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NOTE PURCHASE AGREEMENT

Note Purchase Agreement

NOTE PURCHASE AGREEMENT | Document Parties: VICIS CAPITAL MASTER FUND | MEDICAL SOLUTIONS MANAGEMENT INC., You are currently viewing:
This Note Purchase Agreement involves

VICIS CAPITAL MASTER FUND | MEDICAL SOLUTIONS MANAGEMENT INC.,

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Title: NOTE PURCHASE AGREEMENT
Governing Law: New York     Date: 12/20/2007
Law Firm: Quarles & Brady LLP; Bingham McCutchen LLP    

NOTE PURCHASE AGREEMENT, Parties: vicis capital master fund , medical solutions management inc.
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EXHIBIT 10.1

NOTE PURCHASE AGREEMENT

THIS NOTE PURCHASE AGREEMENT (this “Agreement”), effective the 16th day of December, 2007, is made by and between VICIS CAPITAL MASTER FUND (the “Purchaser”), and MEDICAL SOLUTIONS MANAGEMENT INC., a Nevada corporation (the “Company”).

RECITALS :

WHEREAS, pursuant to the terms and conditions hereof, the Company wishes to sell, and the Purchaser desires to purchase, a note issued by the Company in the form attached hereto as Exhibit A , in the principal amount of $1,000,000 (the “Bridge Note”) and a Warrant (as defined in Section 5.2 below) in a bridge financing (“Bridge Financing”).

WHEREAS, the parties agree that the Bridge Notes shall be convertible, at the option of the Purchaser, into equity securities or convertible debt financing to be issued by the Company in connection with a future financing (“Future Financing”) pursuant to the terms herein set forth.

NOW, THEREFORE , the Company and the Purchaser hereby agree as follows:

ARTICLE I

SALE OF BRIDGE NOTE

1.1 Purchase and Sale of the Bridge Note . Subject to the terms and conditions hereof and in reliance on the representations and warranties contained herein, or made pursuant hereto, the Company will issue and sell to the Purchaser, and the Purchaser will purchase from the Company at the closing of the transactions contemplated hereby (the “Closing”), the Bridge Note and Warrant for $1,000,000 (the “Purchase Price”).

1.2 Closing . The Closing shall be deemed to occur at the offices of Quarles & Brady, LLP, 411 East Wisconsin Avenue, Milwaukee, Wisconsin at 5:00 p.m. CST on December 16th, 2007 or at such other place, date or time as mutually agreeable to the parties (the “Closing Date”).

1.3 Closing Matters . On the Closing Date, subject to the terms and conditions hereof, the following actions shall be taken:

(a) The Company will deliver to the Purchaser (i) the Bridge Note, dated the Closing Date, in the principal amount of $1,000,000; (ii) the Warrant; and (iii) the registration rights agreement in the form of Exhibit B attached hereto (the “Registration Rights Agreement”), each executed by a duly authorized officer.

(b) The Purchaser shall deliver to the Company the Purchase Price in immediately available funds to the Company.

 


ARTICLE II

REPRESENTATIONS AND WARRANTIES OF COMPANY

The Company hereby represents and warrants to the Purchaser as of the date of this Agreement as follows:

2.1 Organization and Qualification . The Company is a corporation duly organized and validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, and has all requisite corporate power and authority to carry on its business as now conducted. The Company is duly qualified as a foreign corporation to do business and is in good standing in every jurisdiction in which its ownership of property or the nature of the business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing would not have a Material Adverse Effect. As used in this Agreement, “Material Adverse Effect” means any material adverse effect on the business, properties, assets, operations, results of operations, condition (financial or otherwise) or prospects of the Company and its Subsidiary or on the transactions contemplated hereby or by the agreements and instruments to be entered into in connection herewith, or on the authority or ability of the Company to perform its obligations under the Transaction Documents (as hereinafter defined).

2.2 No Violation . The Company is not in violation of: (a) any of the provisions of its articles of incorporation, bylaws or other organizational or charter documents; or (b) any judgment, decree or order or any statute, ordinance, rule or regulation applicable to the Company, except for possible violations which would not, individually or in the aggregate, have a Material Adverse Effect.

