Exhibit 10.78
EXECUTION COPY
SETTLEMENT AGREEMENT AND GENERAL RELEASE
This SETTLEMENT AGREEMENT AND GENERAL RELEASE (the “AGREEMENT”) is made and
entered into this 16th day of April, 2009, by and between NATIONSHEALTH, INC.
(“NATIONSHEALTH”) and UNITED STATES PHARMACEUTICAL GROUP, L.L.C. (“USPG”)
(collectively referred to herein as the “COMPANY”), on the one hand, and SUSAN
HILL (“MS. HILL”) and ROBERT HILL (“MR. HILL”) (collectively referred to as “the
HILLS”), on the other hand (the HILLS and the COMPANY are collectively referred
to herein as the “PARTIES”), and is joined, solely as to Section 4(b) hereof, by
CAPITALSOURCE FINANCE LLC in its capacity as Agent for the Lenders under the
Loan Agreement referred to below (“Agent”).
WHEREAS, USPG and MS. HILL entered into a Stock Purchase Agreement, dated
September 4, 2007, that provides for USPG to purchase one hundred percent (100%)
of the stock of Diabetes Care and Education, Inc. (“DCE”) (the “Purchase
Agreement”);
WHEREAS, in conjunction with the purchase of DCE, NATIONSHEALTH and MS. HILL
entered into an employment agreement dated September 4, 2007 that provided for
employment by MS. HILL by NATIONSHEALTH (the “Employment Agreement”);
WHEREAS, in conjunction with the purchase of DCE, NATIONSHEALTH and MR. HILL
entered into a non-competition agreement dated September 4, 2007 that provided,
among other things, certain non-disclosure, non-competition and
non-disparagement provisions by MR. HILL and the NATIONSHEALTH (the “Mr. Hill
Non-Competition Agreement”);
WHEREAS, following the closing of the Purchase Agreement, NATIONSHEALTH has
employed MS. HILL and MR. HILL in positions with responsibilities related to the
ongoing management of DCE;
WHEREAS, the PARTIES have had disputes regarding the appropriate management of
DCE and their respective obligations under the Purchase Agreement and the
Employment Agreement;
WHEREAS, the PARTIES have reached an agreement to compromise and settle all
disputes between them;
WHEREAS, MS. HILL has agreed that any special distribution payments as defined
in Paragraph 4 of this Agreement shall be subject to the Subordination Agreement
dated September 4, 2007 (the “Subordination Agreement”) entered into between MS.
HILL and CapitalSource Finance LLC (together with its successors and assigns,
“Lender” and sometimes, individually or collectively with Agent, “CSF”) pursuant
to which MS. HILL subordinated the Subordinated Debt (as defined in the
Subordination Agreement) to the Senior Debt (as defined in the Subordination
Agreement);

 

 

