STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT (this "AGREEMENT") is entered into as of
June 30, 2003, by and among PrimeSource Surgical, Inc., a Delaware corporation
(the "SELLER"), Xxxxx Xxxxxx ("XX. XXXXXX"), Xxxxx Xxxx ("XX. XXXX") and New
England Medical Specialties, Inc., a Connecticut corporation (the "PURCHASER"
and, together with Xx. Xxxxxx and Xx. Xxxx, the "XXXXXX GROUP").
R E C I T A L S
---------------
WHEREAS, Seller owns all of the issued and outstanding capital stock
(the "Shares") of Ruby Merger Sub, Inc., a Delaware corporation (the "Company")
and a wholly owned subsidiary of the Seller.
WHEREAS, Seller desires to sell, and the Purchaser desires to
purchase, the Shares for the consideration and on the terms set forth in this
Agreement.
WHEREAS, the Board of Directors of each of the Seller and the
Purchaser has approved, and deems it advisable and in the best interests of its
stockholders to consummate the purchase of the Shares.
In consideration of the foregoing and the mutual representations,
warranties, covenants and agreements set forth herein, intending to be legally
bound hereby, the parties hereto agree as follows:
1. PURCHASE; CLOSING
-----------------
(a) PURCHASE PRICE. The Seller hereby agrees to sell to the Purchaser and
the Purchaser hereby agrees to purchase from the Seller on the Closing
Date, the Shares for an aggregate purchase price of $1,000,000 (the
"PURCHASE PRICE").
(b) CLOSING. The consummation of the purchase and sale of the Shares to be
purchased hereunder (the "CLOSING") shall occur on the date of this
Agreement (the "CLOSING DATE").
(c) CLOSING OBLIGATIONS OF THE SELLER.
(i) At the Closing, the Seller must deliver:
(1) a certificate of the secretary of the Seller
certifying, among other things, the resolutions
adopted by its board of directors, authorizing the
sale of the Shares;
(2) the Resignation in the form attached hereto as
EXHIBIT A, executed by Xxxxx XxXxxxx;
(3) the Resignation in the form attached hereto as
EXHIBIT B, executed by Xxxx Xxxxxx; and
(4) the Termination Agreement in the form attached
hereto as EXHIBIT C (the "TERMINATION AGREEMENT"),
executed by the Seller; and
(5) the unaudited balance sheet of the Company as of
May 31, 2003 (the "BALANCE SHEET") as well as
subsidiary ledgers for accounts receivable,
inventory, and accounts payable as of June 29,
2003.
(ii) No later than five (5) days after the Closing Date, the
Seller must deliver:
(1) the certificates representing the Shares, duly
endorsed in blank (or accompanied by duly executed
stock powers), for transfer to the Purchaser; and
(2) the minute books, stock books, records and
organizational documents of the Company.
(d) CLOSING OBLIGATIONS OF THE XXXXXX GROUP.
(i) At the Closing, the Xxxxxx Group must deliver:
(1) a sum equal to the Purchase Price, payable by wire
transfer of immediately available funds to the
Seller;
(2) the Release in the form attached hereto as EXHIBIT
D, executed by the Purchaser, Xx. Xxxxxx and Xx.
Xxxx; and
(3) the Termination Agreement, executed by Xx. Xxxxxx.
(ii) No later than ninety (90) days after the Closing Date, the
Xxxxxx Group must deliver:
(1) the Seller's telecom equipment on the premises,
including the items listed on SCHEDULE I attached
hereto; and
(2) the Seller's software installed on the Company's
computers, including the items listed on SCHEDULE
II attached hereto.
2. REPRESENTATIONS AND WARRANTIES OF THE SELLER
--------------------------------------------
The Seller hereby represents and warrants to the Purchaser as set
forth below:
(a) The Seller is a corporation duly organized, validly existing and in
good standing under the laws of the State of Massachusetts and has all
requisite corporate power and authority to enter into this Agreement,
to sell the Shares and to perform its obligations hereunder.
(b) The execution and delivery of this Agreement by the Seller have been
duly and validly authorized, and all necessary corporate action has
been taken to make this Agreement a valid and binding obligation of
the Seller, enforceable in accordance with its terms, except that the
enforcement thereof may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and to general
principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).
(c) The Balance Sheet has been prepared from, is in accordance with and
accurately reflects the books and records of the Company and fairly
presents the financial condition of the Company as of the date
indicated therein.
