Exhibit 2.2
SHAREHOLDERS AGREEMENT
This Shareholders Agreement (this "Agreement") is entered into as of this
6th day of February, 1997, by and among Magellan Health Services, Inc., a
Delaware corporation ("Magellan"), John T. Lincoln ("Lincoln"), Paul G.
Shoffeitt ("Shoffeitt") (Magellan, Lincoln and Shoffeitt hereinafter referred
to collectively as the "Shareholders" or individually as a "Shareholder") and
Care Management Resources, Inc., a Florida corporation (the "Corporation").
W I T N E S S E T H:
WHEREAS, the Corporation is authorized to issue 500,000 shares of common
stock (the "Common Stock");
WHEREAS, pursuant to the transactions contemplated by that certain Stock
Purchase Agreement dated of even date herewith between Lincoln, Shoffeitt and
Magellan (the "Stock Purchase Agreement"), each of the Shareholders is or
will be the owner of the number of shares of the Common Stock set forth on
Exhibit A attached hereto (all or a portion of which are sometimes
hereinafter referred to as the "Shares");
WHEREAS, the Shareholders desire to set forth certain rights and
obligations among themselves and the Corporation; and
WHEREAS, the parties hereto desire that certain limitations and
restrictions should be placed upon the sale and transfer of the Shares;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto, intending to
be legally bound, do hereby covenant and agree as follows:
1 Restrictive Legend.
1.1 So long as this Agreement shall remain in force, there shall be
inscribed conspicuously upon each certificate representing the Shares, the
following restrictive legend;
The shares represented by this certificate are subject to a certain
Shareholders Agreement effective as of February 6, 1997, and all amendments
thereto, copies of which Agreement and all amendments thereto are on file at
the principal office of the Corporation, and any sale, bequest, pledge,
encumbrance, mortgage, transfer, gift, assignment, distribution or other
disposition of this certificate in violation of said Agreement shall be
invalid.
The shares represented by this certificate have not been registered
under the Securities Act of 1933, as amended, or under any state securities
laws. They may not be sold, transferred, conveyed, pledged or hypothecated
unless they have first been registered under said laws or unless the shares
are exempt from registration under said laws.
1.2 All references in this Agreement to the Shares shall be deemed to
include all subsequent acquisitions of shares of the capital stock of the
Corporation by any of the Shareholders, including without limitation, the
acquisition of shares of capital stock of the Corporation in connection with any
stock dividend, stock split, recapitalization, combination or exchange of
shares, merger, consolidation, acquisition of property or stock, separation,
reorganization or the like, occurring after the date hereof.
2 Right of Co-Sale
2.1 In the event that Magellan desires to make a disposition of all or any
of its Shares pursuant to the terms of a bona fide, written, third party offer
(the "Offer"), Magellan shall deliver written notice of such intention to each
of the other Shareholders (the "Other Shareholders"). If the Offer is for the
purchase of Shares, Magellan shall not sell any Shares unless the party who has
offered to purchase the Shares also extends the Offer in writing (the "Offer
Notice") to each of the Other Shareholders to purchase a proportional amount of
their Shares on the same terms and conditions and at the same price per share as
specified in the Offer, including any remuneration or other benefit paid to
Magellan or any of its parents or subsidiaries, or their respective affiliates
or stockholders. In the case of the Offer being made for consideration other
than cash, the amount of the consideration other than cash shall be deemed to be
the fair market value of such consideration as determined mutually by the Other
Shareholders and the Board of Directors of the Corporation acting in good faith,
as evidenced by a resolution of the Board of Directors, and the Offer Notice
will be deemed to include such cash price terms.
2.2 The Other Shareholders shall have 30 days from the date of receipt of
the Offer Notice to exercise the right of co-sale by delivering to the
Corporation and Magellan notice of such exercise.
2.3 Magellan shall have the right to compel the Other Shareholders to sell
a proportional amount of their Shares pursuant to the terms and conditions
contained in the Offer, provided that Magellan notifies each of the Other
Shareholders of its election to compel such sale in its Offer Notice delivered
to the Other Shareholders, and also provided that the offeror is not an
affiliate, subsidiary or parent of the Corporation or Magellan.
