SECURITIES ACQUISITION AGREEMENT
THIS AGREEMENT is made and entered into as of the 13th day of
May, 1997, by and between HOUSECALL MEDICAL RESOURCES, INC., a
Delaware corporation ("COMPANY"); and R. XXXXXX XXXXXXXX, an
individual resident of the State of Tennessee ("XXXXXXXX").
Background Statement
Xxxxxxxx is an executive employee of Healthfirst, Inc., a
Delaware corporation ("HFI") and HFI Management, Inc., a Delaware
corporation ("MANAGEMENT") and the sole general partner of HFI
Home Care Management, L.P., a Delaware limited partnership (the
"PARTNERSHIP").
Pursuant to that certain Acquisition Agreement, dated May
13, 1997, by and among Housecall Medical Resources, Inc., HFI
Acquisition Corp. and the other signatories thereto (the
"ACQUISITION AGREEMENT"), Xxxxxxxx shall receive the number of
shares of common stock of Company as described in and pursuant to
PARAGRAPH 3.2 of the Acquisition Agreement (the "SHARES"). As a
condition to the issuance of the Shares, the parties hereto are
required to execute and deliver this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. REPRESENTATIONS AND WARRANTIES OF COMPANY. To
induce Xxxxxxxx to enter into this Agreement, Company hereby
represents and warrants to, and covenants and agrees, with
Xxxxxxxx as follows:
(a) Company is duly organized, and validly existing
and in good standing under the laws of the State of
Delaware. Company has full corporate power and authority to
make, execute and perform this Agreement and the
transactions contemplated hereby. This Agreement and all
transactions required hereunder, have been duly and validly
authorized and approved by all necessary corporate action on
the part of Company. This Agreement has been duly and
validly executed and delivered on behalf of Company by its
duly authorized officers, and this Agreement constitutes the
valid and legally binding obligation of Company,
enforceable, subject to general equity principles, in
accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization or similar
laws affecting the rights of creditors generally. Neither
the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will
constitute a violation or breach of the certificate of
incorporation or the bylaws of Company or any provision of
any material contract or other instrument to which Company
is a party.
(b) The relative rights and privileges of Xxxxxxxx as
a shareholder of Company are as set forth in Company's
Certificate of Incorporation and By-laws, true, correct and
complete copies of which are attached hereto as EXHIBITS A
AND B, respectively.
(c) The Shares are fully paid and nonassessable.
(d) The documents listed and identified on EXHIBIT C
attached hereto (collectively, the "SEC DOCUMENTS")
constitute all of the documents (other than preliminary
filings) that Company was required by applicable securities
Law to file with the Securities and Exchange Commission
("SEC") since June 30, 1996. The financial statements of
Company for fiscal years 1995 and 1996 included or
incorporated by reference in the SEC Documents were prepared
in accordance with GAAP and present fairly, in all material
respects, in accordance with GAAP, the consolidated
financial condition, results of operations and changes in
financial position of Company as of the dates thereof. No
representation, warranty or covenant of Company contained in
this Agreement, or in connection with the transactions
contemplated herein, contains any untrue statements of a
material fact or omits to state a material fact necessary to
make the statements contained herein not misleading.
SECTION 2. REPRESENTATIONS AND WARRANTIES OF XXXXXXXX. To
induce Company to enter into this Agreement and issue Shares to
Xxxxxxxx, Xxxxxxxx hereby represents and warrants to, and
covenants and agrees with Company, as follows:
(a) Xxxxxxxx has received (well in advance of the date
of this Agreement) and carefully reviewed the SEC Documents
and has relied only on the information contained therein.