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WHEREAS, Lender has designated Agent as its agent to take certain actions under
the Loan Agreement (as defined in the Subordination Agreement) pursuant to
Section 12.12. of the Loan Agreement;
NOW, THEREFORE, for and in consideration of the mutual promises herein
contained, and for good and valuable consideration, the receipt, sufficiency and
adequacy of which are hereby acknowledged, the PARTIES agree as follows:
1. The HILLS agree that they both will: (a) resign from their positions with the
COMPANY effective October 2, 2008 (the “Separation Date”), such that their last
day on salary as active employees shall be October 1, 2008 and their last day as
participants in the group medical plan as active employees shall be November 30,
2008; (b) refrain from applying for or otherwise seeking employment with the
COMPANY or any of its subsidiaries or affiliates at any time in the future; (c)
return all property of the COMPANY, including, but not limited to, access keys
or cards, cell phones, laptop computers, printers, answering machines, modems,
manuals, calculators, handbooks, files, papers, memoranda, letters, facsimiles,
computer software and financial data.
2. The COMPANY shall provide to MR. HILL: (a) payment of severance at an annual
rate of $100,000.00 for a period of six (6) months (the “MR. HILL Severance”),
starting on October 2, 2008 and running through and including April 2, 2009 (the
“Severance Period”); and (b) reimbursement of cost of the premiums under COBRA,
following submission of appropriate documentation, for continued medical
coverage (at the same level coverage in place on October 1, 2008) for the months
of December through June 2009, provided that such payments shall cease at any
such earlier time should MR. HILL no longer be eligible for coverage under COBRA
(collectively, “MR. HILL’s Separation Benefits”). The amount set forth in
Paragraph 2(a), less applicable taxes, withholdings, and authorized deductions,
will be paid to Employee in 12 equal installments with the COMPANY’s regular,
semi-monthly payroll. Each installment will be in the gross amount of $4,166.67,
less applicable taxes, withholdings, and authorized deductions. In addition to
the MR. HILL Severance, the Company shall provide to MR. HILL equal installments
of $4,166.77 with the COMPANY’s regular, semi-monthly payroll for the period
April 3, 2009 through and including the date of the payment described below in
Section 4(a)(i), which “MR. HILL Additional Severance” shall be subject to
applicable taxes, withholdings and authorized deductions.
3. The COMPANY shall provide to MS. HILL: (a) payment of severance at an annual
rate of $180,000.00 for a period of six (6) months (the “MS. HILL Severance”),
which shall be payable during the Severance Period; and (b) reimbursement of
cost of the premiums under COBRA, following submission of appropriate
documentation, for continued medical coverage (at the same level coverage in
place on October 1, 2008) for the months of December 2008 through June 2009,
provided that such payments shall cease at any such earlier time should MS. HILL
no longer be eligible for coverage under COBRA (collectively, “MS. HILL’s
Separation Benefits”). The amount set forth in Paragraph 3(a), less applicable
taxes, withholdings, and authorized deductions, will be paid to Employee in 12
equal installments with the COMPANY’s regular, semi-monthly payroll. In addition
to the MS. HILL Severance, the Company shall provide to MS. HILL equal
installments of $7,500.00 with the COMPANY’s regular, semi-monthly payroll for
the period April 3, 2009 through and including the date of the payment described
below in Section 4(a)(i) through and including the date of the payment described
below in Section 4(a)(i), which “MS. HILL Additional Severance” shall be subject
to applicable taxes, withholdings and authorized deductions. (The MS. HILL
Additional Severance and the MR. HILL Additional Severance shall collectively be
known as the “Additional Severance.”) Furthermore, the Company shall pay to MS.
HILL the amount of her attorneys’ fees associated with the negotiation of this
AGREEMENT, up to a ten thousand dollar ($10,000) cap, upon submission to the
Company of documentation of such legal fees and costs.

 

 

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4. (a) In addition to MS. HILL’s Separation Benefits described above and in lieu
of any “Earn-Out Payments” as provided for under the Purchase Agreement, the
COMPANY and MS. HILL have agreed that the COMPANY will provide her with a
special distribution in the total amount of one million seven hundred fifty
thousand dollars ($1,750,000.00) (the “Special Distribution Payments”), which
shall be paid in accordance with the following schedule: (i) a three hundred
thousand dollar ($300,000) payment to MS. HILL on or before June 30, 2009;
(ii) a three hundred thousand dollar ($300,000) payment to MS. HILL on or before
December 31, 2009; (iii) a three hundred thousand dollar ($300,000) payment to
MS. HILL on or before June 30, 2010; (iv) a four hundred thousand dollar
($400,000) payment on or before December 31, 2010; and (v) a four hundred fifty
thousand dollar ($450,000) payment on or before June 30, 2011. Each Special
Distribution Payment shall be wire transferred by the COMPANY to the HILL’s bank
account listed on Schedule 1, or such other account as the HILLS may designate
in writing to USPG from time to time. Notwithstanding the foregoing, the
lump-sum payment to be made under Section 4(a)(i) shall be reduced by the amount
that is equivalent to seventy-seven percent (77%) of the Additional Severance
paid to the HILLS under Paragraphs 2 and 3 of this AGREEMENT.
(b) The PARTIES agree that the payment of any Special Distribution Payment shall
be subject to the provisions of the Subordination Agreement. The PARTIES and
Agent on behalf of Lender agree that the Subordination Agreement shall be
amended as follows:
(i) The defined terms “Earn-Out Obligation” and “Subordinated Debt” are amended
so that all references thereto in the Subordination Agreement shall, as the
context requires, mean and refer to the Special Distribution Payments.
(ii) The defined term “SPA” is amended so that all references thereto in the
Subordination Agreement shall, as the context requires, mean and refer to, and
include, this AGREEMENT.
(iii) The second sentence of Section 2 of the Subordination Agreement is amended
as follows:
Borrower may request to make a regularly scheduled payment of Subordinated Debt
by delivering a written notice to Senior Lender of its intent to make such a
payment (a “Payment Request”) at least six (6) weeks prior to making such
payment, which request shall contain (i) a statement as to the amount of the
Special Distribution Payment to be paid and (ii) a certification from an
authorized officer of Borrower that there then exists no Default or Event of
Default, and no such Default or Event of Default would result by or from such
payment and that such payment will be made in compliance with the provisions of
the SPA as in effect as of the date hereof (except for the date of such
payment).