2.3 Authorization; Enforcement; Validity . The Company has the requisite corporate power and authority to enter into and perform its obligations under this Agreement, the Bridge Note, the Warrant and each of the other agreements or instruments entered into by the parties hereto in connection with the transactions contemplated by this Agreement (collectively, the “Transaction Documents”) and to issue the Bridge Note and Warrant in accordance with the terms hereof. The execution and delivery of the Transaction Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby, including, without limitation, the issuance of the Bridge Note and Warrant, have been duly authorized by the board of directors of the Company (the “Board”), and no further consent or authorization is required by the Company, the Board or its stockholders. This Agreement and the other Transaction Documents of even date herewith have been duly executed and delivered by the Company, and constitute the legal, valid and binding obligations of the Company enforceable against the Company in accordance with their respective terms, except (i) as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies, or (ii) as any rights to indemnity or contribution hereunder may be limited by federal and state securities laws and public policy consideration.

2.4 No Conflicts . The execution, delivery and performance of the Transaction Documents by the Company and the consummation by the Company of the transactions

 

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contemplated hereby and thereby will not (i) result in a violation of any articles or articles of incorporation, any certificate of designations, preferences and rights of any outstanding series of preferred stock or bylaws of the Company or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any material agreement, indenture or instrument to which the Company is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations) applicable to the Company or by which any property or asset of the Company is bound or affected, except in the case of clauses (ii) and (iii), for such breaches or defaults as would not be reasonably expected to have a Material Adverse Effect.

2.5 Governmental Consents . Except for the filing of a Form D with the Securities and Exchange Commission (the “SEC”), the Company is not required to obtain any consent, authorization or order of, or make any filing or registration with, any court, governmental agency or any regulatory or self-regulatory agency or any other person or entity in order for it to execute, deliver or perform any of its obligations under or contemplated by the Transaction Documents, in each case, in accordance with the terms hereof or thereof. All consents, authorizations, orders, filings and registrations which the Company is required to obtain at or prior to the Closing pursuant to the preceding sentence have been obtained or effected. The Company is unaware of any facts or circumstances which might prevent the Company from obtaining or effecting any of the foregoing.

2.6 Financial Information; SEC Documents . Since December 30, 2005, the Company has filed all reports, schedules, forms, statements and other documents (“SEC Documents”) required to be filed by it with the SEC pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). As of their respective dates, the SEC Documents complied in all material respects with the requirements of the Exchange Act and the rules and regulations of the SEC promulgated thereunder applicable to such SEC Documents, and none of such SEC Documents, at the time they were filed with the SEC, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. As of their respective dates, the financial statements of the Company included in such SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto. Such financial statements have been prepared in accordance with generally accepted accounting principles, consistently applied, during the periods involved (except (i) as may be otherwise indicated in such financial statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may exclude footnotes or may be condensed or summary statements) and fairly present in all material respects the financial position of the Company as of the dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). No other information provided by or on behalf of the Company to the Purchaser that is not included in the SEC Documents contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements therein, in the light of the circumstance under which they are or were made, not misleading.

 

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ARTICLE III

REPRESENTATIONS AND WARRANTIES OF PURCHASER

The Purchaser hereby represents and warrants to the Company as of the date of this Agreement as follows:

3.1 Organization . The Purchaser is a corporation, limited liability company or partnership duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization.

3.2 Authorization . This Agreement has been duly authorized, validly executed and delivered by the Purchaser and is a valid and binding agreement and obligation of the Purchaser enforceable against the Purchaser in accordance with its terms, subject to limitations on enforcement by general principles of equity and by bankruptcy or other laws affecting the enforcement of creditors’ rights generally, and the Purchaser has full power and authority to execute and deliver this Agreement and the other agreements and documents contemplated hereby and to perform its obligations hereunder and thereunder.

3.3 Investment Investigation . The Purchaser understands that no Federal, state, local or foreign governmental body or regulatory authority has made any finding or determination relating to the fairness of an investment in the Bridge Note and Warrant and that no Federal, state, local or foreign governmental body or regulatory authority has recommended or endorsed, or will recommend or endorse, any investment in the Bridge Note. The Purchaser, in making the decision to purchase the Bridge Note and Warrant, has relied upon independent investigation made by it and has not relied on any information or representations made by third parties.