2.4 No Closing shall occur with respect to Magellan unless a Closing will
also occur with respect to the Other Shareholders (if any) who have elected to
participate in the Offer; provided however that in the event the Closing with
respect to the Other Shareholders fails to occur due to a reason other than the
breach of the offeror's duty, the Closing with respect to Magellan shall be
allowed to occur, notwithstanding the failure to close with respect to the Other
Shareholder(s). The Closing of the transactions pursuant to an Offer shall
occur contemporaneously with respect to Magellan's and the Other Shareholder's
Shares and shall be in accordance with the provisions of Section 8 hereof.
2.5 Magellan agrees that in the event that it sells, transfers, conveys or
disposes of all or any of its Shares in a transaction other than as described
in Section 2.1 hereof, whether or not it is part of a reorganization,
recapitalization or other similar event, each of the Other Shareholders shall be
entitled to receive its proportionate share, based on its percentage of the
issued and outstanding shares of capital stock of the Corporation held
immediately prior to such event, of any remuneration, payment or other benefit
paid to Magellan or to any of its parents, subsidiaries, affiliates or
stockholders in connection with such transaction.
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3 OTHER SHAREHOLDERS' PUT RIGHT. At any time after two years from the date
hereof, each of the Other Shareholders shall have the right to sell to
Magellan, and Magellan hereby agrees to purchase, all of the number of shares
of Common Stock specified by the Other Shareholder(s) of either (or both) of
the Other Shareholder's Shares (but in no event shall an Other Shareholder
specify less than the greater of (i) all of his then issued and outstanding
Shares or (ii) 2.5% of the total number of shares of Common Stock then issued
and outstanding) at ninety percent (90%) of the fair market value of such
Shares, as determined at the time of such put notice by an appraiser selected
by mutual agreement of Magellan and the Other Shareholder(s) who elect to
exercise such put option. If the Other Shareholder(s) and Magellan cannot
agree upon an appraiser, each of the Other Shareholder(s) and Magellan shall
select an appraiser (the "Individual Appraisers"), and the Individual
Appraisers shall then mutually select an independent appraiser of national
reputation (the "Independent Appraisers"). The Independent Appraiser shall
then perform the appraisal, and its determination shall be binding and
conclusive on the parties hereto. Each party shall pay all costs and fees of
its Individual Appraiser, and the parties shall each pay one-half (or
one-third, if both of the Other Shareholders are selling) of the costs of the
Independent Appraiser; provided that the Other Shareholder shall pay the
entire costs of the Independent Appraiser in connection with any exercise of
his rights under this Section 3 following the first such exercise of his
rights hereunder. The Other Shareholders may only exercise their rights
under this Section 3 in writing and may do so no more than once in any twelve
month period. In the event that one of the Other Shareholders exercises his
rights under this Section 3, such Other Shareholder and Magellan shall
schedule a Closing, in accordance with the provisions of Section 8 hereof,
for the purchase and sale of such Shares to be held within sixty (60) days of
the exercise of such notice.