 

 

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(iv) The third sentence of Section 2 of the Subordination Agreement is amended
as follows:
Following Borrower’s delivery of a Payment Request, Borrower may make such
requested payment of the Subordinated Debt upon its receipt of Senior Lender’s
written consent thereto (a “Senior Lender Consent”), which Senior Lender Consent
shall be delivered to Borrower within six (6) weeks of Senior Lender’s receipt
of the Payment Request so long as no Default or Event of Default has occurred
and is continuing, and no such Default or Event of Default would result by or
from such payment.
The PARTIES and CSF agree that, except as otherwise provided in this AGREEMENT,
the Subordination Agreement remains in full force and effect and has not
otherwise been amended or modified in any respect, it being the intention of the
PARTIES and CSF that this Section 4(b) and the Subordination Agreement be read,
construed and interpreted as one and the same instrument. The PARTIES and CSF
agree that, in the event of any conflict or inconsistency between the provisions
of this AGREEMENT and the Subordination Agreement, the terms of the
Subordination Agreement shall govern with the Special Distribution Payments
being Subordinated Debt thereunder.
(c) The COMPANY shall deliver each Payment Request to Senior Lender on or before
six (6) weeks before each Special Distribution Payment is due.
(d) The COMPANY shall provide the HILLS with a copy of the Payment Request
(contemporaneously with the sending of the Payment Request, provided that
inadvertent failure to provide copy thereof to the HILLS shall not be a material
breach of this AGREEMENT) and the Senior Lender Consent (per the Subordination
Agreement) with respect to such Special Distribution Payment on the date such
payment is made. The HILLS acknowledge and agree that the failure of the COMPANY
to provide a copy of the Payment Request or the Senior Lender Consent shall not
affect any of CSF’s rights under the Subordination Agreement or the
subordination of the Subordinated Debt.
5. MS. HILL owns 473,933 shares of NATIONSHEALTH common stock which was issued
in connection with the Purchase Agreement. It is the intention of the
signatories hereto that all such stock (the “Shares”) shall be transferred to
the COMPANY. Specifically, simultaneous with the Effective Date of this
AGREEMENT (as defined in Paragraph 15), MS. HILL shall deliver to counsel for
the COMPANY all stock certificates representing all of the Shares, duly-endorsed
to transfer all such Shares to the COMPANY, which delivery process shall include
MS. HILL executing the stock power documents appended at Appendix A. Further,
MS. HILL represents and warrants that, as of the Effective Date of this
AGREEMENT: (i) she owns all rights, title and interest in and to the Shares,
(ii) she has not sold, transferred, assigned, pledged, hypothecated to any third
party or otherwise encumbered any interest in the Shares, (iii) there is no
litigation or governmental proceeding or investigation pending or, to the
knowledge of MS. HILL, threatened against her, which may call into question her
ability to transfer all of the Shares to NATIONSHEALTH in accordance with this
Section 5, and (iv) the transfer by MS. HILL of the Shares to NATIONSHEALTH in
accordance with this Section 5 will result in NATIONSHEALTH owning the Shares
free and clear of all encumbrances and with marketable title. The signatories
will execute all such further required documents and take all other steps as
shall be necessary to effectuate promptly at such time the transfers of the
Shares, as well as to effectuate the amendment of any corporate documentation
necessary to effectuate the removal of any rights that MS. HILL might have as a
stockholder of NATIONSHEALTH. The grant of stock options to MS. HILL on
September 4, 2007 by the COMPANY shall be afforded the treatment set forth in
the applicable stock option agreement, such that Ms. Hill shall have three
months from her separation from the COMPANY to exercise the stock options, which
options shall expire at such time if they remain unexercised.