Xxxxxxxx and his advisor(s) have had a reasonable
opportunity to ask questions of and receive answers from
Company or persons acting on its behalf, concerning the
terms and conditions of the acquisition of Shares, and to
obtain additional information, to the extent possessed or
obtainable without unreasonable effort or expense by
Company, necessary to verify the accuracy of the information
in the SEC Documents. All such questions have been answered
to the full satisfaction of Xxxxxxxx. Xxxxxxxx acknowledges
that in making his decision to receive Shares, Xxxxxxxx is
relying solely on the information set forth in the SEC
Documents and the materials provided to Xxxxxxxx therewith,
and that Xxxxxxxx is not relying on any other materials
previously provided regarding Company, all of which are
superseded in their entirety by the SEC Documents. No oral
representations were made to Xxxxxxxx or his advisor(s) in
connection with the receipt of Shares which were in any way
inconsistent with the SEC Documents.
(b) Xxxxxxxx has such knowledge and experience in
financial and business matters as to enable him to (i)
utilize the information made available to him in connection
with the receipt of Shares, (ii) evaluate the merits and
risks associated with the receipt of Shares, and (iii) make
an informed decision with respect thereto.
(c) Xxxxxxxx (i) has adequate means of providing for
his current needs and possible contingencies, (ii) has no
need for liquidity in connection with the receipt of Shares,
(iii) is able to bear the economic risks associated with the
receipt of Shares for an indefinite period and has the
capacity to protect his own interests in connection with the
receipt of Shares, and (iv) can afford the complete loss of
the Average Price of the Shares, as that term is defined in
the Acquisition Agreement, received hereunder. Xxxxxxxx is
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an "accredited investor" as that term is defined in Rule
501(a) of Regulation D promulgated pursuant to the
Securities Act of 1933, as amended (the "ACT").
(d) Xxxxxxxx recognizes that the receipt of Shares
involves certain risks.
(e) Xxxxxxxx understands that (i) the transfer of
Shares has not been registered under the Act, as amended, in
reliance upon exemptions from the registration provisions of
the Act, (ii) the Shares received by Xxxxxxxx must be held
indefinitely unless the sale or transfer thereof is
subsequently registered under the Act, or an exemption from
such registration is available, (iii) certificates
representing the Shares (and all replacements therefor) will
contain the legend set forth in EXHIBIT D attached hereto,
and (iv) Company will rely upon the representations and
warranties made by Xxxxxxxx in this Agreement in order to
establish such exemption from the registration provisions of
the Act.
(f) Xxxxxxxx understands that neither the offering nor
the transfer of Shares has been registered under the
securities laws of any state due to exemptions from
registration based upon the private or limited nature of the
offering, and that Company will rely upon the
representations and warranties made by Xxxxxxxx in this
Agreement in order to establish such exemptions from
registration under state securities laws.
(g) Xxxxxxxx will not transfer any Shares without
registration under the Act and applicable state securities
laws unless the transfer is exempt from registration under
the Act and such laws.
(h) The Shares are being received solely for Xxxxxxxx'
own account and not for the account of any other person, and
no other person has or will have a direct or indirect
beneficial interest in such Shares. The Shares are being
received for investment purposes only, and not for
distribution, assignment, sale or transfer to others.
(i) The foregoing representations, warranties and
covenants, and all other information which Xxxxxxxx has
provided to Company concerning Xxxxxxxx and Xxxxxxxx'
financial condition are true, complete and accurate as of
the date hereof.
SECTION 3. INDEMNIFICATION. Xxxxxxxx shall indemnify and
hold harmless Company, and any person, partnership, corporation
or entity affiliated in any manner with or employed by Company
(including without limitation the officers, directors, agents and
employees of Company and all professional advisors thereto), from
and against any and all loss, damage, liability or expense,
including costs and reasonable attorneys' fees, to which they may
become subject or which they may incur by reason of or in
connection with any misrepresentation made by Xxxxxxxx herein,
any breach of any of Xxxxxxxx' representations or warranties, or
the failure of Xxxxxxxx to fulfill any of his covenants or
agreements under this Agreement.
