Exhibit 10.105
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is made as of January 27,
2003 by and among Healthcare Investors of America, Inc., a Maryland corporation
(the "Corporation"), and Aries Capital Partners, LLC ("Purchaser"), an Arizona
limited liability company.
The Corporation and the Purchaser hereby agree as follows:
SECTION 1.
AUTHORIZATION, PURCHASE AND SALE OF THE STOCK
1.1 AUTHORIZATION OF THE STOCK. The Corporation has authorized the issuance
and sale to the Purchaser of Eight Hundred Thousand (800,000) shares of the
Corporation's common stock (the "Stock").
1.2 SALE AND PURCHASE OF THE STOCK. At the Closing (as defined herein),
subject to the terms and conditions hereof and in reliance upon the
representations, warranties and agreements contained herein, each Purchaser
agrees, to purchase at the Closing and the Corporation agrees to sell and issue
to Purchaser at the Closing, the Stock.
SECTION 2.
CLOSING, PAYMENT AND DELIVERY
2.1 CLOSING DATE AND PLACE OF CLOSING. The purchase and sale of the stock
shall take place at the offices of the Corporation, 0000 X. Xxxx Xxxx, Xxxxx
000, Xxxxxx, XX 00000, at 10:00 a.m., on the Closing Date. The parties intend
that the Closing Date will occur on the third business day subsequent to the
receipt of shareholder approval of the proposals set forth in the Proxy
Statement establishing a Special Meeting of the Shareholders approving the
issuance of the Stock.
2.2 PAYMENT AND DELIVERY. At the Closing, the Corporation will deliver to
Purchaser's counsel a certificate representing the Stock that Purchaser is
purchasing against payment of the purchase price therefor by check or wire
transfer of same-day funds to the Corporation. The amount of payment for the
Stock shall be One Dollar plus other consideration as listed in Section 2.4.
2.3 COVENANT OF BEST EFFORTS AND GOOD FAITH. The Corporation and Purchaser
agree to use their respective best efforts and to act in good faith to cause to
occur all conditions to Closing which are in their respective control.
2.4 INDEMNIFICATION. From and after the Closing Date, as additional
consideration for the issuance and delivery of Stock hereunder, Purchaser and
Xxxx Xxxxxxxxxx, jointly and severally, agree to indemnify and hold harmless (i)
all stockholders of record as of the Closing, and (ii) directors and officers of
the Corporation as of December 1, 2002 to include F. Xxxx Xxxxxxx, Xxxxx X.
Xxxxxx, Xxxxxxx Xxxxxxxx, Harbor American Capital Group as Advisor to the
Corporation and its general partner Heritage Advisory Corporation and Xxxxx X.
Xxxxxxx, for all costs, liabilities, claims or damages (including reasonable
attorneys fees and expenses incurred) arising from the litigation entitled PNC
BANK V. HEALTHCARE INVESTORS OF AMERICA, INC., ET AL, in the 11th Circuit for
Miami-Dade County Florida, Case No. 0206571 CA 04 or from a case entitled XXXX
X. XXXXXXX, XX., D/B/A SUNDANCE REALTY ADVISORS VS. LENOX HEALTHCARE, INC. AND
HEALTHCARE INVESTORS OF AMERICA, INC. in the Commonwealth of Massachusetts
District Court Department, Pittsfield Division, Civil Action No. 9827-CV-0199.
SECTION 3.
REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
The Corporation hereby represents and warrants to Purchaser that:
3.1 INCORPORATION. The Corporation is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland and is
qualified to do business in each jurisdiction in which the character of its
properties or the nature of its business requires such qualification, except
where the failure to so qualify would not have a material adverse effect upon
the Corporation's financial condition, business, assets or results of operations
(hereafter, a "Material Adverse Effect"). The Corporation has all requisite
corporate power and authority to carry on its business as now conducted.