 

 

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6. In exchange for the consideration that the HILLS will receive under this
AGREEMENT, the HILLS, on behalf of themselves, their heirs, spouses, successors,
current and former agents, representatives, attorneys, assigns, executors,
beneficiaries, and administrators, hereby release and forever discharge the
COMPANY and each and all of its current and former parents, divisions,
subsidiaries (including, but not limited to, Diabetes Care and Education, Inc.),
affiliates, investors, lenders, predecessors, successors, assigns, officers,
directors, attorneys, shareholders, agents, representatives and employees
(collectively, the “COMPANY RELEASED PARTIES”) from any and all charges,
complaints, claims, liabilities, obligations, promises, agreements, damages,
actions, causes of action, whether accrued or to be accrued, suits, rights,
demands, costs, losses, debts and expenses (including, but not limited to, any
attorneys’ fees incurred by the HILLS) of any nature whatsoever, whether in law
or in equity, whether known or unknown, which the HILLS now have or ever may
have had against the COMPANY RELEASED PARTIES, up to the date of this AGREEMENT
including, but not limited to, any and all matters related in any way to the
HILLS’ employment with or resignation from the COMPANY, the Purchase Agreement,
the Employment Agreement, as well as all claims under Title VII of the Civil
Rights Act of 1964, the Americans with Disabilities Act, the Age Discrimination
in Employment Act (including the Older Workers Benefit Protection Act), the
Employee Retirement Income Security Act of 1974, the Family and Medical Leave
Act, Kentucky Civil Rights Act (Ky. Rev. Stat. § 344.010, et. seq.), Kentucky’s
1976 Equal Employment Opportunities Act (Ky. Rev. Stat. § 207.130, et. seq.),
Kentucky’s Equal Pay Law (Ky. Rev. Stat. § 337.420, et. seq.), any other
federal, state or local anti-discrimination, wage or employment-related laws and
any other contractual or tort claims related in any way to the HILLS’ employment
with or resignation from the COMPANY, any other claims in any way related to the
Shares and any other claims for compensation, benefits or equity.
Notwithstanding this foregoing, nothing in this AGREEMENT shall relieve the
COMPANY of any indemnification obligations that would otherwise exist for the
HILLS in their capacity as former directors and officers of the COMPANY with
respect to claims or investigations involving the activities of DCE or the
COMPANY.
7. In exchange for the consideration that the COMPANY will receive under this
AGREEMENT, the COMPANY, on behalf of its current and former parents, divisions,
subsidiaries (including, but not limited to, Diabetes Care and Education, Inc.),
affiliates, predecessors, successors, assigns, officers, directors, attorneys,
shareholders, agents, representatives and employees hereby release and forever
discharge the HILLS on behalf of themselves, their heirs, spouses, successors,
current and former agents, representatives, attorneys, assigns, executors,
beneficiaries, and administrators, (collectively, the “HILLS RELEASED PARTIES”)
from any and all charges, complaints, claims, liabilities, obligations,
promises, agreements, damages, actions, causes of action, whether accrued or to
be accrued, suits, rights, demands, costs, losses, debts and expenses
(including, but not limited to, any attorneys’ fees incurred by the COMPANY) of
any nature whatsoever, whether in law or in equity, whether known or unknown,
which the COMPANY now has or ever may have had against the HILLS RELEASED
PARTIES, up to the date of this AGREEMENT, including, but not limited to, any
and all matters related in any way to the HILLS’ employment with the COMPANY,
the Purchase Agreement, and the Employment Agreement. Notwithstanding the
provisions of this Section 7, nothing contained in this Section 7 shall release
or otherwise prevent or impair a claim preserved under Section 8 below.

