STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement") is made as
of this 8th day of January, 1997 by and between Transworld Home
HealthCare, Inc., a New York corporation (the "Company"), and
Hyperion Partners II L.P., a Delaware limited partnership ("HPII"
or the "Investor").
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Purchase and Sale of Shares.
1.1 Sale and Issuance of Shares. Subject to the terms
and conditions of this Agreement, at the Closing (as hereinafter
defined), the Investor agrees to purchase and the Company agrees
to sell and issue to the Investor 898,877 shares (the "Shares")
of common stock, par value $.01 per share, of the Company (the
"Common Stock") at a price of $11.125 per Share, for an aggregate
purchase price of $10,000,000.
1.2 Closing. The purchase and sale of the Shares
shall take place at the offices of Proskauer Xxxx Xxxxx &
Xxxxxxxxxx LLP, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, within
15 days following the satisfaction of the conditions set forth in
Sections 4 and 5, or at such other time and place as the Company
and the Investor mutually agree upon orally or in writing (which
time and place are designated as the "Closing"). At the Closing,
in addition to satisfying the other conditions set forth herein,
the Company shall deliver to the Investor one or more
certificates representing the Shares, against delivery to the
Company by the Investor of a wire transfer in the amount of
$10,000,000.
2. Representations and Warranties of the Company. The
Company hereby represents and warrants to, and agrees with, the
Investor that:
2.1 Organization, Good Standing and Qualification.
The Company is a corporation duly organized, validly existing and
in good standing under the laws of the State of New York. The
Company has all requisite power and authority to own, lease,
license and use its properties and assets and to carry on its
business as now conducted and as proposed to be conducted. The
Company has all requisite power and authority to enter into and
perform this Agreement and the transactions contemplated hereby.
2.2 Authorization. All corporate action on the part
of the Company and its officers, directors and shareholders
necessary for the authorization, execution and delivery of this
Agreement, the performance of all obligations of the Company
hereunder and the authorization, sale, issuance and delivery of
the Shares has been taken. This Agreement constitutes the valid
and legally binding obligation of the Company, enforceable in
accordance with its terms, except (i) as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting
enforcement of creditors' rights generally, and (ii) as
enforceability may be limited by laws relating to the
availability of specific performance, injunctive relief or other
equitable remedies.
2.3 Valid Issuance of Shares.
(a) The Shares, when issued, sold and delivered in
accordance with the terms hereof and for the consideration
expressed herein, (i) will be duly and validly issued and fully
paid and nonassessable, (ii) will be free of any pledges, liens,
security interests, claims or other encumbrances of any kind,
(iii) will be issued in compliance with all applicable federal
and state securities laws, and (iv) will not be issued in
violation of any preemptive rights of shareholders. The Shares
have been duly and validly reserved for issuance.
(b) The outstanding shares of Common Stock are all
duly and validly authorized and issued, fully paid and
nonassessable, and were issued in compliance with all applicable
federal and state securities laws.
2.4 Governmental Consents. No consent, approval,
order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state or
local governmental authority on the part of the Company or any of
its subsidiaries is required in connection with the consummation
of the transactions contemplated by this Agreement except for (i)
filings with respect to compliance with the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended; (ii) filing with
the Securities and Exchange Commission on Form 10-C; and (iii)
such filings as have been made.
2.5 Compliance with Other Instruments. The execution,
delivery and performance of this Agreement and the consummation
of the transactions contemplated hereby will not result in a
violation of, or be in conflict with, or constitute, with or
without the passage of time or the giving of notice or both, a
default under, any provision of the Company's certificate of
incorporation, as amended, or bylaws, as amended, or any
judgment, order, writ or decree, or any contract, agreement or
instrument, or require any consent, waiver or approval
thereunder, or give rise to a right to terminate or accelerate
the performance required thereby, or constitute an event which
results in the creation of any lien, charge or encumbrance upon
any asset of the Company. The execution, delivery and
performance of this Agreement, and the consummation of the
transactions contemplated hereby, will not constitute a "change
of control" under any agreement or contract or give rise to any
right to receive severance or similar payments.
2.6 Registration Rights Agreement. The Shares are
"Registrable Securities" as that term is used in the Registration
Rights Agreement dated as of May 29, 1996 between the Company and
the Investor (the "Registration Rights Agreement"), and are
entitled to all of the benefits of the Registration Rights
Agreement.
