SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): July 10, 1998
CONSOLIDATED MEDICAL MANAGEMENT, INC.
(Exact Name of Registrant as Specified in Charter)
Montana 2-89616 82-0369233
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number)
Identification No.)
13005 Justice Avenue, Baton Rouge, LA 70816
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (504) 292-3100
Item 2. Acquisition or Disposition of Assets
(a) On July 10, 1998, Consolidated Medical Management, Inc. (the
"Company") entered into an Agreement and Plan of Reorganization (the
"Agreement") with Independent Diagnostic Services, Inc. (formerly
United Medical Services Corporation), a Louisiana corporation
("IDS"), and the sole shareholder of such entity, Michael W.
Schiacchetano. The Agreement provided for the issuance of 20,000
shares of common stock of the Company in exchange for all of the
outstanding shares of IDS, which shares were owned by Mr.
Schiacchetano. The closing of the Agreement was held July 10, 1998.
At the closing the Company issued and delivered the 20,000 shares
of common stock of the Company to Mr. Schiacchetano (which
represented less than 1% of the total outstanding shares of common
stock of the Company) and he delivered a stock certificate to the
Company representing all of the issued and outstanding shares of IDS.
IDS, a development stage company, was incorporated in the
State of Louisiana on December 19, 1996, and commenced operations in
January 1998. IDS is based in Baton Rouge and provides ultrasound
imaging for doctors using a portable ultrasound imaging machine
owned by IDS.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
On August 19, 1998, the Company engaged Roberts, Cherry and
Company, Certified Public Accountants, as independent auditors of
the Company for the year ended December 31, 1998. The decision to
retain Roberts, Cherry and Company, and not to re-engage Terrence J.
Dunne, the former independent auditor, was made by the Board of
Directors on such date. The decision not to re-engage Mr. Dunne did
not involve a dispute with the Company over accounting policies or
practices. The report of Mr. Dunne on the Company's financial
statements for the year ended December 31, 1997, did not contain an
adverse opinion or disclaimer of opinion, nor was it modified as to
uncertainty, audit scope, or accounting principals. In connection
with the audit of the Company's financial statements for such year
ended December 31, 1997, there were no disagreements with Mr. Dunne
on any matters of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure which, if not
resolved to the satisfaction of Mr. Dunne, would have caused such
firm to make reference to the matter in its report.
Neither the Company, nor anyone on its behalf, has consulted
Roberts, Cherry and Company regarding the application of accounting
principles to a specific completed or contemplated transaction, or
the type of audit opinion that might be rendered on the Company's
financial statements, and neither written nor oral advice was
provided by Roberts, Cherry and Company that was an important factor
considered by the Company in reaching a decision as to any
accounting, auditing, or financial reporting issue.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits
(a) The financial statements required by this item are not
included in this initial report, but will be filed within 60
days after the date this initial report on Form 8-K is filed.
(b) The pro forma financial information required by this item is
not included in this initial report, but will be filed
within 60 days after the date this initial report on Form
8-K is filed.
(c) The following exhibits are filed with this report:
Exhibit No. Description Location
2.1 Agreement dated July 10, 1998 Attached
16.1 Letter on Change in Certifying Accountant Attached
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
Consolidated Medical Management, Inc.
Date: August 20, 1998 By /s/ Sunni M. Wooley, President and
Principal Financial Officer
EXHIBIT 2.1
AGREEMENT
This Agreement (the "Agreement"), entered into this 10th day
of July, 1998, is by, between, and among Consolidated Medical
Management, Inc., a publicly held Montana corporation (hereinafter
the "Purchaser"), United Medical Services Corporation., a
privately-held Louisiana corporation (hereinafter the "Private
Company"), and the shareholder of the Private Company (hereinafter
the "Shareholder").
RECITALS:
WHEREAS, the Purchaser wishes to acquire, and the
Shareholder is willing to sell, all of the outstanding stock of the
Private Company in exchange solely for a part of the voting stock of
the Purchaser; and,
WHEREAS, the parties hereto intend to qualify such
transaction as a tax-free exchange pursuant to Section 368(a)(1)(B)
of the Internal Revenue Code of 1986, as amended;
NOW, THEREFORE, based upon the stated premises, which are
incorporated herein by reference, and for and in consideration of
the mutual covenants and agreements set forth herein, the mutual
benefits to the parties to be derived herefrom, and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Purchaser, the Private Company, and the
Shareholder approve and adopt this Agreement and mutually covenant
and agree with each other as follows:
1. Shares to be Transferred and Shares to be Issued.
1.1 On the Closing Date the Shareholder shall transfer to
the Purchaser certificates for the number of shares of the common
stock of the Private Company described in Schedule "A," attached
hereto and incorporated herein, which in the aggregate shall
represent all of the issued and outstanding shares of the common
stock of the Private Company.