 

 

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8. (a) In further exchange for the consideration that the HILLS will receive
under this AGREEMENT, (i) MS. HILL agrees that the Covenant Not to Compete
contained in Section 6(f) of the Employment Agreement will remain in full force
and effect for a period of three (3) years following the Separation Date.
Furthermore, MS. HILL agrees that the non-disclosure and intellectual property
protection obligations contained in Section 6(a)-(d) of the Employment Agreement
will remain in full force and effect; (ii) MR. HILL agrees that the Covenant Not
to Compete contained in Section 1(f) of the Non-Competition Agreement will
remain in full force and effect for a period of three (3) years following the
Separation Date; and (iii) MS. HILL agrees that the obligations under Articles 4
(Representations and Warranties Concerning the Company), 6.4 (Confidentiality),
6.5 (Covenant Not to Compete or Solicit), 8.2 (Indemnification Provisions for
Buyer’s Benefit), except that a breach of Article II of the Purchase Agreement
shall no longer form the basis of any claim, 8.3 (Indemnification Provisions for
Seller’s Benefit), 8.4 (Matters Involving Third Parties), 8.7 (Reduction for
Insurance and Third Party Payments and 8.8 (Limits on Remedies) under the
Purchase Agreement will remain in full force and effect. Furthermore, MR. HILL
agrees that the non-disclosure, intellectual property protection and other
obligations contained in Section 1(b)-(e) and (g-i) of the Non-Competition
Agreement will remain in full force and effect.
(b) The HILLS warrant, represent and acknowledge that they know of no matters,
information or concerns of any type regarding the COMPANY’s actions, policies,
practices and procedures, particularly any concerns regarding regulatory
compliance. The HILLS affirmatively warrant, represents and acknowledge that
their execution of this Agreement reflects the fact that each of MS. HILL and
MR. HILL are not aware of any matter, information or concern that could have, or
should have, been disclosed as of the date and time of execution of this
Agreement. The HILLS further warrant, represent and acknowledge that each has
not been prevented, prohibited or in any manner restricted by the COMPANY from
making a full disclosure to the COMPANY of any and all of regulatory concerns.
9. The PARTIES agree to describe the circumstances of the HILLS’ departure from
the COMPANY in accordance with Appendix B.

 

 

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10. The PARTIES agree that they and their agents will not publicize or disclose,
directly or indirectly, the terms, conditions or existence of this AGREEMENT to
anyone other than their attorneys, physicians, accountants, and financial
advisors. The PARTIES further agree that they will advise any individual to whom
the terms, conditions or existence of this AGREEMENT have been disclosed (the
“RECIPIENTS”) of the confidentiality requirements of this paragraph, will secure
the agreement of all RECIPIENTS to abide by such confidentiality requirements,
and will use their best efforts to ensure that the confidentiality requirements
are complied with in all respects. The HILLS further agree that they will not
appropriate for their own use, disclose to any third party, or authorize anyone
else to disclose, unless authorized by the President of the COMPANY in writing,
any confidential information concerning matters related to the COMPANY’s
business. For purposes of this subsection, the term “Confidential Information”
means nonpublic information and proprietary information, including trade
secrets, sales reports, account files, customer names, customer lists,
management or strategic plans, methods of doing business, contact lists,
identities of vendors and contractors, pricing information, marketing strategies
and literature, employee handbooks or manuals, internal self-critical studies or
analyses performed by the COMPANY, information regarding the COMPANY’s personnel
polices or actions taken, any document which indicates by title or substance
that it was prepared, generated or distributed by or on behalf of the COMPANY,
any other document or material reflecting internal information about the COMPANY
that is not readily available to the general public regarding the COMPANY’s
operations or policies, or any documents or information relating to any of the
above.
11. This AGREEMENT shall not be construed as an admission of any sort by either
of the PARTIES, nor shall it be used as evidence in a proceeding of any kind,
except one in which one of the PARTIES alleges breach of the terms of this
AGREEMENT or one in which one of the PARTIES elects to use this AGREEMENT as a
defense to any claim barred by the AGREEMENT.
12. The HILLS agree that they will not, directly or indirectly, make or allow or
cause others to make, whether in oral, print, electronic or other form, any
statement or take any action that reasonably could be construed to be a false,
derogatory, disparaging, or misleading statement of fact or a libelous or
slanderous statement of or concerning: (a) the COMPANY or any of its current and
former parents, divisions, subsidiaries (including, but not limited to, Diabetes
Care and Education, Inc.), affiliates, predecessors, successors, assigns,
officers, directors, attorneys, shareholders, agents, representatives or
employees; or (b) any product designed, produced, or sold by the COMPANY.
13. The COMPANY agrees that it will not, directly or indirectly, make or allow
or cause others (including employees) to make, whether in oral, print,
electronic or other form, any statement or take any action that reasonably could
be construed to be a false, derogatory, disparaging, or misleading statement of
fact or a libelous or slanderous statement of or concerning the HILLS.
14. By signing this AGREEMENT, the HILLS acknowledge and agrees that: (a) they
have been afforded a reasonable and sufficient period of time of not less than
twenty-one (21) days for deliberation thereon and for negotiation of the terms
thereof; (b) they have carefully read and understand the terms of this
AGREEMENT; (c) have signed this AGREEMENT freely and voluntarily and without
duress or coercion and with full knowledge of its significance and consequences
and of the rights relinquished, surrendered, released and discharged hereunder;
(d) the only consideration for signing this AGREEMENT are the terms stated
herein and no other promise, agreement or representation of any kind has been
made to them by any person or entity whatsoever to cause them to sign this
AGREEMENT; and (e) they were apprised by the COMPANY of their right to consult
with legal counsel or a representative of their choice and they did so consult
with legal counsel before signing this AGREEMENT.

