LLC MEMBERSHIP INTEREST PURCHASE AGREEMENT
THIS LLC
MEMBERSHIP INTEREST PURCHASE AGREEMENT , (this
“Agreement”) is entered into effective as of the 6th
day of September, 2007 (the “Effective Date”) by and
among Medical Resources, LLC, a Florida limited liability company,
(“MR”), Walter Janke and Lalita Janke, (together, the
“Jankes”) and PrimaCare Corporation, a Florida
corporation (“Buyer”). MR, the Jankes and Buyer are
hereinafter referred to jointly as the “Parties” and
singularly as “Party”.
WHEREAS, Buyer desires to purchase from the Jankes and the
Jankes desire to sell to Buyer membership interests representing
100% of the membership interests in MR.
NOW,
THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants, agreements and conditions
set forth in this Agreement, and intending to be legally bound, the
parties agree as follows:
| 1. |
Purchase and Sale of Membership Interests. |
| |
(a) |
Agreement . At the Closing, the Jankes shall sell to
Buyer, and Buyer shall purchase from the Jankes in accordance with
the terms and conditions contained in this Agreement: |
| |
(i) |
The Jankes’ membership interests in MR (the “MR
Membership Interests”), which consists of 100% of all of
MR’s issued and outstanding membership interests; |
| 2. |
Purchase Price; Payment |
| |
(a) |
Purchase Price . The aggregate purchase price (the
“Purchase Price”) for the Membership Interests shall be
an amount equal to 5 times MR’s earnings before interest,
taxes, depreciation and amortization (“EBITDA”), which
shall be calculated based upon an audited review of MR’s
financial statements for the 24 month period from January 1, 2008
through December 31, 2009. Notwithstanding the foregoing, the
Purchase Price shall be no less than Fifteen Million Dollars
($15,000,000) and no more than Thirty Million Dollars
($30,000,000). |
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(b) |
Payment . The Purchase Price shall be paid as
follows: |
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(i) |
At the Closing, Buyer shall deliver 28 million IWWI shares (as
defined below) as an estimate of the Purchase Price to Escrow Agent
pursuant to an Escrow Agreement by and among the Jankes, Buyer, MR,
and Escrow Agent (the “Escrow Agreement”). The form of
the Escrow Agreement shall be agreed upon by all Parties within 30
days from the date of this Agreement. |
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(ii) |
All payments under this Section 2 shall be made in the
form of shares of common stock of Inform Worldwide Holdings, Inc.
(the “IWWI Shares”). The number of the IWWI Shares to
be placed into Escrow shall be determined as follows: |
| |
(1) |
The Purchase Price divided by the 90 days Weighted Average
Price of the IWWI Shares on the Trading Day immediately preceding
the Closing Date. |
The
“Weighted Average Price” shall be established by the
dollar volume-90 days weighted average price for IWWI Shares in the
over-the-counter market on the electronic bulletin board for such
security during the period beginning at 9:30:01 a.m., New York Time
(or such other time as such market publicly announces is the
official open of trading), and ending at 4:00:00 p.m., New York
Time (or such other time as such market publicly announces is the
official close of trading) as reported by Bloomberg. All such
determinations to be appropriately adjusted for any stock dividend,
stock split, stock combination or other similar transaction during
the applicable calculation period.
The
“Trading Day” means any day on which the IWWI Shares
are traded on the over-the-counter market on the electronic
bulletin board.
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(c) |
When the Purchase Price can be computed finally under the
provisions of Section 2(a), an appropriate adjustment shall be made
to the number of IWWI Shares delivered to the Escrow Agent. If
Escrow Agent has received more shares than as is required to
satisfy the Purchase Price, the Escrow agent shall deliver to Buyer
such excess shares. If the Purchase Price requires the Buyer to pay
additional shares, Buyer shall promptly deliver the proper number
of shares needed so that the Purchase Price can be satisfied to the
Jankes. |
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(d) |
Excluded Assets . At the Closing, title to the 2004 Kia
Sedona Automobile License Tag No. 4531DX. Additionally, if MR
receives from America’s Health Choice Medical Plans, Inc. any
additional compensation due to CMS retroactive adjustments for the
period prior to the Closing Date, fifty percent (50%) of the
amounts received shall be payable to the Jankes when received by
MR, as an addition to the Purchase Price. Further, at the time of
Closing, MR shall assign to the Jankes all of its causes of action
which it may hold against Dr. Edward Sollie and/or Molina
Healthcare, Inc. |
| 3. |
Representations and Warranties of MR and Jankes
. |
The Jankes,
jointly and severally, and MR, jointly and severally with the
Jankes, make the following representations and warranties to Buyer,
each of which is true and correct on the date hereof and shall
survive the consummation of the transactions contemplated
hereby.