1.2 In exchange for the transfer of the common stock of the
Private Company pursuant to subsection 1.1. hereof, the Purchaser
shall on the Closing Date and contemporaneously with such transfer
of the common stock of the Private Company to it by the Shareholder
issue and deliver to the Shareholder the number of shares of common
stock of the Purchaser specified on Schedule "A" hereof.
2. Representations and Warranties of the Shareholder.
The Shareholder, represents and warrants to the Purchaser as set
forth below. These representations and warranties are made as an
inducement for the Purchaser to enter into this Agreement and, but
for the making of such representations and warranties and their
accuracy, the Purchaser would not be a party hereto.
2.1 Ownership of Stock.
a. The Shareholder is the record and beneficial
owner and holder of the number of fully paid and nonassessable
shares of the common stock of the Private Company listed in Schedule
"A" hereto as of the date hereof and will continue to own such
shares of the common stock of the Private Company until the delivery
thereof to the Purchaser on the Closing Date and all such shares of
common stock are or will be on the Closing Date owned free and clear
of all liens, encumbrances, charges and assessments of every nature
and subject to no restrictions with respect to transferability. The
Shareholder currently has, and will have at Closing, full power and
authority to dispose, assign, and transfer his shares of the Private
Company in accordance with the terms hereof. The Shareholder
currently has, and will have at Closing, full power and authority to
vote his shares of the Private Company, without restriction of any
kind.
b. Except for this Agreement, there are no
outstanding options, contracts, calls, commitments, agreements or
demands of any character relating to the common stock of the Private
Company listed in Schedule "A" and owned by the Shareholders.
2.2 Accuracy of All Statements Made by the Shareholder.
No representation or warranty by the Shareholder in this Agreement,
nor any statement, certificate, schedule, or exhibit hereto
furnished or to be furnished by or on behalf of the Shareholder
pursuant to this Agreement, nor any document or certificate
delivered to the Purchaser by the Shareholder pursuant to this
Agreement or in connection with actions contemplated hereby,
contains or shall contain any untrue statement of material fact or
omits or shall omit a material fact necessary to make the statements
contained therein not misleading.
3. Representations and Warranties of the Private
Company. The Private Company represents and warrants to the
Purchaser as set forth below. These representations and warranties
are made as an inducement for the Purchaser to enter into this
Agreement and, but for the making of such representations and
warranties and their accuracy, the Purchaser would not be a party
hereto.
3.1 Organization and Authority. The Private Company is
a corporation duly organized, validly existing and in good standing
under the laws of the State of Louisiana with full power and
authority to enter into and perform the transactions contemplated by
this Agreement.
3.2 Capitalization. As of the date of the Closing, the
Private Company will have a total of no more than 5,000 shares of
common stock issued and outstanding. All of the shares will have
been duly authorized and validly issued and will be fully paid and
nonassessable. There are no options, warrants, conversion
privileges, or other rights presently outstanding for the purchase
of any authorized but unissued stock of the Private Company.
3.3 Performance of This Agreement. The execution and
performance of this Agreement and the transfer of stock contemplated
hereby have been authorized by the board of directors of the Private
Company.
3.4 Financials. True copies of the financial statements
of the Private Company for March 31, 1998, has been furnished to the
Purchaser. Said financial statements are true and correct in all
material respects and present an accurate and complete disclosure of
the financial condition of the Private Company as of March 31, 1998,
and the earnings for the periods covered, in accordance with
generally accepted accounting principles applied on a consistent
basis. Such financial statements meet the requirements of
Regulation S-X and Item 7 of Form 8-K promulgated by the Securities
and Exchange Commission.
3.5 Liabilities. There are no material liabilities of
the Private Company, whether accrued, absolute, contingent or
otherwise, which arose or relate to any transaction of the Private
Company, its agents or servants occurring prior to March 31, 1998,
which are not disclosed by or reflected in said financial
statements. As of the date hereof, there are no known
circumstances, conditions, happenings, events or arrangements,
contractual or otherwise, which may hereafter give rise to
liabilities, except in the normal course of business of the Purchaser.