2
(d) Since the date of the Balance Sheet, the Seller has conducted its
business only in the ordinary course of business and, except as known
or may be deemed to be known by Xx. Xxxxxx in his capacity as manager
of the Company, there has not been any:
(i) change in the Company's authorized or issued capital stock;
grant of any stock option or right to purchase shares of
capital stock of the Company; issuance of any security
convertible into such capital stock; grant of any
registration rights; purchase, redemption, retirement, or
other acquisition by the Company of any shares of any such
capital stock; or declaration or payment of any dividend or
other distribution or payment in respect of shares of
capital stock;
(ii) amendment to the organizational documents of the Company;
(iii) damage to or destruction or loss of any asset or property of
the Company, whether or not covered by insurance, materially
and adversely affecting the properties, assets, business,
financial condition, or prospects of the Company;
(iv) sale (other than sales of inventory in the ordinary course
of business) or lease of any asset or property of the
Company materially and adversely affecting the business,
financial condition, or prospects of the Company;
(v) material change in the accounting methods used by the
Company;
(vi) material incurrence of any liability or obligation
(absolute, accrued, contingent or otherwise), except items
incurred in the ordinary course of business and consistent
with past practice; or
(vii) lapse of any rights to the use of any intellectual property
materially and adversely affecting the business, financial
condition, or prospects of the Company.
(e) The Seller has timely filed (or has had timely filed on its behalf)
or, in the case of federal and state tax returns that are not yet due,
will timely file (or will have timely filed on its behalf) with the
appropriate tax authorities all federal and state tax returns required
to be filed by them through the Closing Date.
(f) Any intercompany debt due from the Company to the Seller or
PrimeSource Healthcare, Inc. will not remain as such on the balance
sheet of the Company as of June 30, 2003.
Other than as set forth in this Section 2, Seller makes no
representations or warranties to the Purchaser.
3. REPRESENTATIONS AND WARRANTIES OF THE XXXXXX GROUP
--------------------------------------------------
The Purchaser, Xx. Xxxxxx and Xx. Xxxx each hereby represent and
warrant to, and agree with, the Seller as set forth below.
(a) The Shares are being purchased for Purchaser's, Xx. Xxxxxx'x and Xx.
Xxxx'x own account, and not for the account of any other person, and
not with a view to, or for sale in connection with, any distribution
or resale to others within the meaning of Section 2(11) or Rule 502(d)
promulgated under the Securities Act of 1933, as amended (the "Act").
3
The offering and sale of the Shares is intended to be exempt from
registration under the Act by virtue of Section 4(2) of the Act. Xx.
Xxxxxx and Xx. Xxxx are each an "accredited investor" as defined in
Rule 501(a) of Regulation D promulgated under the Act. No other person
has a direct or indirect beneficial interest in such Shares.
(b) The Seller has made available to Purchaser all documents and
information that Purchaser has requested relating to an investment in
the Company. Xx. Xxxxxx and Xx. Xxxx previously sold the Company to
the Seller and Xx. Xxxxxx has been responsible for the operations of
the Company, such that they are intimately familiar with the business
of the Company. The Xxxxxx Group has carefully considered and has, to
the extent the Xxxxxx Group believes such discussion necessary,
discussed with each of the Purchaser's, Xx. Xxxxxx'x and Xx. Xxxx'x
respective professional legal, tax and financial advisers the
suitability of an investment in the Company and the Xxxxxx Group has
determined that the Shares are a suitable investment for the Xxxxxx
Group. The Xxxxxx Group has not relied on the Company or the Seller
for any tax or legal advice in connection with the Purchaser's
purchase of the Shares. In evaluating the suitability of an investment
in the Company, the Purchaser has not relied upon any representations
or other information (whether oral or written) from the Company or the
Seller or any of their respective agents.
(c) This Agreement is a valid and binding obligation of the Xxxxxx Group,
enforceable in accordance with its terms, subject to laws of general
application relating to bankruptcy, insolvency and the relief of
debtors and rules of law governing specific performance, injunctive
relief or other equitable remedies.
(d) The Shares have not been registered under the Act nor qualified under
any applicable state securities or blue sky laws in reliance, in part,
on the representations and warranties herein. No federal or state
agency has made any finding or determination as to the fairness of
this offering for investment, nor any recommendation or endorsement of
the Shares. There is no public market for the Shares or any of the
Company's securities and there is no certainty that such a market will
ever develop. There can be no assurance that the Xxxxxx Group will be
able to sell or dispose of the Shares.