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(a) |
Organization and Qualification . MR is a limited
liability company duly organized and in active status under the
laws of the State of Florida. MR has all requisite power and
authority to carry on its business as currently conducted and is
duly qualified to transact business in each jurisdiction in which
the failure to be so qualified would reasonably be expected to have
a material adverse effect on MR’s business, properties or
financial condition (a “Material Adverse
Effect”). |
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(b) |
Capitalization . As of the Closing, the outstanding
equity of MR will consist of 100% membership interest held by
Jankes. There are no outstanding rights, options, warrants,
preemptive rights, rights of first refusal or similar rights for
the purchase or acquisition from MR of any equity interest in MR.
All outstanding equity interests of MR have been issued in
compliance with state and federal securities laws. |
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(c) |
Subsidiaries . Except as provided on Schedule
3(c) , and except as to Clinicare of Broward, LLC (formerly
known as Family Futures, LLC), MR does not presently own or
control, directly or indirectly, any interest in any other
corporation, association, or other business entity. MR is not a
participant in any joint venture, partnership, or similar
arrangement. |
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(d) |
Valid Issuance of Membership Interests . The Membership
Interests shall be duly authorized, validly issued, fully paid and
non-assessable and will be free of restrictions on transfer
directly or indirectly created by MR other than restrictions on
transfer under this Agreement and under applicable state and
federal securities laws. |
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(e) |
Jankes . Each of the Jankes is a competent adult and has
full power, legal right and authority to execute and deliver this
Agreement and the other documents and instruments to be executed
and delivered by each of the Jankes pursuant hereto and to carry
out the transactions contemplated hereby and thereby. Each of the
Jankes has, and at the Closing Buyer will receive, good and
marketable fee title to the MR Membership Interests, free and clear
of all liens. |
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(f) |
Authority . The execution and delivery of this Agreement
and the other documents and instruments to be executed and
delivered by MR or the Jankes pursuant hereto and the consummation
of the transactions contemplated hereby and thereby have been duly
authorized by MR and the Jankes. No other or further act or
proceeding on the part of MR or its members (including the Jankes
in their personal capacities) is necessary to authorize this
Agreement or the other documents and instruments to be executed and
delivered by MR or the Jankes pursuant hereto or the consummation
of the transactions contemplated hereby and thereby. MR and the
Jankes have delivered to Buyer true, correct and complete copies of
all consents, resolutions and other documents necessary to duly
authorize the execution and delivery of this Agreement and the
other documents and instruments to be executed and delivered by MR
or the Jankes pursuant hereto and the consummation of the
transactions contemplated hereby and thereby. This Agreement
constitutes, and when executed and delivered, the other documents
and instruments to be executed and delivered by MR or the Jankes
pursuant hereto will constitute, valid and binding agreements of MR
and/or the Jankes, as the case may be, enforceable in accordance
with their respective terms. |
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(g) |
Governmental Consents . Except as provided on
Schedule 3(g) , no consent, approval, order or authorization
of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority on
the part of MR is required in connection with the offer, sale or
issuance of the Membership Interests. |
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(h) |
Litigation . Except as provided on Schedule 3(h)
, there are no actions, suits, proceedings or investigations
pending or, to the best of MR’s knowledge, threatened before
any court, administrative agency or other governmental body against
MR. MR is not a party or subject to, and none of its assets is
bound by, the provisions of any order, writ, injunction, judgment
or decree of any court or government agency or
instrumentality. |
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(i) |
Employees . Except as provided on Schedule 3(i) ,
MR is not a party to or bound by any currently effective employment
contract, deferred compensation agreement, bonus plan, incentive
plan, profit sharing plan, retirement agreement or other employee
compensation agreement or arrangement with any collective
bargaining agent. Except as provided on Schedule 3(i), upon the
closing of this transaction, Buyer shall have the right to
renegotiate all employment contracts to which MR is a
party. |
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(j) |
Intellectual Property . To their knowledge MR has
sufficient title to and ownership of, or other rights to use, all
trade secrets, and, to its knowledge, copyrights, information,
proprietary rights, trademarks, service marks and trade names in
each case necessary for its business as now conducted without any
material conflict with or infringement of the rights of others.