SECTION 4. ADOPTION OF BY-LAWS. Xxxxxxxx hereby adopts,
accepts and agrees to be bound by all the terms and provisions of
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Company's By-laws and to perform all obligations therein imposed
upon a shareholder of Company with respect to the Shares received
hereunder.
SECTION 5. REGISTRATION RIGHTS.
(a) Piggyback Rights. If at any time prior to the
fifth anniversary of the date hereof, the Company shall prepare
and file one or more registration statements under the Act, with
respect to a public offering of shares of common stock by the
Company or by its security holders (other than a registration
statement on Form X-0, Xxxx X-0 or any similar form considered
inappropriate for general use by selling shareholders), the
Company agrees to include in any such registration statement such
information as is required, and any Shares to be issued to
Xxxxxxxx pursuant to the Acquisition Agreement, whether or not
paid to him at such time, as may be requested by him, to permit a
public offering of the Shares so requested; provided, however,
that if, in the written opinion of the Company's managing
underwriter, if any, for such offering, the inclusion of the
Shares requested to be registered, when added to the securities
being registered by the Company or the selling security
holder(s), would exceed the maximum amount of the Company's
securities that can be marketed without otherwise materially and
adversely affecting the entire offering, then the Company may
exclude from such offering all or any portion of the Shares
requested to be so registered, but only if no securities are
included in such registration statement other than securities
being sold for the account of the Company or by Persons pursuant
to the exercise of "piggyback" registration rights granted prior
to the date hereof, and then only on a pro rata basis with
respect to all securities not being sold by the Company or by
Persons exercising such prior "piggyback" registration rights.
The Company shall bear all fees and expenses incurred by it in
connection with the preparation and filing of such registration
statement. In the event of such a proposed registration, the
Company shall furnish Xxxxxxxx not less than thirty (30) days'
written notice prior to the proposed or expected effectiveness
date of such registration statement. Such notice shall continue
to be given by the Company to Xxxxxxxx, with respect to
subsequent registration statements filed by the Company, until
such time as all of the Shares have been registered or may be
sold by Xxxxxxxx without registration under the Act or any
succeeding provision. Xxxxxxxx, as the holder of the Shares shall
exercise the rights provided for in this SECTION 5 by giving
written notice to the Company within twenty (20) days of written
receipt of the Company's notice provided for herein. The
registration provided for herein relates to the resale, after
issuance by the Company, of the Shares by Xxxxxxxx, and not to
the issuance by the Company of the Shares to Xxxxxxxx under the
Acquisition Agreement.
(b) Information to be Furnished by Xxxxxxxx. In
connection with the registration of the Shares, and as a
condition to the Company's obligations under subsection (a) of
this SECTION 5, Xxxxxxxx will furnish to the Company in writing
such information with respect to Xxxxxxxx and his proposed
disposition as shall be reasonably necessary in order to assure
compliance with the Act and with other federal and applicable
statement securities laws. Without limiting the generality of
the foregoing, in connection with an underwritten public
offering, if Xxxxxxxx elects such method of disposition, he shall
be required to enter into a written agreement with the managing
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underwriter in such form and containing such provisions as is
customary in the securities business for such an arrangement, and
to complete and execute all questionnaires, powers of attorney,
indemnities, and other documents or instruments, all may be
reasonably required under such terms of the underwriting
arrangements.
(c) Expenses of Xxxxxxxx. All underwriting discounts
and selling commissions applicable to the sale of the Shares, as
well as fees and expenses of any counsel, accountant, or other
advisor to Xxxxxxxx, other than as relates to the registration
thereof pursuant to Section 5(a) of this Agreement, shall be
borne by Xxxxxxxx.