3. Representations and Warranties of the Investor. The
Investor hereby represents and warrants to the Company that:
3.1 Authorization. The Investor has all requisite
power and authority to enter into this Agreement. This Agreement
has been duly executed and delivered and constitutes the
Investor's valid and legally binding obligation, enforceable in
accordance with its terms, except (i) as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting
enforcement of creditors' rights generally and (ii) as
enforceability may be limited by laws relating to the
availability of specific performance, injunctive relief or other
equitable remedies.
3.2 Purchase Entirely for Own Account. The Shares to
be purchased by the Investor will be acquired for investment for
its own account, and, except as contemplated by the Registration
Rights Agreement or otherwise in accordance with applicable
securities laws, not with a view to the resale or distribution of
any part thereof and without the present intention of selling,
granting any participation in, or otherwise distributing the
same.
3.3 Investment Experience. The Investor can bear the
economic risk of its investment and has such knowledge and
experience in financial or business matters that it is capable of
evaluating the merits and risks of the investment in the Shares.
3.4 Restricted Securities. The Investor understands
that the Shares it is purchasing are characterized as "restricted
securities" under the federal securities laws inasmuch as they
are being acquired from the Company 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 Act, only in certain limited
circumstances. In this connection, the Investor represents that
it is familiar with Rule 144 of the Securities and Exchange
Commission, as presently in effect, and understands the resale
limitations imposed thereby and by the Act.
3.5 Legends. The Investor understands that the
certificates evidencing the Shares will bear the following
legend:
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), OR ANY STATE SECURITIES LAWS AND NEITHER SUCH SHARES NOR
ANY INTEREST THEREIN MAY BE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN EXEMPTION THEREFROM UNDER SUCH ACT OR SUCH
LAWS AND THE RULES AND REGULATIONS THEREUNDER."
The Shares shall not be required to bear such legend if
an opinion of counsel reasonably satisfactory to the Company is
delivered to the Company to the effect that neither the legend
nor the restrictions on transfer contained in this Agreement are
required to insure compliance with the Act. Whenever, pursuant
to the preceding sentence, any certificate for any of the Shares
is no longer required to bear the foregoing legend, the Company
may, and if requested by the holder thereof, shall, issue to the
holder, at the Company's expense, a new certificate not bearing
the foregoing legend.
4. Conditions to the Investor's Obligations at Closing.
The obligations of the Investor under this Agreement are subject
to the fulfillment on or before the Closing of each of the
following conditions:
4.1 Representations and Warranties. The
representations and warranties of the Company contained in
Section 2 shall be true in all material respects on and as of the
Closing with the same effect as though such representations and
warranties had been made on and as of the Closing.
4.2 Performance. The Company shall have performed and
complied with all agreements, covenants, obligations and
conditions contained in this Agreement in all material respects
that are required to be performed or complied with by it on or
before the Closing.
4.3 No Material Adverse Change. There shall have been
no material adverse change in the business, affairs, prospects,
operations, properties, assets or condition (financial or
otherwise) of the Company and its subsidiaries taken as a whole.
4.4 Compliance Certificate. The President or Chief
Executive Officer of the Company shall deliver to the Investor at
the Closing a certificate certifying that the conditions
specified in Sections 4.1, 4.2, 4.3, 4.5, 4.6 and 4.11 have been
fulfilled.
4.5 Qualifications; Litigation. All authorizations,
approvals or permits, if any, of any governmental authority or
regulatory body that are required in connection with the lawful
issuance and sale of the Shares pursuant to this Agreement shall
be duly obtained and effective as of the Closing. There shall
not have been instituted or threatened any legal proceeding
relating to, or seeking to prohibit or otherwise challenge, this
Agreement or the consummation of the transactions contemplated by
this Agreement, or seeking to obtain substantial damages with
respect thereto.
4.6 Consents and Coordination. All consents and
waivers that are required in connection with the Closing under
this Agreement, and the consummation of the transactions
contemplated hereby, shall be duly obtained and effective as of
the Closing.
4.7 Proceedings and Documents. All corporate and
other proceedings in connection with the transactions
contemplated at the Closing and all documents incident thereto
shall be satisfactory in form and substance to the Investor, and
the Investor shall have received all such counterpart original
and certified or other copies of such documents as it may
reasonably request.
