EXHIBIT 6.13
PLAN AND AGREEMENT OF REORGANIZATION
This PLAN AND AGREEMENT OF REORGANIZATION (the "Agreement") is entered
into on this 27th day of June, 1997, by and between MEDICAL RESOURCES
MANAGEMENT, INC., a Nevada corporation ("MRM") and LASER MEDICAL, INC., a
Utah corporation ("LM"), and those persons listed in EXHIBIT A hereto, being
all of the shareholders of LM who own individually at least five percent (5%)
of the outstanding stock of LM and together hold over 50% of the outstanding
stock of LM as of the date this Agreement is executed.
PLAN OF REORGANIZATION
The transaction contemplated by this Agreement is intended to be a "tax
free" exchange as contemplated by the provisions of Sections 351 and
368(a)(1)(B) of the Internal Revenue Code of 1986, as amended. MRM will
acquire up to 100% of LM's issued and outstanding common stock (no par value
per share), and all warrants and options outstanding (the "LM Stock" or the
"LM Shares"), in exchange for 190,000 shares of MRM's common stock ($.001 par
value per share) (the "Exchange Stock") (collectively, the "Exchange
Transaction"). The Exchange Transaction will result in LM becoming a wholly
owned subsidiary of MRM.
AGREEMENT
SECTION 1
TRANSFER OF LM SHARES
1.1 All shareholders of LM (the "Shareholders" or the "LM
Shareholders") as of the date of Closing, as such term is defined in Section
3 herein (the "Closing" or the "Closing Date"), shall transfer, assign,
convey and deliver to MRM at the Closing Date certificates representing 100%
of the LM shares then issued and outstanding, or such lesser percentage as
shall be acceptable to MRM, but in no event less than 95% of the LM Shares.
The transfer of the LM Shares shall be made free and clear of all liens,
mortgages, pledges, encumbrances or charges, whether disclosed or
undisclosed, except as the LM Shareholders and MRM shall have otherwise
agreed in writing.
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SECTION 2
ISSUANCE OF EXCHANGE STOCK AND ADDITIONAL
STOCK TO LM SHAREHOLDERS
2.1 As consideration for the transfer, assignment, conveyance and
delivery of the LM Stock hereunder, MRM shall, at the Closing, issue to the
LM Shareholders, pro rata in accordance with each Shareholder's percentage
ownership of LM immediately prior to the Closing, certificates for 190,000
shares of Exchange Stock. The parties intend that the Exchange Stock being
issued will be used to acquire all issued and outstanding LM Shares. To the
extent that less than 100% of the LM Stock is acquired, the number of shares
of Exchange Stock issuable to those LM Shareholders who have elected to
participate in the exchange described in this Agreement (the "Exchange")
shall increase proportionately.
2.2 The issuance of the Exchange Stock shall be made free and clear of
all liens, mortgages, pledges, encumbrances or charges, whether disclosed or
undisclosed, except as the LM Shareholders and MRM shall have otherwise agree
in writing. As provided herein, and immediately prior to the Closing, MRM
shall have issued and outstanding: (i) not more than 7,200,000 shares of
common stock; (ii) not more than 1,300,000 options outstanding; (iii) not
more than 515,540 Class A warrants issued in conjunction with a recent
Private Offering; (iv) not more than 515,540 Class B warrants issued in
conjunction with a recent Private Offering; (v) 140,000 warrants held by an
investment relations firm; (vi) 100,000 warrants held by a lender; and (vii)
shall not have any shares of preferred stock issued and outstanding. All
options and warrants provide for the purchase of one share of common stock
for each option or warrant.
2.3 None of the Exchange Stock issued to the LM Shareholders, nor any
of the LM Stock transferred to MRM hereunder shall, at the time of Closing,
be registered under federal securities laws but, rather, shall be issued
pursuant to an exemption therefrom and be considered "restricted stock"
within the meaning of Rule 144 promulgated under the Securities Act of 1933,
as amended (the "Act"). All of such shares shall bear a legend worded
substantially as follows:
"The shares represented by this certificate have not been registered
under the Securities Act of 1933 (the "Act") and are 'restricted
securities' as that term is defined in Rule 144 under the Act. The
shares may not be offered for sale, sold or otherwise transferred
except pursuant to an exemption from registration under the Act, the
availability of which is to be established to the satisfaction of the
Company."
The respective transfer agents of MRM and LM shall annotate their records to
reflect the restrictions on transfer embodied in the legend set forth above.
There shall be no requirement that MRM register the Exchange Stock under the
Act, nor shall LM or the Shareholders be required to register any LM Shares
under the Act.
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SECTION 3
CLOSING
3.1 CLOSING OF TRANSACTION. Subject to the fulfillment or waiver of
the conditions precedent set forth in Section 11 hereof, the Closing shall
take place on the Closing Date at the offices of Medical Resources
Management, Inc., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ at 10:00
a.m., local time, or at such other time on the Closing Date as LM and MRM
shall mutually agree in writing.
3.2 CLOSING DATE. The Closing Date of the Exchange shall take place on
a date chosen by mutual agreement of LM and MRM within sixty (60) days from
the date of this Agreement, or such later date upon which LM and MRM may
mutually agree in writing, or as extended pursuant to subsection 12.1(b)
herein.
3.3 DELIVERIES BY LM AT CLOSING. LM shall deliver or cause to be
delivered to MRM at the Closing:
(a) certificates representing all shares, or an amount of shares
acceptable to MRM, of the LM Stock as described in Section 1,
each endorsed in blank by the registered owner;
(b) an agreement from each Shareholder surrendering his or her
shares agreeing to a restriction on the transfer of the
Exchange Stock as described in Section 2 hereof;
(c) a copy of a consent by LM's Board of Directors authorizing LM
to take the necessary steps toward closing the transaction
described by this Agreement in the form set forth in EXHIBIT B;
(d) a copy of a Certificate of Good Standing for LM issued not
more than thirty (30) days prior to the Closing Date by the
Utah Secretary of State;
(e) an opinion of C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, counsel to LM, dated the
Closing Date, in a form deemed acceptable by MRM and its
counsel;
(f) Articles of Incorporation and Bylaws of LM certified as of the
Closing Date by the President and Secretary of LM;
(g) all of LM's corporate records;
(h) executed bank forms for LM bank accounts reflecting a change
in management and signatories to said bank accounts;
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(i) such other documents, instruments or certificates as shall be
reasonably requested by MRM or its counsel.