3.2 CAPITALIZATION. The authorized capital stock of the Corporation
consists of 10,000,000 shares of common stock, par value $.01 per share. The
number of shares of common stock outstanding as of the date hereof and as of the
Closing Date will be 397,600 shares. There are no shares of preferred stock
issued and outstanding. The terms, preferences and privileges of the outstanding
shares of capital stock are set forth in the Corporation's Articles of
Incorporation, as amended (the " Articles"). There are no existing options,
warrants, calls, preemptive (or similar) rights, subscriptions or other rights,
agreements, arrangements or commitments of any character obligating the
Corporation to issue, transfer or sell, or cause to be issued, transferred or
sold, any shares of the capital stock of the Corporation or other equity
interests in the Corporation or any securities convertible into or exchangeable
for such shares of capital stock or other equity interests (collectively,
"Securities"), and there are no outstanding contractual obligations of the
Corporation to repurchase, redeem or otherwise acquire any shares of its capital
stock or other equity interests. No holder of any capital stock or Securities of
the Corporation has any outstanding registration rights.
3.3 AUTHORIZATION. All corporate action on the part of the Corporation, its
officers, and directors necessary for the authorization, execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein has been taken. When executed and delivered by the
Corporation, this Agreement shall constitute the legal, valid and binding
obligation of the Corporation, enforceable against the Corporation in accordance
with its terms, except (i) as limited by bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of
creditors' rights generally; (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable
remedies; and (iii) to the extent the indemnification provisions contained in
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this Agreement may be limited by applicable federal or state securities laws.
The Corporation has all requisite corporate power to enter into this Agreement
and to carry out and perform its obligations under the terms of this Agreement.
Notwithstanding anything to the contrary herein, all parties hereto acknowledge
that the consummation of this transaction is conditioned upon the receipt of
shareholder approval from a majority of the shareholders of the Corporation.
3.4 VALID ISSUANCE OF THE STOCK. The Stock being purchased by the Purchaser
hereunder will, upon issuance pursuant to the terms hereof, be duly authorized
and validly issued, fully paid, nonassessable and free of any liens or
encumbrances created by the Corporation and will, assuming the accuracy of the
representations and warranties made by the Purchaser to the Corporation, be in
compliance with applicable state and federal securities laws.
3.5 SEC DOCUMENTS. The Corporation has furnished to Purchaser a true and
complete copy of the Corporation's Annual Report on Form 10-KSB for the year
ended December 31, 2001and the Company's Quarterly Report on Form 10-QSB for the
nine month period ended on September 30, 2002, and any other statement, report,
registration statement (other than registration statements on Form S-8) or
definitive proxy statement filed by the Corporation with the Securities and
Exchange Commission (the "SEC") during the period commencing December 31, 2001
and ending on the date hereof. The Corporation will, promptly upon the filing
thereof, also furnish to Purchaser all statements, reports, (including, without
limitation, Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K), registration statements and definitive proxy
statements filed by the Corporation with the SEC during the period commencing on
the date hereof and ending on the Closing Date (all such materials required to
be furnished to each Purchaser pursuant to this sentence or pursuant to the next
preceding sentence of this Section 3.5 being called, collectively, the "SEC
Documents"). As of their respective filing dates, the SEC Documents complied or
will comply in all material respects with the requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or the Securities Act of
1933, as amended (the "Securities Act"), as applicable, and none of the SEC
Documents contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which they were
made, not misleading, as of their respective filing dates, except to the extent
corrected by a subsequently filed SEC Document. The Corporation has not filed
any amendment to its Annual Report on Form 10-KSB for the year ended December
31, 2001 or its Company's Quarterly Report on Form 10-QSB for the nine month
period ended on September 30, 2002. The Corporation has not filed any Current
Reports on Form 8-K with respect to any event occurring between September 30,
2002 and the date hereof.
