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EXHIBIT 2(e)
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT, dated as of January 21, 1999, by and amongst
Integrated Health Concepts Inc., a Texas corporation ("IHC" or the "Company"),
US Diagnostic Inc., a Delaware corporation ("USD"), and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, M.D., a
resident of Houston, Texas ("Buyer").
WITNESSETH:
WHEREAS, USD owns 85% of the outstanding capital stock of IHC (the
"Company Stock"); and
WHEREAS, IHC is engaged in the business of owning and operating
diagnostic imaging centers primarily in Houston, Texas; and
WHEREAS, subject to the limitations and exclusions contained in this
Agreement and on the terms and conditions hereinafter set forth, USD desires to
sell, and Buyer desires to purchase, the Company Stock (the "Acquisition");
NOW THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants and agreements herein contained, the
parties hereto do hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF THE COMPANY STOCK
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1.01. AGREEMENT TO PURCHASE. At the Closing, Buyer shall purchase the
Company Stock from USD, upon and subject to the terms and conditions of this
Agreement, in exchange for the Purchase Price (as defined in Section 1.02
hereof).
1.02. PURCHASE PRICE. Subject to the terms and conditions of this
Agreement, in reliance on the representations, warranties and agreements of USD
and the Company contained herein, and in full and complete consideration of the
sale, assignment, transfer and delivery of the Company Stock, the purchase price
(the "Purchase Price") for the Company Stock shall be $2,900,000, payable at the
Closing, plus (i) the assumption, release and extinguishment of the specific
liabilities set forth in Section 4.03 in accordance with Section 4.03, and (ii)
the payment of the amounts set forth in Section 1.06 in accordance with Section
1.06. USD shall cause the Company to continue to pay all payables in the
ordinary course of business through December 31, 1998 including, but not limited
to all Company payroll, taxes, notes, rental payments, insurance and trade,
consistent with prior practice of USD and the Company.
1.03. CLOSING. The Closing of the transactions contemplated by this
Agreement will take place at the offices of USD, or at such other place as the
parties may agree in writing, at
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10:00 a.m. (local time) on January 22, 1999, or at such other time as the
parties may agree in writing (the "Closing Date"). The Closing will be deemed to
have occurred for accounting and other purposes at the close of business on
December 31, 1998.
1.04. FURTHER ASSURANCES. After the Closing, each party hereto shall
from time to time, at the request of any other party hereto and without further
cost or expense to the requesting party, execute and deliver such other
instruments of conveyance and transfer and take such other actions as the
requesting party may reasonably request, in order to carry out the intent of
this Agreement and the documents referred to herein. For a period of no less
than 90 days after the Closing Date, USD shall from time to time at the request
of Buyer, provide assistance in the transition of operations in the Company,
which shall include, but not be limited to, assistance with human resource
issues, transfer of utilities, computer related issues, insurance, service
agreements and other matters related to the operation of the Company. In
addition, for a period of no more than 90 days after the Closing Date, USD shall
provide billing and collection services to the Company, and the Company shall
reimburse USD for USD's actual costs in connection with providing such services.
1.05. NONREFUNDABLE DEPOSIT. Simultaneously with execution of this
Agreement, Buyer shall deliver to Steel ▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, as escrow agent
pursuant to the escrow agreement in the form attached hereto as Exhibit A (the
"Escrow Agreement"), a bank cashier's check or certified check in the amount of
$1,000,000 which amount shall, subject to the provisions of the Escrow
Agreement, constitute a nonrefundable deposit (the "Deposit"). Upon consummation
of the transactions contemplated by this Agreement in accordance with the terms
of this Agreement, the Deposit shall be credited towards the Purchase Price. In
the event that the transactions contemplated by this Agreement are not
consummated in accordance with the terms of this Agreement for any reason, then
the Deposit shall be and remain fully nonrefundable.