(e) The person executing this Agreement on behalf of the Purchaser has
been duly authorized and is duly qualified (A) to execute and deliver
this Agreement and all other instruments executed and delivered on
behalf of the Purchaser in connection with the purchase of the Shares
and (B) to purchase and hold the Shares; and (ii) the signature of the
person executing this Agreement on behalf of Purchaser is binding upon
the Purchaser.
(f) Pursuant to Xx. Xxxxxx'x and Xx. Xxxx'x previous ownership of the
Company and Xx. Xxxxxx'x continued management of the Company, the
Xxxxxx Group has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks
of investment in the Company and of making an informed investment
decision. Xx. Xxxxxx, Xx. Xxxx, the Purchaser, or their respective
professional advisors, have the capacity to protect the Xxxxxx Group's
concerns in connection with the purchase of the Shares, and the Xxxxxx
Group is able to bear the economic risk, including the complete loss,
of an investment in the Shares.
(g) Pursuant to Xx. Xxxxxx'x and Xx. Xxxx'x previous ownership of the
Company and Xx. Xxxxxx'x continued management of the Company, the
Xxxxxx Group either (i) has a preexisting personal or business
relationship with the Company or its officers, directors or
controlling persons or (ii) by reason of the Xxxxxx Group's business
or financial experience, or the business or financial experience of
4
the Xxxxxx Group's respective professional advisors who are
unaffiliated with and who are not compensated, directly or indirectly,
by the Company or any affiliate or selling agent of the Company, is
capable of evaluating the risks and merits of this investment and has
the capacity to protect Purchaser's own interest in connection with
this transaction.
4. INVENTORY VALUATION RESERVE
---------------------------
On the Closing Date, the Xxxxxx Group prepared, or caused to be
prepared, and delivered to the Seller, its calculation of the inventory
valuation reserve in the amount of $90,000, related to the inventory per the
Company's subsidiary ledger as of June 29, 2003. On October 1, 2003, the Seller
must deliver a sum equal to $22,500, payable by wire transfer of immediately
available funds, to the Purchaser.
5. EMPLOYEE BENEFIT PLANS
----------------------
Promptly following the Closing Date, the Xxxxxx Group will provide
medical and dental coverage for all employees of the Company.
6. INDEMNIFICATION
---------------
Each party hereto shall defend, hold harmless and indemnify the other
against and from any damage, loss, expense or liability, including reasonable
attorneys' fees, resulting from or arising out of the breach or default in the
performance by such party of any of the terms, covenants, representations,
warranties and conditions herein. This hold harmless and indemnification
obligation, together with the representations, warranties, covenants and
agreements of each party hereto, shall survive the termination of this Agreement
from any cause whatsoever.
7. GENERAL PROVISIONS
------------------
(a) EXPENSES. Except as otherwise expressly provided in this Agreement,
each party to this Agreement will bear its respective expenses
incurred in connection with the preparation, execution, and
performance of this Agreement, including all fees and expenses of
agents, representatives, counsel, and accountants. In the event of
termination of this Agreement, the obligation of each party to pay its
own expenses will be subject to any rights of such party arising from
a breach of this Agreement by another party.
(b) NOTICES. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have
been duly given when (i) delivered by hand (with written confirmation
of receipt), (ii) sent by telecopier (with written confirmation of
receipt), provided that a copy is mailed by certified mail, return
receipt requested, or (iii) when received by the addressee, if sent by
a nationally recognized overnight delivery service (receipt
requested), in each case to the appropriate addresses and telecopier
numbers set forth below (or to such other addresses and telecopier
numbers as a party may designate by notice to the other parties):
SELLER
------
PrimeSource Healthcare, Inc.
0000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx XxXxxxx, CFO
Fax: 000-000-0000
5
and a copy (which shall not constitute notice) to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxx
Facsimile No.: (000) 000-0000
Purchaser and/or Xx. Xxxxxx and/or Xx. Xxxx
New England Medical Specialties, Inc.
c/o Xxxxx Xxxxxx
000 Xxx Xxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Fax: 000-000-0000
(c) NO ASSIGNMENT. Except as specifically provided to the contrary in this
Agreement, neither party shall transfer, assign or encumber any of its
rights, privileges, duties or obligations under this Agreement without
the prior written consent of the other party, and any attempt to so
transfer, assign or encumber shall be void; provided, however, that
the Seller may assign this Agreement and its rights hereunder to its
successor in any merger or consolidation or to the purchaser of
substantially all of its assets.