3.6 FINANCIAL STATEMENTS. The Corporation's audited Statements of
Operations, and Distributions in Excess of Net Earnings and Cash Flows for the
fiscal year ended December 31, 2001 and the Corporation's audited Balance Sheet
as of December 31, 2001 are included in the Corporation's Annual Report on Form
10-KSB for the year ended December 31, 2001, a copy of which has been delivered
to the Purchaser. The Company's unaudited Statements of Operations, and
Distributions in Excess of Net Earnings and Cash Flows for the nine month period
ended September 30, 2002 and the Company's unaudited Balance Sheet as of
September 30, 2002 are included in the Company's Quarterly Report on Form 10-QSB
for the nine month period ended on September 30, 2002, copies of which have been
delivered to the Purchaser. All of the financial statements referred to above in
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this Section 3.6 are hereinafter referred to collectively, as the "Financial
Statements". The Financial Statements have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis during
the periods involved, and fairly present, in all material respects, the
financial position of the Corporation and the results of its operations as of
the date and for the periods indicated thereon, except that those Financial
Statements that are unaudited may not have been prepared in accordance with
generally accepted accounting principles because of the absence of footnotes
normally contained therein and may be subject to normal year-end audit
adjustments which, individually and in the aggregate, will not be material.
3.7 CONSENTS. All consents, approval, orders, authorizations,
registrations, qualifications, and filings required on the part of the
Corporation to be obtained or made prior to the Closing in connection with the
execution, delivery or performance of this Agreement, and the consummation of
the transactions contemplated herein have been obtained or made or will be
obtained or made, prior to the Closing.
3.8 NO CONFLICT. The execution and delivery of this Agreement by the
Corporation and the consummation of the transactions contemplated hereby will
not in any material respect conflict with or result in any material violation of
or material default (with or without notice or lapse of time, or both) under, or
give rise to a right of termination, cancellation or acceleration of any
material obligation or to a loss of a material benefit or give rise to an event
which results in the creation of any lien, charge or encumbrance upon any of the
Corporation's properties or assets under (i) the Articles or Bylaws of the
Corporation or (ii) any material agreement or instrument, permit, franchise,
license, judgment, order, statute, law, ordinance, rule or regulations,
applicable to the Corporation or its respective properties or assets.
3.9 ABSENCE OF LITIGATION. With the exception of (i) the case entitled PNC
BANK V. HEALTHCARE INVESTORS OF AMERICA, INC., ET AL, in the 11th Circuit for
Miami-Dade County Florida, Case No. 0206571 CA 04, and (ii) the case entitled
XXXX X. XXXXXXX, XX., D/B/A SUNDANCE REALTY ADVISORS X. XXXXX HEALTHCARE, INC
AND HEALTHCARE INVESTORS OF AMERICA, INC. in the Pittsfield Division of the
Commonwealth of Massachusetts District Court Department Civil Action No.
9827-CV-0199, there is no action, suit or proceeding or, to the Corporation's
knowledge, any investigation, pending, or to the Corporation's knowledge,
threatened against the Corporation and in which an unfavorable outcome, ruling
or finding in any said matter, or for all matters taken as a whole, would have a
material adverse effect. There is not pending or threatened any such action,
suit, proceeding or investigation that questions this Agreement or the right of
the Corporation to execute, deliver and perform under same.
3.10 TRADING MARKET. The Common Stock is currently traded on the "pink
sheets".
3.11 BROKERS OR FINDERS. The Corporation has not dealt with any broker or
finder in connection with the transactions contemplated by this Agreement, and
the Corporation has not incurred, and shall not incur, directly or indirectly,
any liability for any brokerage or finders' fees or agents commissions or any
similar charges in connection with this Agreement or any transaction
contemplated hereby.