4.8 Opinion of Company Counsel. Xxxx, Marks & Xxxxx
LLP, counsel for the Company, shall have delivered an opinion
which is addressed to the Investor, dated as of the Closing and
substantially in the form delivered pursuant to the Unit Purchase
Agreement dated as of November 20, 1995 between the Company and
the Investor (the "Unit Purchase Agreement").
4.9 Banks Waiver and Consent. The Company shall have
received, in form and substance satisfactory to the Investor, (i)
the waiver of the lenders (the "Banks") party to the Credit
Agreement dated as of July 31, 1996, as amended (the "Credit
Agreement") among the Company, the Banks and Bankers Trust
Company, as Agent, of any right the Banks may have to the
proceeds of the transactions contemplated hereby to prepay
outstanding indebtedness of the Company under the Credit
Agreement, (ii) the consent of the Banks to the issuance and sale
of the Shares and waiver of any events of default caused in
connection therewith, (iii) the consent of the Banks to the Stock
Purchase Agreement (the "Stock Purchase Agreement") dated as of
November 13, 1996, as amended, between the Company and Health
Management, Inc. ("HMI") and the consummation of the transactions
contemplated thereby, (iv) the consent of the Banks to the
Agreement and Plan of Merger (the "Merger Agreement") among the
Company, IMH Acquisition Corp. and HMI dated as of November 13,
1996, and the consummation of the merger (the "Merger") and other
transactions contemplated thereby and (v) such other consents and
waivers of the Banks as may be required in connection with the
transactions hereunder and under the Stock Purchase Agreement and
Merger Agreement.
4.10 Xxxx-Xxxxx-Xxxxxx. All applicable waiting periods
in respect of the transactions contemplated by this Agreement
under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended, shall have expired at or prior to the Closing.
4.11 Investment in and Merger with Health Management,
Inc. The transactions contemplated by the Stock Purchase
Agreement and the Merger Agreement (including, without
limitation, the Merger) shall have been consummated.
5. Conditions to the Company's Obligations at the
Closings. The obligations of the Company to the Investor under
Section 1 of this Agreement are subject to the fulfillment on or
before the Closing of the following conditions, any of which may
be waived by the Company:
5.1 Representations and Warranties. The
representations and warranties of the Investor contained in
Section 3 shall be true in all material respects on and as of the
Closing with the same effect as though such representations and
warranties had been made on and as of the date of the Closing.
5.2 Payment of Purchase Price. The Investor shall
have delivered the purchase price specified in Section 1.2.
5.3 Performance. The Investor shall have performed
and complied with all agreements, covenants, obligations and
conditions contained in this Agreement in all material respects
that are required to be performed or complied with by it on or
before the Closing.
5.4 Qualifications; Litigation. All authorizations,
approvals or permits, if any, of any governmental authority or
regulatory body that are required in connection with the lawful
issuance and sale of the Shares pursuant to this Agreement shall
be duly obtained and effective as of the Closing. There shall
not have been instituted or threatened any legal proceeding
relating to, or seeking to prohibit or otherwise challenge, this
Agreement or the consummation of the transactions contemplated by
this Agreement, or seeking to obtain substantial damages with
respect thereto.
5.5 Banks Waiver and Consent. The Company shall have
received, in form and substance satisfactory to the Company, (i)
the waiver of the Banks of any right they may have to the
proceeds of the transactions contemplated hereby to prepay
outstanding indebtedness of the Company under the Credit
Agreement, (ii) the consent of the Banks to the issuance and sale
of the Shares and waiver of any events of default caused in
connection therewith, (iii) the consent of the Banks to the Stock
Purchase Agreement and the consummation of the transactions
contemplated thereby, (iv) the consent of the Banks to the Merger
Agreement and the consummation of the Merger and other
transactions contemplated thereby and (v) such other consents and
waivers of the Banks as may be required in connection with the
transactions hereunder and under the Stock Purchase Agreement and
Merger Agreement.
5.6 Xxxx-Xxxxx-Xxxxxx. All applicable waiting periods
in respect of the transactions contemplated by this Agreement
under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended, shall have expired at or prior to the Closing.
5.7 Consents and Coordination. All consents and
waivers that are required in connection with the Closing under
this Agreement, and the consummation of the transactions
contemplated hereby, shall be duly obtained and effective as of
the Closing.