3.6 Absence of Certain Changes or Events. Except as set
forth in this Agreement, since March 31 1998, there has not been (i)
any material adverse change in the business, operations, properties,
level of inventory, assets, or condition of the Private Company, or
(ii) any damage, destruction, or loss to the Private Company
(whether or not covered by insurance) materially and adversely
effecting the business, operations, properties, assets, or
conditions of the private Company.
3.7 Litigation. There are no legal, administrative or
other proceedings, investigations or inquiries, product liability or
other claims, judgments, injunctions or restrictions, either
threatened, pending, or outstanding against or involving the Private
Company or its subsidiaries, if any, or their assets, properties, or
business, nor does the Private Company or its subsidiaries know, or
have reasonable grounds to know, of any basis for any such
proceedings, investigations or inquiries, product liability or other
claims, judgments, injunctions or restrictions. In addition, there
are no material proceedings existing, pending or reasonably
contemplated to which any officer, director, or affiliate of the
Private Company or as to which the Shareholder is a party adverse to
the Private Company or any of its subsidiaries or has a material
interest adverse to the Private Company or any of its subsidiaries.
3.8 Taxes. All federal, state, foreign, county and
local income, profits, franchise, occupation, property, sales, use,
gross receipts and other taxes (including any interest or penalties
relating thereto) and assessments which are due and payable have
been duly reported, fully paid and discharged as reported by the
Private Company, and there are no unpaid taxes which are, or could
become a lien on the properties and assets of the Private Company,
except as provided for in the financial statements of the Private
Company, or have been incurred in the normal course of business of
the Private Company since that date. All tax returns of any kind
required to be filed have been filed and the taxes paid or accrued.
3.9 Hazardous Materials. No hazardous material has been
released, placed, stored, generated, used, manufactured, treated,
deposited, spilled, discharged, released, or disposed of on or under
any real property currently or previously owned or leased by the
Private Company or any of its subsidiaries.
3.10 Business Plan. All of the information contained in
the business plan of the Private Company, a copy of which has been
furnished to the Purchaser, is true and correct in all material
respects and does not contain any untrue statement of material fact
or omit a material fact necessary to make the statement contained
therein not misleading.
3.11 Accuracy of All Statements Made by the Private
Company. No representation or warranty by the Private Company in
this Agreement, nor any statement, certificate, schedule, or exhibit
hereto furnished or to be furnished by or on behalf of the Private
Company pursuant to this Agreement, nor any document or certificate
delivered to the Purchaser by the Private Company pursuant to this
Agreement or in connection with actions contemplated hereby,
contains or shall contain any untrue statement of material fact or
omits or shall omit a material fact necessary to make the statements
contained therein not misleading.
4. Representations and Warranties of the Purchaser.
The Purchaser represents and warrants to the Private Company and to
the Shareholder as set forth below. These representations and
warranties are made as an inducement for the Private Company and the
Shareholder to enter into this Agreement and, but for the making of
such representations and warranties and their accuracy, the Private
Company and the Shareholder would not be parties hereto.
4.1 Organization and Good Standing. The Purchaser is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Montana with full power and authority
to enter into and perform the transactions contemplated by this
Agreement.
4.2 Capitalization. As of the date of the Closing, the
Purchaser will have a total of no more than 5,236,057 shares of
common stock issued and outstanding, including the shares to be
issued to the Shareholder. All of the shares will have been duly
authorized and validly issued and will be fully paid and
nonassessable. Except for the Purchaser's obligations hereunder
with respect to the shares to be issued pursuant to subsection 1.2
hereof, there are no options, warrants, conversion privileges, or
other rights presently outstanding for the purchase of any
authorized but unissued stock of the Purchaser. As of the Closing,
the Articles of Incorporation, as amended, of the Purchaser (the
"Purchaser Articles") and as currently in effect shall be in the
form previously furnished to the Private Company. The rights,
preferences, and privileges of the common stock shall be as set
forth in the Purchaser Articles.
4.3 Performance of This Agreement. The execution and
performance of this Agreement and the issuance of stock contemplated
hereby have been authorized by the board of directors of the Purchaser.
4.4 Financials. True copies of the financial statements
of the Purchaser for the fiscal year ended December 31, 1997, and
the period ended March 31, 1998, have been delivered by the
Purchaser to the Private Company. These statements have been
examined and certified by Scott McHone and Roberts, Cherry &
Company, Certified Public Accountants. Said financial statements
are true and correct in all material respects and present an
accurate and complete disclosure of the financial condition of the
Purchaser as of March 31, 1998, and the earnings for the periods
covered, in accordance with generally accepted accounting principles
applied on a consistent basis.