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3.12 COMPLIANCE WITH CHARTER, LAWS, ETC. The Corporation is in compliance
in all material respects with the terms of its Certificate and By-laws as
currently in effect, true and complete copies of which have been delivered to
each Purchaser, and each of the Articles and By-laws of the Corporation (in the
form, provided to the Purchaser), is in full force and effect as of the Closing
Date. To the best of the Corporation's knowledge, the Corporation has complied,
and is in compliance with, federal, state, county, local and foreign laws,
rules, regulations, ordinances, decrees and orders applicable to the operation
of its business or to the real property or personal property that it owns or
leases (including, without limitation, all such laws, rules, ordinances, decrees
and orders relating to antitrust, currency exchange, environmental protection,
occupational safety and health, equal opportunity, pension, securities and
trading-with-the-enemy matters), except where any such failures to comply,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect.
3.13 PRIVATE OFFERING. During the six months preceding the date of this
Agreement, neither the Corporation nor any person acting on its behalf has,
directly or through any agent, sold, offered for sale, solicited offers to buy
or otherwise negotiated in respect of any security (as defined in the Securities
Act) that is or may be integrated with the sale of the Stock in a manner that
would require the registration of the issuance and sale by the Corporation of
the Stock under the Securities Act. During the six months preceding the date of
this Agreement, neither the Corporation nor any person acting on its behalf has
offered or sold any Stock by means of any general solicitation or general
advertising within the meaning of Rule 502(c) under the Securities Act. Assuming
the accuracy of the Purchaser's representations in Section 4 hereof, the
offering and sale of the Stock will satisfy the requirements of Rule 506 under
the Securities Act.
3.14 CHANGES.
(a) Since September 30, 2002, except as disclosed or in SEC Documents
or press releases prepared through or as of a date subsequent to September 30,
2002, there has not been:
(i) any damage, destruction or loss (whether or not covered by
insurance) to its assets which has had or is reasonably expected to have a
material adverse effect;
(ii) any material change in the accounting methods or practices
followed by the Corporation;
(iii) any material debt, obligation or liability (whether
absolute or contingent) incurred by the Corporation (whether or not presently
outstanding) except (x) current liabilities incurred, and obligations under
agreements entered into, in the ordinary course of business and (y) obligations
or liabilities entered into or incurred in connection with the execution of this
Agreement;
(iv) any sale, lease, abandonment or other disposition by the
Corporation of any real property or, other than in the ordinary course of
business, of any equipment or other operating properties or, other than in the
ordinary course of business, any sale, assignment, transfer, license or other
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disposition by the Corporation of any intellectual property or other intangible
asset;
(v) any dividends or other distributions of cash or other
property paid by the Corporation in respect of any of its capital stock
(vi) any waivers or releases by the Corporation of any material
debt or obligation owed to the Corporation; or
(vii) to the best of the Corporation's knowledge, any other event
that could reasonably be expected to result in a material adverse effect.
(b) Notwithstanding anything to the contrary in this Agreement, if,
after the date of this Agreement the Corporation discloses to the Purchaser or
the Purchaser otherwise becomes aware of any information concerning an event
that renders the representation and warranty set forth in this Section 3.14
inaccurate, and such information is material and not otherwise available to the
public generally, the Purchaser agrees not to sell, assign or otherwise transfer
any of the Stock based on such material non-public information until such
material non-public information is made available to the public generally.
3.15 LABOR MATTERS. The Corporation has no collective bargaining agreement
with any of its employees and, to the Corporation's knowledge, there is no labor
union organizing activity pending or threatened with respect to the Corporation.
There are no disputes pending or, to the knowledge of the Corporation,
threatened between the Corporation, on the one hand, and any of its employees,
on the other hand, other than employee grievances arising in the ordinary course
of business which would not, individually or in the aggregate, have a material
adverse effect.
SECTION 4.