3.4 Accredited Investor . The Purchaser is an “accredited investor” as defined under Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”).

3.5 No Distribution . The Purchaser is and will be acquiring the Bridge Note and Warrant for its own account, and not with a view to any resale or distribution of the Bridge Note in whole or in part, in violation of the Securities Act or any applicable securities laws.

3.6 Resale . The parties intend that the offer and sale of the Bridge Note and Warrant be exempt from registration under the Securities Act, by virtue of Section 4(2) and/or Rule 506 of Regulation D promulgated under the Securities Act. The Purchaser understands that the Bridge Note and Warrant purchased hereunder have not been, and may never be, registered under the Securities Act and that the Bridge Note and Warrant cannot be sold or transferred unless its is first registered under the Securities Act and such state and other securities laws as may be applicable or in the opinion of counsel for the Company an exemption from registration under the Securities Act is available (and then the Bridge Note and Warrant may be sold or transferred only in compliance with such exemption and all applicable state and other securities laws).

3.7 Reliance . The Purchaser understands that the Bridge Note and Warrant are being offered and sold to it in reliance on specific provisions of Federal and state securities laws and that the Company is relying upon the truth and accuracy of the representations, warranties,

 

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agreements, acknowledgments and understandings of the Purchaser set forth herein for purposes of qualifying for exemptions from registration under the Securities Act, and applicable state securities laws.

ARTICLE IV

INDEMNIFICATION

4.1 Indemnification by the Company . The Company agrees to defend, indemnify and hold harmless the Purchaser and shall reimburse the Purchaser for, from and against each claim, loss, liability, cost and expense (including without limitation, interest, penalties, costs of preparation and investigation, and the reasonable fees, disbursements and expenses of attorneys, accountants and other professional advisors) (collectively, “Losses”) directly or indirectly relating to, resulting from or arising out of any untrue representation, misrepresentation, breach of warranty or non-fulfillment of any covenant, agreement or other obligation by or of the Company contained herein or in any certificate, document, or instrument delivered to the Purchaser pursuant hereto.

4.2 Indemnification by the Purchaser . The Purchaser agrees to defend, indemnify and hold harmless the Company and shall reimburse the Company for, from and against all Losses directly or indirectly relating to, resulting from or arising out of any untrue representation, misrepresentation, breach of warranty or non-fulfillment of any covenant, agreement or other obligation of the Purchaser contained herein or in any certificate, document or instrument delivered to the Company pursuant hereto.

4.3 Procedure . The indemnified party shall promptly notify the indemnifying party of any claim, demand, action or proceeding for which indemnification will be sought under Sections 4.1 or 4.2 of this Agreement, and, if such claim, demand, action or proceeding is a third party claim, demand, action or proceeding, the indemnifying party will have the right at its expense to assume the defense thereof using counsel reasonably acceptable to the indemnified party. The indemnified party shall have the right to participate, at its own expense, with respect to any such third party claim, demand, action or proceeding. In connection with any such third party claim, demand, action or proceeding, the Purchaser and the Company shall cooperate with each other and provide each other with access to relevant books and records in their possession. No such third party claim, demand, action or proceeding shall be settled without the prior written consent of the indemnified party, which shall not be unreasonably withheld. If a firm written offer is made to settle any such third party claim, demand, action or proceeding and the indemnifying party proposes to accept such settlement and the indemnified party refuses to consent to such settlement, then: (i) the indemnifying party shall be excused from, and the indemnified party shall be solely responsible for, all further defense of such third party claim, demand, action or proceeding; and (ii) the maximum liability of the indemnifying party relating to such third party claim, demand, action or proceeding shall be the amount of the proposed settlement if the amount thereafter recovered from the indemnified party on such third party claim, demand, action or proceeding is greater than the amount of the proposed settlement.

ARTICLE V

COVENANTS

 

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5.1 Terms of Debt Financing . The Purchaser may, at its option, convert all or a portion of the Bridge Note into equity securities or convertible debt financing to be offered by the Company in a Future Financing. The Bridge Note shall convert at a discount of 16.67% of the price per security offered by the Company in the Future Financing.

5.2 Issuance of Warrants under Bridge Note . The Company hereby agrees that at Closing it shall issue to the Purchaser a five-year warrant to purchase 2,500,000 shares of the Company’s common stock at an exercise price of $0.40 and otherwise in the form attached hereto as Exhibit C (the “Warrant”).