(d) CHOICE OF LAW. This Agreement shall be governed by and construed in
accordance with the internal laws, and not the laws of conflicts of
laws, of the State of Delaware.
(e) SEVERABILITY. The parties hereto agree that the terms and provisions
in this Agreement are reasonable and shall be binding and enforceable
in accordance with the terms hereof and, in any event, that the terms
and provisions of this Agreement shall be enforced to the fullest
extent permissible under law. In the event that any term or provision
of this Agreement shall for any reason be adjudged to be unenforceable
or invalid, then such unenforceable or invalid term or provision shall
not affect the enforceability or validity of the remaining terms and
provisions of this Agreement, and the parties hereto hereby agree to
replace such unenforceable or invalid term or provision with an
enforceable and valid arrangement which in its economic effect shall
be as close as possible to the unenforceable or invalid term or
provision.
(f) PARTIES IN INTEREST. All of the terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable
by the respective permitted successors and assigns of the parties
hereto.
(g) MODIFICATION, AMENDMENT AND WAIVER. No modification, amendment or
waiver of any provision of this Agreement shall be effective against
the Seller, the Purchaser, Xx. Xxxxxx or Xx. Xxxx unless approved in
writing and authorized by each such party and unless it specifically
states that it is intended to amend the provisions of this Agreement.
The failure at any time to enforce any of the provisions of this
Agreement shall in no way be construed as a waiver of such provisions
6
and shall not affect the right of any of the parties thereafter to
enforce each and every provision hereof in accordance with its terms.
(h) INTEGRATION. This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and supersedes all
prior negotiations, understandings and agreements, written or oral.
(i) HEADINGS. The headings of the sections and paragraphs of this
Agreement have been inserted for convenience of reference only and do
not constitute a part of this Agreement.
(j) COUNTERPARTS. This Agreement may be executed in counterpart with the
same effect as if all parties had signed the same document. All such
counterparts shall be deemed an original, shall be construed together
and shall constitute one and the same instrument.
(k) ATTORNEYS' FEES. In the event of any controversy, claim or dispute
between the parties arising out of or relating to this Agreement, or
the enforcement of the provisions hereof, the substantially prevailing
party shall be entitled to recover its costs and expenses, including
but not limited to reasonable attorneys' fees incurred in connection
herewith.
(l) TIME OF ESSENCE. With regard to all dates and time periods set forth
or referred to in this Agreement, time is of the essence.
(m) FURTHER ASSURANCES. The parties agree to use their best efforts and
act in good faith in carrying out their obligations under this
Agreement. The parties also agree, without further consideration, to
execute such further instruments and to take such further actions as
may be necessary or desirable to carry out the purposes and intent of
this Agreement.
[SIGNATURE PAGE FOLLOWS]
7
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
PRIMESOURCE SURGICAL, INC.
By: /s/ Xxxxx XxXxxxx
----------------------------------------------
Name: Xxxxx XxXxxxx
Title: Chief Financial Officer,
Chief Operating Officer and Clerk
NEW ENGLAND MEDICAL SPECIALTIES, INC.
By: /s/ Xxxxx Xxxxxx
----------------------------------------------
Name: Xxxxx Xxxxxx
Title: President
XXXXX XXXXXX
/s/ Xxxxx Xxxxxx
-------------------------------------------------
Xxxxx Xxxxxx
XXXXX XXXX
/s/ Xxxxx Xxxx
-------------------------------------------------
Xxxxx Xxxx
[STOCK PURCHASE AGREEMENT]
SCHEDULE I
----------
SELLER'S TELECOM EQUIPMENT
* Cisco 1600 Router
* Cisco PIX506E Firewall/VPN
SCHEDULE II
SELLER'S SOFTWARE
* MS Office packages (Word, Excel, Powerpoint, Access, Outlook).
* Century TinyTerm Plus Edition (Southware telnet software)
* Norton Antivirus Security Client.
* WINZIP
* TimeClock Plus (Payroll timeclock)
EXHIBIT A
---------
RESIGNATION
-----------
I, Xxxxx X. XxXxxxx, hereby resign from (i) the Board of Directors and (ii)
the offices of Chief Operating Officer, Chief Financial Officer, Secretary and
Treasurer of Ruby Merger Sub., Inc., a Delaware corporation, effective as of
June 30, 2003.