3.4 DELIVERIES BY MRM AT CLOSING. MRM shall deliver or cause to be
delivered to LM at the Closing:
(a) a copy of a consent of MRM's Board of Directors authorizing
MRM to take the necessary steps toward closing the transaction
described by this Agreement in the form set forth in EXHIBIT C;
(b) a copy of a Certificate of Good Standing for MRM issued not
more than thirty (30) days prior to the Closing by the
Secretary of State of Nevada;
(c) stock certificate(s) or a computer listing from MRM's transfer
agent representing the Exchange Stock to be newly issued by
MRM under this Agreement, which certificates shall be in the
names of the appropriate LM Shareholders, each in the
appropriate denomination as described in Section 2;
(d) an opinion of ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq., special counsel to
MRM, dated the Closing Date, in a form deemed acceptable to LM
and its counsel;
(e) Articles of Incorporation and Bylaws of MRM certified as of
the Closing Date by the President and Secretary of MRM;
(f) such other documents, instruments or certificates as shall be
reasonably requested by LM or its counsel.
3.5 FILINGS, COOPERATION.
(a) Prior to the Closing, the parties shall proceed with due
diligence and in good faith to make such filings and take such
other actions as may be necessary to satisfy the conditions
precedent set forth in Section 11 below.
(b) On and after the Closing Date, MRM, LM and the Shareholders
set forth in EXHIBIT A shall, on request and without further
consideration, cooperate with one another by furnishing or
using their best efforts to cause others to furnish any
additional information and/or executing and delivering or
using their best efforts to cause others to execute and
deliver any additional documents and/or instruments, and doing
or using their best efforts to cause others to do any and all
such other things as may be reasonably required by the parties
or their counsel to consummate or otherwise implement the
transactions contemplated by this Agreement.
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SECTION 4
REPRESENTATIONS AND WARRANTIES BY
LM AND CERTAIN SHAREHOLDERS
4.1 SUBJECT TO THE SCHEDULES OF EXCEPTIONS ATTACHED HERETO AND
INCORPORATED HEREIN BY THIS REFERENCE (WHICH SCHEDULES SHALL BE ACCEPTABLE TO
MRM), LM AND THOSE SHAREHOLDERS LISTED ON EXHIBIT A REPRESENT AND WARRANT TO
MRM AS FOLLOWS:
(a) ORGANIZATION AND GOOD STANDING OF LM. LM is a corporation
duly organized, validly existing and in good standing under
the laws of the State of Utah, and has full corporate power
and authority to own or lease its properties and to carry on
its business as now being conducted and as proposed to be
conducted. The Articles of Incorporation of LM and all
Amendments thereto as presently in effect, certified by the
Secretary of State of Utah, and the Bylaws of LM as presently
in effect, certified by the President and Secretary of LM,
have been delivered to MRM and are complete and correct, and
since the date of such delivery, there has been no amendment,
modification or other change thereto.
(b) CAPITALIZATION. LM's authorized capital stock is 100,000
shares of no par value common stock (defined herein as "LM
Common Stock"), of which 100,000 shares are issued and
outstanding prior to the Closing Date, and held of record by
two (2) persons, who are currently residents of one of the
following jurisdictions: Utah. All of such outstanding shares
are validly issued, fully paid and non-assessable. All
securities issued by LM as of the date of this Agreement have
been issued in compliance with all applicable state and
federal laws. Except as set forth in SCHEDULE 4.1(b), no other
equity securities or debt obligations of LM are authorized,
issued or outstanding.
(c) SUBSIDIARIES. LM has no subsidiaries and no other
investments, directly or indirectly, or other financial
interest in any other corporation or business organization,
joint venture or partnership of any kind whatsoever.
(d) FINANCIAL STATEMENTS. LM will deliver to MRM, prior to the
Closing, a copy of LM's unaudited financial statements through
December 31, 1996 and through April 30, 1997 (the "LM
Financial Statements"), which will be true and complete. The
LM Financial Statements will be signed by the President and
Secretary of LM certifying that, to the best of their
knowledge, such financial statements are true and complete.
Other than changes in the usual and ordinary conduct of the
business, since April 30, 1997 there have been, and at the
Closing Date there will be, no material adverse changes in
such financial statements.
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(e) ABSENCE OF UNDISCLOSED LIABILITIES. LM has no liabilities
which are not adequately reflected or reserved against in the
LM Financial Statements or otherwise reflected in this
Agreement, and LM shall not have as of the Closing Date any
liabilities (secured or unsecured and whether accrued,
absolute, direct, indirect or otherwise) which were incurred
after April 30, 1997, and would be, individually or in the
aggregate, materially adverse to the results of operations or
financial condition of LM as of the Closing Date.
(f) LITIGATION. Except as disclosed in SCHEDULE 4.1(f), there are
no outstanding orders, judgments, injunctions, awards or
decrees of any court, governmental or regulatory body, or
arbitration tribunal against LM or its properties. Except as
disclosed in SCHEDULE 4.1(f), there are no actions, suits or
proceedings pending, or, to the knowledge of LM, threatened
against or affecting LM, any of its officers or directors
relating to their positions as such, or any of its properties,
at law or in equity, or before or by any federal, state,
municipal or other governmental department, commission, board,
bureau, agency or instrumentality, foreign or domestic, in
connection with the business, operations or affairs of LM,
which might result in any material adverse change in the
operations or financial condition of LM, or which might
prevent or materially impede the consummation of the
transactions under this Agreement.
(g) COMPLIANCE WITH LAWS. To the best of its knowledge, the
operations and affairs of LM do not violate any law,
ordinance, rule or regulation currently in effect, or any
order, writ, injunction or decree of any court or governmental
agency, the violation of which would substantially and
adversely affect the business, financial condition or
operations of LM.
(h) ABSENCE OF CERTAIN CHANGES. Except as set forth in SCHEDULE
4.1(h), or otherwise disclosed in writing to MRM, since April
30, 1997: (i) LM has not entered into any material
transaction; (ii) there has been no change in the condition
(financial or otherwise), business, property, prospects,
assets or liabilities of LM as shown in the LM Financial
Statements, other than changes that both individually and in
the aggregate do not have a consequence that is materially
adverse to such condition, business, property, prospects,
assets or liabilities; (iii) there has been no damage to,
destruction of or loss of any of the properties or assets of
LM (whether or not covered by insurance) materially and
adversely affecting the condition (financial or otherwise),
business, property, prospects, assets or liabilities of LM;
(iv) LM has not declared or paid any dividend, made any
distribution on its capital stock, redeemed, purchased or
otherwise acquired any of its capital stock, granted any
options to purchase shares of its stock, or issued any shares
of its capital stock; (v) there has been no material adverse
change,
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except in the ordinary course of business, in the contingent
obligations of LM by way of guaranty, endorsement, indemnity,
warranty or otherwise; (vi) there have been no loans made by
LM to its employees, officers or directors; (vii) there has
been no waiver or compromise by LM of a valuable right or of a
material debt owed to it; (viii) there has been no
extraordinary increase in the compensation of any of LM'
employees; (ix) there has been no agreement of commitment by
LM to do or perform any of the acts described in this Section
4.1(h); and (x) there has been no other event or conditions
of any character which might reasonably be expected either to
result in a material and adverse change in the condition
(financial or otherwise), business, property, prospects,
assets or liabilities of LM, or to materially impair the
ability of LM to conduct the business now being conducted.