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
Purchaser hereby represents, warrants and covenants to the Corporation
that:
4.1 AUTHORIZATION. All corporate action on the part of the Purchaser, its
officers, and directors necessary for the authorization, execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein has been taken. When executed and delivered by the
Purchaser, this Agreement shall constitute the legal, valid and binding
obligation of the Purchaser, enforceable against the Purchaser in accordance
with its terms, except (i) as limited by bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of
creditors' rights generally; (ii) as limited by laws relating to the
availability of specific performance, injunctive relief or other equitable
remedies; and (iii) to the extent the indemnification provisions contained in
this Agreement may be limited by applicable federal or state securities laws.
The Purchaser has all requisite corporate power to enter into this Agreement and
to carry out and perform its obligations under the terms of this Agreement.
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4.2 CONSENTS. All consents, approval, order, authorizations, registrations,
qualifications and filings required on the part of the Purchaser to be obtained
or made prior to the consummation of the transactions contemplated herein have
been obtained or made or will be obtained or made, prior to the Closing.
4.3 NO CONFLICT. The execution and delivery of this Agreement by the
Purchaser and the consummation of the transactions contemplated hereby will not
in any material respect conflict with or result in any material violation of or
material default (with or without notice or lapse of time, or both) under, or
give rise to a right of termination cancellation or acceleration of any material
obligation or to a loss of a material benefit or give rise to an event which
results in the creation of any lien, charge or encumbrance upon any of the
Purchaser's properties or assets under (i) The Articles or Bylaws of the
Purchaser or (ii) any material agreement or instrument, permit, franchise,
license, judgment, order, statute, law, ordinance, title or regulations,
applicable to the Purchaser or its respective properties or assets.
4.4 ABSENCE OF LITIGATION. There is no action, suit or proceeding or to the
Corporation's knowledge, any investigation pending, or to the Purchaser's
knowledge, threatened against the Purchaser and in which an unfavorable outcome,
ruling or finding in any said matter, or for all matters taken as a whole would
have a material adverse effect. There is not pending or threatened any such
action, suit, proceeding or investigation that questions this Agreement or the
right of the Purchaser to execute, deliver and perform under same.
4.5 COMPLIANCE WITH CHARTER, LAWS, ETC. The Purchaser is in compliance in
all material respects with the terms of its Articles of Organization
("Articles") and By-laws as currently in effect. Each of the Articles, and
By-laws of the Purchaser is in full force and effect as of the Closing Date. To
the best of the Purchaser's knowledge, the Purchaser has complied, and is in
compliance with federal, state, county, local and foreign laws, rules,
regulations, ordinances, decrees and orders applicable to the operation of its
business or to the real property or personal property that it owns or leases
(including, without limitation, all such laws, rules, ordinances, decrees and
orders relating to antitrust, currency exchange, environmental protection,
occupational safety and health, equal opportunity, pension, securities and
trading-with-the-enemy matters), except where any such failures to comply,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect.
4.6 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Agreement is made with
Purchaser in reliance upon such Purchaser's representation to the Corporation,
which by such Purchaser's execution of this Agreement Purchaser hereby confirms,
that the Stock to be received by such Purchaser will be acquired for investment
for such Purchaser's own account, not as a nominee or agent, and not with a view
to the resale or distribution of any part thereof, and that Purchaser has no
present intention of selling, granting any participation in or otherwise
distributing the same. By executing this Agreement, Purchaser further represents
that Purchaser does not have any contract, undertaking, agreement or arrangement
with any person to sell, transfer or grant participations to such person or to
any third person, with respect to any of the Stock.
4.7 INVESTMENT EXPERIENCE. Purchaser acknowledges that it can bear the
economic risk of its investment, and has such knowledge and experience in
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financial or business matters that it is capable of evaluating the merits and
risks of the investment in the Stock.
4.8 RESTRICTED SECURITIES. Purchaser understands that the shares of Stock
it is purchasing are characterized as "restricted securities" under the federal
securities laws inasmuch as they are being acquired from the Corporation in a
transaction not involving a public offering and that under such laws and
applicable regulations such Securities may be resold without registration under
the Securities Act only in certain limited circumstances. In the absence of an
effective registration statement covering the Securities or an available
exemption from registration under the Act, the Stock must be held indefinitely.