4 RIGHT OF FIRST REFUSAL. No Shareholder (a "Selling Shareholder") shall
dispose of any of its Shares without first delivering, in writing, to each of
the other Shareholders (the "Non-Selling Shareholders") notice of such
intended disposition (the "First Notice"), including a summary of the terms
and conditions thereof (the "Section 4 Offer"). The Non-Selling
Shareholders shall have the right and option, which shall be
non-assignable, to purchase, at the price and on the terms and conditions
provided in the Section 4 Offer, all (but not less than all) of the Shares to
which the Section 4 Offer relates (the "Offered Shares"), in proportion to
their then current holdings of shares of the Corporation, or in such other
proportion as the Non-Selling Shareholders may agree. If either or both of
the Non-Selling Shareholders desire to exercise their option, they shall
deliver a notice (the "Second Notice") to that effect to the Selling
Shareholder and to the other Non-Selling Shareholder within twenty (20) days
after the receipt of the Section 4 Offer. In the event that one of the
Non-Selling Shareholders gives a timely Second Notice and other Non-Selling
Shareholder does not, then the electing Non-Selling Shareholder shall have
the right to purchase the remaining Offered Shares by giving notice (the
"THIRD NOTICE") to the first Non-Selling Shareholder and to the Selling
Shareholder no later than ten (10) days after the expiration of the time by
which Second Notices were to have been delivered, and if such Non-Selling
Shareholder fails to timely send a Third Notice electing to purchase all of
the Offered Shares, then the Non-Selling Shareholders shall be deemed to have
elected not to purchase any of the Offered Shares. The Selling Shareholder
and the Non-Selling Shareholders who elect to purchase the Offered Shares
shall agree upon a date, not later than twenty (20) days from the service of
the Second Notice (or Third Notice, if applicable), on which the Closing
shall be held in accordance with Section 8 hereof. In the event that the
Non-Selling Shareholders do not give timely notice of the exercise of their
option to purchase all of the Offered Shares, then within ninety (90) days
from the expiration or termination of such option period, the Offered Shares
may be sold by the Selling Shareholder to a third party; provided
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that the sale is made pursuant to the terms of the Section 4 Offer included in
the First Notice and provided that such third party purchaser executes and
delivers to each of the Non-Selling Shareholders executed counterparts of
this agreement (substituting the name of such third party purchaser in place
of each reference herein to the Selling Shareholder). If for any reason no
such transfer occurs within such ninety (90) day period, the Offered Shares
shall remain subject to this Agreement, and any subsequent disposition of the
Shares must be made in accordance with the provisions hereof.
5 Maintenance of Pro Rate Share
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5.1 During the period commencing on the date hereof and terminating at
such time, if ever, as Magellan and/or its majority owned subsidiaries have
invested or loaned to the Corporation funds equal to Ten Million Dollars
($10,000,000) (the "Funding Period"), the Corporation shall not issue any
equity securities which would reduce the percentage of the issued and
outstanding capital stock of the Corporation held by either of the Other
Shareholders below the percentage held immediately prior to such issuance,
without the consent of each of the Other Shareholders, which may be granted
or denied in their sole and absolute discretion; provided however, that the
Corporation shall be permitted to issue at any time equity securities of any
class to any third party customer of the Corporation in connection with a
transaction pursuant to which the Corporation is acquiring substantial
business and operating revenues from such customer. Nothing contained in
this Section 5.1 or any other provision of this Agreement shall be construed
to obligate Magellan to invest or loan to the Corporation any amount of
funds, all such investments and loans being in the sole discretion of
Magellan.
5.2 After the Funding Period, for as long as one of the Other
Shareholders owns some or all of his Shares, such Other Shareholder shall
have the right to purchase any or all of his pro rata share of any New
Securities (as defined below) which the Corporation may propose to issue and
sell, on the same terms and conditions under which the New Securities are to
be offered to third parties. Such right shall be exercisable by written
notice delivered within 45 days of receipt of written notice from the
Corporation of the proposed issuance of New Securities, which notice shall
include a detailed description of all facts and circumstances relating to
such issuance. The Other shareholder's pro rata share, for purposes of this
section, is the ratio of the number of Shares owned by such Other Shareholder
immediately prior to the issuance of New Securities to the total number of
issued and outstanding shares of Common stock, determined on a fully diluted
basis, immediately prior to the issuance of the New Securities.
5.3 "New Securities" shall mean any capital stock of the Corporation,
whether now authorized or not (including, but not limited to, shares of the
Corporation's capital stock held in its treasury), and rights, options or
warrants to purchase capital stock, and securities of any type whatsoever
that are, or may become, convertible into capital stock, but shall not
include any securities issued in connection with (i) any requirement that the
Corporation issue securities for distribution to a third party customer from
whom the Corporation is receiving or will immediately receive substantial
business and operating revenues or (ii) any additional equity investment by a
third party investor, if all parties hereto consent to such investment.
5.4 The rights granted pursuant to this Section 5 shall expire upon,
and shall not be applicable to, the first sale of Common Stock of the
Corporation to the public, which sale is effected
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pursuant to an underwritten registration statement filed with, and declared
effective by, the Securities and Exchange Commission.