(i) EMPLOYEES. Except as disclosed in SCHEDULE 4.1(i), there are
no collective bargaining, bonus, profit sharing, compensation
or other plans, agreements or arrangements between LM and any
of its employees, officers or directors, and there are no
employment, consulting, severance or indemnification
arrangements, agreements or understandings between LM (on the
one hand), and any current or former employees, officers or
directors (on the other hand). The LM Shareholders assume all
responsibility for any claims by or damages to any current or
former LM employees and their families. The LM Shareholders
will indemnify and hold blameless MRM from any and all such
claims and damages that may result from litigation or
otherwise from any current or former LM employees or their
families.
(j) ASSETS. All of the assets reflected on the LM Financial
Statements or acquired and held as of the Closing Date will be
owned by LM on the Closing Date. Except as set forth in
SCHEDULE 4.1(j), LM owns outright and has good and marketable
title, or holds valid and enforceable leases, to all of such
assets. None of LM's equipment used by LM in connection with
its business has any material defects, and all such equipment
is, in all material respects, in good operating condition and
repair, and is adequate for the uses to which it is being put.
None of LM' equipment is in need of maintenance or repairs,
except for ordinary, routine maintenance and repair.
Furthermore, LM represents that, except to the extent
disclosed in SCHEDULE 4.1(j) to this Agreement or reserved
against on its balance sheet as of April 30, 1997, it is not
aware of any accounts or contracts receivable existing that,
in its judgment, would be uncollectible.
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(k) TAX MATTERS. LM represents that, except as set forth in
SCHEDULE 4.1(k), all federal, foreign, state and local tax
returns, reports and information statements required to be
filed by or with respect to the activities of LM have been
timely filed. Since April 30, 1997, LM has not incurred any
liability with respect to any federal, foreign, state or local
taxes except in the ordinary and regular course of business.
Such returns, reports and information statements are true and
correct in all material respects insofar as they relate to the
activities of LM. On the date of this Agreement, LM is not
delinquent in the payment of any such tax or assessment, and
no deficiencies for any amount of such tax have been proposed
or assessed. Any tax sharing agreement among or between LM
and any affiliate thereof shall be terminated as of the
Closing Date.
(l) CONTRACTS. Set forth on SCHEDULE 4.1(l) hereto is a true and
complete list of all material contracts, agreements or
commitments to which LM is a party or is bound. All such
material contracts, agreements and commitments are valid and
biding on LM in accordance with their terms.
(m) INSURANCE. Set forth on SCHEDULE 4.1(m) hereto is a list of
insurance policies currently maintained by LM in full force
and effect which provide for coverages which are usual and
customary in its business as to amount and scope, and are
adequate to protect LM against any reasonably foreseeable risk
of loss.
(n) OPERATING AUTHORITIES. To the best of its knowledge, LM has
all material operating authorities, governmental certificates,
and licenses, permits, authorizations and approvals (the
"Permits" or, individually, "Permit") required to conduct its
business as presently conducted. Such Permits are set forth
on SCHEDULE 4.1(n). Since LM's inception (i) there has not
been any notice or adverse development regarding such Permits;
(ii) such Permits are in full force and effect; (iii) no
material violations are or have been recorded in respect of
any Permit; and (iv) no proceeding is pending or threatened to
revoke or limit any Permit.
(o) CONTINUATION OF KEY MANAGEMENT. To the best of its knowledge,
LM's key management personnel intend to continue their
employment with LM after the Closing. For purposes of this
subsection 4.1(o), "key management personnel" shall include
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇.
(p) BOOKS AND RECORDS. The books and records of LM are complete
and correct, are maintained in accordance with good business
practice, and accurately reflect, in all material respects,
all of the transactions described therein, and there have been
no material transactions
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involving LM which properly should have been set forth therein
and which have not been accurately so set forth.
(q) AUTHORITY TO EXECUTE AGREEMENT. The Board of Directors of LM,
pursuant to the power and authority legally vested in it, has
duly authorized the execution and delivery by LM of this
Agreement, and has duly authorized each of the transactions
hereby contemplated. LM has the power and authority to
execute and deliver this Agreement, to consummate the
transactions hereby contemplated, and to take all other
actions required to be taken by it pursuant to the provisions
hereof. LM has taken all actions required by law, its Articles
of Incorporation, as amended, its Bylaws, as amended, or
otherwise, to authorize the execution and delivery of this
Agreement. This Agreement is valid and binding upon LM and
those LM Shareholders listed in EXHIBIT A hereto in accordance
with its terms. Neither the execution and delivery of this
Agreement, nor the consummation of the transactions
contemplated hereby, will constitute a violation or breach of
the Articles of Incorporation, as amended, or the Bylaws, as
amended, of LM, or of any agreement, stipulation, order, writ,
injunction, decree, law, rule or regulation applicable to LM.
(r) FINDER'S FEES. LM is not, and on the Closing Date will not
be, liable or obligated to pay any finder's, agent's or
broker's fee arising out of or in connection with this
Agreement or the transactions contemplated by this Agreement.
4.2 DISCLOSURE. At the date of this Agreement, LM and those LM
Shareholders listed in EXHIBIT A have, and at the Closing Date they will
have, disclosed all events, conditions and facts materially affecting the
business and prospects of LM. LM and such Shareholders have not now, and
will not have at the Closing Date, withheld knowledge of any such events,
conditions or facts which they know, or have reasonable grounds to know, may
materially affect LM' business or prospects. Neither this Agreement, nor any
certificate, exhibit, schedule or other written document or statement,
furnished to MRM by LM and/or by such Shareholders in connection with the
transactions contemplated by this Agreement, contains or will contain any
untrue statement of a material fact, or omits or will omit to state a
material fact necessary to be stated in order to make the statements
contained herein or therein not misleading.