5.8 Investment in and Merger with Health Management,
Inc. The transactions contemplated by the Stock Purchase
Agreement and the Merger Agreement (including, without
limitation, the Merger) shall have been consummated.
6. Covenants of the Company. The Company covenants and
agrees with the Investor as follows:
6.1 Advice of Changes. The Company will promptly
advise the Investor in writing of (i) any event occurring
subsequent to the date of this Agreement which would render any
representation or warranty of the Company contained in this
Agreement, if made on or as of the date of such event or the date
of the Closing, untrue or inaccurate in any material respect and
(ii) any material adverse change in the business of the Company
and its subsidiaries taken as a whole.
6.2 Information. The Company covenants and agrees
that the Company shall deliver to the Investor the information
specified in Section 6.9 of the Unit Purchase Agreement, unless
the Investor at any time specifically requests that such
information not be delivered to it.
6.3 Observer and Director Rights. The Company
covenants and agrees that it will afford to the Investor the
observer, director and other rights specified in Sections 6.11
and 8.1(a) of the Unit Purchase Agreement.
6.4 Listing Application. The Company shall prepare
and file with the NASD an Additional Listing Application, in the
form and within the time period prescribed by the NASD, with
respect to the listing of the Shares.
7. Indemnification. The Company agrees to indemnify the
Investor and its general partner, and each officer, director,
employee, partner, agent and affiliate of the Investor and its
general partner (the "Indemnified Parties") for, and hold each
Indemnified Party harmless from and against: (i) any and all
damages, losses, claims and other liabilities of any and every
kind, including, without limitation, judgments and costs of
settlement, and (ii) any and all out-of-pocket costs and expenses
of any and every kind, including, without limitation, reasonable
fees and disbursements of one counsel for such Indemnified
Parties (selected by the Investor) (all of which expenses
periodically shall be reimbursed as incurred), in each case,
arising out of or suffered or incurred in connection with (A) any
investigative, administrative or judicial proceeding or claim
brought or threatened relating to or arising out of the
Investor's purchase of the Shares, or this Agreement, the
Registration Rights Agreement, the Stock Purchase Agreement, the
Merger Agreement or the transactions contemplated hereby and
thereby, or (B) any material inaccuracy or alleged inaccuracy in
any representation or warranty of the Company made or
incorporated by reference in this Agreement or any material
breach or alleged breach by the Company of any covenant or
agreement made or incorporated by reference in this Agreement or
the Registration Rights Agreement.
8. Termination.
8.1 Termination Prior to Closing. This Agreement may
be terminated at any time prior to the Closing:
(a) by the mutual consent of the Investor and the
Company;
(b) by the giving of notice by the Investor or the
Company at any time after June 30, 1997 (or such later date as
shall have been agreed to in writing by the parties hereto), if
at the time notice of such termination is given the Closing shall
not have been consummated;
(c) by the giving of notice by the Investor or the
Company at any time after the Stock Purchase Agreement or the
Merger Agreement is terminated; or
(d) by the Investor, if there has been a material
misrepresentation or material breach on the part of the Company
in any of the representations, warranties, covenants or
agreements of the Company set forth herein, or if there has been
any material failure on the part of the Company to comply with
its obligations hereunder, or by the Company if there has been a
material misrepresentation or material breach on the part of the
Investor in any of the representations, warranties, covenants or
agreements of the Investor set forth herein, or if there has been
any material failure on the part of the Investor to comply with
its obligations hereunder.
8.2 Liability Upon Termination.
(a) In the event of termination of this Agreement
pursuant to Sections 8.1(a), 8.1(b) or 8.1(c), no party hereto
shall have any liability or further obligation to any other party
hereto except as provided in Sections 7, 9.7 and 9.8.
(b) In the event of termination pursuant to Section
8.1(d), (i) if the Investor is the non-breaching party, the
Investor shall be entitled to reimbursement of expenses as set in
Section 9.8 and (ii) the non-breaching party shall have the right
to pursue all rights and remedies available to it hereunder or
otherwise provided at law or equity, including without
limitation, the right to seek specific performance and money
damages.
