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Title: |
Merger Agreement and Plan of Reorganization |
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Entities: |
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Date: |
2003 |
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Preview shows 15KB of 151KB total |
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Price: |
$60 |
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ID: |
#821525 |
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MERGER AGREEMENT AND PLAN OF REORGANIZATION
BY AND AMONG
PAINCARE HOLDINGS, INC.,
PAINCARE ACQUISITION COMPANY IV, INC.,
MEDICAL REHABILITATION SPECIALISTS II, P.A.,
AND
KIRK MAURO, M.D.
EXECUTION DATE: APRIL 17, 2003.
3
{PAGE}
TABLE OF CONTENTS
{TABLE}
{S} {C}
1 DEFINITIONS ................................................. 5
2 TRANSACTION ................................................. 5
2.1 Transaction ................................................. 5
2.2 Effect of the Merger ........................................ 5
2.3 Effective Time; Filing of Certificates of Merger ............ 5
2.4 Articles of Incorporation ................................... 6
2.5 Bylaws ...................................................... 6
2.6 Directors and Officers ...................................... 6
2.7 Tax Consequences ............................................ 6
2.8 Additional Actions .......................................... 6
2.9 No Dissenters' Rights ....................................... 6
2.10 Surrender of Certificates ................................... 6
2.11 Conversion of Shares ........................................ 7
2.12 Shareholder Consent and Release ............................. 7
2.13 Piggyback Registration ...................................... 7
3 TRANSACTION CONSIDERATION ................................... 7
3.1 Transaction Consideration ................................... 7
3.1 Transaction Consideration ................................... 7
3.2 Potential Post Closing Adjustments .......................... 7
3.3 Earn-out Payment ............................................ 8
3.4 Pledge Agreement ............................................ 10
4 REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDER ........... 10
4.1 Organization, Qualification, and Corporate Power ............ 10
4.2 Capitalization .............................................. 11
4.3 Authorization ............................................... 11
4.4 Noncontravention ............................................ 11
4.5 Broker's Fees ............................................... 11
4.6 Title to Assets ............................................. 11
4.7 No Subsidiaries ............................................. 12
{/TABLE}
i
{PAGE}
{TABLE}
{S} {C}
4.8 Financial Statements ........................................ 12
4.9 Events Subsequent to Most Recent Year End ................... 12
4.10 Undisclosed Liabilities...................................... 13
4.11 Tax Matters ................................................. 14
4.12 Real Property ............................................... 15
4.13 Intellectual Property ....................................... 16
4.14 Condition of Tangible Assets ................................ 16
4.15 Contracts ................................................... 16
4.16 Powers of Attorney .......................................... 17
4.17 Insurance; Malpractice ...................................... 17
4.18 Litigation .................................................. 17
4.19 Health Care Compliance ...................................... 18
4.20 Fraud and Abuse ............................................. 18
4.21 Legal Compliance ............................................ 18
4.22 Rates and Reimbursement Policies ............................ 19
4.23 Medical Staff ............................................... 19
4.24 Employees ................................................... 19
4.25 Employee Benefits ........................................... 19
4.26 Physicians and Other Providers .............................. 20
4.27 Guaranties .................................................. 21
4.28 Environment, Health, and Safety ............................. 21
4.29 Certain Business Relationships with the Company and its
Affiliates .................................................. 22
4.30 Third-party Payors .......................................... 22
4.31 Bank Accounts ............................................... 22
4.32 Tax Status .................................................. 22
4.33 Binding Obligation .......................................... 22
4.34 No Corporate Practice or Fee Splitting ...................... 22
4.35 Staff Privileges ............................................ 22
4.36 Intentions .................................................. 22
4.37 Securities Representation ................................... 22
4.38 HIPAA ....................................................... 24
4.39 Improper and Other Payments ................................. 24
{/TABLE}
{PAGE}
{TABLE}
{S} {C}
4.40 Accounts Receivable ......................................... 24
4.41 Medical Waste ............................................... 24
4.42 No Untrue or Inaccurate Representation or Warranty .......... 25
5 REPRESENTATIONS AND WARRANTIES OF THE ACQUIRING COMPANIES ... 25
5.1 Organization of PainCare and Subsidiary ..................... 25
5.2 Authorization of Transaction ................................ 25
6 CLOSING ..................................................... 25
7 CLOSING DELIVERIES .......................................... 25
7.1 Deliveries of the Company and the Shareholder ............... 25
7.2 Deliveries of PainCare ...................................... 26
8 CONDITIONS TO THE OBLIGATIONS OF PAINCARE AND SUBSIDIARY .... 26
8.1 Representations and Warranties; Covenants and Agreements .... 26