 

 

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15. The release of ADEA claims set forth in Paragraph 6 of this AGREEMENT
Release may be revoked, in a writing sent to counsel for the COMPANY, Terri
Chase, McDermott Will & Emery LLP, 340 Madison Avenue, New York, New York 10173
at any time during the period of seven (7) calendar days following the date of
execution by the HILLS. If such seven (7) day revocation period expires without
either of the HILLS exercising his or her revocation right, the obligations of
this AGREEMENT then will become fully effective (the “Effective Date”).
16. (a) The HILLS agree to make themselves reasonably available to respond to
inquiries from the COMPANY for six months following the Separation Date. The
HILLS also agree to cooperate with and assist the COMPANY, at its request, in
connection with any claim or litigation arising out of events occurring or
agreements made, during the course of their employment with DCE or the COMPANY.
The HILLS acknowledge and agree that this promise to cooperate as set forth in
this section is a material term under this AGREEMENT. Further, upon service on
either of the HILLS, or anyone acting on their behalf, of any order or other
legal process requiring either of the HILLS to divulge information prohibited
from disclosure under this AGREEMENT, the HILLS shall immediately, but in any
event no later then within two business days, notify Joshua Weingard, or his
successor, of such service and of the content of any testimony or information to
be provided pursuant to such order or process and the HILLS shall cooperate with
the COMPANY in any lawful efforts to avoid such disclosure.
(b) The COMPANY agrees to reimburse or indemnify the HILLS for any out-of-pocket
expenses, including but not limited to travel expenses, incurred in fulfilling
their duties under Paragraph 16(a) of this AGREEMENT.
17. The HILLS agree that if it is found by a court of law that either MR. HILL
or MS. HILL has violated any of their obligations under Paragraphs 8(a) or 10 of
this AGREEMENT, they shall return to the COMPANY the Separation Benefits and
Special Distribution Payments provided for under Paragraphs 2-4 of this
AGREEMENT, and they shall indemnify the COMPANY from and against any and all
judgments, damages, losses, liabilities, attorneys’ fees, costs and other
expenses incurred as a result of the HILLS’ violation(s). The COMPANY agrees
that if it pursues an action under this paragraph and it is found by a court of
law that neither MR. HILL nor MS. HILL has violated any of their obligations
under Paragraphs 8(a) or 10 of this AGREEMENT, the COMPANY shall indemnify the
HILLS for all attorneys’ fees, costs and other expenses incurred as a result of
defending such action.
18. The COMPANY agrees that, if it is determined by a court of law that the
COMPANY breached a provision of this AGREEMENT, then the COMPANY will indemnify
the HILLS for all attorneys’ fees, costs and other expenses incurred as a result
of the COMPANY’S breach of any provision of this AGREEMENT or in any successful
action by the HILLS to enforce any provision of this AGREEMENT, including but
not limited to an action to enforce the Special Distribution Payments as
provided in Paragraph 4 of this AGREEMENT.