SECTION 5
REPRESENTATIONS AND WARRANTIES BY MRM
5.1 Subject to the schedules of exceptions, attached hereto and
incorporated herein by this reference (which schedules shall be acceptable to
LM), MRM represents and warrants to LM and those Shareholders listed in
EXHIBIT A as follows:
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(a) ORGANIZATION AND GOOD STANDING OF MRM. MRM is a corporation
duly organized, validly existing and in good standing under
the laws of the State of Nevada, and has full corporate power
and authority to own or lease its properties and to carry on
its business as now being conducted and as proposed to be
conducted. MRM is qualified to conduct business as a foreign
corporation in no other jurisdiction, and the failure to so
qualify in any other jurisdiction does not materially
adversely affect the ability of MRM to carry on its business
as most recently conducted. The Articles of Incorporation of
MRM, and all amendments thereto, as presently in effect,
certified by the Secretary of State of Nevada, and the Bylaws
of MRM as presently in effect, certified by the President and
Secretary of MRM, have been delivered to LM and are complete
and correct, and since the date of such delivery, there has
been no amendment, modification or other change thereto.
(b) CAPITALIZATION. MRM's authorized capital stock consists of
100,000,000 shares of $.001 par value common stock (defined
herein as "MRM Common Stock"), approximately 7,200,000 shares
of which will be issued and outstanding prior to the Closing
Date. All authorized and/or outstanding options and warrants
are set forth on SCHEDULE 5.1(b). Except as set forth on
SCHEDULE 5.1(b), no other equity securities or debt
obligations of MRM are authorized, issued or outstanding, and
as of the Closing Date, there will be no other outstanding
options, warrants, agreements, contracts, calls, commitments
or demands of any character, preemptive or otherwise, other
than this Agreement, relating to any of the MRM Common Stock,
and there will be no outstanding security of any kind
convertible into MRM Common Stock. The shares of MRM Common
Stock are free and clear of all liens, charges, claims,
pledges, restrictions and encumbrances whatsoever of any kind
or nature that would inhibit, prevent or otherwise interfere
with the transactions contemplated hereby. All of the
outstanding shares of MRM Common Stock are validly issued,
fully paid and non-assessable, and there are no voting trust
agreements or other contracts, agreements, or arrangements
restricting or affecting voting or dividend rights or
transferability with respect to the outstanding shares of MRM
Common Stock.
(c) ISSUANCE OF EXCHANGE STOCK. All of the MRM Common Stock to be
issued to or transferred to LM Shareholders pursuant to this
Agreement, when issued, transferred and delivered as provided
herein, will be duly authorized, validly issued, fully paid
and non-assessable, and will be free and clear of all liens,
charges, claims, pledges, restrictions and encumbrances
whatsoever of any kind or nature, except those restrictions
imposed by state or federal corporate and securities
regulations.
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(d) APPROVAL OF THE TRANSACTION. MRM will use its best efforts to
forthwith obtain any approval of the transactions set forth in
this Agreement relating to its outstanding shares if required
by the General Corporation Law of California.
(e) VIOLATIONS, CONFLICTS. Neither the execution and delivery of
this Agreement nor the consummation of the transactions
contemplated hereby, nor compliance by MRM with any of the
provisions hereof will: (i) violate or conflict with, or
result in a breach of any provisions of, or constitute a
default (or an event which, with notice or lapse of time or
both, would constitute a default) under, any of the terms,
conditions or provisions of the Articles of Incorporation or
Bylaws of MRM, or any note, bond, mortgage, indenture, deed of
trust, license, agreement or other instrument to which MRM is
a party, or by which it or its properties or assets may be
bound or affected; or (ii) violate any order, writ,
injunction, decree, statute, rule, permit or regulations
applicable to MRM or to any of its properties or assets.
(f) FINANCIAL STATEMENTS. MRM will deliver to LM, prior to the
Closing, a copy of MRM's audited financial statements through
October 31, 1996 (the "MRM Financial Statements"), which will
be true and complete, and which have been prepared in
accordance with generally accepted accounting principles.
Other than changes in the usual and ordinary conduct of the
business, since October 31, 1996 there have been, and at the
Closing Date there will be, no material adverse changes in
such financial statements.
(g) ABSENCE OF UNDISCLOSED LIABILITIES. MRM has no liabilities
which are not adequately reflected or reserved against in the
MRM Financial Statements or otherwise reflected in this
Agreement, and MRM shall not have as of the Closing Date any
liabilities (secured or unsecured and whether accrued,
absolute, direct, indirect or otherwise) which were incurred
after October 31, 1996, and would be, individually or in the
aggregate, materially adverse to the results of operations or
financial condition of MRM as of the Closing Date.
(h) LITIGATION. There are no outstanding orders, judgments,
injunctions, awards or decrees of any court, governmental or
regulatory body, or arbitration tribunal against MRM or its
properties. There are no actions, suits or proceedings
pending, or, to the knowledge of LM, threatened against or
affecting MRM, any of its officers or directors relating to
their positions as such, or any of its properties, at law or
in equity, or before or by any federal, state, municipal or
other governmental department, commission, board, bureau,
agency or instrumentality, foreign or domestic, in connection
with the business, operations or affairs of MRM which might
result in any material adverse change in the operations or
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financial condition of MRM, or which might prevent or
materially impede the consummation of the transactions under
this Agreement.
(i) COMPLIANCE WITH LAWS. To the best of its knowledge, the
operations and affairs of MRM do not violate any law,
ordinance, rule or regulation currently in effect, or any
order, writ, injunction or decree of any court or governmental
agency, the violation of which would substantially and
adversely affect the business, financial condition or
operations of MRM.
(j) TAX MATTERS. MRM represents that, except as set forth in
SCHEDULE 5.1(j), all federal, foreign, state and local tax
returns, reports and information statements required to be
filed by or with respect to the activities of MRM have been
timely filed. Since October 31, 1996, MRM has not incurred
any liability with respect to any federal, foreign, state or
local taxes except in the ordinary and regular course of
business. Such returns, reports and information statements
are true and correct in all material respects insofar as they
relate to the activities of MRM. On the date of this
Agreement, MRM is not delinquent in the payment of any such
tax or assessment, and no deficiencies for any amount of such
tax have been proposed or assessed. Any tax sharing agreement
among or between MRM and any affiliate thereof shall be
terminated as of the Closing Date.
(k) BOOKS AND RECORDS. The books and records of MRM are complete
and correct, are maintained in accordance with good business
practice, and accurately reflect, in all material respects,
all of the transactions described therein, and there have been
no material transactions involving MRM which properly should
have been set forth therein and which have not been accurately
so set forth.