Except as set forth on Schedule 3(k), there are no material
outstanding options, licenses, or agreements of any kind relating
to the foregoing, nor is MR bound by or a party to any material
options, licenses or agreements of any kind with respect to the
trademarks, service marks, trade names, copyrights, trade secrets,
licenses, information, proprietary rights and processes of any
other person or entity. MR has not received any written, or to its
knowledge, oral communications alleging that MR has violated or, by
conducting its business as proposed, would violate any of the
trademarks, service marks, trade names, copyrights or trade secrets
or other proprietary rights of any other person or
entity. |
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(k) |
Absence of Certain Events . Except as and to the extent
set forth in Schedule 3(k) , since July 31, 2007, there has
not been: |
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(i) |
No Adverse Change . Any material adverse change in the
conduct, financial condition, assets, liabilities, business,
prospects or operations of MR. |
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(ii) |
No Damage . Any material loss, damage or destruction,
whether covered by insurance or not, relating to or affecting the
business, assets or liabilities of MR. |
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(iii) |
No Increase in Compensation . Any increase in the
compensation, salaries, commissions or wages payable or to become
payable to any employees or agents of MR, including any bonus or
other employee benefit granted, made or accrued in respect of such
employees or agents, or any increase in the number of such
employees or agents. |
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(iv) |
No Labor Disputes . Any labor dispute or disturbance
relating to or affecting MR, other than routine individual
grievances that are not material to the conduct, financial
condition, assets, Liabilities, business, prospects or operations
of MR. |
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(v) |
No Distributions . Any declaration, setting aside or
payment of any dividend or other distribution in respect of
MR’s capital stock; any redemption, purchase or other
acquisition by MR of any capital stock of MR, or any security
relating to such capital stock; or any other payment of any kind to
any of MR’s members, except for regular payments of base
salary, benefits under employee agreements applicable to MR
employees generally and reimbursement of expenses in accordance
with MR’s expense reimbursement policy. |
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(vi) |
No Increase in Affiliate Obligations . Any increase in
MR’s investment in or receivable from any Affiliate of
MR. |
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(vii) |
No Disposition of Property . Any sale, lease, grant or
other transfer or disposition of any assets of MR, except for the
sale of Inventory items in the ordinary course of
business. |
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(viii) |
No Indebtedness . Any indebtedness for borrowed money
incurred, assumed or guaranteed by MR. |
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(ix) |
Loans and Advances . Any loan or advance made by MR to
any person or entity, other than advances made to MR’s
employees in the ordinary course of business for travel and
entertainment in accordance with past practice. |
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(x) |
Credit . Any grant of credit by MR to any customer
(including any distributor) of MR on terms or in amounts more
favorable than those that have been extended to such customer in
the past, any other change in the terms of any credit heretofore
extended by MR or any other change of MR’s policies or
practices with respect to the granting of credit. |
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(xi) |
Discharge of Obligations . Any discharge, satisfaction
or agreement to satisfy or discharge any liability of MR, other
than the discharge or satisfaction in the ordinary course of
business of current liabilities and current liabilities incurred
since July 31, 2007 in the ordinary course of business. |
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(xii) |
Deferral of Liabilities . Any deferral, extension or
failure to pay any of the liabilities of MR as when the same become
due or any allowance of the level of the liabilities of MR to
increase in any material respect or any prepayment of any of the
liabilities of MR. |
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(xiii) |
Accounting Principles . Any material change in
MR’s financial or tax accounting principles or methods,
except to the extent required by GAAP. |
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(xiv) |
No Unusual Events . Any other event or condition not in
the ordinary course of business that relates to or affects the
business or assets of MR. |
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(l) |
Compliance with Other Instruments . Except as set forth
on Schedule 3(l): (i) MR is not in violation or default of any
provision of its Certificate of Formation or its Operating
Agreement, each as in effect immediately prior to the Closing; (ii)
MR is not in violation or default of any provision of any material
instrument, mortgage, deed of trust, loan, contract, commitment,
judgment, decree, order or obligation to which it is a party or by
which it or any of its properties or assets are bound; and (iii) MR
is not in violation or default of any provision of any federal,
state or local statute, rule or governmental regulation. The
execution, delivery and performance of and compliance with this
Agreement and the sale of the Membership Interests will not result
in any such violation, be in conflict with or constitute, with or
without the passage of time or giving of notice, a default under
any such provision, require any consent or waiver under any such
provision (other than any consents or waivers that have been
obtained), or result in the creation of any mortgage, pledge, lien,
encumbrance or charge upon any of the properties or assets of MR
pursuant to any such provision. |
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(m) |
Permits . MR has all material franchises, permits,
licenses, and any similar authority necessary for the conduct of
its business as now being conducted by it. MR is not in default in
any material respect under any of such franchises, permits,
licenses, or other similar authority. |
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(n) |
No Default . Except as set forth on Schedule 3(n), MR is
not in default in any material respect under any contract to which
it is a party, nor has any event or omission occurred that, through
the passage of time or the giving of notice, or both, would
constitute a default in any material respect thereunder or cause
the acceleration of any of MR’s obligations thereunder or
result in the creation of any lien on any of MR’s assets.
