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EXHIBIT 10.12
AMENDMENT TO PLAN AND AGREEMENT OF MERGER
THIS IS AN AMENDMENT TO THE PLAN AND AGREEMENT OF MERGER by and among
Xxxxx HealthPlan Services, Inc., a Florida corporation (the "Purchaser"), Xxxxx
HealthPlan Services Acquisition Corp., a Florida corporation (the "Merger
Subsidiary"), and Health International, Inc., a Delaware corporation (the
"Company").
W I T N E S S E T H :
WHEREAS, the parties have heretofore entered into a Plan and Agreement
of Merger dated February 11, 1998 (the "Plan and Agreement of Merger") which
requires that certain shares of Company Preferred Stock be converted into
Company Common Stock prior to the closing of the transactions contemplated
thereby; and
WHEREAS, on February 26, 1998, the Company issued a call for
redemption of the Company Preferred Stock effective on March 30, 1998. Pursuant
to the terms of the Company Preferred Stock, the Company Preferred Stock is
entitled to a redemption payment of $10,000 per share. At any time prior to the
redemption date, each share of Company Preferred Stock can be converted into
2,000 shares of Company Common Stock. Although holders of the Company Preferred
Stock would likely receive more consideration by converting their shares of
Company Preferred Stock then by allowing them to be redeemed, as of the date
hereof holders of five shares have not elected to convert their shares of
Company Preferred Stock. In order to give each holder of Company Preferred Stock
the full consideration provided in the Plan and Agreement of Merger,
notwithstanding whether such holder elects to convert such holder's Company
Preferred Stock prior to the redemption, the Company desires to amend the Plan
and Agreement of Merger so as to convert the unconverted shares of Company
Preferred Stock into the right to receive the same consideration which would
have been received by the holders of the Company Preferred Stock had they
converted their Company Preferred Shares into Company Common Shares prior to the
Merger; and
WHEREAS, the Purchaser and the Merger Subsidiary are willing to so
amend the Plan and Agreement of Merger.
NOW, THEREFORE, in consideration of the premises and the mutual
promises, representations, warranties and covenants hereinafter set forth, the
parties hereto agree as follows:
1. Definitions. All definitions used herein which are not defined
herein shall have the same meanings as set forth in the Plan and Agreement of
Merger unless otherwise defined.
2. Representation of the Company. The Company hereby represents and
warrants to the Purchaser and the Merger Subsidiary that twenty (20) shares of
Company Preferred Stock have duly and validly converted into forty thousand
(40,000) shares of Company Common Stock prior to the date hereof, leaving as of
the date hereof only five (5) shares of Company Preferred Stock which have not
been converted which will reduce the expected outstanding Company Common Stock
at Closing to 2,816,867 shares.
3. Waiver of Requirement for Conversion of Company Preferred Stock. By
entering into this Amendment, the parties agree to waive the requirements of
Section 3.3 of the Plan and Agreement of Merger and Section 5.2.8 of the Plan
and Agreement of Merger, which would require the remaining five shares of
Company Preferred Stock to be converted into Company Common Stock as a condition
to the closing of the Merger.
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4. Amendment to Paragraph 2.3 of the Plan and Agreement of Merger.
Paragraph 2.3 of the Plan and Agreement of Merger is hereby amended by deleting
in its entirety the present Paragraph 2.3 and substituting therewith the
following:
"2.3 Effects of Merger. Subject to the Acts, at the Effective Time,
the Merger shall have the following effects:
2.3.1 Conversion of Shares. At the Effective Time, by virtue of
the Merger and without any action on the part of the holder of any
shares of capital stock of the Purchaser or the Company:
2.3.1.1 each share of Merger Subsidiary Common Stock that
is issued and outstanding immediately prior to the Effective Time
shall remain outstanding;
2.3.1.2 each share of Company Common Stock that is issued
and outstanding immediately prior to the Effective Time, except
for Dissenting Shares, shall be converted into the right to
receive the Per Share Common Stock Consideration and each share
of Company Preferred Stock issued and outstanding immediately
prior to the Effective Time shall be converted into the right to
receive the Per Share Preferred Stock Consideration;
2.3.1.3 each outstanding certificate representing shares of
Company Common Stock or Company Preferred Stock, except for
Dissenting Shares, shall be deemed, for all purposes, to evidence
only the right to receive upon surrender of such certificate the
consideration into which such shares of Company Common Stock or
Company Preferred Stock are convertible as specified in Section
2.3.1.2 above; and
2.3.1.4 each share of Company Common Stock and Company
Preferred Stock that is owned by the Company immediately prior to
the Effective Time as treasury stock will be canceled and retired
and will cease to exist, without any conversion thereof.