(l) AUTHORITY TO EXECUTE AGREEMENT. The Board of Directors of
MRM, pursuant to the power and authority legally vested in it,
has duly authorized the execution and delivery by MRM of this
Agreement and the Exchange Stock, and has duly authorized each
of the transactions hereby contemplated. MRM has the power
and authority to execute and deliver this Agreement, to
consummate the transactions hereby contemplated, and to take
all other actions required to be taken by it pursuant to the
provisions hereof. MRM has taken all actions required by law,
its Articles of Incorporation, as amended, it Bylaws, as
amended, or otherwise, to authorize the execution and delivery
of this Agreement and the Exchange Stock, pursuant to the
provisions hereof. This Agreement is valid and binding upon LM
in accordance with its terms. Neither the execution and
delivery of this Agreement, nor the consummation of the
transactions contemplated hereby, will constitute a violation
or breach of the Articles of Incorporation, as amended, or the
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Bylaws, as amended, of MRM, or of any agreement, stipulation,
order, writ, injunction, decree, law, rule or regulation
applicable to MRM.
(m) FINDER'S FEES. MRM is not, and on the Closing Date will not
be, liable or obligated to pay any finder's, agent's or
broker's fee arising out of or in connection with this
Agreement or the transactions contemplated by this Agreement.
5.2 DISCLOSURE. At the date of this Agreement, MRM has, and at the
Closing Date it will have, disclosed all events, conditions and facts
materially affecting the business and prospects of MRM. MRM has not now, and
will not have at the Closing Date, withheld knowledge of any such events,
conditions or facts which it knows, or has reasonable grounds to know, may
materially affect MRM's business or prospects. Neither this Agreement, nor
any certificate, exhibit, schedule or other written document or statement,
furnished to LM or the LM Shareholders by MRM in connection with the
transactions contemplated by this Agreement, contains or will contain any
untrue statement of a material fact, or omits or will omit to state a
material fact necessary to be stated in order to make the statements
contained herein or therein not misleading.
SECTION 6
ACCESS AND INFORMATION
6.1 AS TO LM. Subject to the protections provided by subsection 9.4
herein, LM shall give to MRM and to MRM's counsel, accountants and other
representatives full access during normal business hours throughout the
period prior to the Closing to all of LM' properties, books, contracts,
commitments and records, including information concerning products and
customer base, and patents held by, or assigned to, LM, and shall furnish to
MRM during such period all such information concerning LM' affairs as MRM may
reasonably request.
6.2 AS TO MRM. Subject to the protections provided by subsection 9.4
herein, MRM shall give to LM, the LM Shareholders and to LM's counsel,
accountants and other representatives full access during normal business
hours throughout the period prior to the Closing to all of MRM's properties,
books, contracts, commitments and records, and shall furnish to LM and the LM
Shareholders during such period all such information concerning MRM's affairs
as LM and the LM Shareholders may reasonably request.
SECTION 7
COVENANTS OF LM AND LM SHAREHOLDERS
7.1 NO SOLICITATION. LM and the LM Shareholders listed on EXHIBIT A,
to the extent within each Shareholder's control, will use their best efforts
to cause LM's offic ers, employees, agents and representatives not, directly
or indirectly , to solicit, encourage, or initiate any discussions with, or
negotiate or otherwise deal with, or
13
provide any information to, any person or entity other than MRM and its
officers, employees and agents, concerning any merger, sale of substantial
assets, or similar transaction involving LM, or any sale of any of its
capital stock or of the capital stock held by such Shareholders in excess of
10% of such Shareholder's current stock holdings, except as otherwise
disclosed in this Agreement. LM will notify MRM immediately upon receipt of
an inquiry, offer, or proposal relating to any of the foregoing. None of the
foregoing shall prohibit providing information to others in a manner in
keeping with the ordinary conduct of LM's business, or providing information
to government authorities.
7.2 CONDUCT OF BUSINESS PENDING THE TRANSACTION. LM and the LM
Shareholders listed on EXHIBIT A, to the extent within each Shareholder's
control, covenant and agree with MRM that, prior to the consummation of the
transaction called for by this Ag reement, and the Closing, or the
termination of this Agreement pursuant to its terms, unless MRM shall
otherwise consent in writing, and except as otherwise contemplated by this
Agreement, they will each comply with all of the following:
(a) LM's business shall be conducted only in the ordinary and
usual course. LM shall use reasonable efforts to keep intact
its business organization and good will, keep available the
services of its respective officers and employees, and
maintain good relations with suppliers, creditors, employees,
customers and others having business or financial
relationships with LM, and LM shall immediately notify MRM of
any event or occurrence which is material to, and not in the
ordinary and usual course of, the business of LM.
(b) LM shall not (i) amend its Articles of Incorporation or
Bylaws, or (ii) split, combine, or reclassify any of its
outstanding securities, or (iii) declare, set aside, or pay
any dividend or other distribution on, or make or agree or
commit to make any exchange for or redemption of any such
securities payable in cash, stock or property.
(c) LM shall not (i) issue or agree to issue any additional shares
of, or rights of any kind to acquire any shares of, its
capital stock of any class, or (ii) enter into any contract,
agreement, commitment, or arrangement with respect to any of
the foregoing, except as set forth in this Agreement.
(d) LM shall not create, incur, or assume any long-term or
short-term indebtedness for money borrowed, or make any
capital expenditures or commitment for capital expenditures,
except in the ordinary course of business and consistent with
past practice.
(e) LM shall not (i) adopt, enter into, or amend any bonus, profit
sharing, compensation, stock option, warrant, pension,
retirement, deferred compensation, employment, severance,
termination or other employee benefit plan, agreement, trust
fund, or arrangement for the benefit or
14
welfare of any officer, director or employee, or (ii) agree to
any material (in relation to historical compensation) increase
in the compensation payable or to become payable to, or any
increase in the contractual term of employment of, any officer,
director or employee, except, with respect to employees who
are not officers or directors, in the ordinary course of
business in accordance with past practices, or with the
written approval of MRM.
(f) LM shall not sell, lease, mortgage, encumber or otherwise
dispose of, or grant an interest in, any of its assets or
properties, except for: (i) sales, encumbrances and other
dispositions or grants in the ordinary course of business and
consistent with past practice; (ii) liens for taxes not yet
due; (iii) liens or encumbrances that are not material in
amount or effect and that do not impair the use of the
property; or (iv) as specifically provided for or permitted in
this Agreement.
(g) Neither LM nor any of its subsidiaries shall enter into any
agreement, commitment, or understanding, whether in writing or
otherwise, with respect to any of the matters referred to in
subparagraphs (a) through (f) above.
(h) LM will continue to properly and promptly file when due all
federal, state, local, foreign and other tax returns, reports
and declarations required to be filed by it, and will pay, or
make full and adequate provision for the payment of, all taxes
and governmental charges due from or payable by LM.