1.06. ▇▇▇▇▇▇▇ SETTLEMENT. Prior to or on the Closing Date, Buyer agrees
to (i) pay to USD a lump sum of $400,000 in cash which sum is to reimburse USD
for that portion of the settlement (the 'settlement") which USD paid in December
1998 pursuant to the Settlement Agreement and Release among IHC, USD and ▇▇▇
▇▇▇▇▇▇▇, an individual and also as Trustee of the ▇▇▇ ▇▇▇▇▇▇▇ Investment Trust
(collectively, "▇▇▇▇▇▇▇"), dated as of December 3, 1998, and (ii) pay to USD a
lump sum of $300,000 in cash, or assume USD's obligation to pay such sum with
appropriate consents and releases of USD, in USD's sole option, which sum
represents the balance of the Settlement which is to be paid by USD to ▇▇▇▇▇▇▇
in 1999 and 2000.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND USD
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The Company and USD hereby represent, covenant and warrant to Buyer as
follows:
2.01. ORGANIZATION, GOOD STANDING. IHC is a corporation duly organized,
validly existing and in good standing under the laws of the State of Texas and
has full corporate power and authority to carry on its business as it is now
being conducted and to own the properties and assets it now owns. The copies of
the articles of incorporation of IHC attached hereto as SCHEDULE 2.01 are
complete and correct copies of such instruments as presently in effect.
2.02. CAPITALIZATION. (a) As of the date hereof, the authorized capital
stock of IHC is fully described in SCHEDULE 2.02 and is true and correct in all
respects. All issued and outstanding shares of capital stock of IHC are duly and
validly authorized, issued, fully paid and nonassessable. There are no
outstanding (a) securities convertible into or exchangeable for the capital
stock; (b) options, warrants or other rights to purchase or subscribe to the
capital stock or securities convertible into or exchangeable for capital stock;
or (c) contracts, commitments, agreements, understandings or arrangements of any
kind relating to the issuance of the capital stock, any such convertible or
exchangeable securities or any such options, warrants or rights. Except as set
forth in SCHEDULE 2.02, USD owns the Company Stock free and clear of all liens,
security interests and encumbrances and upon delivery of the certificates in
accordance with this agreement, Buyer will be the record and beneficial owner
and holder of Company Stock, free and clear of all security interests, liens and
encumbrances. IHC does not own capital stock or other equity securities of any
corporation, partnership, or other entity or any rights to acquire any equity or
ownership interest in any business.
2.03. AUTHORIZATION, ETC. IHC has corporate power and authority, and
USD has corporate power and authority, to enter into this Agreement and to carry
out the transactions contemplated hereby. IHC has taken all action required by
law, its charter documents, or otherwise to be taken by it to authorize the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby, and this Agreement is a valid and binding
agreement of the IHC and USD enforceable in accordance with its terms.
2.04. FINANCIAL STATEMENTS. IHC and USD have heretofore delivered to
Buyer audited consolidated financial statements of USD for the fiscal years
ended December 31, 1996 and 1997 (the "USD Financial Statements") and the
unaudited financial statements of IHC (i) for the fiscal year ended December 31,
1997, (ii) for the nine months ended September 30, 1998 and (iii) for the month
ended October 31, 1998 (the "Company Financial Statements," and together with
the USD Financial Statements, the "Financial Statements"). The USD Financial
Statements and the notes thereto fairly present the assets, liabilities,
financial condition and results of operations of USD, and the Company Financial
Statements and the notes thereto fairly present the assets, liabilities,
financial condition and results of operations of IHC, all as at the respective
dates thereof and for the periods referred to therein, and all in accordance
with generally accepted accounting principles, subject, in the case of interim
Financial Statements, to normal recurring year-end adjustments and the absence
of notes, consistently applied throughout the periods involved, except as
disclosed in the notes to the Financial Statements.
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2.05. CONSENTS AND APPROVALS OF GOVERNMENTAL AUTHORITIES AND OTHERS.
Except as set forth on SCHEDULE 2.05, no material consent, approval or
authorization of, or declaration, filing or registration with, any governmental
or regulatory authority is required in connection with the execution, delivery
and performance of this Agreement or the consummation of the transactions
contemplated hereby.
2.06. COMPLIANCE WITH LAW. Since August 29, 1996, the operations of the
Company have been conducted in accordance with all material applicable laws,
regulations and other requirements of all national governmental authorities, and
of all states, municipalities and other political subdivisions and agencies
thereof, having jurisdiction over, including, without limitation, all such laws,
regulations and requirements relating to consumer protection, equal opportunity,
health, occupational safety, pension and securities matters, including those
promulgated by the Health Care Financing Administration and the Texas Department
of Health. Except as set forth on SCHEDULE 2.06, the Company has not received
any notification of any assorted present or past failure by the Company to
comply with any material laws, rules or regulations.