5.5 The rights granted pursuant to this Section 5 shall not be
construed as granting to any Shareholder preemptive rights with respect to
the issuance of New Securities to employees of the Corporation pursuant to
employee incentive stock options.
5.6 Any purchase of New Securities under this Section 5 shall be
made in accordance with the provisions of Section 8 hereof.
5.7 In the event of a stock split, stock dividend, combination of
shares, recapitalization, reorganization or other change in the capital
structure of the Corporation, then the number and the kind of shares covered
by this Agreement shall be appropriately adjusted to reflect such change in
such manner as the Corporation may, in good faith, deem equitable to prevent
dilution of the Shareholders.
6 Incidental Registration Rights
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6.1 If the Corporation at any time proposes to register any of its
securities for sale for its own account or for the account of any other
person, it shall give written notice (the "Corporation's Notice") to each of
the Other Shareholders of its intention to do so at least fifteen (15) days
prior to the filing of a registration statement with respect to such
registration with the Securities and Exchange Commission (the "Commission").
If either (or both) of the Other Shareholders desires to exercise his
registration rights hereunder with respect to his Shares, he may demand the
registration of his Shares in connection with the Corporation's registration
at no cost or expense to the Other Shareholder (including without limitation,
for filing fees, attorney fees or any other items) be delivering to the
Corporation, within thirty (30) business days after the delivery of the
Corporation's Notice, written notice of such request (the "Shareholder's
Notice") stating the number of Shares to be registered. The Corporation shall
use its commercially reasonable best efforts to cause all Shares specified in
the Shareholder's Notice to be registered under the Securities Act of 1933,
as amended (the "Securities Act"), so as to permit the sale or other
disposition by such Shareholder.
6.2 If the managing underwriter of such public offering advises the
Corporation in writing that the inclusion in the offering of some or all of
the Shares sought to be registered by the Other Shareholder(s) creates a
significant risk that the price per share which the Corporation will derive
from such offering will be adversely affected, or that the number of shares
sought to be registered is too large a number to be reasonably sold, then
Magellan and the Other Shareholders will proportionally decrease the number
of their Shares to be included in such offering so that no more than the
number of Shares as the managing underwriter advises can be sold without such
adverse impact will be included.
6.3 The Corporation may, for any reason and without the consent of
the Other Shareholders, determine not to proceed with any registration and
abandon the proposed offering, whereupon the Corporation shall be relieved of
any further obligations under the terms of this Section 6 to proceed with
such registration or offering.
6.4 At any time more than 270 days following an offering of Common
Stock of the Corporation, the Other Shareholders shall be entitled to cause
the Corporation to file, by demand made
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jointly or individually by the Other Shareholders (the "Shareholder Demand"),
at no cost or expense to them (including without limitation, for filing fees,
attorney fees or any other items), an additional registration statement with
the Commission to cover all, but not less than all, of their unregistered
Shares of the same class of Shares; provided however, that if a Shareholder
Demand is made independently by one of the Other Shareholders and the second
Other Shareholder elects not to join in the Shareholder Demand, such second
Other Shareholder shall be barred from making a Shareholder Demand for a
period of eighteen (18) months after the expiration of the effectiveness of
the registration statement filed in connection with the earlier Shareholder
Demand.
6.4.1 If all of the Shares sought to be registered under any Shareholder
Demand can be lawfully sold immediately (i.e., without reduction in quantity
due to volume restrictions) pursuant to Rule 144 or Rule 144A of the
Securities Act, then the Corporation shall notify the Shareholder submitting
such Shareholder Demand that Rule 144 or Rule 144A, as applicable, is
available, in which event, the Corporation shall not be required to register
such Shares.
6.4.2 The Other Shareholders shall not be entitled to make or
participate in more than one Shareholder Demand, notwithstanding any
subsequent acquisition by either of them of additional, unregistered Shares.