(i) LM will comply with all laws and regulations applicable to it
and to its operations.
(j) LM will maintain in full force and effect insurance coverage
of a type and in such amounts as are customary in its
business, but not less than that set forth in SCHEDULE 4.1(m).
SECTION 8
COVENANTS OF MRM
8.1 NO SOLICITATION. MRM will not discuss or negotiate with any other
corporation, firm or other person or entertain or consider any inquiries or
proposals relating to the possible disposition of its shares of capital
stock, or its assets, and will conduct business only in the ordinary course.
Notwithstanding the foregoing, MRM shall be free to engage in activities
mentioned in the preceding sentence which are designed to further the mutual
interests of the parties to this Agreement.
15
8.2 CONDUCT OF MRM PENDING CLOSING. MRM covenants and agrees with LM
that, prior to the consummation of the transactions called for by this
Agreement, and the Closing, or the termination of this Agreement pursuant to
its terms, unless LM shall otherwise consent in writing, and except as
otherwise contemplated by this Agreement, MRM will comply with all of the
following:
(a) No change will be made in MRM's Articles of Incorporation or
Bylaws, or in MRM's authorized or issued shares of capital
stock, except as may be first approved in writing by LM.
(b) No dividends shall be declared, no stock options granted and
no employment agreements shall be entered into with officers
or directors of MRM, except as may be first approved in
writing by LM.
SECTION 9
ADDITIONAL COVENANTS OF THE PARTIES
9.1 COOPERATION. Both LM and MRM will cooperate with each other and
with their respective counsel, accountants and agents in carrying out the
transaction contemplated by this Agreement, and in delivering all documents
and instruments deemed reasonably necessary or useful by the other party.
9.2 EXPENSES. Each of the parties hereto shall pay all of its
respective costs and expenses (including attorneys' and accountants' fees,
costs and expenses) incurred in connection with this Agreement and the
consummation of the transactions contemplated herein.
9.3 PUBLICITY. Prior to the Closing, any written news releases or
public disclosure by either party pertaining to this Agreement shall be
submitted to the other party for its review and approval prior to such
release or disclosure, provided, however, that (a) such approval shall not be
unreasonably withheld, and (b) such review and approval shall not be required
of disclosures required to comply, in the judgment of counsel, with federal
or state securities or corporate laws or policies.
9.4 CONFIDENTIALITY. While each party is obligated to provide access
to and furnish information in accordance with Sections 4 and 5 herein, it is
understood and agreed that such disclosure and information subsequently
obtained as a result of such disclosures are proprietary and confidential in
nature. Each party agrees to hold such information in confidence and not to
reveal any such information to any person who is not a party to this
Agreement, or an officer, director or key employee of MRM or LM, and not to
use the information obtained for any purpose other than assisting in its due
diligence inquiry precedent to the Closing. Upon request of any party
hereto, a confidentiality agreement, acceptable to the disclosing party, will
be executed by any person selected to receive such proprietary information,
prior to receipt of such information.
16
SECTION 10
SURVIVAL OF REPRESENTATIONS,
WARRANTIES AND COVENANTS
10.1 The representations, warranties and covenants of LM, and of those
Shareholders listed on EXHIBIT A contained herein, shall survive the
execution and delivery of this Agreement, the Closing and the consummation of
the transactions called for by this Agreement. The representations,
warranties and covenants of MRM contained herein shall survive the execution
and delivery of this Agreement, the Closing and the consummation of the
transactions called for by this Agreement.
SECTION 11
CONDITIONS PRECENDENT TO OBLIGATIONS OF THE PARTIES
11.1 The obligations of MRM, LM and the LM Shareholders listed on
EXHIBIT A under this Agreement shall be subject to the fulfillment, on or
prior to the Closing, of all conditions elsewhere herein set forth,
including, but not limited to, receipt by the appropriate party of all
deliveries required by Sections 4 and 5 herein, and the fulfillment, prior to
Closing, of each of the following conditions:
(a) All representations and warranties made in this Agreement by
MRM, LM and the LM Shareholders listed on EXHIBIT A shall be
true and correct in all material respects on and as of the
Closing Date with the same effect as if such representations
and warranties had been made on and as of the Closing Date.
(b) MRM, LM and the LM Shareholders listed on EXHIBIT A shall have
performed or complied with all covenants, agreements and
conditions contained in this Agreement on their part required
to be performed or complied with at or prior to the Closing.
(c) All material authorizations, consents or approvals of any and
all governmental regulatory authorities necessary in connection
with the consummation of the transactions contemplated by this
Agreement shall have been obtained and be in full force and
effect.
(d) The Closing shall not violate any permit or order, decree or
judgment of any court or governmental body having competent
jurisdiction, and there shall not have been instituted any
legal or administrative action or proceeding to enjoin the
transaction contemplated hereby or seeking damages from any
party with respect thereto.
17
(e) Each LM Shareholder acquiring Exchange Stock will be required,
at the Closing, to submit an agreement confirming that all of
the Exchange Stock received will be acquired for investment
and not with a view to, or for sale in connection with, any
distribution thereof, and agreeing not to transfer any of the
Exchange Stock for a period of one year from the date of the
Closing, except to those persons approved by legal counsel to
MRM as falling within the exemption from registration under
the Securities Act of 1933 and any applicable state securities
laws, which transfers do not constitute a public distribution
of securities, and in which the transferees execute an
investment letter in forma and substance satisfactory to
counsel for MRM. Each LM Shareholder acquiring Exchange Stock
will be required to transfer to MRM at the Closing his or her
respective LM Shares, free and clear of all liens, mortgages,
pledges, encumbrances or charges, whether disclosed or
undisclosed.
(f) All schedules prepared by LM shall be current or updated as
necessary as of the Closing Date.
(g) Each party shall have received favorable opinions from the
other party's counsel on such matters in connection with the
transactions contemplated by this Agreement as are reasonable.
(h) Each party shall have satisfied itself that since the date of
this Agreement the business of the other party has been
conducted in the ordinary course. In addition, each party
shall have satisfied itself that no withdrawals of cash or
other assets have been made and no indebtedness has been
incurred since the date of this Agreement, except in the
ordinary course of business or with respect to services
rendered or expenses incurred in connection with the Closing
of this Agreement, unless said withdrawals or indebtedness
were either authorized by the terms of this Agreement or
subsequently consented to in writing by the parties hereto.
(i) Each party covenants that, to the best of its knowledge, it
has complied in all material respects with all applicable
laws, orders and regulations of federal, state, municipal
and/or other governments and/or any instrumentality thereof,
foreign or domestic, applicable to their assets, to the
business conducted by them and to the transactions
contemplated by this Agreement.