2.07. BROKERS AND FINDERS. Neither USD nor the Company, nor any of
their officers, directors or employees, has employed any broker or finder or
incurred any liability for any brokerage fees, commissions or finders' fees in
connection with the transactions contemplated by this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUYER
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Buyer represents and warrants to the Company and USD as follows:
3.01. CORPORATE ORGANIZATION; ETC. Buyer is an individual residing in
Houston, Texas and has the power and authority to carry on its business as now
being conducted and to own the properties and assets it now owns.
3.02. AUTHORIZATION, ETC. Buyer has the power and authority to enter
into this Agreement and to carry out the transactions contemplated hereby. Buyer
has taken all action required by law or otherwise to authorize the execution and
delivery of this Agreement and the transactions contemplated hereby, and this
Agreement is a valid and binding agreement of Buyer enforceable against Buyer in
accordance with its terms. Buyer has the absolute and unrestricted right, power,
and authority to execute, deliver and perform its obligations under, this
Agreement (and the agreements referenced herein). No filing by Buyer under the
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976 is required in connection
with the Acquisition.
3.03. CERTAIN PROCEEDINGS. There is no pending proceeding that has been
commenced against Buyer that challenges, or may have the effect of preventing,
delaying, making illegal, or
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otherwise interfering with, any of the transactions contemplated hereby. To
Buyer's actual knowledge, no such proceeding has been threatened.
3.05 BROKERS OR FINDERS. Neither Buyer nor any of its officers,
directors, employees or shareholders has employed any broker or finder, or
incurred any liability, contingent or otherwise, for any brokerage fees,
commissions, finders' fees or other similar payment in connection with the
transactions contemplated by this Agreement and will indemnify and hold the
Company and USD harmless from any such payment alleged to be due by or through
Buyer as a result of the action of Buyer or any of its officers, directors,
employees or shareholders.
ARTICLE IV
COVENANTS OF THE COMPANY, USD AND BUYER
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The parties hereto hereby covenant and agree as follows:
4.01. CONSENTS. The Company will (i) prior to the Closing, use its best
efforts to obtain all consents and waivers set forth on SCHEDULE 2.05 hereto
(the "Required Consents"); and (iii) use its best efforts to assist Buyer in
obtaining all necessary approvals from any governmental agencies or departments
as may be necessary or desirable in connection with the Acquisition. All
Required Consents will be in writing and executed counterparts thereof will be
delivered to Buyer prior to the Closing.
4.02. SUPPLEMENTS TO SCHEDULES. From time to time prior to the Closing,
USD and the Company will promptly supplement or amend any Schedule hereto with
respect to any matter hereafter arising which, if existing or occurring at the
date of this Agreement, would have been required to be set forth or described in
any such Schedule. No supplement or amendment of any such Schedule shall be
deemed to be a breach of any representation or warranty made in this Agreement.
4.03. RELEASE AND ASSUMPTION OF DEBT. Buyer hereby covenants and agrees
to take any and all action necessary to, effective prior to or on the Closing
Date, (i) cause USD and/or the Company to be removed as guarantor (and all of
its obligations fully extinguished) on the debt instruments listed on SCHEDULE
4.03(a) hereto (collectively, the "Guaranteed Debt") and (ii) relieve USD and/or
the Company from any and all obligations under or relating to (A) the
instruments and agreements listed on SCHEDULE 4.03(b) and (B) any and all other
instruments or agreements relating to IHC, the centers operated thereby, or the
debt or assets thereof, or arising in connection with USD's ownership of IHC
(collectively, the "Assumed Obligations") so as to fully and completely
extinguish any and all liabilities USD and/or the Company may have with respect
to such Assumed Obligations and Guaranteed Debt. Any such action shall include
but not be limited to, the assumption and/or guarantee, as may be necessary, of
the Guaranteed Debt or Assumed Obligations by Buyer or, on Buyer's behalf, by a
third party. All such releases and instruments related to the foregoing shall be
in forms satisfactory to counsel for USD and the
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Company. In addition, Buyer agrees that, effective prior to or on the Closing
Date, Buyer (i) shall cause that certain Secured Promissory Note dated August
28, 1996 to ▇▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, M.D. ("Athari"), as trustee for the entities
listed on Schedule 1 thereto (collectively, "Payee"), in an aggregate principal
amount of $2,500,000 to be paid in full (including the principal thereof plus
accrued but unpaid interest, if any) and/or surrendered to IHC for cancellation,
and (ii) shall terminate or cause the termination of the following agreements
such that all obligations of IHC and USD pursuant thereto shall be terminated
and extinguished, to the reasonable satisfaction of counsel thereto, and any
security or collateral pledged pursuant to such agreements shall be fully and
completely surrendered and released to the pledgor thereof: (i) the Security
Agreement dated August 28, 1996 from IHC, as debtor, to Payee, as Secured Party,
covering the collateral described therein, (ii) the Guaranty dated August 28,
1996 from USD, as guarantor, to Payee, (iii) the Pledge Agreement by USD of the
stock of IHC dated August 28, 1996 by and between USD, as pledgor, and Athari,
as trustee on behalf of the entities listed on Exhibit A thereto, and (iv) the
Consulting Agreement by and between IHC and Athari effective August 29, 1996
(which Consulting Agreement may, in the alternative, be assumed rather than
terminated, with appropriate releases of USD).