ARTICLE VI

MISCELLANEOUS

6.1 Governing Law . This Agreement and the rights of the parties hereunder shall be governed in all respects by the laws of the State of New York wherein the terms of this Agreement were negotiated, without regard to the conflicts of laws thereof.

6.2 Survival . Except as specifically provided herein, the representations, warranties, covenants and agreements made herein shall survive the Closing.

6.3 Amendment . This Agreement may not be amended, discharged or terminated (or any provision hereof waived) without the written consent of the Company and the Purchaser.

6.4 Successors and Assigns . Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon and enforceable by and against, the successors, assigns, heirs, executors and administrators of the parties hereto. The Purchaser may assign its rights hereunder, and the Company may not assign its rights or obligations hereunder without the consent of the Purchaser or any of its successors, assigns, heirs, executors and administrators.

6.5 Entire Agreement . This Agreement and the other Transaction Documents constitute the full and entire understanding and agreement between the parties with regard to the subject matter hereof and thereof.

6.6 Notices, etc . All notices, demands or other communications given hereunder shall be in writing and shall be sufficiently given if delivered either personally or by a nationally recognized courier service marked for next business day delivery or sent in a sealed envelope by first class mail, postage prepaid and either registered or certified, addressed as follows:

 

  (a) if to the Company:

Medical Solutions Management Inc.

237 Cedar Hill Street

Marlboro MA 01752

Attn: Chief Executive Officer

With a copy to:

 

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Andrew B. White, Esq.

Bingham McCutchen

150 Federal Street

Boston, MA 02110

 

  (b) if to a Purchaser:

Vicis Capital Master Fund

Tower 56, Suite 700

126 E. 56th Street, 7th Floor

New York, NY 10022

Attn: Shad Stastney

with a copy to:

Andrew D. Ketter, Esq.

Quarles & Brady LLP

411 East Wisconsin Avenue

Milwaukee, Wisconsin 53202

6.7 Delays or Omissions . No delay or omission to exercise any right, power or remedy accruing to any holder of the Bridge Note (or any portion thereof) upon any breach or default of the Company under this Agreement shall impair any such right, power or remedy of such holder nor shall it be construed to be a waiver of any such breach or default, or an acquiescence, therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any holder of any breach or default under this Agreement, or any waiver on the part of any holder of any provisions or conditions of this Agreement must be, made in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any holder, shall be cumulative and not alternative.

6.8 Severability . The invalidity of any provision or portion of a provision of this Agreement shall not affect the validity of any other provision of this Agreement or the remaining portion of the applicable provision. It is the desire and intent of the parties hereto that the provisions of this Agreement shall be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated to be invalid or unenforceable, such provision shall be deemed amended to delete therefrom the portion thus adjudicated to be invalid or unenforceable, such deletion to apply only with respect to the operation of such provision in the particular jurisdiction in which such adjudication is made.

6.9 Expenses . Each party shall bear its own expenses and legal fees incurred on its behalf with respect to the negotiation, execution and consummation of the transactions contemplated by this Agreement.

 

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6.10 Consent to Jurisdiction; Waiver of Jury Trial . EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED THE STATE AND COUNTY OF NEW YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTION DOCUMENTS. EACH OF THE PARTIES TO THIS AGREEMENT IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH SUCH PARTY MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN ANY SUCH COURTS AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN ANY SUCH COURTS HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY IN ANY SUCH LEGAL PROCEEDING. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY CONSENTS TO SERVICE OF PROCESS BY NOTICE IN THE MANNER SPECIFIED IN SECTION 6.6 AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION SUCH PARTY MAY NOW OR HEREAFTER HAVE TO SERVICE OF PROCESS IN SUCH MANNER.

6.11 Titles and Subtitles . The titles of the articles, sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement.

6.12 Further Assurances . The parties agree to execute and deliver all such further documents, agreements and instruments and take such other and further action as may be necessary or appropriate to carry out the purposes and intent of this Agreement.

6.13 Counterparts . This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

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IN WITNESS WHEREOF, the parties hereto have duly executed this Note Purchase Agreement, as of the day and year first above written.