4.5 Liabilities. There are no material liabilities of
the Purchaser, whether accrued, absolute, contingent or otherwise,
which arose or relate to any transaction of the Purchaser, its
agents or servants which are not disclosed by or reflected in said
financial statements. As of the date hereof, there are no known
circumstances, conditions, happenings, events or arrangements,
contractual or otherwise, which may hereafter give rise to
liabilities, except in the normal course of business of the Purchaser.
4.6 Litigation. There are no legal, administrative or
other proceedings, investigations or inquiries, product liability or
other claims, judgments, injunctions or restrictions, either
threatened, pending, or outstanding against or involving the
Purchaser or its subsidiaries, if any, or their assets, properties,
or business, nor does the Purchaser or its subsidiaries know, or
have reasonable grounds to know, of any basis for any such
proceedings, investigations or inquiries, product liability or other
claims, judgments, injunctions or restrictions. In addition, there
are no material proceedings existing, pending or reasonably
contemplated to which any officer, director, or affiliate of the
Purchaser is a party adverse to the Purchaser or any of its
subsidiaries or has a material interest adverse to the Purchaser or
any of its subsidiaries.
4.7 Taxes. All federal, state, foreign, county and
local income, profits, franchise, occupation, property, sales, use,
gross receipts and other taxes (including any interest or penalties
relating thereto) and assessments which are due and payable have
been duly reported, fully paid and discharged as reported by the
Purchaser, and there are no unpaid taxes which are, or could become
a lien on the properties and assets of the Purchaser, except as
provided for in the financial statements of the Purchaser, or have
been incurred in the normal course of business of the Purchaser
since that date. All tax returns of any kind required to be filed
have been filed and the taxes paid or accrued.
4.8 Hazardous Materials. No hazardous material has been
released, placed, stored, generated, used, manufactured, treated,
deposited, spilled, discharged, released, or disposed of on or under
any real property currently or previously owned or leased by the
Purchaser or any of its subsidiaries, except as set forth in the
financial statements of the Purchaser.
4.9 Legality of Shares to be Issued. The shares of
common stock of the Purchaser to be issued by the Purchaser pursuant
to this Agreement, when so issued and delivered, will have been duly
and validly authorized and issued by the Purchaser and will be fully
paid and nonassessable.
4.10 Accuracy of All Statements Made by the Purchaser.
No representation or warranty by the Purchaser in this Agreement,
nor any statement, certificate, schedule, or exhibit hereto
furnished or to be furnished by the Purchaser pursuant to this
Agreement, nor any document or certificate delivered to the Private
Company or the Shareholder pursuant to this Agreement or in
connection with actions contemplated hereby, contains or shall
contain any untrue statement of material fact or omits to state or
shall omit to state a material fact necessary to make the statements
contained therein not misleading.
5. Covenants of the Parties.
5.1 Corporate Records.
a. Simultaneous with the execution of this
Agreement by the Private Company, if not previously furnished, such
entity shall deliver to the Purchaser copies of the Articles of
Incorporation, as amended, and the current bylaws of the Private
Company, and copies of the resolutions duly adopted by the board of
directors of the Private Company approving this Agreement and the
transactions herein contemplated.
b. Simultaneous with the execution of this
Agreement by the Purchaser, if not previously furnished, such entity
shall deliver to the Private Company copies of the Purchaser
Articles, and the current bylaws of the Purchaser, and copies of the
resolutions duly adopted by the board of directors of the Purchaser
approving this Agreement and the transactions herein contemplated.
5.2 Access to Information.
a. The Purchaser and its authorized
representatives shall have full access during normal business hours
to all properties, books, records, contracts, and documents of the
Private Company, and the Private Company shall furnish or cause to
be furnished to the Purchaser and its authorized representatives all
information with respect to its affairs and business as the
Purchaser may reasonably request. The Purchaser shall hold, and
shall cause its representatives to hold confidential, all such
information and documents, other than information that (i) is in the
public domain at the time of its disclosure to the Purchaser; (ii)
becomes part of the public domain after disclosure through no fault
of the Purchaser; (iii) is known to the Purchaser or any of its
officers or directors prior to disclosure; or (iv) is disclosed in
accordance with the written consent of the Private Company. In the
event this Agreement is terminated prior to Closing, the Purchaser
shall, upon the written request of the Private Company, promptly
return all copies of all documentation and information provided by
the Private Company hereunder.