6.5 Pursuant to any registration subject to a Shareholder's Notice or
Shareholder Demand, the Corporation shall use its commercially reasonable
best efforts to register or qualify the shares covered by such registration
statement under such state securities, blue sky or other applicable laws of
such jurisdictions as each Shareholder with Shares to be covered by the
registration shall reasonably request to enable such Shareholder to
consummate the public sale or other disposition of the Shares owned by such
Shareholder; provided that the Corporation shall not be required in
connection therewith or as an election thereto to qualify to do business or
to file a general consent to service in any such jurisdiction.
Notwithstanding the foregoing, such Shareholder shall have the right to
require the Corporation to complete a registration in any or all of the
states listed on Schedule 6.5 regardless of whether the Corporation is
required thereby to file a qualification to do business or a consent to
service of process.
6.6 Upon receipt of a written notice from the Corporation to suspend sales
to permit the Corporation to correct or update a registration statement or
prospectus, each of the Shareholders shall not (until further notice, not
more than ninety (90) days following the date of the notice to suspend sales)
effect any sales of his Shares.
6.7 Following the effective date of a registration statement filed by the
Corporation hereunder, the Corporation shall prepare and file with the
Commission such amendments and supplements to such registration statement and
the prospectuses used in connection therewith as may be necessary to keep
such registration statement effective and current, until the earlier of (i)
the sale of all securities offered for sale pursuant to the registration
statement, or (ii) one hundred eighty (180) days after the effective date of
the registration statement.
6.8 Immediately after the date on which a registration statement filed by
the Corporation under the Securities Act becomes effective, the Corporation
shall use its commercially reasonable best efforts to file with the
Commission all reports, financial statements and other documents and to take
all other actions necessary to make available current public information with
regard to the Corporation to
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enable the Shareholders to make sales of Shares pursuant to Rule 144 and/or
Rule 144A of the Commission under the Securities Act.
6.9 If the Corporation files a registration statement in connection
with an underwritten public offering, each of the Shareholders, if so
requested by the managing underwriter of such public offering, shall not
effect any sale or distribution of any Shares (except pursuant to such
registration statement) of the capital stock of the Company, whether now
owned or hereafter acquired, during the period commencing with the effective
date of such registration statement and ending on the close of business on
the one hundred and eightieth (180th) day thereafter or such time as the
registration statement is withdrawn, whichever is earlier.
6.10 Notwithstanding anything to the contrary contained herein, any
Other Shareholder who elects to have his Shares registered for sale
hereunder, shall bear all fees and expenses of any counsel engaged by such
Other Shareholder in connection therewith, and all underwriting discounts,
brokerage fees or commissions relating to the sale of his Shares.
7 Successor Entity and Subsequent Shareholders
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7.1 If the Corporation is merged into or consolidated with another
corporation or other legal entity and the Corporation is not the surviving
entity, (i) in the event Magellan shall be the majority shareholder in the
new entity, Magellan shall make appropriate provision for the preservation of
the rights and obligations of the parties hereto under this Agreement and
(ii) in the event Magellan shall be a minority shareholder in the new entity,
Magellan shall make appropriate provisions such that the Other Shareholders,
if any, who will also become minority shareholders of the new entity will
have the same rights and obligations as Magellan with respect to their status
as minority shareholders in the new entity.
7.2 In the event that a third party shall become a shareholder of the
Corporation prior to any public offering of any securities of the Corporation
pursuant to a transfer under Sections 2 or 4 hereof (a "Subsequent
Shareholder"), such Subsequent Shareholder shall be bound by the terms and
obligations of this Agreement to the same extent as an Other Shareholder.
7.3 In the event that an officer, director or employee of Magellan
or of any of its subsidiaries shall become a shareholder of the Corporation and
shall have additional or differing shareholder rights (and obligations
directly related to those rights) from those set forth herein, the Other
Shareholders, upon their written consent (such consent to be as to the entire
set of rights and obligations and not only as to selected rights and
obligations), shall be deemed to also have such additional or differing
shareholder rights (and obligations directly related to those rights);
provided however, that nothing in this Section 7.3 shall apply to the purchase
price paid by any such shareholder for his or her Shares.