 

COMPANY:
MEDICAL SOLUTIONS MANAGEMENT INC.
 

/s/ Brian Leseperance

Name:   Brian Lesperance
Title:   President and Chief Executive Officer
PURCHASER:
VICIS CAPITAL MASTER FUND
    By: Vicis Capital LLC
 

/s/ Keith Hughes

Name:   Keith Hughes
Title:   Chief Financial Officer

 

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EXHIBIT A

FORM OF NOTE

NEITHER THIS NOTE NOR THE SECURITIES INTO WHICH IT MIGHT CONVERT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY, IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER, PLEDGE, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE ACT.

 

$1,000,000   Marlboro, Massachusetts
  December      , 2007

MEDICAL SOLUTIONS MANAGEMENT INC.

PROMISSORY NOTE

Medical Solutions Management Inc., a Nevada corporation (the “Company”), for value received, hereby promises to pay to Vicis Capital Master Fund (the “Holder”) on December 16, 2008 (the “Maturity Date”), the principal amount of One Million Dollars ($1,000,000), and all interest accrued thereon, in accordance with the terms hereof, until paid in accordance with the terms hereof. This Note is issued in connection with that certain Note Purchase Agreement (the “Note Purchase Agreement”) of even date herewith between the Company and the Holder.

1. Terms of Note .

1.1. Interest . Interest shall accrue on the unpaid principal balance of this Note from the date hereof and shall be payable at the rate of five percent (5%) per annum, computed on the basis of a 365 day year for the actual number of days elapsed since the date hereof, until all unpaid principal under this Note shall have been repaid in full.

1.2. Prepayment . No portion of the principal amount of this Note may be paid by the Company at any time prior to the Maturity Date (including any extension thereof).

1.3. Conversion . This Note shall be convertible into securities offered by the Company in a future financing pursuant to the terms set forth in Section 5.1 of the Note Purchase Agreement.

2. Usury . This Note is hereby expressly limited so that in no event whatsoever shall the amount paid or agreed to be paid to the Holder hereunder exceed the amount permissible under applicable law. If at any time the performance of any provision of this Note involves a

 


payment exceeding the limit of the price that may be validly charged for the loan, use, forbearance or detention of money under applicable law, then automatically and retroactively, ipso facto , the obligation to be performed shall be reduced to such limit, it being the specific intent of the Company and the Holder that all payments under this Note are to be credited first to interest, if any, as permitted by law, but not in excess of the lesser of (a) the agreed rate of interest set forth herein and (b) that permitted by law, and the balance toward the reduction of principal. The provisions of this Section 2 shall never be superseded or waived and shall control every other provision of this Note.

3. Miscellaneous .

3.1. Transfer of Note . The Holder may not assign or otherwise transfer this Note (or any portion hereof) or any of its rights hereunder without the prior written consent of the Company, and no interest herein shall be pledged or otherwise encumbered by the Holder without the prior written consent of the Company, and any such attempted disposition of this Note or any portion hereof shall be of no force or effect.

3.2. Titles and Subtitles . The titles and subtitles used in this Note are for convenience only and are not to be considered in construing or interpreting this Note.

3.3. Notices . All notices required or permitted hereunder shall be in writing and shall be deemed effectively given: (a) upon personal delivery to the party to be notified; (b) when sent by confirmed facsimile or electronic transmission if sent during normal business hours of the recipient on a business day, or if not, then on the next business day; or (c) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt (or, in the case of non-U.S. residents, two (2) business days after deposit with an internationally recognized overnight courier, specifying international priority delivery, with written verification of receipt). All communications shall be sent to the parties at the following addresses or at such other address as shall be given in writing by a party to the other parties:

 

   Holder:    Vicis Capital Master Fund   
      Tower 56, Suite 700   
      126 E. 56th Street, 7th Floor   
      New York, NY 10022   
      Attn: Shad Stastney   

 

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   Company:    Medical Solutions Management Inc.   
      237 Cedar Hill Street   
      Marlboro, MA 01752   
   Attention:    Chief Executive Officer   
   With a copy to:   
   Andrew B. White, Esq.   
   Bingham McCutchen LLP   
   150 Federal Street   
   Boston, MA 02110   

3.4. Collection Costs . Should all or any part of the indebtedness represented by this Note be collected by action at law, or in bankruptcy, insolvency, receivership or other court proceedings, or should this Note be placed in the hands of attorneys for collection after default, the Company hereby promises to pay to the Holder, upon demand by the Holder at any time, in addition to the outstanding principal and all (if any) other amounts payable on or in respect of this Note, all court costs and reasonable attorneys’ fees and other collection charges and expenses incurred or sustained by the Holder.

