Exhibit 2.1
CONTRIBUTION AND STOCK
AGREEMENT
by and between
SOUTHLAND HEALTH SERVICES,
INC.
and
ROY JOSEPH CERONE, AS THE SOLE
MEMBER
OF SOUTHLAND HEALTH SERVICES,
LLC,
A MISSISSIPPI LIMITED LIABILITY
COMPANY
Dated as of May 2,
2004
CONTRIBUTION AND STOCK EXCHANGE
AGREEMENT
This CONTRIBUTION AND STOCK EXCHANGE
AGREEMENT (“Agreement”) is made and entered into as of
the 2nd day of May, 2004, by and between Southland Health Services,
inc., a Delaware corporation (“Company”), and Roy
Joseph Cerone (“Cerone”), the sole member of Southland
Health Services, LLC. a Mississippi limited liability company
(“Southland LLC”), upon the following terms and
conditions.
RECITALS:
WHEREAS, this Agreement is being
entered into pursuant to the Plan of Organization attached hereto
as Exhibit A (the “Plan of Organization”), among the
Company, the Shareholders of EmergyStat, Inc., a Mississippi
corporation (“EmergyStat”), and Cerone (with EmergyStat
and Southland LLC being sometimes referred to individually as a
“Founding Company”); and
WHEREAS, pursuant to the Plan of
Organization, all of the membership interest of Southland, LLC is
to be exchanged for shares of Common Stock of the Company;
and
WHEREAS, the parties to the Plan of
Organization have approved and adopted the Plan of Organization as
an integrated plan with the understanding and intent that the
transfer of shares, membership interests and cash to the Company
pursuant to the Plan of Organization, on the detailed terms and
conditions contained in this Agreement and the other agreement
described in Section 1.2(a) below, shall constitute a tax-free
transfer of property under Section 351 of the Internal Revenue
Code of 1986, as amended (the “Code”).
NOW, THEREFORE, in consideration of
the foregoing premises, the respective representations, warranties
and covenants contained herein and certain other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound, the parties hereby
agree as follows:
AGREEMENT:
ARTICLE I
Purchase and Sale of Common Stock
Section 1.1
Authorization . Prior to Closing, the Company will have duly
authorized the issuance and sale One Thousand (1000) shares of
Common Stock Subject to the terms and conditions of this Agreement,
at the Closing, Cerone shall convey to the Company all of the
membership interests in Southland, LLC a exchange, the Company
shall issue and deliver to Cerone a total of 200 s Common Stock of
the Company.
After all 1000 shares as authorized
have been issued, the stock ownership of the Company will be as
follows:
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A.
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Joe Cerone - -
200 shares, representing 20% of the outstanding stock of the
Company;
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B.
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Glenn Crawford
- - 630 shares, representing 63% of the outstanding stock of the
Company;
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C.
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Joseph P.
Donovan - - 90 shares, representing 9% of the outstanding stock of
the Company;
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D.
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Tom McGregor,
Trustee or his successor - - 80 shares, representing 8% of the
outstanding stock of the Company.
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Section 1.2 Conditions of
the Obligations of Cerone at Closing . The obligations of
Cerone under Section 1.1 of this Agreement are subject to the
fulfillment on or before Closing of each of the following
conditions:
(a) Closing of Other
Agreements . The transactions contemplated by the
contemporaneous Contribution Agreement with the Shareholders of
Emergystat shall have been consummated in accordance with the terms
and after the satisfaction (without any waiver) of all conditions
contained therein.
(b) Representations and
Warranties . The representations and warranties of the Company
contained in Article II shall be true and correct on and as of the
Closing Date, with the same effect as though such representations
and warranties had been made on and as of the Closing
Date.
(c) Performance . The Company
shall have performed and complied in all material respects with all
agreements, obligations and conditions contained in this Agreement
that are required to be performed or complied with by it on or
before Closing.
(d) Qualifications . All
authorizations, approvals, permits, consents or waivers, if any, of
any governmental authority or regulatory body of the United States
or of any state, except for notices of sale required to be filed
with the Securities and Exchange Commission (“SEC”)
under Regulation D of the Securities Act, of 1933, as amended (the
“Securities Act”), or such post-closing filings as may
be required under applicable state security laws which will be
timely filed within the applicable periods therefor or of any other
person, including, without limitation, the Company’s
shareholders, that are required in connection with the lawful
issuance and sale of the Common Stock pursuant to this Agreement
and the execution, performance and delivery of this Agreement and
the documents required to be delivered pursuant to this Agreement
shall be duly obtained and effective as of the Closing.