In this connection, Purchaser represents that it is familiar with SEC Rule 144,
as presently in effect, and understands the resale limitations imposed thereby
and by the Securities Act, including without limitation the Rule 144 condition
that current information about the Corporation be available to the public.
4.9 FURTHER LIMITATIONS ON DISPOSITION. Without in any way limiting the
representations set forth above, Purchaser further agrees not to make any
disposition of all or any portion of the Stock unless:
(a) there is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such registration statement; or
(b) it is made in compliance with Rule 144; or
(c) Purchaser shall have (i) notified the Corporation of the proposed
disposition and shall have furnished the Corporation with a detailed statement
of the circumstances surrounding the proposed disposition, (ii) provided a
written agreement from the transferee for the benefit of the Corporation to be
bound by this Section 4, and (iii) if requested by the Corporation, Purchaser
shall have furnished the Corporation with an opinion of counsel, reasonably
satisfactory to the Corporation that such disposition will not require
registration of such shares under the Securities Act. It is agreed that the
Corporation will not require opinions of counsel for transactions made pursuant
to Rule 144 except in unusual circumstances.
(d) Notwithstanding any of the foregoing, transfers for no
consideration to principals of or investment advisory clients of Purchaser shall
be permitted without any consent, statement or legal opinion.
4.10 LEGENDS. It is understood that the certificates evidencing the Stock
it is purchasing shall bear the following legend:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR OFFERED FOR SALE IN
THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES
UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAW OR AN OPINION OF
COUNSEL SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED."
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SECTION 5.
CONDITIONS TO OBLIGATIONS OF THE PURCHASER
The obligation of the Purchaser to purchase the Stock is subject to the
fulfillment on or prior to the Closing Date of each of the following conditions:
5.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties of
the Corporation shall be true and correct in all material respects on the
Closing Date as if made on such Closing Date and the Corporation shall have an
officer provide a certificate as of the Closing Date attesting to such fact.
5.2 PERFORMANCE. All covenants, agreements and conditions contained in this
Agreement to be performed or complied with by the Corporation on or prior to the
Closing Date shall have been performed or complied with in all material
respects.
5.3 OPINION OF CORPORATION'S COUNSEL. The Purchaser shall have received
from counsel to the Corporation an opinion in the form attached hereto.
5.4 LEGAL ISSUANCE. At the time of the Closing, the issuance and purchase
of the Stock shall be legally permitted by all the laws and regulations to which
the Purchaser and the Corporation are subject.
5.5 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings in
connection with the transactions contemplated hereby and all documents and
instruments incident to such transactions shall be satisfactory in form and
substance to the Purchaser and their counsel.
5.6 SHAREHOLDER APPROVAL. Shareholder Approval of the issuance of the Stock
shall have occurred.
SECTION 6.
CONDITIONS TO OBLIGATIONS OF THE CORPORATION
The Corporation's obligation to sell the Stock is subject to the
fulfillment on or prior to the Closing Date of each of the following conditions:
6.1 REPRESENTATIONS AND WARRANTIES . The representations and warranties
made by the Purchaser shall be true and correct in all material respects on the
Closing Date as if made on such Closing Date and the Purchaser shall have an
officer provide a certificate as of the Closing Date attesting to such fact
6.2 PERFORMANCE. All covenants, agreements and conditions contained in this
Agreement to be performed or complied with by the Purchaser on or prior to the
Closing Date shall have been performed or complied with in all material
respects.
6.3 LEGAL ISSUANCE. At the time of the Closing, the issuance and purchase
of the Stock shall be legally permitted by all laws and regulations to which the
Purchaser and the Corporation are subject.
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6.4 PAYMENT. The Corporation shall concurrently receive payment for the
Stock as provided in Section 2.
6.5 SHAREHOLDER APPROVAL. Shareholder Approval of the issuance of the Stock
shall have occurred.