8 CLOSING. At any closing held to transfer Shares pursuant to the
provisions of any sections of this Agreement (a "Closing"):
8.1 The location shall be at the offices of the Corporation unless
otherwise agreed to by all of the parties to the Closing.
8.2 The selling party or parties shall deliver to the purchasing
party certificates representing the Shares to be sold, duly endorsed in blank
or accompanied by stock powers endorsed in blank. In the
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event that the selling party is an Other Shareholder, and that such Other
Shareholder will, after such sale hold less than two percent of the outstanding
Shares, such Other Shareholder shall also deliver to the Corporation, to the
extent applicable, his resignation as a director, officer and/or employee of
the Corporation as well as that of any individual who holds such a position
with the Corporation due to his or her affiliation with the selling party.
8.3 The purchasing party shall pay to the selling party the
applicable purchase price at the closing by delivery of a cashier's check for
the full amount of the purchase price.
8.4 Except as otherwise provided herein, each party shall pay its own
expenses incidental to any transaction provided for in this Agreement.
9 Election of Directors. Magellan agrees to vote its shares to cause John
T. Lincoln to be a member of the Board of Directors of the Corporation until
the later to occur of (i) he no longer holds at least a two percent (2%)
interest in the outstanding Common Stock of the Corporation or (ii) the
termination of his employment with the Corporation.
10 Financial Information. So long as an Other Shareholder holds any
Shares, the Corporation shall deliver to such Other Shareholder (i) such
periodic financial information regarding the Corporation as is routinely
prepared by or on behalf of the Corporation, and (ii) notice of all material
transactions involving the Corporation; provided however, that such notice
may, at the Corporation's discretion, be delivered after the consummation of
such material transaction or transactions.
11 Competing Activities.
11.1 Magellan convenants and agrees, that so long as Magellan holds any
Shares, Magellan and each entity which controls, is controlled by, or is
under common control with Magellan, will refrain from, directly or indirectly
entering into, conducting, carrying on or engaging in the Business (as
defined in Exhibit B attached hereto) anywhere in the United States.
11.2 Each of the Other Shareholders convenants and agrees, that, subject
to the terms of any current or subsequent agreements, including, but not
limited to the Employment Agreement, and any other employment agreements or
noncompete agreements entered into by an Other Shareholder and Magellan or
the Corporation, (i) so long as an Other Shareholder shall be either a
director, officer, employee or consultant of the Corporation, such Other
Shareholder shall refrain from directly or indirectly entering into,
conducting, carrying on or engaging in the Business anywhere in the United
States and (ii) so long as an Other Shareholder owns any Shares, such Other
Shareholder shall refrain from obtaining or having any equity interest in any
entity which is directly or indirectly entering into, conducting, carrying on
or engaging in the Business anywhere in the United States, except for the
ownership of less than 2% of the shares of any company, the shares of which
are traded on any national securities exchange or are quoted on NASDAQ.
11.3 For purposes of this Agreement, the words "directly or indirectly"
shall include participating in any entity or enterprise as an owner, partner,
limited partner, joint venturer, stockholder or in any other capacity,
including without limitation, as principal or agent, or through any person,
subsidiary or employee acting as nominee, agent or otherwise.
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11.4 Notwithstanding anything to the contrary contained herein, the
Business shall not include (i) any consulting business related to behavioral
health care, or (ii) the business conducted by Public Solutions, Inc., which
consists of providing or managing behavioral health care services pursuant to
contracts with federal, state and local governments and governmental
agencies, providing health and human services, including behavioral
healthcare services, to the mentally retarded, the developmentally disabled,
the elderly, persons under the control or supervision of criminal/juvenile
justice systems and other designated populations.
12 Representations and Warranties of Magellan. Magellan represents and
warrants to Shareholder, as of the date hereof, as follows:
12.1 Magellan is a corporation duly organized, validly existing, and
in good standing under the laws of Delaware.