ARTICLE V
CONDITIONS TO THE COMPANY's AND USD's OBLIGATIONS
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Each and every obligation of the Company and USD under this Agreement
to be performed on or before the Closing shall be subject to the satisfaction,
on or before the Closing, of each of the following conditions, unless waived in
writing by the Company and USD:
5.01. REPRESENTATIONS AND WARRANTIES TRUE. The representations and
warranties of Buyer contained herein shall be in all material respects true and
accurate as of the date when made and at and as of the Closing as though such
representations and warranties were made at and as of such date, except for
changes expressly permitted or contemplated by the terms of this Agreement.
5.02. PERFORMANCE. Buyer shall have performed and complied with all
agreements, obligations and conditions required by this Agreement to be
performed or complied with by them on or prior to the Closing.
5.03. NO GOVERNMENTAL PROCEEDING OR LITIGATION; HSR. No suit, action,
investigation, inquiry or other proceeding by any governmental body or other
person or legal or administrative proceeding shall have been instituted or
threatened which questions the validity or legality of the transactions
contemplated hereby. The waiting period, if applicable, and any extensions
thereof, under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976 shall
have expired.
5.04. NO INJUNCTION. On the Closing Date there shall be no injunction,
writ, preliminary restraining order or any order of any nature issued by a court
of competent jurisdiction directing that the transactions provided for herein or
any of them not be consummated as so provided or
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imposing any conditions on the consummation of the transactions contemplated
hereby which USD deems unacceptable in its sole discretion.
5.05. ITEMS TO BE DELIVERED AT CLOSING BY BUYER. At the Closing, Buyer
shall deliver to USD (i) a bank cashier's check or certified check in the amount
of the Purchase Price (or a wire transfer of immediately available funds
pursuant to wire instructions provided on or before the Closing Date), and (ii)
an officer's certificate of Buyer that the representations and warranties
contained in Article 3 of this Agreement are true and correct in all material
respects at and as of the Closing Date as if made on the Closing Date (except
for representations and warranties specifically relating to a time or times
other than the Closing Date, which shall be true and correct in all material
respects at such time or times).
5.06. APPROVALS. All Required Consents shall have been obtained.
5.07. GUARANTEED DEBT AND ASSUMED DEBT. USD shall have been fully and
completely released and relieved of all liabilities and obligations under the
debt instruments listed on SCHEDULE 4.03 hereto to the reasonable satisfaction
of counsel to USD.
ARTICLE VI
CONDITIONS TO BUYER's OBLIGATIONS
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Each and every obligation of Buyer under this Agreement to be performed
on or before the Closing shall be subject to the satisfaction, on or before the
Closing, of each of the following conditions, unless waived in writing by Buyer:
6.01. REPRESENTATIONS AND WARRANTIES. True. The representations and
warranties contained in Article II hereof, the Schedules and in all certificates
and other documents delivered and to be delivered by the Company and USD
pursuant hereto or in connection with the transactions contemplated hereby shall
be true, complete and accurate in all material respects as of the date when made
and at and as of the Closing Date as though such representations and warranties
were made at and as of such date, except for changes expressly permitted or
contemplated by the terms of this Agreement and except for representations
expressly made as of a particular date.
6.02. PERFORMANCE. The Company and USD shall have performed and
complied, in all material respects, with all agreements, obligations and
obligations required by this Agreement to be performed or complied with by them
on or prior to the Closing.
