STOCK PURCHASE AGREEMENT
Agreement (the "Agreement") made as of the 3rd day of July, 1996 by
and among Lifeline Systems (Canada), Inc., an Ontario corporation with its
principal office at _________________, Ontario (the "Buyer"), and Xxxxxxx
Xxxxxxxx, who resides at 00 Xxxxxxxx Xxxx, Xxxxxxx, Xxxxxxx, Xxxxxx (the
"Stockholder").
A. The Stockholder is the owner of 8,531.25 Common Shares of
CareTel, Inc., an Ontario corporation (the "Company").
B. The Buyer desires to purchase, and the Stockholder desires to
sell, 2,100 Common Shares of the Company (the "Shares") for the consideration
set forth below, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual promises hereinafter
set forth and other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties hereby agree as follows:
1. Purchase and Sale of the Shares.
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1.01 Purchase of the Shares from the Stockholder. Subject to
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and upon the terms and conditions of this Agreement, at the closing of the
transactions contemplated by this Agreement (the "Closing"), the Stockholder
shall sell, transfer, convey, assign and deliver the Shares to the Buyer, and
the Buyer shall purchase, acquire and accept the Shares from the Stockholder. At
the Closing the Stockholder shall deliver to the Buyer certificates evidencing
the Shares duly endorsed in blank or with stock powers duly executed by the
Stockholder.
1.02 Further Assurances. At any time and from time to time
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after the Closing, at the Buyer's request and without further consideration, the
Stockholder shall promptly execute and deliver such instruments of sale,
transfer, conveyance, assignment and confirmation, and take all such other
actions as the Buyer may reasonably request, more effectively to transfer,
convey and assign to the Buyer, and to confirm the Buyer's title to, all of the
Shares and to carry out the purpose and intent of this Agreement.
1.03 Purchase Price for the Shares.
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(a) The purchase price to be paid by the Buyer for the
Shares shall be 6,000 shares of the Common Stock, $.02 par value per share, of
Lifeline Systems, Inc. (the "Lifeline Stock").
1.04 Stockholder's Representations.
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The Stockholder hereby represents and warrants to the
Buyer and to Lifeline Systems, Inc. as follows:
(a) He is acquiring the Lifeline Stock for his own account
for investment only, and not with a view to, or for sale in connection with, any
distribution of the Lifeline Stock in violation of the United States Securities
Act of 1933, as amended (the "Securities Act"), or any rule or regulation under
the Securities Act or any securities laws of Ontario or any other jurisdiction.
(b) He understands that (i) the Lifeline Stock has not
been registered under the Securities Act and constitutes "restricted securities"
within the meaning of Rule 144 under the Securities Act; (ii) the Lifeline Stock
cannot be sold, transferred or otherwise disposed of unless it is subsequently
registered under the Securities Act or an exemption from registration in then
available; and (iii) in any event, the exemption from registration under Rule
144 or otherwise may not be available for at least two years and even then will
not be available unless the terms and conditions of Rule 144 are complied with.
(c) A legend substantially in the following form will be
placed on the certificate representing the Lifeline Stock:
"The shares represented by this certificate have
not been registered under the United States
Securities Act of 1933, as amended, and may not
be sold, transferred or otherwise disposed of in
the absence of an effective registration
statement under such Act or an opinion of
counsel satisfactory to the corporation (which
shall include Peabody & Xxxxxx if counsel to the
corporation does not issue such opinion
following written request) to the effect that
such registration is not required. No such
opinion shall be required if the shares
represented by this certificate are eligible for
resale under Rule 144(k) under the Securities
Act, and in the event that the shares are
eligible for resale under said Rule 144(k), this
legend shall be removed following the request of
the holder."
(d) He has good and marketable title to the Shares, free
and clear of any and all covenants, conditions, restrictions, voting trust
arrangements, liens, charges, encumbrances, options and adverse claims or rights
whatsoever.
(e) He has the full right, power and authority to enter
into this Agreement and to transfer, convey and sell to the Buyer at the Closing
the Shares and, upon consummation of the purchase contemplated hereby, the Buyer
will acquire from the Stockholder good and marketable title to the Shares, free
and clear of all covenants, conditions, restrictions, voting trust arrangements,
liens, charges, encumbrances, options and adverse claims or rights whatsoever.
(f) He is not a party to, subject to or bound by any
agreement or other restriction or any judgment, order, writ, prohibition,
injunction or decree of any court or other governmental body which would prevent
the execution or
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delivery of this Agreement by the Stockholder or the transfer, conveyance and
sale of the Shares.
(g) No broker or finder has acted for the Stockholder in
connection with this Agreement or the transactions contemplated hereby, and no
broker or finder is entitled to any brokerage or finder's fee or other
commissions in respect of such transactions based upon agreements, arrangements
or understandings made by or on behalf of the Stockholder or the Company.
2. Registration Rights. Lifeline Systems, Inc. hereby agrees that,
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following the request of the Stockholder to register the Lifeline Stock for
resale under the Securities Act (provided that the Stockholder is not then
prohibited from reselling the Lifeline Stock), it will file a Form S-3
Registration Statement with the Securities and Exchange Commission covering the
Lifeline Stock (provided it is then eligible to do so). Notwithstanding the
foregoing, (i) Lifeline Systems, Inc. shall not be required to so file a
registration statement pursuant hereto to the extent that the Stockholder would
then be permitted to sell the Lifeline Stock under Rule 144 under the Securities
Act; and (ii) Lifeline shall have the right to postpone the filing of any such
registration statement for a period not in excess of six months if at the time
of the requested filing thereof Lifeline Systems, Inc. is engaged or has fixed
plans to engage in a registered public offering or is engaged in any other
activity which, in the good faith determination of Lifeline Systems, Inc.'s
board of directors, would be adversely affected by the requested registration to
the material detriment of Lifeline Systems, Inc. The Stockholder agrees to
cooperate with Lifeline Systems, Inc. in the registration of the Lifeline Stock
pursuant to this Section.
Lifeline Systems, Inc. agrees that in the event the Stockholder sells
the Lifeline Stock pursuant to Rule 144 under the Securities Act, it will not in
any manner restrict its counsel from issuing any legal opinion as may be
required by the Company's transfer agent in order to remove the transfer
restrictions from the Lifeline Stock. Lifeline Systems, Inc. agrees that
damages are an inadequate remedy for any breach of this provision and that the
Stockholder shall, whether or not he is pursuing any potential remedies at law,
be entitled to equitable relief in the form of preliminary and permanent
injunctions without bond or other security upon any actual or threatened breach
of this provision.
Lifeline Systems, Inc. further agrees that, at the request of the
Stockholder, it will repurchase the Lifeline Stock in the event that the
Lifeline Stock is not registered under the Securities Act within 60 days after
written notice by the Stockholder to Lifeline Systems, Inc., requesting such
notice (provided that at the time of such request the Stockholder is not
prohibited from reselling the Lifeline Stock. The purchase price to be paid by
Lifeline Systems, Inc. will be the last sale price of Lifeline Systems, Inc.
common stock on the date on which such notice is given.
At such time as the Lifeline Stock becomes available for resale
pursuant to Rule 144(k) under the Securities Act, the Company shall cause the
legend to be removed without the requirement of opinion of counsel.
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3. Governing Law. This Agreement shall be governed by and construed
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in accordance with the laws of the Province of Ontario, Canada.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto as of and on the date first above written.
(Corporate Seal) Lifeline Systems (Canada),Inc.
By:_______________________________
Title:
(Corporate Seal) Lifeline Systems, Inc.
By:_______________________________
Title:
__________________________________
Xxxxxxx Xxxxxxxx
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