/s/ Xxxxx X. XxXxxxx
----------------------------
Xxxxx X. XxXxxxx
EXHIBIT B
---------
RESIGNATION
-----------
I, Xxxxxxxx X. Xxxxxx, hereby resign from (i) the Board of Directors and
(ii) the offices of President and Chief Executive Officer of Ruby Merger Sub.,
Inc., a Delaware corporation, effective as of June 30, 2003.
/s/ Xxxxxxxx X. Xxxxxx
------------------------
Xxxxxxxx X. Xxxxxx
EXHIBIT C
---------
TERMINATION AGREEMENT
This Termination Agreement ("Agreement"), is entered into as of this 30th
day of June, 2003 by and among XXXXX X. XXXXXX, an individual ("Xxxxxx") and
PRIMESOURCE SURGICAL, INC., a Delaware corporation (the "Company").
RECITALS
A. WHEREAS, the parties to this agreement have entered that certain
Employment Agreement dated January 1, 2001 (the "Employment Agreement").
B. WHEREAS, Xxxxxx has voluntarily resigned his employment with the
Company.
C. WHEREAS, Xxxxxx and the Company now desire to resolve amicably, fully
and finally all matters between them, including, but in no way limited to, those
matters relating to the employment relationship between them and the termination
of that relationship.
NOW THERFORE, in consideration for the mutual promises and covenants set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties do hereby agree as follows:
1. TERMINATION OF EMPLOYMENT AGREEMENT. Xxxxxx and the Company agree that
the Employment Agreement is hereby immediately terminated in all means and
respects and is of no further force and effect.
2. RESIGNATION OF EMPLOYMENT. Xxxxxx hereby acknowledges that he has
voluntarily resigned his employment effective June 30, 2003.
3. RELEASE OF ALL CLAIMS.
(a) Xxxxxx hereby releases and discharges forever the Company,
PrimeSource Healthcare, Inc., a Massachusetts corporation ("PrimeSource"), Ruby
Merger Sub, Inc., a Delaware corporation ("Ruby"), their divisions, affiliates
and subsidiaries, and each of their present and former directors, officers,
employees, trustees, agents, attorneys, insurers, parent corporations,
subsidiaries, divisions, related and affiliated companies and entities,
shareholders, representatives, predecessors, successors and assigns, and each
and all of them (hereinafter collectively referred to as the "Released
Parties"), from and against all liabilities, claims, liens, causes of action,
charges, complaints, grievances, obligations, costs, losses, damages, injuries,
attorneys' fees, and other legal responsibilities (collectively referred to as
"claims"), of any form whatsoever, including, but not limited to, any claims in
law, equity, contract, tort, or any claims under the Connecticut Fair Employment
Practices Act, Title VII of the Civil Rights Act of 1964, as amended, the
Americans With Disabilities Act, the Age Discrimination in Employment Act, as
amended by the Older Workers Benefit Protection Act of 1990, or any other local
ordinance or federal or state statute or constitution, WHETHER KNOWN OR UNKNOWN,
UNFORESEEN, UNANTICIPATED, UNSUSPECTED OR LATENT, which Xxxxxx or Xxxxxx'x
successors in interest now own or hold, or have at any time heretofore owned or
held, or may at any time own or hold by reason of any matter or thing arising
from any cause whatsoever prior to the date of execution of this Agreement, and
without limiting the generality of the foregoing, from all claims, demands and
causes of action based upon, relating to, or arising out of Xxxxxx'x employment
relationship with the Company and/or any of the Released Parties and the
termination of that relationship.
(b) Without limiting the scope of this Agreement in any way, Xxxxxx
certifies that this Agreement constitutes a knowing and voluntary waiver of any
and all rights or claims that exist or that Xxxxxx has or may claim to have
under the Age Discrimination in Employment Act ("ADEA"), as amended by the Older
Workers Benefit Protection Act of 1990 (29 U.S.C. xx.xx. 621, et seq.). This
release does not govern any rights or claims that might arise under the ADEA
after the date this Agreement is signed by the parties. Xxxxxx acknowledges
that: (a) the consideration provided pursuant to this Agreement is in addition
to any consideration that Xxxxxx would otherwise be entitled to receive; (b)
Xxxxxx has been and is hereby advised in writing to consult with an attorney
prior to signing this Agreement; (c) Xxxxxx has been provided a full and ample
opportunity to review this Agreement, including a period of at least twenty-one
(21) days within which to consider it; (d) to the extent that Xxxxxx takes less
than twenty-one (21) days to consider this Agreement prior to execution, Xxxxxx
acknowledges that Xxxxxx had sufficient time to consider this Agreement with
counsel and that Xxxxxx expressly, voluntarily and knowingly waives any
additional time; and (e) Xxxxxx is aware of Xxxxxx'x right to revoke this
Agreement at any time within the seven (7) day period following the date on
which Xxxxxx signs the Agreement and that the Agreement shall not become
effective or enforceable until the seven (7) day revocation period expires (the
"Effective Date"). Xxxxxx further understands that he shall relinquish any right
he has to the consideration specified in this Agreement if he exercises his
right to revoke it. Notice of revocation must be made in writing and must be
received by the Company through its counsel, Xxxx Xxxxxxxx, Esq., SKADDEN, ARPS,
Slate, XXXXXXX & XXXX LLP, 000 Xxxxx Xxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx
00000, no later than 5:00 p.m. (Pacific Standard Time) on the seventh (7th) day
after Xxxxxx signs this Agreement.