b. The Private Company and its authorized
representatives shall have full access during normal business hours
to all properties, books, records, contracts, and documents of the
Purchaser, and the Purchaser shall furnish or cause to be furnished
to the Private Company and its authorized representatives all
information with respect to its affairs and business the Private
Company may reasonably request. The Private Company shall hold, and
shall cause its representatives to hold confidential, all such
information and documents, other than information that (i) is in the
public domain at the time of its disclosure to the Private Company;
(ii) becomes part of the public domain after disclosure through no
fault of the Private Company; (iii) is known to the Private Company
or any of its officers or directors prior to disclosure; or (iv) is
disclosed in accordance with the written consent of the Purchaser.
In the event this Agreement is terminated prior to Closing, the
Private Company shall, upon the written request of the Purchaser,
promptly return all copies of all documentation and information
provided by the Purchaser hereunder.
5.3 Actions Prior to Closing. From and after the date
of this Agreement and until the Closing Date:
a. The Purchaser and the Private Company shall
each carry on its business diligently and substantially in the same
manner as heretofore, and neither party shall make or institute any
unusual or novel methods of purchase, sale, management, accounting
or operation.
b. Neither the Purchaser nor the Private
Company shall enter into any contract or commitment, or engage in
any transaction not in the usual and ordinary course of business and
consistent with its business practices.
c. Neither the Purchaser nor the Private
Company shall amend its Articles of Incorporation or bylaws or make
any changes in authorized or issued capital stock, except as
provided in this Agreement.
d. The Purchaser and the Private Company shall
each use its best efforts (without making any commitments on behalf
of the company) to preserve its business organization intact.
e. Neither the Purchaser nor the Private
Company shall do any act or omit to do any act, or permit any act or
omission to act, which will cause a material breach of any material
contract, commitment, or obligation of such party.
f. The Purchaser and the Private Company shall
each duly comply with all applicable laws as may be required for the
valid and effective issuance or transfer of stock contemplated by
this Agreement.
g. Neither the Purchaser nor the Private
Company shall of any property or assets, except products sold in the
ordinary course of business.
h. The Purchaser and the Private Company shall
each promptly notify the other of any lawsuits, claims, proceedings,
or investigations that may be threatened, brought, asserted, or
commenced against it, its officers or directors involving in any way
the business, properties, or assets of such party.
5.4 Shareholders' Meeting or Consent. The Purchaser
shall promptly submit this Agreement and the transactions
contemplated hereby for the approval of its stockholders and,
subject to the fiduciary duties of the Board of directors of the
Purchaser under applicable law, shall use its best efforts to obtain
stockholder approval and adoption of this Agreement and the
transactions contemplated hereby. In connection with such meeting
of stockholders, the Purchaser shall prepare a proxy or information
statement to be furnished to the shareholders of the Purchaser
setting forth information about this Agreement and the transactions
contemplated hereby. The Private Party shall promptly furnish to
the Purchaser all information, and take such other actions, as may
reasonably be requested in connection with any action to be taken by
the Purchaser in connection with the immediately preceding sentence.
The Private Company shall have the right to review and provide
comments to the proxy or information statement prior to mailing to
the shareholders of the Purchaser.
5.5 No Covenant as to Tax or Accounting Consequences.
It is expressly understood and agreed that neither the Purchaser nor
its officers or agents has made any warranty or agreement, expressed
or implied, as to the tax or accounting consequences of the
transactions contemplated by this Agreement or the tax or accounting
consequences of any action pursuant to or growing out of this
Agreement.
5.6 Indemnification. The Private Company and the
Shareholder, severally and not jointly, shall indemnify Purchaser
for any loss, cost, expense, or other damage (including, without
limitation, attorneys' fees and expenses) suffered by Purchaser
resulting from, arising out of, or incurred with respect to the
falsity or the breach of any representation, warranty, or covenant
made by the Private Company or the Shareholder herein, and any
claims arising from the operations of the Private Company prior to
the Closing Date. Purchaser shall indemnify and hold the Private
Company and the Shareholder harmless from and against any loss,
cost, expense, or other damage (including, without limitation,
attorneys' fees and expenses) resulting from, arising out of, or
incurred with respect to, or alleged to result from, arise out of or
have been incurred with respect to, the falsity or the breach of any
representation, covenant, warranty, or agreement made by Purchaser
herein, and any claims arising from the operations of Purchaser
prior to the Closing Date. The indemnity agreement contained herein
shall remain operative and in full force and effect, regardless of
any investigation made by or on behalf of any party and shall
survive the consummation of the transactions contemplated by this
Agreement.