(e) Proceedings and Documents
. All corporate and other proceedings related to the transactions
contemplated by this Agreement and all documents incident thereto
shall, at the Closing, be reasonably satisfactory in form and
substance to counsel for Cerone, who shall have received all
counterpart original and certified or other copies of such
documents as they may reasonably request.
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(f) Opinion of Company
Counsel . Cerone shall have received an opinion from legal
counsel for the Company certifying that the Company is duly
organized and in good standing, and also certifying as to the
accurateness of the matters stated below in
Section 2.4.
(g) Board of Directors .
Effective as of Closing, the Board of Directors of the Company
shall consist of three (3) members who shall be Glenn
Crawford, Joseph P. Donovan, and Joe Cerone. The Company shall
reimburse the directors for expenses incurred in performing their
duties as directors.
(h) Stockholders’
Agreement . Company and its shareholders shall have entered
into a Stockholders’ Agreement and such agreement shall
continue to be in full force and effect.
(i) Resolutions . Company
shall have made available to Cerone copies of the resolutions of
the Board of Directors of the Company authorizing the execution,
delivery and consummation of this Agreement, the issuance of shares
of Common Stock, together with copies of the resolutions of the
shareholders of the Company authorizing the issuance of the Common
Stock, each certified as to their due adoption and continued
validity by the Secretary of the Company.
(j) Bylaws . Company shall
have delivered to Cerone the Bylaws of the Company.
Section 1.3 Conditions of
Company’s Obligations at Closing . The obligations of the
Company to Cerone under this Agreement are subject to the
fulfillment on or before the Closing of each of the following
conditions:
(a) Representation and
Warranties . The representations and warranties of Cerone
contained in Article III shall be true on and as of the Closing
Date with the same effect as though such representations and
warranties had been made on and as of the Closing Date.
(b) Performance . Cerone
shall have complied in all material respects with all agreements,
obligations and conditions contained in this Agreement to be
performed or complied with by him on or before Closing.
(c) Stockholders’
Agreement . Cerone shall have entered into the
Stockholders’ Agreement, and such agreement shall continue to
be in full force and effect.
Section 1.4 Deliveries at
Closing.
(a) Payment of Purchase Price
. At the Closing, Cerone shall deliver the necessary assignments of
all membership interests in Southland, LLC.
(b) Stock Certificates . At
the Closing, Company shall deliver to Cerone the number of shares
of Common Stock due him pursuant to Section 1.1
above.
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ARTICLE II
Representations of Company
Company hereby represents to Cerone
that, except as set forth on the disclosure schedule attached
hereto as Schedule I (the Disclosure Schedule”), and to the
best of the knowledge of the Company, the following representations
are true and correct as of the date of this Agreement and will be
true and correct at the Closing.
Section 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 Delaware and has all requisite corporate power
and authority to carry on its business as now conducted and as
currently proposed to be conducted. The Company and its
subsidiaries are duly qualified to transact business and are in
good standing in each jurisdiction in which the failure to so
qualify would have a material adverse effect on their business or
properties.
Section 2.2 Corporate
Documents . The Bylaws of the Company will be adopted at
Closing.
Section 2.3 Capitalization and
Voting Rights.
(a) Immediately prior to the
Closing, the authorized capital of the Company consists solely of
Ten Thousand (10:000) shares of Common Stock, none of which
are issued and outstanding.
(b) The capitalization of the
Company immediately following the Closing of the transactions
contemplated by this Agreement shall be as reflected in
Section 1.1 above.
(c) The outstanding shares of Common
Stock are duly and validly authorized and issued, fully paid and
nonassessable. The issuance of the Common Stock of Company and any
predecessor of the Company and any involvement in any transfer of
any such stock by the Company or any predecessor of the Company has
been in accordance with all applicable agreements and state blue
sky laws, including the Securities Act of 1933, as amended (the
“Securities Act”) and any relevant state securities
laws or pursuant to valid exemptions therefrom.
(d) Except for options granted to
executive officers of the Company or any of its subsidiaries set
forth in Section 2.3(e) of the Disclosure Schedule, there are
no outstanding options, warrants, calls, commitments, rights
(including, without limitation, conversion, preemptive,
participation or stock appreciation rights) or agreements,
including proxy or shareholder agreements or agreements of any
kind; relating to shares of the Common Stock. Except as
contemplated hereunder, there are no contractual obligations of the
Company to repurchase, redeem or otherwise acquire any shares of
the Common Stock. No bonds, debentures, notes or other indebtedness
having the right to vote (or convertible into or exercisable for
securities having the right to vote) on any matters on which
shareholders of Company may vote are issued or outstanding. Company
is not a party or subject to any agreement or
understanding,
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and, to the best of Company’s knowledge,
there is no agreement or understanding between any persons and/or
entities which affects or relates to the voting or giving of
written consents with respect to any security or by a director of
Company. Except as set forth in the Stockholders’ Agreement,
the Company is not under any obligation to register any of its
securities under the Securities Act.