2.3.1.5 Notwithstanding anything in this Section 2.3 to the
contrary, shares of Company Common Stock and Company Preferred
Stock which are issued and outstanding immediately prior to the
Effective Time and which are held by Shareholders who have not
voted such shares in favor of the Merger and who shall have
properly exercised their rights of appraisal for such shares in
the manner provided by the Delaware General Corporation Law (the
"Dissenting Shares") shall evidence only the right to receive the
amount, if any, determined to be payable thereon pursuant to the
applicable appraisal rights statute and shall not be converted or
exchangeable for the right to receive the Per Share Common Stock
Consideration or Per Share Preferred Stock Consideration, as the
case may be, set forth herein, unless and until such holder shall
have failed to perfect or shall have effectively withdrawn or
lost such holder's right to appraisal and payment, as the case
may be. If such Shareholder shall have failed to so perfect or
shall have effectively withdrawn or lost such right, such
Shareholder's shares shall thereupon be deemed to have been
converted into and to have become exchangeable for, at the
Effective Time, the right to receive the Per Share Common Stock
Consideration or the Per Share Preferred Stock
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Consideration, as the case may be, set forth herein without any
interest thereupon. The Company shall give the Purchaser prompt
notice of any Dissenting Shares (and shall also give the
Purchaser prompt notice of any withdrawals of such demands for
appraisal rights) and the Purchaser shall have the right to
direct all negotiations and proceedings with respect to any such
demands. The Company shall not, except with the prior written
consent of the Purchaser, voluntarily make any payment with
respect to, or settle or offer to settle, any such demand for
appraisal rights."
5. Amendment to Paragraph 2.4 of the Plan and Agreement of Merger.
Paragraph 2.4 of the Plan and Agreement of Merger is amended by deleting the
present Paragraph 2.4 and substituting therefor the following:
"2.4 Exchange of Certificates.
2.4.1 Paying Agent. Not later than the Effective Time, the Purchaser
shall deposit with the Paying Agent for the benefit of Company Shareholders, for
payment in accordance with this Section 2.4, cash in the amount of the Closing
Cash Consideration less an amount equal to the number of shares of Company
Common Stock and Company Preferred Stock for which the Company has reserved a
valid notice of dissent multiplied by the Per Share Common Stock Consideration
or the Per Share Preferred Stock Consideration, as the case may be (hereinafter
referred to as the "Payment Fund").
2.4.2 Exchange Procedures for Certificates Representing Shares. No
later than five (5) days following the Effective Time, the Paying Agent or the
Company shall mail to each holder of record of a certificate or certificates
(the "Certificates") which immediately prior to the Effective Time represented
outstanding shares of Company Common Stock or Company Preferred Stock whose
shares were converted into the right to receive the Per Share Common Stock
Consideration or Per Share Preferred Stock Consideration, as the case may be,
pursuant to Section 2.3 (i) a letter of transmittal (which shall specify that
delivery shall be effected, and that risk of loss and title to the Certificates
shall pass, only upon delivery of the Certificates (or affidavits of loss in
lieu thereof) to the Paying Agent and shall be in such form and have such other
provisions as the Purchaser may reasonably specify) and (ii) instructions for
effecting the surrender of the Certificates in exchange for the Per Share Common
Stock Consideration or Per Share Preferred Stock Consideration, as the case may
be, as set forth herein. Upon surrender of a Certificate for cancellation to the
Paying Agent, together with a duly executed and complete letter of transmittal,
the holder of such Certificate shall be entitled to receive in exchange therefor
as soon thereafter as possible either a wire transfer of same day funds (if the
Shareholder pays all wire transfer fees) or a check, at the Shareholder's
option, representing the amount of the Per Share Common Stock Consideration or
Per Share Preferred Stock Consideration, as the case may be, multiplied by the
number of shares represented by such certificate(s), after giving effect to any
required withholding tax, if any, and the shares represented by the Certificate
so surrendered shall be canceled forthwith. No interest will be paid or accrued
on the Per Share Common Stock Consideration or Per Share Preferred Stock
Consideration. In the event of a transfer of ownership of shares of Company
Common Stock or Company Preferred Stock which is not registered on the transfer
records of the Company, the transferee shall only be entitled to the Per Share
Common Stock Consideration or Per Share Preferred Stock Consideration for each
share so transferred if the Certificate representing such shares of Company
Common Stock or Company Preferred Stock held by such transferee is presented to
the Exchange Agent, accompanied by all documents required to evidence and effect
such
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transfer and to evidence that any applicable stock transfer taxes have been
paid. Until surrendered as contemplated by this Section 2.4, each Certificate
shall be deemed at any time after the Effective Time to represent only the right
to receive upon surrender the Per Share Common Stock Consideration or Per Share
Preferred Stock Consideration as provided in this Article II.
2.4.3 Distributions with Respect to Unsurrendered Shares.
Notwithstanding any other provisions of this Agreement, no part of the Per Share
Common Stock Consideration or Per Share Preferred Stock Consideration shall be
paid to any holder of Company Common Stock or Company Preferred Stock, until the
holder shall surrender the Certificate as to which such Per Share Common Stock
Consideration or Per Share Preferred Stock Consideration relates as provided in
this Section 2.4.