(c) It is further understood and agreed that all rights under Section
1542 of the California Civil Code and/or any statute or common law principle of
similar effect in any jurisdiction are hereby expressly waived by Xxxxxx.
Section 1542 reads as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES
NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR."
Notwithstanding the provisions of Section 1542 or any statute or common law
principle of similar effect in any jurisdiction, and for the purpose of
implementing a full and complete release and discharge of all claims, Xxxxxx
expressly acknowledges that this Agreement is intended to include in its effect,
without limitation, all claims which Xxxxxx does not know or suspect to exist in
Xxxxxx'x favor at the time of execution hereof, and that the release agreed upon
contemplates the extinguishment of any such claim or claims.
4. STOCK OPTIONS. 325,000 of the stock options granted by PrimeSource to
Xxxxxx in March 2003 (the "Accelerated Options") shall become fully vested and
exercisable upon the later of the Closing Date (as defined below) and the
Effective Date. If the Closing Date occurs prior to July 1, 2003, the
Accelerated Options shall remain exercisable through the second anniversary of
the Closing Date. If the Closing Date occurs after June 30, 2003, the
Accelerated Options shall remain exercisable through the first anniversary of
the Closing Date. All of Xxxxxx'x stock options granted by PrimeSource or its
affiliates in March 2003, other than the Accelerated Options, shall terminate
upon the Closing Date.
For purposes of this Agreement, the Closing Date is the date of
consummation of the sale of all of the issued and outstanding capital stock of
Ruby, a wholly owned subsidiary of the Company.
5. CONFIDENTIALITY. You agree that, in the course of your employment with
the Company, you have had access to confidential and proprietary information
("Confidential Information") relating to the Release Parties, and that such
Confidential Information has been disclosed to you in confidence and only for
the use of the Company or its affiliates. You understand and agree that (a) you
will keep such Confidential Information confidential at all times, (b) except in
your capacity as an owner, manager or employee of Ruby, you will not make use of
such Confidential Information on your own behalf, or on behalf of any third
party, and (c) you have returned to the Company any and all copies, duplicates,
reproductions, or excerpts of such Confidential Information and any Company
property within your possession, custody, or control. You further agree to keep
the terms of this Agreement confidential, except as may be required to obtain
legal or tax advice with respect to the rights and obligations created hereby.
6. GOVERNING LAW. The Agreement and the related documents shall be governed
by the internal laws of the State of Delaware, without regard to its conflicts
or choice of law principles, as to all matters, including but not limited to
matters of validity, construction, effect and performance.
7. FURTHER ACTS. The parties shall promptly sign any other documents and
take any other acts which are necessary or desirable to effectuate the purpose
of this Agreement.
8. AMENDMENT. This Agreement may only be amended, modified, terminated or
revoked, in writing, signed by Xxxxxx and an authorized representative of the
Company.
9. SEVERABILITY. If any provision or provisions of this Agreement or any of
the documents or instruments delivered pursuant hereto shall be deemed invalid
or unenforceable pursuant to a final determination of any court of competent
jurisdiction, such determination or action will be construed so as not to affect
the validity and enforceability of any other portion of the Agreement and such
affected portion shall be deemed to be amended by the parties hereto to the
minimum extent necessary to cause the amended portion to be valid and
enforceable.
10. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same Agreement, and delivery of an
executed counterpart of a signature page to this Agreement transmitted via
facsimile transmission, or a photocopy thereof, shall be effective as delivery
of a manually executed counterpart of this Agreement.