6.03. APPROVALS. All Required Consents shall have been obtained.
6.04. NO GOVERNMENT PROCEEDING OR LITIGATION. No suit, action,
investigation, inquiry or other proceeding by any governmental body or other
person or legal or administrative
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proceeding shall have been instituted or threatened which questions the validity
or legality of the transactions contemplated hereby.
6.05. NO INJUNCTION. On the Closing Date there shall be no injunction,
writ, preliminary restraining order or any order of any nature issued by a court
of competent jurisdiction directing that the transactions provided for herein or
any of them not be consummated as so provided or imposing any conditions on the
consummation of the transactions contemplated hereby which Buyer deems
unacceptable in its sole discretion.
6.06. DELIVERIES BY USD AND THE COMPANY. At the Closing, the Company
and USD shall deliver to Buyer:
(i) Certificates representing the Company Stock duly endorsed (or
accompanied by duly executed stock powers);
(ii) An officer's certificate of each of the Company and USD that the
representations and warranties contained in Article 2 of this Agreement are true
and correct in all material respects at and as of the Closing Date as if made on
the Closing Date (except for representations and warranties specifically
relating to a time or times other than the Closing Date, which shall be true and
correct in all material respects at such time or times) after giving full effect
to any supplements to the Schedules which were delivered by the Company or USD
to Buyer prior to or on the Closing Date; and
(iii) A Good Standing certificate including tax status dated within ten
days prior to the Closing Date from the Secretary of State of Texas for each of
the entities referred to collectively as the Company.
6.07. RESIGNATIONS. On or prior to the Closing Date, the Company shall
have received the written resignations of all officers and directors requested
by Buyer.
ARTICLE VII
CONDUCT OF THE COMPANY'S BUSINESS PENDING THE CLOSING
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7.01. CONDUCT OF BUSINESS. Pending the Closing and except as otherwise
expressly consented to or approved by Buyer in writing, the Company will (i)
carry on its business diligently, in the ordinary course, and substantially in
the same manner as heretofore conducted, (ii) use its best efforts to preserve
its business, to keep available the services of its present personnel, to
preserve in full force and effect the contracts, agreements, instruments,
leases, licenses, arrangements, and understandings of the Company, and to
preserve the good will of its suppliers, customers, and others having business
relations with any of them, and (iii) give to Buyer's officers, employees,
counsel, accountants and other representatives reasonable free and full access
to and the right to inspect, during normal business hours, all of the premises,
properties, assets, records, contracts and other documents relating to its
business and shall permit
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them to consult with the officers, employees, accountants, counsel and agents of
the Company for the purpose of making such investigation of the Company as Buyer
shall desire to make, provided that such investigation shall not unreasonably
interfere with the Company's business operations.
ARTICLE VIII
SURVIVAL OF REPRESENTATIONS AND WARRANTIES
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8.01. SURVIVAL OF WARRANTIES; INVESTIGATION. The representations,
warranties and agreements of the Company, USD and Buyer contained herein or in
any certificates or other documents delivered prior to or at the Closing shall
survive the Closing for a period of one (1) year and not be deemed waived or
otherwise affected by any investigation made by any party hereto.
ARTICLE IX
TERMINATION AND ABANDONMENT
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9.01. METHODS OF TERMINATION . This Agreement may be terminated at any
time prior to or on the Closing Date:
(a) By mutual consent of Buyer, USD and the Company; or
(b) By a party hereto, if there has been a material violation or breach
by the other party of any agreement, representation or warranty made by it
contained in this Agreement which if curable, has not been cured within 15 days
after receipt of notice; or
(c) By either party, if the Closing has not occurred (other than
through the failure of any party seeking to terminate this Agreement to comply
fully with its obligations under the Agreement) on or before January 22, 1999,
or such later date as the parties may agree; or
(d) (i) by USD and the Company, if any of the conditions in Article V
have not been satisfied as of the Closing Date or if satisfaction of such a
condition is or becomes impossible (other than through the failure of USD to
comply with its obligations under this Agreement) and USD has not waived such
condition on or before the Closing Date;
(ii) by Buyer, if any of the conditions in Article VI have not been
satisfied as of the Closing Date or if satisfaction of such a condition is or
becomes impossible (other than through the failure of Buyer to comply with its
obligations under this Agreement) and Buyer has not waived such condition on or
before the Closing Date.