SECTION 7.
AFFIRMATIVE COVENANTS OF THE CORPORATION
The Corporation hereby covenants that, during such time as Purchaser owns
any shares of Stock totaling in excess of 20,000 shares,:
7.1 REPORTS AND FINANCIAL STATEMENTS
(a) The Corporation will comply with its reporting and filing
obligations under the Exchange Act, and will not take any action or file any
documents (whether or not permitted by the Exchange Act or the rules thereunder)
to terminate or suspend its reporting and filing obligations under the Exchange
Act.
(b) The Corporation will furnish to Purchaser or have available to
Purchaser through the Xxxxx System the SEC for two years, concurrently with the
distribution or filing thereof, its reports on Form 10K and 10Q, and each other
report, registration statement, definitive proxy statement or other document
filed with the SEC, and each press release or other public announcement issued
by the Corporation.
7.2 MAINTENANCE AND COMPLIANCE. The Corporation will (i) maintain its
corporate existence, rights, powers and privileges in good standing, (ii) comply
in all material respects with the laws and governmental regulations and
restrictions applicable to its business or properties, (iii) keep records and
books of account and maintain a system of internal accounting controls in
accordance with generally accepted accounting principles and (iv) retain
independent public accountants of recognized standing as auditors of the
Corporation's annual financial statements.
7.3 ASSIGNMENT OF RIGHTS. The rights of Purchaser hereunder may be assigned
by Purchaser in connection with the transfer or assignment of its shares of
Stock. Such rights may be further reassigned by each such transferee to
subsequent transferees. Any transferee asserting rights under this Agreement
shall be bound by its provisions. In no event shall any transfers be made in
violation of the federal securities laws.
7.4 EFFECT OF COVENANTS. The covenants in Sections 7.1 and 7.3 shall not be
deemed to prohibit a merger, sale of all assets or other corporate
reorganization if (i) the entity surviving or succeeding to the Corporation is
bound by this Agreement with respect to its securities issued in exchange for or
replacement of the Stock, or (ii) the consideration received in exchange for or
replacement of the Stock is cash.
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SECTION 8
ARBITRATION
8.1 ARBITRATION
8.1.1 SCOPE. Resolution of any and all disputes arising from or in
connection with this Agreement, whether based on contract, tort, common law,
equity, statute, regulation, order or otherwise ("Disputes"), including disputes
arising in connection with claims by third persons, shall be exclusively
governed by and settled in accordance with the provisions of this Section 8;
provided, that the foregoing shall not preclude equitable or other judicial
relief to enforce the provisions hereof or to preserve the status quo pending
resolution of Disputes hereunder.
8.1.2 BINDING ARBITRATION. The parties hereby agree to submit all
Disputes to arbitration for final and binding resolution. Any party may initiate
such arbitration by delivery of a demand therefor (the "Arbitration Demand") to
the other parties. The arbitration shall be conducted in the City of Phoenix,
AZ, by a panel of three arbitrators, one chosen by each party and the third
selected by agreement of the parties not later than 10 days after delivery of
the Arbitration Demand, or, failing such agreement, appointed pursuant to the
Commercial Arbitration Rules of the America Arbitration Association, as amended
from time to time (the "AAA Rules"). If the arbitrators become unable to serve,
his/her or their successor(s) shall be similarly selected or appointed.
8.1.3 PROCEDURE. The arbitration shall be conducted pursuant to the
Federal Arbitration Act and such procedures as the parties may agree or, in the
absence of or failing such agreement, pursuant to the AAA Rules. Notwithstanding
the foregoing, (a) each party shall have the right to audit the books and
records of the other parties that are reasonably related to the Dispute; (b)
each party shall provide to the other, reasonably in advance of any hearing,
copies of all documents that a party intends to present in such hearing; (c) all
hearings shall be conducted on an expedited schedule; and (d) all proceedings
shall be confidential, except that either party may at its expense make a
stenographic record thereof.