9. Miscellaneous.
9.1 Survival of Warranties. The warranties,
representations, covenants and agreements of the Company and the
Investor contained in or made pursuant to this Agreement shall
survive the execution and delivery of this Agreement and the
Closing. Neither any investigation by or on behalf of the
Investor nor the receipt by the Investor of any data or
information from the Company, shall in any way affect the right
of the Investor to rely on the representations, warranties,
covenants and agreements of the Company or the right of the
Investor to terminate this Agreement as provided in Section 8.
9.2 Successors and Assigns. The Investor and each
assignee of the Investor may, without the consent of the Company,
assign its rights under this Agreement, in whole or in part, in
connection with any sale or transfer to an affiliate or a
partner, and the terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective
successors and assigns of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective
successors and assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.
9.3 Governing Law. This Agreement shall be governed
by and construed under the laws of the State of New York as
applied to agreements among New York residents entered into and
to be performed entirely within New York.
9.4 Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the
same instrument.
9.5 Titles and Subtitles. The titles and subtitles
used in this Agreement are used for convenience only and are not
to be considered in construing or interpreting this Agreement.
9.6 Notices. Unless otherwise provided, any notice
required or permitted under this Agreement shall be given in
writing and shall be deemed effectively given upon receipt by the
party to be notified or five days after deposit with the United
States Post Office, by registered or certified mail, postage
prepaid and addressed to the party to be notified (i) if to the
Company, at the following address:
00 Xxxxxxxx Xxxxxx
Xxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxxx X. Xxxxxx
with a copy to:
Xxxx Marks & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxx
(ii) if to HPII, at the following address:
00 Xxxxxxx Xxxxxxxxx Xxxx.
Xxxxx 000
Xxxxxxxxx, Xxx Xxxx 11553-3600
Attn: Xxxxx X. Xxxx
with a copy to:
Proskauer Xxxx Xxxxx & Xxxxxxxxxx LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxx
or at such other address as any of the parties may designate
by 10 days' advance written notice to the other parties.
9.7 No Finder's Fee. Each party represents that it is
not, and will not be, obligated for any finder's fee or
commission in connection with this transaction.
The Investor agrees to indemnify and hold harmless the
Company from any liability for any commission or compensation in
the nature of a finder's fee (and the costs and expenses of
defending against such liability or asserted liability) for which
the Investor or any of its officers, employees or representatives
is responsible.
The Company agrees to indemnify and hold harmless the
Investor from any liability for any commission or compensation in
the nature of a finder's fee (and the costs and expenses of
defending against such liability or asserted liability) for which
the Company or any of their respective officers, employees or
representatives is responsible.
9.8 Expenses. The Company agrees to pay all
out-of-pocket fees and reasonable expenses incurred by HPII in
connection with this Agreement and the transactions contemplated
hereby (whether or not the transactions contemplated hereby are
consummated) including, without limitation, (i) the reasonable
fees and expenses of counsel for HPII incurred in connection with
this Agreement and the transactions contemplated hereby
(including the reasonable fees and expenses of Proskauer Xxxx
Xxxxx & Xxxxxxxxxx LLP, and including, without limitation, any
legal fees and expenses relating to any future waiver, consent or
amendment, whether or not any such future action is given or
consummated) and (ii) all filing fees relating to filings under
the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1974, as
amended.
9.9 Amendments and Waivers. Any term of this
Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with
the written consent of HPII and the Company.
9.10 Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such
provision shall be excluded from this Agreement and the balance
of this Agreement shall be interpreted as if such provision were
so excluded and shall be enforceable in accordance with its
terms.
9.11 Entire Agreement. This Agreement constitutes the
entire agreement between the parties hereto with respect to the
subject matter hereof.
9.12 Equitable Adjustments. Prior to the consummation
of the Closing, all number of Shares referred to herein shall be
equitably adjusted to account for stock splits, stock dividends,
mergers and similar corporate events.
[END OF TEXT]
IN WITNESS WHEREOF, the parties have executed this
agreement as of the date first above written.
"COMPANY"
TRANSWORLD HOME HEALTHCARE, INC.
By:/s/Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President
and Chief Administrative
Officer
"THE INVESTOR OR HPII"
HYPERION PARTNERS II L.P.
By: HYPERION VENTURES II L.P.,
its General Partner
By: HYPERION FUNDING II CORP.,
its General Partner
By:/s/Xxxxx X. Xxxx
Name: Xxxxx X. Xxxx
Title: Executive Vice President