9.02. PROCEDURE UPON TERMINATION. In the event of termination pursuant to
Section 9.01 hereof, notice thereof shall forthwith be given to the other
parties hereto and the transactions
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contemplated by this Agreement shall be terminated, without further action by
the parties hereto. If the transactions contemplated by this Agreement are
terminated as provided herein:
(a) Each party will redeliver all documents, work papers and other
material of any other party relating to the transactions contemplated hereby,
whether so obtained before or after the execution hereof, to the party
furnishing the same;
(b) All confidential information received by any party hereto with
respect to the business of any other party shall be treated in accordance with
Section 11.09 hereof; and
(c) No party hereto shall have any liability or further obligation to
any other party to this Agreement except as stated in subparagraphs (a), (b) and
(c) of this Section 9.02, PROVIDED, HOWEVER, that if such termination is a
result of the failure of any condition set forth in Article VI hereof, Buyer
shall be entitled to recover from USD all out-of-pocket costs which Buyer has
incurred (including reasonable attorney's fees and expenses).
ARTICLE X
INDEMNIFICATION
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10.01. INDEMNIFICATION BY USD. In the event that the transactions
contemplated by this Agreement are consummated, USD shall indemnify Buyer and
each of its officers and directors and hold each of them harmless from, against
and in respect of and shall on demand reimburse such persons for: (i) all its
losses, liabilities, damages, costs and expenses arising from any material
misrepresentation or material breach of any representation, warranty, covenant
or agreement on the part of USD or the Company under this Agreement; (ii) any
and all actions, suits, claims, or legal, administrative, arbitration,
governmental or other proceedings or investigations against Buyer that relate to
the Company or its business in which the principal event giving rise thereto
occurred after August 29, 1996 and before the Closing Date, or which result from
or arise out of any action or inaction after August 29, 1996 and before the
Closing Date of USD, the Company or any employee, agent, representative or
subcontractor of the Company, (iii) any and all actions, suits, claims, or
legal, administrative, arbitration, governmental or other proceedings or
investigations against Buyer that relate to any unpaid tax matters, directly
owed by the Company, or by USD with respect to the Company, on a consolidated
basis in which the principal event giving rise thereto occurred after August 29,
1996 and before the Closing Date; (iv) any and all actions, suits, proceedings,
elections, demands, assessments, judgments, costs and expenses, including
without limitation, reasonable legal fees and expenses, incident to any of the
foregoing or incurred in investigating or attempting to avoid same or to oppose
the imposition thereof, or in enforcing this indemnity. Notwithstanding the
foregoing, in the event that a court of competent jurisdiction having final
adjudicative authority and from which no appeal is available shall determine
that Buyer is not entitled to indemnification, then Buyer shall not be entitled
to recover its legal fees with respect to such claim from USD.
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10.02. INDEMNIFICATION BY BUYER. In the event that the transactions
contemplated by this Agreement are consummated, Buyer shall indemnify USD and
hold it harmless from, against and in respect of and shall on demand reimburse
USD for: (i) all its losses, liabilities, damages, costs and expenses arising
from or in connection with any misrepresentation or breach of any
representation, warranty, covenant or agreement on the part of Buyer under this
Agreement; (ii) any and all actions, suits, claims, or legal, administrative,
arbitration, governmental or other proceedings or investigations against USD
that relate to Buyer or the business in which the principal event giving rise
thereto occurred prior to August 29, 1996 and after the Closing Date or which
result from or arise out of any action or inaction prior to August 29, 1996 and
after the Closing Date of Buyer or any officer, employee, agent, representative
or subcontractor of Buyer; and (iii) any and all actions, suits, proceedings,
elections, demands, assessments, judgments, costs and expenses, including
without limitation, reasonable legal fees and expenses, incident to any of the
foregoing or incurred in investigating or attempting to avoid same or to oppose
the imposition thereof, or in enforcing this indemnity. Notwithstanding the
foregoing, in the event that a court of competent jurisdiction having final
adjudicative authority and from which no appeal is available shall determine
that USD is not entitled to indemnification then USD shall not be entitled to
recover its legal fees with respect to such claim from Buyer.