2.4.4 No Further Ownership Rights in Company Common Stock or Company
Preferred Stock. The Per Share Common Stock Consideration or Per Share Preferred
Stock Consideration paid pursuant to this Article II shall be deemed to have
been paid in full satisfaction of all rights pertaining to the shares of Company
Common Stock or Company Preferred Stock and from and after the Effective Time
there shall be no further registration of transfers on the stock transfer books
of the Company of shares of Company Common Stock or Company Preferred Stock. If,
after the Effective Time, Certificates are presented to the Purchaser or the
Company for any reason, they shall be canceled and exchanged as provided in this
Section 2.4.
2.4.5 Termination of Payment Fund. Any portion of the Payment Fund
which remains undistributed to Company Shareholders for six months after the
Effective Time shall be delivered to the Purchaser, upon demand thereby, and
holders of shares of Company Common Stock or Company Preferred Stock who have
not theretofore complied with this Section 2.4 shall thereafter look only to the
Purchaser for payment of any claim to the Per Share Common Stock Consideration
or Per Share Preferred Stock Consideration.
2.4.6 No Liability. None of the Purchaser, the Company or the Paying
Agent shall be liable to any person in respect of any part of the Per Share
Common Stock Consideration or Per Share Preferred Stock Consideration delivered
to a public official pursuant to any applicable abandoned property, escheat or
similar law. If any Certificates shall not have been surrendered prior to seven
years after the Effective Time of the Merger (or immediately prior to such
earlier date on which any part of the Per Share Common Stock Consideration or
Per Share Preferred Stock Consideration would otherwise escheat to or become the
property of any governmental authority), any such cash in respect of such
Certificate shall, to the extent permitted by the Acts, become the property of
the Purchaser, free and clear of all claims or interest of any person previously
entitled thereto.
2.4.7 Investment of Payment Fund. The Paying Agent shall invest any
cash included in the Payment Fund, as directed by the Purchaser, on a daily
basis. Any interest and other income resulting from such investments shall be
paid to the Purchaser upon termination of the Payment Fund pursuant to Section
2.4.5.
2.4.8 Lost, Stolen or Destroyed Certificates. In the event any
Certificate of Company Common Stock or Company Preferred Stock shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the
Person claiming such Certificate to be lost, stolen or destroyed and, if
required by Purchaser, the posting by such Person of a bond in the amount of the
Per Share Common Stock Consideration or Per Share Preferred Stock Consideration
multiplied by the number of shares represented
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thereby as indemnity against any claim that may be made against it with respect
to such Certificate, the Paying Agent will issue in exchange for such lost,
stolen or destroyed Certificate the Per Share Common Stock Consideration or Per
Share Preferred Stock Consideration upon receipt of such affidavit in respect of
the Company Common Stock represented by such Certificate pursuant to this
Agreement."
6. The defined term "Company Shareholders" or "Shareholders"
contained in Item 16 of Exhibit 1.1 of the Plan and Agreement of Merger shall be
amended to read in its entirety as follows:
"Company Shareholders" or "Shareholders" shall mean the
shareholders of the Company at the Effective Time, including holders
of Company Common Stock or Company Preferred Stock, each of which may
be referred to individually as a "Shareholder."
The defined terms "Exchange Agent" and "Exchange Fund" in Items 29 and
30 of Exhibit 1.1 to the Plan and Agreement of Merger shall be changed
throughout the Plan and Agreement of Merger to "Paying Agent" and "Payment
Fund," respectively. The definition of "Per Share Closing Cash Consideration"
contained in Item 49 of Exhibit 1.1 of the Plan and Agreement of Merger is
deleted in its entirety and in its place the following definitions are added as
items 49(A) and 49(B):
"49A. "Per Share Common Stock Consideration" shall mean an amount
of cash equal to the Outstanding Share Consideration divided by (i)
the total number of issued and outstanding shares of Company Common
Stock at the Closing plus (ii) the total number of issued and
outstanding shares of Company Preferred Stock at Closing multiplied by
2000.
49B. "Per Share Preferred Stock Consideration" shall mean an
amount of cash equal to the Per Share Common Stock Consideration
multiplied by 2000."
7. Except as set forth herein, all the terms of the Plan and
Agreement of Merger shall remain in full force and effect.
IN WITNESS WHEREOF, each party hereto has executed or caused this
Amendment to the Plan and Agreement of Merger to be executed on its behalf
effective as of this 30th day of March, 1998.
"Purchaser"
XXXXX HEALTHPLAN SERVICES, INC.
By:
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Title:
"Merger Subsidiary"
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XXXXX HEALTHPLAN SERVICES
ACQUISITION CORP.
By:
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Title:
"Company"
HEALTH INTERNATIONAL, INC.
By:
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Title:
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