Except as set forth on Schedule 3(n), no third party is in default
in any material respect under any contract to which MR is a party,
nor has any event or omission occurred that, through the passage of
time or the giving of notice, or both, would constitute a default
in any material respect thereunder, or give rise to an automatic
termination, or the right of discretionary termination thereof.
Except as set forth on Schedule 3(n), each contract to which MR is
a party is in full force and effect and is a valid and binding
agreement enforceable against MR and, to MR’s knowledge, the
other party or parties thereto in accordance with its
terms. |
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(o) |
Environmental and Safety Laws . MR is not in violation
of any applicable statute, law or regulation relating to the
environment or occupational health and safety. |
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(p) |
Registration Rights . MR has not granted or agreed to
grant any registration rights, including piggyback rights, to any
person or entity. |
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(q) |
Title to Property and Assets . Except as set forth on
Schedule 3(q), MR has good and marketable title to all of
properties and assets owned by it, free and clear of all mortgages,
liens and encumbrances, except liens for current taxes and
assessments not yet due. Except as set forth on Schedule 3(q), with
respect to the material property and assets it leases, MR is in
material compliance with such leases and, to the best of its
knowledge, holds a valid leasehold interest free of all liens,
claims or encumbrances. MR’s material properties and assets
are in good condition and repair, in all material respects, for the
purposes for which they are currently used, ordinary wear and tear
excepted. |
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(r) |
Agreements; Actions . Except as provided on Schedule
3(r) , there are no agreements, understandings or proposed
transactions between MR and any of its officers, directors,
affiliates, or any affiliate thereof. |
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(s) |
Brokers or Finders . MR has not agreed to incur,
directly or indirectly, any liability for brokerage or
finders’ fees, agents’ commissions or other similar
charges in connection with this Agreement or any of the
transactions contemplated hereby. |
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| 4. |
Representations and Warranties of Buyer. |
Buyer makes
the following representations and warranties to MR and the Jankes,
and unless otherwise provided herein, each of which is true and
correct on the date hereof and shall survive the consummation of
the transactions contemplated hereby.
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(a) |
Organization and Qualification . Buyer is a corporation
duly organized and in active status under the laws of the State of
Florida. Buyer has all requisite power and authority to carry on
its business as currently conducted, and is duly qualified to
transact business. |
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(b) |
Corporate Power . Buyer has all requisite corporate
power and authority to execute and deliver this Agreement and the
other documents and instruments to be executed and delivered by
Buyer pursuant hereto and to carry out the transactions
contemplated hereby and thereby. |
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(c) |
Authority . The execution and delivery of this Agreement
and the other documents and instruments to be executed and
delivered by Buyer pursuant hereto and the consummation of the
transactions contemplated hereby and thereby have been duly
authorized by Buyer. No other or further corporate act or
proceeding on the part of Buyer or its shareholders is necessary to
authorize this Agreement or the other documents and instruments to
be executed and delivered by Buyer pursuant hereto or the
consummation of the transactions contemplated hereby and thereby.
This Agreement constitutes, and when executed and delivered, the
other documents and instruments to be executed and delivered by
Buyer pursuant hereto will constitute, valid and binding agreements
of Buyer, as the case may be, enforceable in accordance with their
respective terms, except as such may be limited by bankruptcy,
insolvency, reorganization or other laws affecting creditors’
rights generally, and by general equitable principles. |
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(d) |
Valid Issuance of IWWI Shares . On the date of the
Closing, the IWWI Shares shall be duly authorized, validly issued,
fully paid and non-assessable and will be free of restrictions on
transfer directly or indirectly created by Buyer other than
restrictions on transfer under this Agreement and under applicable
state and federal securities laws. |
| 5. |
Covenants Prior to the Closing. |
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(a) |
Management and Operation of Business Pending the Closing
. As of the Effective Date, Buyer shall have full control and
authority over the management and operations of MR and shall be
elected the sole manager of MR. Until the Closing, Buyer shall not
make any distributions to itself from MR without the consent of the
Jankes, and shall not incur any new contractual obligations or
indebtedness in each instance greater than Three Thousand Dollars
($3,000.00) |
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