10.03. PROCEDURES FOR INDEMNIFICATION. Promptly after receipt by an
indemnified party under Section 10.01 or 10.02 of notice of the commencement of
any action for which indemnification may be available under Section 10.01 or
10.02, such indemnified party shall, if a claim in respect thereof is to be made
against an indemnifying party under such action, give notice to the indemnifying
party of the commencement thereof, but the failure to do so to notify the
indemnifying party shall not relieve it of any liability that it may have to any
indemnified party except to the extent the indemnifying party demonstrates that
the defense of such action is prejudiced thereby. In case any such action shall
be brought against an indemnified party and it shall give notice to the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall elect, to
assume the defense thereof with counsel reasonably satisfactory to such
indemnified party and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
section for any fees of other counsel or any other expenses, in each case
subsequently incurred by such indemnified party in connection with the defense
thereof, other than reasonable costs of investigation and costs and expenses of
legal counsel, if the indemnified party and the indemnifying party are both
parties to the action and the indemnified party has been advised by counsel that
there may be one or more defenses available to it and not available to the
indemnifying party. If an indemnifying party assumes the defense of such an
action (a) no compromise or settlement thereof may be effected by the
indemnifying party without the indemnified party's consent (which shall not be
unreasonably withheld) unless (i) there is no finding or admission of any
violation of law 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 (ii) the
sole relief provided is monetary damages that are paid in full by the
indemnifying party and (b) the indemnifying party shall have no liability with
respect to
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any compromise or settlement thereof effected without its consent (which shall
not be unreasonably withheld). If notice is given to an indemnifying party of
the commencement of any action and it does not, within ten days after the
indemnified party's notice is given, give notice to the indemnified party of its
election to assume the defense thereof, the indemnifying party shall be bound by
any determination made in such action or any compromise or settlement thereof
effected by the indemnified party. Notwithstanding the foregoing, if an
indemnified party determines in good faith that there is a reasonable
probability that an action may materially and adversely affect it or its
affiliates other than as a result of monetary damages, such indemnified party
may, by notice to the indemnifying party, assume the exclusive right to defend,
compromise or settle such action, but the indemnifying party shall have the
right to participate in such action and not be bound by any determination of an
action so defended or any compromise or settlement thereof effected without its
consent (which shall not be unreasonably withheld).
10.04. SATISFACTION OF INDEMNIFICATION CLAIMS. All indemnification
obligations pursuant to Article X shall be paid within a reasonable period of
time after a claim for indemnification has been made and its validity finally
determined.
10.05. LIMITATION ON CLAIMS. In order to be entitled to indemnification
under this Article X, a claim for indemnification under this Article X must be
brought within one (1) year of the Closing Date. USD shall not be required to
indemnify Buyer and/or the Company under Section 10.01 or otherwise unless and
only to the extent that the amount of any loss, liability, damage or expense for
which Buyer seeks indemnification under Section 10.01, when aggregated with all
other such losses, liabilities, damages or expenses exceeds $200,000, to a
maximum aggregate indemnification of $500,000 under Section 10.01 or otherwise.
ARTICLE XI
MISCELLANEOUS PROVISIONS
------------------------
11.01. WAIVER OF COMPLIANCE. Any failure of the Company and USD, on the
one hand, or Buyer, on the other, to comply with any obligation, covenant,
agreement or condition herein may be expressly waived in writing by the Chairman
of the Board or President of Buyer or USD, but such waiver or failure to insist
upon strict compliance with such obligation, covenant, agreement or condition
shall not operate as a waiver of, or estoppel with respect to, any subsequent or
other failure.
11.02. EXPENSES; TRANSFER TAXES Whether or not the transactions
contemplated by this Agreement shall be consummated, each party agrees that all
fees and expenses incurred by it in connection with this Agreement shall be
borne by it, including, without limitation, all fees of counsel and accountants.
Buyer agrees that it will pay all transfer or other taxes which may be payable
in connection with the Acquisition.
11.03. NOTICES. All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if delivered
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by hand or if mailed, certified or registered mail, return receipt requested,
with postage prepaid or if delivered to an overnight courier that guarantees
next-day delivery.
a) If to USD, to:
US Diagnostic Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇)▇▇▇-▇▇▇▇
or to such other person or address as or USD shall furnish to Buyer in
writing.
b) If to Buyer, to:
▇▇▇▇▇▇▇▇ Atari, M.D.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
with a copy to:
▇▇▇▇ ▇. ▇▇▇▇
Zimmerman, Axelrad, ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇, P.C.
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
or to such other person or address as Buyer shall furnish to USD in
writing.
11.04. ASSIGNMENT. This Agreement and all of the provisions hereof
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns, but neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned by any party
hereto without the prior written consent of the other parties hereto.
