INTENDED TO BE PERFORMED, IN THE STATE OF TEXAS AND THE
INTERNAL LAWS (BUT NOT THE CONFLICTS OF LAWS RULES) OF SUCH STATE SHALL GOVERN
THE VALIDITY, CONSTRUCTION, ENFORCEMENT, AND INTERPRETATION OF THIS AGREEMENT,
EXCEPT TO THE EXTENT FEDERAL LAWS OTHERWISE GOVERN THE VALIDITY, CONSTRUCTION,
ENFORCEMENT, AND INTERPRETATION OF ALL OR ANY PART OF THIS AGREEMENT.
13. Jurisdiction. Grantor CONSENTS AND AGREES TO THE JURISDICTION
OF ANY STATE COURT SITTING IN DALLAS COUNTY, STATE OF TEXAS, AND TO THE
JURISDICTION OF ANY FEDERAL COURT SITTING IN THE NORTHERN DISTRICT OF TEXAS,
AND WAIVES ANY OBJECTION BASED ON VENUE OR FORUM NON CONVENIENS WITH RESPECT TO
ANY ACTION INSTITUTED THEREIN, AND AGREES THAT ANY DISPUTE CONCERNING THE
RELATIONSHIP BETWEEN SECURED PARTY, ON THE ONE HAND, AND Grantor, ON THE OTHER
HAND, OR THE CONDUCT OF ANY PARTY IN CONNECTION WITH THIS AGREEMENT OR
OTHERWISE SHALL BE HEARD ONLY IN THE COURTS DESCRIBED ABOVE.
14. Notices. Any notices, consents, demands, requests, approvals,
and other communications to be given under this Agreement by any party to the
others shall be deemed to have been duly given if given in writing and
personally delivered, sent by courier, sent by telegram or telecopy, or sent by
mail, registered or certified, postage prepaid with return receipt requested,
at the address specified beside each party's signature at the end of this
Agreement. Notices delivered personally or by courier, telegram, or telecopy
shall be deemed communicated as of actual receipt; mailed notices shall be
deemed communicated as of 10:00 a.m. on the third business day after mailing.
Any party may change its address for notice hereunder by giving notice of such
change in the manner provided in this Section.
15. Counterparts. This Agreement may be executed in counterparts,
each of which shall constitute an original, but all of which shall constitute
one and the same document. Faxed signatures to this Agreement will be binding
and enforceable without the requirement that the manually executed signature
page be delivered.
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 7
45
16. No Waiver. No course of dealing between Secured Party and
Grantor, nor any failure to exercise, nor any delay in exercising on the part
of Secured Party any right hereunder or under the Loan Documents shall operate
as a waiver hereof or thereof; nor shall any single or partial exercise of any
right hereunder or thereunder preclude any other or further exercise thereof or
the exercise of any other right.
17. Amendments and Modifications. This Agreement shall be
modified or amended only in a written document, signed by Secured Party and
Grantor.
18. FINAL AGREEMENT. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
COLLECTIVELY REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
19. Termination. Upon the satisfaction in full of all obligations
and the satisfaction of all additional costs and expenses of Secured Party as
provided in this Agreement, this Agreement shall terminate and Secured Party
shall deliver to Grantor such of the Collateral as shall not have been sold or
otherwise applied pursuant to this Agreement.
20. Counterparts. This Agreement may be executed in a number of
identical counterparts, each of which, for all purposes, is to be deemed an
original, and all of which collectively constitute one agreement, but in making
proof of this Agreement, it shall not be necessary to produce or account for
more than one such counterpart.
Grantor has caused this Agreement to be duly executed and delivered as
of the date first above written.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., P.A. - GRANTOR:
By:
----------------------------------------------
The Physician Group, P.A. - Sole Shareholder
▇▇▇▇▇▇ ▇. Angle, M.D., President
▇▇▇▇ ▇▇▇▇▇ ▇'▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 8
46
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D.- SECURED PARTY:
----------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D., Individually
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
SECURITY AGREEMENT
PHYSICIAN GROUP\▇.▇. ▇▇▇▇▇▇▇▇▇▇▇▇, M.D. 9