3.5. Amendments and Waivers . Any term of this Note may be amended (either generally or in a particular instance and either retroactively or prospectively), with the written consent of the Company and the Holder. Any amendment effected in accordance with this Section 3.5 shall be binding upon the Holder and the Company and their successors and assigns. Any forbearance, failure or delay by the Holder in exercising any right, power or remedy under this Note or otherwise available to the Holder shall not be deemed to be a waiver of such right, power or remedy, nor shall any single or partial exercise of any right, power or remedy preclude the further exercise thereof.

3.6. Severability . If one or more provisions of this Note are held to be unenforceable under applicable law, such provision shall be excluded from this Note and the balance of the Note shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

3.7. Governing Law . This Note shall be governed by and construed and enforced in accordance with the laws of the Commonwealth of Massachusetts, without giving effect to its conflicts of laws principles.

3.8. Certain Waivers . The Company hereby irrevocably waives notice of acceptance, presentment, notice of nonpayment, protest, notice of protest, suit and all other conditions precedent in connection with the delivery, acceptance, collection and/or enforcement of this Note or any collateral or security therefor.

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IN WITNESS WHEREOF, this Note has been executed and delivered as a sealed instrument on the date first above written by the duly authorized representative of the Company.

 

MEDICAL SOLUTIONS MANAGEMENT INC.
By:  

 

Name:   Brian Lesperance
Title:   President and Chief Executive Officer

 

Acknowledged and Agreed to:

VICIS CAPITAL MASTER FUND

    By: Vicis Capital LLC
 

 

Name:   Keith Hughes
Title:   Chief Financial Officer

 

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EXHIBIT B

FORM OF REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT

REGISTRATION RIGHTS AGREEMENT made this __ day of December, 2007 by and between Medical Solutions Management Inc., a Nevada corporation (the “Company”), and Vicis Capital Master Fund (the “Holder”).

RECITALS :

WHEREAS, simultaneously herewith, the Company and the Holder are entering into a Note Purchase Agreement (the “Purchase Agreement”) pursuant to which the Company is issuing to the Holder a warrant (the “Warrant”) to purchase 2,500,000 shares of the Company’s common stock; and

WHEREAS, the execution and delivery of this Agreement is a condition to the closing of the Purchase Agreement.

NOW THEREFORE, in consideration of the agreements set forth herein the parties agree as follows:

1. Definitions . As used in this Agreement, the following terms shall have the following respective meanings:

“Common Stock” means the common stock, $0.001 par value per share, of the Company and any equity securities issued or issuable with respect to the Common Stock in connection with a reclassification, recapitalization, merger, consolidation or other reorganization.

“Warrant Shares” means the shares of Common Stock or other equity securities issued or issuable upon exercise of the Warrant.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, or any similar Federal statute, and the rules and regulations of the SEC issued under such Act, as they each may, from time to time, are in effect.

“Holder” shall have the meaning set forth in the Preamble and any of such Holder’s successors or assigns.

“Person” means any individual, corporation, limited liability company, limited or general partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivisions thereof.

“Registration Statement” means a registration statement filed by the Company with the SEC for a public offering and sale of securities of the Company (other than a registration statement on Form S-8 for an employee benefit plan or dividend reinvestment plan or a registration statement on Form S-4 for a merger, consolidation or acquisition on Form S-4 or

 

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any successor form, or any other form for a limited purpose, or any registration statement covering only securities proposed to be issued in exchange for securities or assets of another corporation).

“Registration Expenses” means the expenses described in Section 4.

“Registrable Securities” means any (i) Warrant Shares and (ii) shares of Common Stock issued or issuable, directly or indirectly, with respect to the Common Stock referenced above. As to any particular Registrable Securities, such securities shall cease to be Registrable Securities when (x) a registration statement with respect to the sale of such securities shall have been declared effective under the Securities Act and such securities shall have been disposed of in accordance with such registration statement, or (y) such securities may be sold pursuant to Rule 144 (or any successor provision) under the Securities Act.