12.2 Magellan has the full corporate power and authority to execute and
deliver this Agreement, to perform hereunder, and to consummate the
transactions contemplated hereby without the necessity of any act, approval
or consent of any other person or entity whomsoever. The execution, delivery
and performance by Magellan of this Agreement and each and every agreement,
document and instrument provided for herein have been duly authorized and
approved by the Board of Directors of Magellan. This Agreement, and each and
every other agreement, document and instrument to be executed and delivered
by Magellan in connection herewith constitute or will, when executed and
delivered, constitute the valid and binding obligation of Magellan,
enforceable against it in accordance with their respective terms.
12.3 The execution and delivery by Magellan of this Agreement and the
consummation of the transactions contemplated hereby do not and will not (a)
violate any provision of the charter or bylaws of Magellan, (b) violate,
conflict with or result in a breach of any agreement, instrument or
understanding to which Magellan is a party or to which any of its assets are
subject or (c) violate any order, decree, judgment, statute, regulation,
ordinance or other law or requirement to which the Magellan or any of its
parents, subsidiaries or affiliates are subject.
12.4 No consent, approval, authorization, order, filing or registration
by or with any person not a party to this Agreement or any governmental or
quasi-governmental or regulatory agency is required to be obtained by
Magellan with regard to the execution of this Agreement or of any other
agreement or instrument contemplated herein or of the consummation of the
transactions contemplated hereby or thereby.
13 Non-Exclusive Remedy. The enforcement by any party hereto of its rights
and remedies pursuant to this Agreement shall not be construed as a waiver of
any other rights or available remedies which it may possess in law or equity
absent this Agreement.
14 Equitable Relief. Each of the Shareholders acknowledges and agrees that a
breach by it of any of the provisions contained in this Agreement will cause
the Corporation and the other Shareholders irreparable injury and damage. By
reason thereof, each of the Shareholders agrees that each party hereto shall
be entitled, in addition to any other remedies it may have under this
Agreement or otherwise and
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without the posting of any bond, to preliminary and permanent injunctive and
other equitable relief to prevent or curtail any breach of this Agreement;
provided, however, that no specification in this Agreement of a specific
legal or equitable remedy shall be construed as a waiver or prohibition
against the pursuing of other legal or equitable remedies in the event of
such a breach.
15. Severability; Independence of Covenants. In the event that any one or
more of the provisions of this Agreement or any word, phrase, clause,
sentence or other portion thereof shall be deemed to be illegal or
unenforceable for any reason, such provision or portion thereof shall be
modified or deleted in such a manner so as to make this Agreement, as
modified, legal and enforceable to the fullest extent permitted under
applicable laws. Each of the parties hereto does hereby expressly authorize
any court of competent jurisdiction to enforce any such provision or portion
thereof or to modify any such provision or portion thereof in order that any
such provision or portion thereof shall be enforced by such court to the
fullest extent permitted by applicable laws.
16. Notices. All notices, demands, requests, consents and approvals which
may be or are required to be given or made pursuant to any provisions of this
Agreement shall be given or made in writing and shall be served personally,
by overnight courier or mailed by prepaid certified or registered mail,
return receipt requested, to the address of each of the parties hereto as set
forth below:
If to the Corporation:
Mr. Steve Davis
Care Management Resources, Inc.
3414 Peachtree Road, N.E., Suite 1400
Atlanta, Georgia 30326
If to Lincoln:
Mr. John T. Lincoln
1500 Atlantic Boulevard #308
Key West, Florida 33040
With a copy to:
Alan M. Schwartz, Esq.
9861 Broken Land Parkway
Suite 340
Columbia, Maryland 21046
If to Shoffeitt:
Paul G. Shoffeitt
2640 Jennings Chapel Road
Woodbine, Maryland 21797
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With a copy to:
Alan M. Schwartz, Esq.
9861 Broken Land Parkway
Suite 340
Columbia, Maryland 21046
If to Magellan:
Magellan Health Services, Inc.
3414 Peachtree Road, N.E., Suite 1400
Atlanta, Georgia 30326
Attn: Cherie Fuzzell, Esq.
or such other address as any of the parties may from time to time advise the
other parties hereto by notice in writing. The date of receipt of any such
notice, demand or request shall be deemed to be the date of giving of such
notice, demand or request if delivered personally, or if mailed or couriered
as aforesaid, the date such notice was delivered to the recipient.