11. NO ACTIONS PENDING. Xxxxxx represents and covenants that Xxxxxx has not
filed, initiated or caused to be filed or initiated, any claim, charge, suit,
complaint, grievance, action or cause of action against the Company or any of
the Released Parties. Except to the extent that such waiver is precluded by law,
Xxxxxx further promises and agrees that Xxxxxx will not file, refile, initiate,
or cause to be filed, refiled or initiated any claim, charge, suit, complaint,
grievance, action, or cause of action based upon, arising out of, or relating to
any claim, demand, or cause of action released herein, nor shall Xxxxxx
participate, assist or cooperate in any claim, charge, suit, grievance,
complaint, action or proceeding regarding any of the Released Parties, whether
before a court or administrative agency or otherwise, unless required to do so
by law.
12. NO ASSIGNMENT. Xxxxxx represents that Xxxxxx has made no assignment and
covenants that Xxxxxx will make no assignment of the claims, demands or causes
of action released herein.
13. NO ADMISSION OF LIABILITY. Xxxxxx understands that the foregoing
consideration is received by Xxxxxx in connection with the parties' resolution
of all matters between them, including, but not limited to, all matters relating
to their employment relationship and the termination of that relationship, and
that neither this Agreement nor the aforesaid payments and consideration are to
be construed as an admission on the part of any of the Released Parties of any
wrongdoing or liability, nor to be admissible as evidence in any proceeding,
other than for enforcement of the provisions of this Agreement.
14. ENTIRE AGREEMENT. Xxxxxx understands that this Agreement represents the
entire agreement and understanding between the parties and, except as expressly
stated in this Agreement, supersedes any prior agreement, understanding or
negotiations respecting such subject.
15. NO RELIANCE ON THE COMPANY. Xxxxxx understands and acknowledges that
reliance is placed wholly upon Xxxxxx'x own judgment, belief and knowledge as to
the propriety of entering into this Agreement and acknowledges that Xxxxxx is
relying solely upon the contents of this Agreement and is not relying on any
other representations or statements whatsoever of any of the Released Parties as
an inducement to enter into this Agreement, and if any of the facts upon which
Xxxxxx now relies in making this Agreement shall hereafter prove to be
otherwise, this Agreement shall nonetheless remain in full force and effect.
16. USE OF HEADINGS. Headings, titles or captions of paragraphs contained
in this Agreement are inserted only as a matter of convenience and for
reference, and in no way define, limit, extend or describe the scope of this
Agreement or the intent of any provisions hereof.
17. INTERPRETATION. Xxxxxx understands that this Agreement is deemed to
have been drafted jointly by the parties. Any uncertainty or ambiguity shall not
be construed for or against any party based on attribution of drafting to any
party.
(Signature Page Follows)
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
PRIMESOURCE SURGICAL, INC.
By: /s/ Xxxxx XxXxxxx
----------------------------------
Name: Xxxxx XxXxxxx
Title: CFO
XXXXX XXXXXX
/s/ Xxxxx Xxxxxx
----------------------------------
Xxxxx Xxxxxx
EXHIBIT D
---------
RELEASE
-------
This Release is being executed and delivered as of June 30, 2003, by and
among the parties listed on the signature pages herein (each a "Releasor," and
collectively, the "Releasors"), in accordance with Section 1.3(b)(ii) of the
Stock Purchase Agreement dated as of June 30, 2003 (the "Agreement"), by and
among PrimeSource Surgical, Inc., a Delaware corporation (the "Company"), and
the Releasors. Capitalized terms used in this Release without definition shall
have the respective meanings given to them in the Agreement.
Each Releasor acknowledges that the execution and delivery of this Release
is a condition to the Company's obligation to sell the Shares as contemplated by
the Agreement (the "Stock Sale") and that the Company is relying on this Release
in consummating the Stock Sale.