(j) MRM shall have provided to LM audited financial statements of
MRM as of October 31, 1996 and for the year then ended,
prepared in accordance with generally accepted accounting
principles.
18
(k) LM shall have provided to MRM unaudited financial statements
of LM as of December 31, 1996 and for the year then ended and
as of April 30, 1997 and for the four months then ended,
prepared in accordance with generally accepted accounting
principles.
(l) Each party hereto shall have granted to the other party
(acting through its management personnel, counsel, accountants
or other representatives designated by it) full opportunity to
examine its books and records, properties, plant and
equipment, proprietary rights and other instruments, rights
and papers of all kinds in accordance with Sections 4 and 5
hereof, and each party shall be satisfied to proceed with the
transactions contemplated by this Agreement upon completion of
such examination and investigation.
(m) If LM Shareholders who in the aggregate own more than five
percent (5%) of the LM Shares dissent from the proposed Exchange
Transaction, or are unable or for any reason refuse to transfer
any of all of their LM Shares to MRM in accordance with Section 1
of this Agreement, then MRM, at its sole option, may terminate
this Agreement.
(n) Each party shall have satisfied itself that all transactions
contemplated by this Agreement, including those contemplated
by the exhibits and schedules attached hereto, shall be legal
and binding under applicable statutory and case law of the
State of California, including, but not limited to, California
securities laws and all other applicable state securities laws.
(o) MRM and LM shall agree to indemnify each other against any
liability to any broker or finder to which that party may
become obligated.
(p) The Exchange Transaction shall be approved by the Boards of
Directors of both LM and MRM. Furthermore, the Exchange
Transaction shall be approved by the shareholders of LM and
MRM, if deemed necessary of appropriate by counsel for the
same, within forty-five (45) days following execution of this
Agreement. If such a shareholder meeting is deemed necessary,
the management of LM and MRM agree to recommend approval of
the Exchange Transaction to their respective shareholders and
to solicit proxies in support of the same.
(q) MRM and LM and their respective legal counsel shall have
received copies of all certificates, opinions and other
documents and instruments as each party or its legal counsel
may reasonably request pursuant to this Agreement or otherwise
in connection with the consummation of the transactions
contemplated hereby, and all such certificates, opinions and
other documents and instruments received by each party shall
be
19
reasonably satisfactory, in form and substance, to each party
and to its legal counsel.
(r) Both LM and MRM shall have the right to waive any or all of
the conditions precedent to its obligations hereunder not
otherwise legally required; provided, however, that no waiver
by a party of any conditions precedent to its obligations
hereunder shall constitute a waiver by such party of any other
condition.
SECTION 12
TERMINATION, AMENDMENT, WAIVER
12.1 This Agreement may be terminated at any time prior to the Closing,
and the contemplated transactions abandoned, without liability to either
party hereto, except with respect to the obligations of MRM, LM and the LM
Shareholders under Section 9.4 hereof:
(a) By mutual agreement of MRM and LM.
(b) If the Closing (as defined in Section 3) shall not have taken
place on or prior to August 26, 1997, this Agreement can be
terminated upon written notice given by MRM or LM, provided
that such party giving notice is not in material default.
(c) By MRM, if in its reasonable belief there has been a material
misrepresentation or breach of warranty on the part of any
Shareholder in the representations and warranties set forth in
the Agreement.
(d) By LM or by a majority (as measured by their equity interest)
of those LM Shareholders listed on EXHIBIT A if, in the
reasonable belief of LM or of any such Shareholders, there has
been a material misrepresentation or breach or warranty on the
part of MRM in the representations and warranties set forth in
this Agreement.
(e) By MRM if, in its opinion or that of its counsel, the Exchange
does not qualify for exemption from registration under
applicable federal or state securities laws, or qualification,
if obtainable, cannot be accomplished (in MRM's opinion or
that of its counsel) without unreasonable expense or effort.
(f) By MRM if, in its opinion or that of its counsel, the Exchange
cannot be consummated under California or other relevant state
corporate law or, if consummation is possible, that it cannot
be accomplished (in MRM's opinion or that of its counsel)
without unreasonable expense or effort.
20
(g) By MRM or by a majority (as measured by their equity interest)
of the LM Shareholders listed on EXHIBIT A if either party shall
determine in its sole discretion that the Exchange has become
inadvisable or impracticable by reason of the institution or
threat by state, local or federal governmental authorities, or
by any other person, of material litigation or proceedings
against any party [it being understood and agreed that a written
request by a governmental authority for information with respect
to the Exchange Transaction, which information could be used in
connection with such litigation or proceedings, may be deemed to
be a threat of material litigation or proceedings regardless of
whether such request is received before or after the signing of
this Agreement].
(h) By MRM if the business or assets or financial condition of LM,
taken as a whole, have been materially and adversely affected,
whether by the institution of litigation or be reason of
changes or developments, or in operations in the ordinary
course of business, or otherwise; or, by a majority (as
measured by their equity interest) of those LM Shareholders
listed on EXHIBIT A if the business or assets or financial
condition of MRM, taken as a whole, have been materially and
adversely affected, whether by the institution of litigation
or by reason of changes or developments, or in operations in
the ordinary course of business, or otherwise.
(i) By MRM if holders of more than five percent (5%) of the LM
Shares fail to tender their Shares at the Closing of the
Exchange Transaction.
(j) By MRM if, in its sole discretion, it appears that the
combined entity will not be auditable.
(k) By LM if MRM fails to perform material conditions as set forth
in Section 11 herein.
(l) By LM if examination of MRM's books and records pursuant to
Section 5 herein uncovers a material deficiency.
(m) By MRM if LM fails to perform material conditions as set forth
in Section 11 herein.
(n) By MRM if examination of LM's books and records pursuant to
Section 4 herein uncovers a material deficiency.
21
SECTION 13
MISCELLANEOUS
13.1 ENTIRE AGREEMENT. This Agreement (including the exhibits and
schedules attached hereto) contains the entire agreement between the parties
hereto with respect to the transactions contemplated hereby, and supersedes
all negotiations, representations, warranties, commitments, offers,
contracts, and writings prior to the date hereof. No waiver and no
modification or amendment of any provision of this Agreement shall be
effective unless specifically made in writing and duly signed by the parties
to be bound thereby.
13.2 BINDING AGREEMENT.
(a) This Agreement shall become binding upon the parties hereto
when, but only when, it shall have been signed on behalf of
all parties hereto.