8.1.4 TIMING. The arbitrators shall complete all hearings not later
than 90 days after his or her selection or appointment, and shall make a final
award not later than 30 days thereafter. The arbitrators shall apportion all
costs and expenses of the arbitration, including the arbitrators' fees and
expenses, and fees and expenses of experts ("Arbitration Costs") between the
prevailing and non-prevailing party as the arbitrators shall deem fair and
reasonable. In circumstances where a Dispute has been asserted or defended
against on grounds that the arbitrator deems manifestly unreasonable, the
arbitrators may assess all Arbitration Costs against the non-prevailing party
and may include in the award the prevailing party's attorney's fees and expenses
in connection with any and all proceedings under this Section 8. Notwithstanding
the foregoing, in no event may the arbitrators award multiple or punitive
damages.
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SECTION 9
MISCELLANEOUS
9.1 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Arizona. Except as set forth in Section
9, any action or proceeding relating to this Agreement may be brought in the
courts of Arizona, or in the United States courts located in Arizona and each of
the parties irrevocably consents to the jurisdiction of such courts in any such
action or proceeding.
9.2 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided herein,
the provisions hereof shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
9.3 ENTIRE AGREEMENT; AMENDMENT. This Agreement (including any Exhibits
and Schedules hereto) and the other documents delivered pursuant hereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and thereof. Neither this Agreement nor any
term hereof may be amended, waived, discharged or terminated except by a written
instrument signed by the Corporation and the Purchaser. .
9.4 NOTICES, ETC. All notices and other communications required or
permitted hereunder shall be mailed by internationally recognized courier
service and facsimile addressed (a) if to the Purchaser, as indicated below the
Purchaser's signature with a copy to the designated entity or at such other
address as the Purchaser shall have furnished to the Corporation in writing, or
(b) if to any other holder of any Stock at the address of such holder as shown
on the records of the Corporation, or (c) if to the Corporation, at its address
set forth below or at such other address as the Corporation shall have furnished
to the Purchaser and each such other holder in writing. All such notices or
communications shall be deemed given when delivered personally by courier, by
internationally recognized courier or by facsimile.
9.5 DELAYS OR OMISSIONS. No delay or omission to exercise any right, power
or remedy accruing to any party to this Agreement (including any holder of
Stock), upon any breach or default or another party under this Agreement, shall
impair any such right, power or remedy of such party nor shall it be construed
to be a waiver of any such breach or default, or an acquiescence therein, or of
or in any similar breach or default thereafter occurring; nor shall any waiver
of any single breach or default be deemed a waiver of any other breach or
default theretofore or thereafter occurring. All remedies, either under this
Agreement or by law or otherwise afforded to any party, shall be cumulative and
not alternative.
9.6 SEVERABILITY. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
9.7 TITLES AND SUBTITLES. The titles of the Sections and subsections of
this Agreement are for convenience of reference only and are not be considered
in construing this Agreement.
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9.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
9.9 FEES AND EXPENSES. The parties hereto shall pay their own costs and
expenses in connection herewith.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered by their duly authorized officers as of the day and year first
written above.
Healthcare Investors of America, Inc.
By: /s/ F. Xxxx Xxxxxxx
Name: F. Xxxx Xxxxxxx
Title: Chairman and CEO
Address: 0000 X. Xxxx Xxxx, Xxxxx 000, Xxxxxx, XX 00000
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Purchaser
Aries Capital Partners LLC
By: /s/ Xxxx Xxxxxxxxxx
Name: Xxxx Xxxxxxxxxx
Title: Managing Member
Address: 00000 X. 00xx Xxxxxx
Xxxxxxxxxx, XX 00000
As to the Indemnification contained within Section 2.4,
Accepted and Acknowledged
By: /s/ Xxxx Xxxxxxxxxx
Xxxx Xxxxxxxxxx, individually
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