Each Releasor, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound,
in order to induce the Company to consummate the Stock Sale, hereby agrees as
follows:
Each Releasor, on behalf of itself and each of its Affiliates (as defined
below), hereby releases and forever discharges PrimeSource Healthcare, Inc., a
Massachusetts corporation, the Company and their Affiliates (as used in this
Release, the term "Affiliate", as applied to any person or entity, means any
other person or entity directly or indirectly controlling, controlled by, or
under common control with, that person or entity; for the purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlling", "controlled by" and "under common control with"), as applied to
any person or entity, means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of that person
or entity, whether through the ownership of voting securities or by contract or
otherwise), in all capacities and relationships, on their own behalf and on
behalf of each of their respective predecessors, successors, assigns, past
and/or present managers, stockholders, directors, officers, employees, agents,
guarantors, representatives and attorneys, their past, present and future
representatives, affiliates, members, related persons, subsidiaries, each in its
individual and/or representative capacity (individually, a "Releasee" and
collectively, "Releasees") from any and all claims, demands, proceedings, causes
of action, orders, obligations, contracts, debts and liabilities whatsoever,
whether known or unknown, suspected or unsuspected, both at law and in equity,
that any of the Releasors or any of their Affiliates now has, have ever had, or
may hereafter have arising contemporaneously with or prior to the Closing Date
or on account of or arising out of any matter, cause or event occurring
contemporaneously with or prior to the Closing Date, whether or not relating to
claims pending on, or asserted after, the Closing Date; provided, however, that
nothing contained herein shall operate to release any obligations of the Company
arising under the Agreement.
Each Releasor hereby irrevocably covenants to refrain from, directly or
indirectly, asserting any claim or demand, or commencing, instituting or causing
to be commenced, any proceeding of any kind against any Releasee, based upon any
matter purported to be released hereby.
Without in any way limiting any of the rights and remedies otherwise
available to any Releasee, each Releasor, severally, and not jointly, shall
indemnify and hold harmless each Releasee from and against all loss, liability,
claim, damage (including incidental and consequential damages) or expense
(including costs of investigation and defense and reasonable attorney's fees)
whether or not involving third party claims, arising directly or indirectly from
or in connection with (i) the assertion by or on behalf of the Releasor or any
of its Affiliates of any claim or other matter purported to be released pursuant
to this Release and (ii) the assertion by any third party of any claim or demand
against any Releasee which claim or demand arises directly or indirectly from,
or in connection with, any assertion by or on behalf of the Releasor or any of
its Affiliates against such third party of any claims or other matters purported
to be released pursuant to this Release.
Each Releasor hereby expressly waives all rights afforded by Section 1542
of the Civil Code of California ("Section 1542") or any statute or common law
principle of similar effect in any jurisdiction with respect to the Releasees.
Section 1542 states as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT
KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.
Notwithstanding the provisions of Section 1542, and for the purpose of
implementing a full and complete release, each Releasor expressly waives and
relinquishes any rights and benefits that it may have under Section 1542. Each
Releasor understands and agrees that this Release is intended to include all
claims, if any, which such Releasor may have and which such Releasor does not
now know or suspect to exist in its favor against the Releasees and that this
Release extinguishes those claims.
Each Releasor represents and warrants to Company that it has been advised
by its attorney of the effect and import of the provisions of Section 1542, and
that such Releasor has not assigned or otherwise transferred or subrogated any
interest in any claims, demands or causes of action that are the subject of this
Release. Each Releasor agrees to indemnify, defend and hold the Releasees
harmless for any liability, loss, claims, demands, damages, costs, expenses or
attorneys' fees incurred as a result of any person or entity asserting such
assignment, transfer or subrogation by such Releasor. Each Releasor further
agrees that in the event of litigation relating to the subject matter of this
Release, Company shall be entitled to reasonable attorneys' fees and costs if it
is the prevailing party in such litigation.
If any provision of this Release is held invalid or unenforceable by any
court of competent jurisdiction, the other provisions of this Release will
remain in full force and effect. Any provision of this Release held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.
This Release may not be changed except in a writing signed by the person(s)
against whose interest such change shall operate. This Release shall be governed
by and construed under the laws of the State of Delaware without regard to
conflicts of laws principles.
All words used in this Release will be construed to be of such gender or
number as the circumstances require.
This Release may be executed in one or more counterparts, each of which
will be deemed to be an original copy of this Release and all of which, when
taken together, will be deemed to constitute one and the same agreement.
Delivery of a signed counterpart by facsimile transmission will constitute a
party's due execution and delivery of this Release.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, each of the undersigned has executed and delivered this
Release as of the date first above written.
NEW ENGLAND MEDICAL SPECIALTIES, INC.
By: /s/ Xxxxx Xxxxxx
----------------------------------
Name: Xxxxx Xxxxxx
Title: President
XXXXX XXXXXX
/s/ Xxxxx Xxxxxx
----------------------------------------
Xxxxx Xxxxxx
XXXXX XXXX
/s/ Xxxxx Xxxx
----------------------------------------
Xxxxx Xxxx