(b) Subject to the condition stated in subsection (a) of this
Section 13.2, this Agreement shall be binding upon, and inure
to the benefit of, the respective parties hereto and their
legal representatives, successors and assigns. This
Agreement, in all of its particulars, shall be enforceable by
the means set forth in subsection 13.9 for the recovery of
damages or by way of specific performance, and the terms and
conditions of this Agreement shall remain in full force and
effect subsequent to the Closing and shall not be deemed to be
merged into any documents conveyed and delivered at the time
of Closing.
(c) In the event that subsection 13.9 hereof is found to be
unenforceable as to any party for any reason, or is not
invoked by any party, and any person is required to initiate
any action at law or in equity for the enforcement of this
Agreement, the prevailing party in such litigation shall be
entitled to recover from the party determined to be in default
all of its reasonable costs incurred in said litigation,
including attorneys' fees.
13.3 SHAREHOLDERS OWNING AT LEAST 5% OF LM STOCK. The LM Shareholders
owning at least five percent (5%) of the issued and outstanding common stock
of LM (see EXHIBIT A hereto) are executing this Agreement only with respect
to sections 3.4, 4, 7, 9.4, 10, 11, 12.1 (d and g), 13.2, 13.3, 13.4, 13.8
and 13.9.
13.4 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which may be deemed an original, but all of which
together shall constitute one and the same instrument.
22
13.5 SEVERABILITY. If any provision(s) hereof shall be held invalid or
unenforceable by any court of competent jurisdiction or as a result of future
legislative action, such holding or action shall be strictly construed and
shall not affect the validity or effect of any other provision hereof.
13.6 ASSIGNABILITY. This Agreement shall be binding upon and inure to
the benefit of the successors and assigns of the parties hereto; provided,
however, that neither this Agreement nor any right hereunder shall be
assignable by LM or MRM without prior written consent of the other party
hereto.
13.7 CAPTIONS. The captions of the various sections of this Agreement
have been inserted only for convenience of reference, and shall not be deemed
to modify, explain, enlarge or restrict any of the provisions of this
Agreement.
13.8 GOVERNING LAW. The validity, interpretation and effect of this
Agreement shall be governed exclusively by the laws of the State of
California.
13.9 DISPUTE RESOLUTION. In the event of a dispute between the parties
hereto involving a claim of breach of representation or warranty hereunder,
or to enforce a covenant herein (either or both of which are referred to
hereafter as a "Claim"), if it is the desire of any party for quick
resolution, the rights and obligations of the parties hereto arising under
the terms of this Agreement with respect to such Claims and/or resolutions of
such disputes will be by the means of the judgment of an independent third
party ("Rent-a-Judge") who has been selected and hired through the mutual
agreement of the parties hereto. The utilization of this subsection 13.9, if
invoked by any party hereto, shall be the exclusive remedy for resolving a
Claim regardless of whether legal action has or has not been otherwise
instituted. If legal action has been instituted by any party, and this
subsection 13.9 is invoked in a timely manner, any such legal action shall be
void ab initio and immediately withdrawn.
(a) In the event of a Claim by any party, any party may make a
written request upon the other parties for a Rent-a-Judge. A
request by any party for the employment of a Rent-a-Judge to
resolve the Claim shall be binding on all other parties to
this Agreement in accordance with the terms hereof.
(b) The parties may agree upon one Rent-a-Judge, but in the event
that they cannot so agree, there shall be three Rent-a-Judges
selected, one named in writing by each of the parties hereto
(MRM and LM) within twenty (20) days after the initial demand
for employment of a Rent-a-Judge, and a third chosen by the
two so appointed. Should either party refuse or neglect to
join in the appointment of the Rent-a-Judge, or to furnish the
Rent-a-Judge(s) with any papers or information demanded, the
Rent-a-Judge(s) are empowered by all parties to this Agreement
to proceed ex parte.
23
(c) Claim resolution proceedings shall take place in the City or
County of Los Angeles, State of California, and the hearing
before the Rent-a-Judge(s) of the matter to be arbitrated
shall be at the time and place within said city or county as
is selected by the Rent-a-Judge(s). The Rent-a-Judge(s) shall
select such time and place promptly after appointment and
shall give written notice thereof to each party at least
thirty (30) days prior to the date so fixed. At the hearing,
any relevant evidence may be presented by either party, and
the formal rules of evidence applicable to judicial
proceedings shall not govern. Evidence may be admitted or
excluded in the sole discretion of the Rent-a-Judge(s). Said
Rent-a-Judge(s) shall hear and determine the matter and shall
execute and acknowledge their award in writing, and cause a
copy thereof to be delivered to each of the parties.
(d) If there is only one Rent-a-Judge, his or her decision shall
be binding and conclusive on the parties. If there are three
(3) Rent-a-Judges, the decision of any two (2) shall be
binding and conclusive on the parties.
(e) If three Rent-a-Judges are selected under the foregoing
procedure, but two (2) of the three (3) fail to reach an
agreement in the determination of the matter in question, the
matter shall be decided by three (3) new Rent-a-Judges who
shall be appointed and shall proceed in the same manner as set
forth in this section, and the process shall be repeated until
a decision is finally reached by two (2) of the three (3)
Rent-a-Judges selected.
(f) The costs of such Claim resolution shall be borne by the
parties equally and each party shall pay its own attorneys'
fees, provided, however, that in the event either party
challenges or in any way seeks to have the decision or award
of the Rent-a-Judge(s) vacated, corrected or modified, if the
challenge is denied or the original decision or award is
affirmed, the challenging party shall pay the costs and fees,
including reasonable attorneys' fees, of the non-challenging
party, both for the challenge and for the original Claim
resolution process.
24
13.10 NOTICES. All notices, requests, demands and other communications
under this Agreement shall be in writing and delivered in person or sent by
certified mail, postage prepaid and properly addressed as follows:
TO LM:
▇▇▇▇▇▇▇ ▇▇▇▇▇, President
Laser Medical, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
WITH A COPY TO:
C. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Woodlands Business Center
▇▇▇▇ ▇. ▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
TO MRM:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, President
Medical Resources Management, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
WITH A COPY TO:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Transworld Bank Plaza
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Any party may from time to time change its address for the purpose of
notices to that party by a similar notice specifying a new address, but no
such change shall be deemed to have been given until it is actually received
by the other party hereto.
All notices and other communications required or permitted under this
Agreement which are addressed as provided in this section 13.10, if delivered
personally, shall be effective upon delivery; and, if delivered by mail, shall
be effective three (3) days following deposit in the United States mail, postage
prepaid.
25
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first written above.
MEDICAL RESOURCES MANAGEMENT, INC.
a Nevada corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
----------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, President
LASER MEDICAL, INC.
a Utah corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
FIVE PERCENT SHAREHOLDERS OF LASER MEDICAL, INC.
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