8.2 Due Diligence ............................................... 26
9 POST-CLOSING COVENANTS ...................................... 26
9.1 General ..................................................... 26
9.2 Tax Returns ................................................. 27
9.3 Transition .................................................. 27
9.4 Litigation Support .......................................... 27
9.5 Consents .................................................... 27
9.6 Operational Covenants ....................................... 27
10 SURVIVAL AND INDEMNIFICATION ................................ 28
10.1 Survival of Representations and Warranties .................. 28
10.2 Indemnification Provisions for the Benefit of PainCare and
Subsidiary .................................................. 28
10.3 Indemnification Provisions for the Benefit of the
Shareholder ................................................. 28
10.4 Matters Involving Third Parties ............................. 28
11 RESTRICTIVE COVENANTS; CONFIDENTIALITY ...................... 30
11.1 Shareholder Restrictive Covenants ........................... 30
11.2 Defenses .................................................... 31
11.3 No Running of Covenant During Breach ........................ 31
11.4 Blue Pencil Doctrine ........................................ 31
{/TABLE}
iii
{PAGE}
{TABLE}
{S} {C}
11.5 Confidentiality, Press Releases, and Public Announcements.... 31
11.6 Conduct of Business ......................................... 32
11.7 No Third-Party Beneficiaries ................................ 33
12 MISCELLANEOUS................................................ 33
12.1 Entire Agreement ............................................ 33
12.2 Succession and Assignment ................................... 33
12.3 Counterparts ................................................ 33
12.4 Headings .................................................... 33
12.5 Notices ..................................................... 33
12.6 Governing Law; Jurisdiction; Attorney's Fees ................ 34
12.7 Amendments and Waivers ...................................... 34
12.8 Severability ................................................ 34
12.9 Expenses .................................................... 34
12.10 Further Assurances .......................................... 34
12.11 Construction ................................................ 34
12.12 Survival .................................................... 35
12.13 Incorporation of Exhibits and Schedules ..................... 35
12.14 Submission to Jurisdiction .................................. 35
12.15 Notification of Certain Matters ............................. 35
{/TABLE}
iv
{PAGE}
Page
MERGER AGREEMENT AND PLAN OF REORGANIZATION
THIS MERGER AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made
and entered into as of this 17/th/ day of April, 2003 (the "Execution Date") by
and among PAINCARE HOLDINGS, INC., a Florida corporation ("PainCare"), PAINCARE
ACQUISITION COMPANY IV, INC., a Florida corporation ("Subsidiary", and together
with PainCare, the "Acquiring Companies"), MEDICAL REHABILITATION SPECIALISTS
II, P.A., a Florida professional association (the "Company"), and KIRK MAURO,
M.D., an individual (the "Shareholder"). PainCare, Subsidiary, the Company and
the Shareholder are sometimes referred to herein individually as a "Party" and
collectively as the "Parties."
RECITALS
A. The Company operates a medical practice and the Shareholder is a
licensed medical provider in the State of Florida and owns all of the issued and
outstanding shares of the Company stock;
B. PainCare desires to enter into this Agreement in order for the
Subsidiary, which is a wholly-owned subsidiary of PainCare, to acquire the
business and assets of the Company;
C. All of the Parties hereto desire to enter into this Agreement to
effectuate the Merger, as hereinafter defined, of the Company with and into
Subsidiary pursuant to the terms and conditions of this Agreement; and
F. It is the intention of the Parties for the Merger contemplated herein to
qualify as a tax-free reorganization pursuant to Sections 368(a)(1)(A) and
368(a)(2)(D) of the Code.
NOW, THEREFORE, in consideration of the premises and the actual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the receipt and adequacy of which are hereby
conclusively acknowledged, the Parties, intending to become legally bound,
hereby agree as follows:
TERMS AND CONDITIONS
1. DEFINITIONS. All capitalized words that are not capitalized for purposes of
grammar and which are not defined in the text of this Agreement are defined
terms with their definitions set forth on Exhibit 1.
2. TRANSACTION.
2.1 Transaction. Upon the terms and subject to the conditions hereof and in
accordance with the provisions of the Florida Business Corporation Act (the
"Florida Act"), the Company shall be merged with and into Subsidiary (the
"Merger") and the separate existence of the Company shall thereupon cease, and
Subsidiary, as the surviving corporation (the "Surviving Corporation"), shall
continue to exist under and be governed by the Florida Act (the "Transaction").
2.2 Effect of the Merger. At and after the Effective Time, as defined in
Section 2.3 below, the effect of the Merger shall, in all respects, be as
provided in the Florida Act. From and after the Effective Time, the Surviving
Corporation shall continue to be a Florida corporation.
2.3 Effective Time; Filing of Certificates of Merger. The Merger shall be
effected by the filing at the time of the Closing or as soon as practicable
thereafter, of the Articles of Merger (the "Articles of Merger"), substantially
in the form of Exhibit 2.3 attached hereto, with the Secretary of the State of
Florida in accordance with the provisions of the Florida Act. The Merger shall
become effective as of 11:59 p.m. on the date of such filing (the
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