“SEC” means the Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended, or any similar Federal statute, and the rules and regulations of the SEC issued under such Act, as they each may from time to time, be in effect.

“Selling Stockholder” means a Holder who has requested its Registrable Securities to be registered pursuant to Section 2 hereof.

2. Piggyback Registration . If, at any time, the Company proposes or is required to register any of its equity securities or securities convertible or exchangeable for equity securities under the Securities Act (other than pursuant to (i) registration on such form or similar form(s) solely for registration of securities in connection with an employee benefit plan or dividend reinvestment plan, Form S-8 or (ii) a merger, consolidation or acquisition, Form S-4), whether or not for its own account, the Company shall give at least 10 (ten) days written notice of its intention to do so to each Holder of record of Registrable Securities. Upon the written request of any Holder, made within 10 days following the receipt of any such written notice (which request shall specify the maximum number of Registrable Securities intended to be disposed of by such Holder and the intended method of distribution thereof), the Company shall use its best efforts to cause all such Registrable Securities, each Holder of which have so requested the registration thereof, to be registered under the Securities Act (with the securities which the Company at the time proposes to register) to permit the sale or other disposition by each Holder (in accordance with the intended method of distribution thereof) of the Registrable Securities to be so registered. There is no limitation on the number of piggyback registrations pursuant to the preceding sentence which the Company is obligated to effect.

If a registration relates to an underwritten offering, the Company shall so advise the Holders of Registrable Securities. In such event, the right of any such Holder to have its Registrable Securities included in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their Registrable Securities through such underwriting (together with the Company) shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by the Company. Each Holder hereby agrees that, if requested by the Company or

 

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the representative of the underwriters of Common Stock (or other securities) of the Company, such Holder shall not sell, transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale, any Common Stock (or other securities) of the Company held by such Holder (other than those included for sale in the registration) for a period specified by the Company and the representative of the underwriters of Common Stock (or other securities) of the Company not to exceed 180 days following the effective date of a registration statement of the Company filed under the Securities Act.

Notwithstanding any other provision of this Agreement, if the underwriter or underwriters reasonably determine in good faith that marketing factors require a limitation of the number of shares to be underwritten, the number of shares that may be included in the underwriting shall be allocated as follows: (i) first, to the securities the Company proposes to sell; (ii) second, to the Registrable Securities requested to be included in such registration by the Holders seeking registration under this Section 2 on a pro rata basis based on the total number of Registrable Securities held by such Holders; and (iii) third, to the Registrable Securities held by Holders other than Holders who requested that their Registrable Securities be included in such registration under this Section 2 pro rata based on the total number of Registrable Securities held by such Holders; provided , however , that in no event shall the amount of securities of the participating Holders included in the registration be reduced below 25% of the total amount of securities included in such offering. If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to the Company and the underwriter, delivered at least 10 days prior to the effective date of the registration statement. Any Registrable Securities excluded or withdrawn from such underwriting shall be excluded and withdrawn from the registration. For any Holder that is a partnership, limited liability company or corporation, the partners, former partners, members, former members and stockholders of such Holder, or the estates and family members of any such partners, former partners, members, former members or stockholders and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single “Holder,” and any pro rata reduction with respect to such “Holder” shall be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such “Holder,” as defined in this sentence.

The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 2 prior to the effectiveness of such registration whether or not any Holder or any stockholder has elected to include securities in such registration. The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section 4.

3. Registration Procedures .

(a) If and whenever the Company is required by the provisions of this Agreement to use its best efforts to effect the registration of any of the Registrable Securities under the Securities Act, the Company shall:

(i) file with the SEC a Registration Statement with respect to such Registrable Securities and use its best efforts to cause that Registration Statement to become and remain effective;

 

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(ii) as expeditiously as possible prepare and file with the SEC any amendments and supplements to the Registration Statement and the prospectus included in the Registration Statement as may be necessary to keep the Registration Statement effective for a period of not less than nine months from the effective date;

(iii) as expeditiously as possible furnish to Holder such reasonable numbers of copies of the prospectus, including a preliminary prospectus, in conformity with the requirements of the


 
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