(d) Certain Restrictions. Notwithstanding anything to
the contrary contained in this SECTION 5, if there is a firm
commitment underwritten offering of securities for the Company
pursuant to a registration covering the Shares, and if Xxxxxxxx
does not elect to sell the Shares to the underwriters of the
Company's securities in connection with such offering, then
Xxxxxxxx (if requested by the managing underwriter) shall agree
to refrain from selling any of the Shares that are otherwise
registered pursuant to this SECTION 5 during the period in which
the underwriting syndicate, as such, participates in the after-
market. Xxxxxxxx shall, however, be entitled to sell such
securities, in any event, commencing on the 120th day after the
effective date of such registration statement, if then lawful to
do so under applicable securities Laws.
(e) Indemnification by Xxxxxxxx. In connection with a
registration of the Shares under the Act pursuant to this SECTION
5, the Company and Xxxxxxxx shall enter into customary
indemnification agreements with regard to losses, claims, damages
or liabilities arising therefrom. In addition, if such
registration relates to an underwritten offering, such
indemnification agreements shall include the underwriters thereof
as a party thereof.
Section 6. Miscellaneous.
() All notices, demands or other communications
required or permitted to be given or made hereunder shall be in
writing and (a) delivered personally, or (b) sent by pre-paid,
first class, certified or registered air mail, return receipt
requested, or (c) by an express courier service, or (d) by
facsimile transmission to the intended recipient thereof, at its
address or facsimile number set out below. Any such notice,
demand or communication shall be deemed to have been duly given
immediately (if given or made by confirmed facsimile), or three
days after mailing or the second day after delivery to an express
courier service, and in proving same it shall be sufficient to
show that the envelope containing the same was duly addressed,
stamped and posted (or that the envelope was delivered to the
express courier service), or that receipt of a facsimile was
confirmed by the recipient. The addresses and facsimile numbers
of the parties for purposes of this Agreement are:
(i) If to Company: Housecall Medical Resources, Inc.
0000 Xxxxxxxxx Xxxx
Xxxxxxxx 000, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Facsimile No.: 000-000-0000
Attention: Chief Financial Officer
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With a copy to: Xxxxxxxxxx Xxxxxxxx LLP
0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Facsimile No.: 404-815-6555
Attention: W. Xxxxx Xxxxx
(ii) If to Xxxxxxxx: R. Xxxxxx Xxxxxxxx
000 Xxxxxxxxxx Xx. XX
Xxxxxxxxx, Xxxxxxxxx
Facsimile No.: 000-000-0000
With a copy to: Xxxxx X. Xxxxx, Esq.
000 Xxxxx Xxxxxxxx Xxxxx
Xxxxx, Xxxx 00000
Facsimile No.: 000-000-0000
Any party may change the address to which notices,
requests, demands or other communications to such parties shall
be delivered or mailed by giving notice thereof to the other
parties hereto in the manner provided herein.
(b) This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all
of which shall constitute one and the same instrument.
(c) This Agreement supersedes all prior discussions
and agreements between the parties with respect to the subject
matter hereof, and this Agreement and the Acquisition Agreement
contain the sole and entire agreement among the parties with
respect to the matters covered hereby. This Agreement shall not
be terminated or otherwise altered or amended except by an
instrument in writing signed by or on behalf of the party
entitled to the benefit of the provision against whom enforcement
is sought.
(d) The validity and effect of this Agreement shall be
governed by and construed and enforced in accordance with the
laws of the State of Georgia, without regard to conflicts of laws
principles.
(e) This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective
heirs, executors, legal representatives, successors and assigns.
(f) All rights and restrictions contained herein may
be exercised and shall be applicable and binding only to the
extent that they do not violate any applicable Laws and are
intended to be limited to the extent necessary to render this
Agreement legal, valid and enforceable. If any term of this
Agreement, or part thereof, not essential to the commercial
purpose of this Agreement shall be held to be illegal, invalid or
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unenforceable by a court of competent jurisdiction, it is the
intention of the parties that the remaining terms hereof, or part
thereof, shall constitute their agreement with respect to the
subject matter hereof, and all such remaining terms, or parts
thereof, shall remain in full force and effect. To the extent
legally permissible, any illegal, invalid or unenforceable
provision of this Agreement shall be replaced by a valid
provision which will implement the commercial purpose of the
illegal, invalid or unenforceable provision.