11.05. PUBLICITY. Neither USD, the Company nor Buyer shall make or
issue, or cause to be made or issued, any announcement or written statement
concerning this Agreement or the transactions contemplated hereby for
dissemination to the general public without the prior consent of the other
party. This provision shall not apply, however, to any announcement or written
statement required to be made by law or the regulations of any federal or state
governmental agency or any stock exchange, except that the party required to
make such announcement shall, whenever practicable, consult with the other party
concerning the timing and content of such announcement before such announcement
is made.
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11.06. GOVERNING LAW; JURISDICTION; COUNTERPARTS; HEADINGS. This
Agreement and the legal relations among the parties hereto shall be governed by
and construed in accordance with the laws of the State of Florida, without
regard to its conflicts of law doctrine. The parties hereto (a) hereby
irrevocably and unconditionally submit to the exclusive jurisdiction of the
courts of the State of Florida located in Palm Beach County or in the United
States District Court for the Southern District of Florida for purposes of any
suit, action or other proceeding arising out of this Agreement or the subject
matter hereof brought by any party hereto, and (b) hereby waive and agree not to
assert, by way of motion, as a defense, or otherwise, in any such suit, action
or proceeding, any claim that it is not subject personally to the jurisdiction
of the above-named courts, that its property is exempt or immune from attachment
or execution, that the suit, action or proceeding is brought in an inconvenient
forum, that the venue of the suit, action or proceeding is improper, or that
this Agreement or the subject matter hereof may not be enforced in or by such
court, and (c) hereby waives in any such action, suit, or proceeding any offsets
or counterclaims. Each party hereto hereby consent to service of process by
certified mail at the address set forth in Section 11.03 hereof and agrees that
its submission to jurisdiction and its consent to service of process by mail is
made for the express benefit of the other parties hereto. Final judgment against
any party hereto in any action, suit or proceeding shall be conclusive, and may
be enforced in other jurisdictions by suit, action or proceeding on the
conclusive evidence of the fact and of the amount of any indebtedness or
liability of such party therein described. This Agreement may be executed
simultaneously in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. The headings of the Sections and Articles of this Agreement are
inserted for convenience only and shall not constitute a part hereof or affect
in any way the meaning or interpretation of this Agreement.
11.07. ENTIRE AGREEMENT. This Agreement, including the Exhibits and
Schedules hereto, and the other documents and certificates delivered pursuant to
the terms hereof, set forth the entire agreement and understanding of the
parties hereto in respect of the subject matter contained herein, and supersede
all prior agreements, covenants, arrangements, communications, representations
or warranties, whether oral or written, by any officer, employee or
representative of any party hereto.
11.08. THIRD PARTIES. Except as specifically set forth or referred to
herein, nothing herein expressed or implied is intended or shall be construed to
confer upon or give to any person or corporation other than the parties hereto
and their successors or assigns, any rights or remedies under or by reason of
this Agreement.
11.09. CONFIDENTIALITY. Each party hereto will hold and will cause its
consultants and advisors to hold in strict confidence, unless compelled to
disclose by judicial or administrative process or, in the opinion of its
counsel, by other requirements of law, all documents and information concerning
the other party furnished it by such other party or its representatives in
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connection with the transactions contemplated by this Agreement (except to the
extent that such information can be shown to have been (i) previously known by
the party to which it was furnished, or (ii) later lawfully acquired from other
sources by the party to which it was furnished), and each party will not release
or disclose such information to any other person, except its auditors,
attorneys, financial advisors, bankers and other consultants and advisors in
connection with this Agreement. If the transactions contemplated by this
Agreement are not consummated, such confidence shall be maintained except to the
extent such information comes into the public domain through no fault of the
party required to hold it in confidence, and such information shall not be used
to the detriment of, or in relation to any investment in, the other party and
all such documents (including copies thereof) shall be returned to the other
party immediately upon the written request of such other party. Each party shall
be deemed to have satisfied its obligation to hold confidential information
concerning or supplied by the other party if it exercises the same care as it
takes to preserve confidentiality for its own similar information.
[INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Stock Purchase
Agreement to be duly executed all as of the day and year first above written.
US DIAGNOSTIC INC.
BY: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇, Chief Executive Officer and President
INTEGRATED HEALTH CONCEPTS, INC.
BY: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
--------------------------------
ITS: Treasurer
--------------------------------
/s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, M.D.
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