Section 2.4 Valid Issuance
of Common Stock . The Common Stock that is being transferred to
Cerone hereunder, when issued, sold and delivered in accordance
with the terms of this Agreement for the consideration expressed
herein, will be duly and validly issued, fully paid, and
nonassessable, and will be free of restrictions on transfer other
than restrictions on transfer under this Agreement and under
applicable state and federal securities laws.
Section 2.5 Exempt
Offering . Assuming the continued truth and accuracy of the
representations of Cerone set forth in Article III of this
Agreement, the offer, sale and issuance of the Common Stock as
contemplated by this Agreement are exempt from the registration
requirements of the Securities Act and state blue sky laws, and
neither the Company nor any authorized agent acting on its behalf
will take any action hereafter that would cause the loss of such
exemptions.
Section 2.6 Subsidiaries
. Except as set forth in Section 2.6 of the Disclosure
Schedule, the Company does not presently, and did not previously,
own or control, directly or indirectly, any interest in any other
corporation, association, or other business entity. The Company is
not a participant in any joint venture, partnership, or similar
arrangement. With respect to each subsidiary identified in
Section 2.6:
(a) The Company is the sole record
and beneficial owner of all of the outstanding securities of such
subsidiary, as detailed in Section 2.6, free and clear of any
lien, restriction, claim, proxy or voting agreement or
encumbrance;
(b) All of the outstanding
securities of such subsidiary are duly authorized, validly issued,
fully paid and non-assessable and none were issued in violation of
any preemptive right;
(c) There are no outstanding
options, warrants, calls, commitments, rights (including, without
limitation, conversion, preemptive, participation or stock
appreciation rights) or agreements, including proxy agreements or
other agreements of any kind, relating to securities of such
subsidiary; and
(d) There are no issued or
outstanding bonds, debentures, notes or other indebtedness having
the right to vote (or convertible into or exercisable for
securities having the right to vote) on any matters on which
shareholders of such subsidiary may vote.
Section 2.7
Authorization . All corporate action on the part of Company,
its officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement, the
performance of all obligations of Company hereunder and thereunder,
and the authorization, issuance (or reservation for issuance), sale
and delivery of the Common Stock
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being sold hereunder has been taken or will be
taken prior to Closing, and this Agreement when executed and
delivered by the Company will constitute valid and legally binding
obligations of Company, enforceable in accordance with their
respective terms, except (i) as limited by applicable
bankruptcy, insolvency, reorganization, moratorium, and other laws
of general application affecting enforcement of creditors’
rights generally, (ii) as limited by laws relating to the
availability of specific performance, injunctive relief, or other
equitable remedies, and (iii) to the extent the
indemnification provisions contained in the Stockholders’
Agreement may be limited by applicable federal or state
laws.
Section 2.8 Consents .
No consent, approval, qualification, order or authorization of, or
registration, declaration or filing with, any court, administrative
agency or commission or other governmental authority or
instrumentality, domestic or foreign, or other third party
(including but not limited to in respect of any franchise, permit,
license, variance, exemption or certificate of need held by the
Company or any of its subsidiaries or by any Founding Company) is
required by or with respect to Company or any of its subsidiaries
or any Founding Company in connection with the execution and
delivery of this Agreement, or the consummation by Company of the
transactions contemplated hereby, which has not already been
obtained, except for notices of sale required to be filed with the
SEC under Regulation D of the Securities Act, or such post closing
filings as may be required under applicable state securities laws
which will be timely filed within the applicable periods
therefor.
Section 2.9 Litigation .
There are no claims (contingent or otherwise) of any kind and there
is no action, suit, proceeding or investigation pending or, to the
Company’s knowledge, threatened against Company or any of its
subsidiaries or any Founding Company or against any asset, interest
or right of the Company or any of its subsidiaries or any Founding
Company or which questions the validity of this Agreement, or the
right of the Company to enter into this Agreement, or to consummate
the transactions contemplated hereby, nor is the Company aware that
there is any basis for any of the foregoing. Neither the Company
nor any subsidiary of the Company or any Founding Company is a
party or subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or
instrumentality. There is no action, suit, proceeding or
investigation by the Company or any subsidiary of the Company
currently pending or that the Company or any subsidiary intends to
initiate.
Section 2.10 Agreements and
Actions .
(a) Except as shown on the attached
Disclosure Statement, there are no agreements, understandings,
instruments, contracts, proposed transactions, judgments, orders,
writs or decrees to which the Company or any of its subsidiaries or
the Founding Companies is a party or by which the Company or any of
its subsidiaries or the Found