(g) Any term or condition of this Agreement may be
waived at any time by the party which is entitled to the benefit
thereof, but only if such waiver is evidenced by a writing signed
by such party. No failure on the part of any party hereto to
exercise, and no delay in exercising, any right, power or remedy
created hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power or remedy by
any such party preclude any other or further exercise thereof or
the exercise of any other right, power or remedy. No waiver by
any party hereto of any breach of or default in any term or
condition of this Agreement shall constitute a waiver of or
assent to any succeeding breach of or default in the same or any
other term or condition hereof.
(h) The headings of particular provisions of this
Agreement are inserted for convenience only and shall not be
construed as a part of this Agreement or serve as a limitation or
expansion on the scope of any term or provision of this
Agreement.
(i) Where the context requires, the use of the
singular form herein shall include the plural, the use of the
plural shall include the singular, and the use of any gender
shall include any and all genders.
(j) Xxxxxxxx shall not cancel, terminate or revoke
this Agreement (except as otherwise specifically permitted under
applicable state securities laws), and this Agreement shall
survive the death or disability of Xxxxxxxx and shall be binding
upon Xxxxxxxx' heirs, executors, administrators, successors and
assigns.
(k) Within ten (10) days (or such shorter period as
may be required in the circumstances) after the receipt of a
written request from Company, Xxxxxxxx shall provide such
information, and execute and deliver such documents, as
reasonably may be necessary to comply with any and all laws,
ordinances and regulations to which Company is subject.
(l) The representations and warranties of Xxxxxxxx set
forth herein shall survive the transfer of the Shares to Xxxxxxxx
pursuant to this Agreement.
IN WITNESS WHEREOF, the parties have executed and
acknowledged this Agreement as of the date set forth below.
HOUSECALL MEDICAL RESOURCES,
INC.
By: /s/ Xxxx X. Xxxxxxx
Name Xxxx X. Xxxxxxx
Title Chief Financial Officer
/s/ R. Xxxxxx Xxxxxxxx
R. XXXXXX XXXXXXXX
000000000
Social Security Number
R. Xxxxxx Xxxxxxxx
Print or Type Name
Executed at: Atlanta, Georgia this 12th day of May, 1997.
Signed, sealed and delivered
in the presence of:
/s/ Xxxxxxx X. Cinnamon
Unofficial Witness
/s/ Xxxxx X. Xxxxxxxxx
Notary Public
(NOTARIAL SEAL)
My Commission expires: September 23, 0000
-0-
XXXXXXX X
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"FEDERAL ACT"), OR ANY STATE SECURITIES LAW, AND HAVE BEEN
ACQUIRED BY THE REGISTERED OWNER HEREOF FOR PURPOSES OF
INVESTMENT AND HAVE BEEN ISSUED OR SOLD IN RELIANCE ON STATUTORY
EXEMPTIONS CONTAINED IN THE FEDERAL ACT OR AVAILABLE UNDER
APPLICABLE STATE SECURITIES LAWS. THE SHARES MAY NOT BE SOLD,
TRANSFERRED, OR OTHERWISE DISPOSED OF EXCEPT IN A TRANSACTION
WHICH IS EXEMPT UNDER THE FEDERAL ACT AND ANY OTHER APPLICABLE
STATE SECURITIES LAWS OR PURSUANT TO AN EFFECTIVE REGISTRATION
UNDER SUCH ACT AND LAWS; IN THE CASE OF RELIANCE UPON AN
EXEMPTION, THE CORPORATION MUST HAVE RECEIVED AN OPINION OF
COUNSEL SATISFACTORY TO IT THAT SUCH TRANSACTION IS EXEMPT AND
DOES NOT REQUIRE SUCH REGISTRATION OF THE SHARES.