17 Successors and Assigns. This Agreement shall be binding upon, inure to
the benefit of, and be enforceable by the parties hereto and their respective
administrators, legal representatives, personal representatives, nominees,
heirs, successors and permitted assigns and transferees.
18 Counterparts. This Agreement may be executed in multiple counterpart
copies, each of which will be considered an original and all of which
constitute one and the same instrument, binding on all parties hereto, even
though all the parties are not signatory to the same counterpart.
19 Assignment. The Shareholders may only assign this Agreement with the
prior, written consent of the other parties hereto.
20 No Waiver. The failure of any party hereto to enforce the terms of this
Agreement on one or more occasions shall not act to waive any of such party's
rights with respect to any subsequent breach of this Agreement by any other
party.
21 Amendments. This Agreement may not be amended except in a writing duly
executed by each of the parties hereto.
22 Construction. The parties acknowledge and agree that this Agreement is
the result of extensive negotiations between the parties and their respective
counsel, and that this Agreement shall not be construed against either party
by virtue of its role or its counsel's role in the drafting hereof.
23 Governing Law. This Agreement shall be governed by and construed in
accordance with the substantive laws of the State of Georgia which apply to a
contract executed and to be performed entirely within the State of Georgia,
without regard to principles of conflicts of laws.
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24 Headings. The headings in this Agreement are provided for convenience of
reference only and are not to be deemed a part of this Agreement.
25 Conflicts With By-Laws. In the event of a conflict between the provisions
of this Agreement and the By-laws of the Corporation, the provisions of this
Agreement shall govern the conflicting By-law provision.
26 Termination. This Agreement shall remain in effect until terminated by
the mutual written agreement of all the parties hereto; provided however,
that in the event that any Shareholder ceases to hold any Shares, this
Agreement shall terminate with respect to such Shareholder.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first written above.
LINCOLN:
Witness:
/s/ Illegible /s/ John T. Lincoln
- ----------------------------- ----------------------------------------
John T. Lincoln
SHOFFEITT:
Witness:
/s/ Illegible /s/ Paul G. Shoffeitt
- ----------------------------- ----------------------------------------
Paul G. Shoffeitt
MAGELLAN:
Magellan Health Services, Inc.
Attest: By: /s/ E.M. Crawford
-------------------------------------
Name: E. Mac Crawford
-----------------------------------
/s/ Illegible Title: Chairman, CEO and President
- ----------------------------- ----------------------------------
CORPORATION:
Care Management Resources, Inc.
By: /s/ John T. Lincoln
------------------------------------
Attest: Name: John T. Lincoln
/s/ Illegible ---------------------------------
- ----------------------------- Title: President
---------------------------------
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EXHIBIT A
LIST OF SHAREHOLDERS' SHARES
Party Number of Shares
----- ----------------
Magellan Health Services, Inc. 340,000
John T. Lincoln 30,000
Paul G. Shoffeitt 30,000
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Schedule 6.5
Registration Territory
California, Florida, Georgia, Illinois, Indiana, Maine, New Jersey, New York,
Pennsylvania, Rhode Island and Texas.
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EXHIBIT B
---------
DEFINITION OF BUSINESS
The term "Business" shall mean the business of providing specialty managed
health care services in the areas of cardiology, ophthalmology, diabetes,
asthma, oncology and other medical sub-specialty areas, including related
case or care management, administrative services, utilization management,
quality management, certification or pre-admission or pre-treatment
certification, assessment and referral, staff clinical services, provider
network services and preferred/exclusive provider organization services.
Notwithstanding the foregoing, the term "Business" shall not include
telemedicine services (e.g., member retention, member/patient satisfaction,
compliance monitoring, physician scheduling and nurse triage), whether
relating to the specialty managed care services provided by the Corporation
otherwise. Notwithstanding the foregoing, it is anticipated that the
Corporation and such subsidiary offering telemedicine services will offer
their respective services in a "bundled" fashion to their respective
customers on such basis as may be mutually agreed by the Corporation and such
subsidiary.
16