 

 

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19. This AGREEMENT represents the entire agreement between the PARTIES with
respect to the subject matters addressed herein and supercedes all prior
agreements between the PARTIES, whether written or oral, except as set forth in
Paragraph 8 of this AGREEMENT. This AGREEMENT may not be altered or amended,
except in a written document executed by the PARTIES, which document
specifically references this AGREEMENT. Should the HILLS seek to challenge the
validity of this AGREEMENT or any provision thereof (except the HILLS’ release
and waiver of claims and rights under ADEA), the HILLS shall, as a
pre-condition, return to the COMPANY the Separation Benefits and Special
Distribution Payments provided for in Paragraphs 2-4 of this AGREEMENT. Further,
if either of the HILLS assert claims against the COMPANY that are released by
this AGREEMENT, the COMPANY shall be entitled to repayment of the Separation
Benefits and Special Distribution Payments provided for in Paragraphs 2-4 of
this AGREEMENT, as well as its attorneys’ fees and costs in obtaining repayment
of these sums and a dismissal of any claims filed against the COMPANY that are
released by this AGREEMENT. Upon execution of this Agreement, MS. HILL expressly
agrees that she is not entitled to any of the “Earn-Out Payments” further
described in Section 2.6 of the Purchase Agreement.
20. The PARTIES agree that a failure by any party at any time to require
performance of any provision of this AGREEMENT shall not waive, affect,
diminish, obviate or void in any way that party’s full right or ability to
require performance of the same, or any other provisions of this AGREEMENT, at
any time thereafter.
21. The terms of this AGREEMENT are the result of negotiations between the
PARTIES and there shall be no presumption that any ambiguities in the AGREEMENT
should be resolved against any party to this AGREEMENT. Any controversy
concerning the construction of this AGREEMENT should be decided neutrally in
light of conciliatory purposes, and without regard to authorship.
22. This AGREEMENT shall be deemed entered into and executed in the State of
Florida and shall be interpreted, enforced and governed under the laws of the
State of Florida. Any recourse for any alleged violation of any provision of
this AGREEMENT shall be addressed exclusively through an action for breach of
contract in any of (i) the courts of Broward County, Florida, (ii) the U.S.
District Court located in Broward County, Florida, (iii) the courts of Jefferson
County, Kentucky, or (iv) the U.S. District Court located in Jefferson County,
Kentucky (collectively, the “Designated Courts”), and hereby irrevocably accept
the exclusive personal jurisdiction of those courts for the purposes of any
suit, action, or proceeding. In addition, the HILLS, USPG and the COMPANY hereby
irrevocably waive, to the fullest extent permitted by law, any objection which
the HILLS or the COMPANY may now or hereafter have to the laying of venue of any
suit, action, or proceeding arising out of or relating to this AGREEMENT or any
judgment entered by any court in respect thereof in the Designated Courts, and
hereby further irrevocably waive any claim that any suit, action, or proceeding
brought in any such court has been brought in an inconvenient forum.
23. The PARTIES warrant and represent that they have read and understand the
foregoing provisions of this AGREEMENT and that they and their respective
signatories are fully authorized and competent to execute this AGREEMENT on
their behalf. The HILLS further warrant and represent that neither of them have
previously assigned or transferred any claims that are the subject of the
release contained in Paragraph 6 herein.
24. This AGREEMENT may be signed in counterparts and transmitted by facsimile or
electronic copies. A facsimile or electronic signature shall be deemed as
effective as an original.

 

 

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Executed as an agreement effective as of the provisions of Paragraph 15 of this
AGREEMENT.
NATIONSHEALTH, INC.

                 
By:
  /s/ Timothy Fairbanks       April 16, 2009    
 
               
 
          Date    
 
                UNITED STATES PHARMACEUTICAL GROUP, LLC (“USPG”)            
 
               
By:
  /s/ Timothy Fairbanks       April 16, 2009    
 
               
 
          Date    
 
               
By:
  /s/ Susan Hill       April 16, 2009    
 
               
 
  Susan Hill       Date    
 
               
By:
  /s/ Robert Hill       April 16, 2009    
 
               
 
  Robert Hill       Date    
 
                Solely as to Section 4(b) above:            
 
                CAPITALSOURCE FINANCE LLC, AS AGENT            
 
               
By:
  /s/ Natasha Luddington       April 16, 2009    
 
               
 
          Date