5.7 Publicity. The parties agree that no publicity,
release, or other public announcement concerning this Agreement or
the transactions contemplated by this Agreement shall be issued by
any party hereto without the advance approval of both the form and
substance of the same by the other parties and their counsel, which
approval, in the case of any publicity, release, or other public
announcement required by applicable law, shall not be unreasonably
withheld or delayed.
5.8 Expenses. Except as otherwise expressly provided
herein, each party to this Agreement shall bear its own respective
expenses incurred in connection with the negotiation and preparation
of this Agreement, in the consummation of the transactions
contemplated hereby, and in connection with all duties and
obligations required to be performed by each of them under this
Agreement.
5.9 Further Actions. Each of the parties hereto shall
take all such further action, and execute and deliver such further
documents, as may be necessary to carry out the transactions
contemplated by this Agreement.
6. Conditions Precedent to the Purchaser's Obligations.
Each and every obligation of the Purchaser to be performed on the
Closing Date shall be subject to the satisfaction prior thereto of
the following conditions:
6.1 Truth of Representations and Warranties. The
representations and warranties made by the Private Company and the
Shareholder in this Agreement or given on their behalf hereunder
shall be substantially accurate in all material respects on and as
of the Closing Date with the same effect as though such
representations and warranties had been made or given on and as of
the Closing Date.
6.2 Performance of Obligations and Covenants. The
Private Company and the Shareholder shall have performed and
complied with all obligations and covenants required by this
Agreement to be performed or complied with by them prior to or at
the Closing.
6.3 Officer's Certificate. The Purchaser shall have
been furnished with a certificate (dated as of the Closing Date and
in form and substance reasonably satisfactory to the Purchaser),
executed by an executive officer of the Private Company, certifying
to the fulfillment of the conditions specified in subsections 6.1
and 6.2 hereof.
6.4 No Litigation or Proceedings. There shall be no
litigation or any proceeding by or before any governmental agency or
instrumentality pending or threatened against any party hereto that
seeks to restrain or enjoin or otherwise questions the legality or
validity of the transactions contemplated by this Agreement or which
seeks substantial damages in respect thereof.
6.5 No Material Adverse Change. As of the Closing Date
there shall not have occurred any material adverse change,
financially or otherwise, which materially impairs the ability of
the Private Company to conduct its business or the earning power
thereof on the same basis as in the past.
6.6 Shareholders' Approval. The holders of not less
than a majority of the outstanding common stock of the Purchaser
shall have voted for authorization and approval of this Agreement
and the transactions contemplated hereby.
6.7 Shareholders' Execution of Agreement. This
Agreement shall have been duly executed and delivered by each of the
parties owning in the aggregate all of the outstanding stock of the
Private Company as of the Closing Date.
7. Conditions Precedent to Obligations of the Private
Company and the Shareholder. Each and every obligation of the
Private Company and the Shareholder to be performed on the Closing
Date shall be subject to the satisfaction prior thereto of the
following conditions:
7.1 Truth of Representations and Warranties. The
representations and warranties made by the Purchaser in this
Agreement or given on its behalf hereunder shall be substantially
accurate in all material respects on and as of the Closing Date with
the same effect as though such representations and warranties had
been made or given on and as of the Closing Date.
7.2 Performance of Obligations and Covenants. The
Purchaser shall have performed and complied with all obligations and
covenants required by this Agreement to be performed or complied
with by it prior to or at the Closing.
7.3 Officer's Certificate. The Private Company shall
have been furnished with a certificate (dated as of the Closing Date
and in form and substance reasonably satisfactory to the Private
Company), executed by an executive officer of the Purchaser,
certifying to the fulfillment of the conditions specified in
subsections 7.1 and 7.2 hereof.
7.4 No Litigation or Proceedings. There shall be no
litigation or any proceeding by or before any governmental agency or
instrumentality pending or threatened against any party hereto that
seeks to restrain or enjoin or otherwise questions the legality or
validity of the transactions contemplated by this Agreement or which
seeks substantial damages in respect thereof.
7.5 No Material Adverse Change. As of the Closing Date
there shall not have occurred any material adverse change,
financially or otherwise, which materially impairs the ability of
the Purchaser to conduct its business.
7.6 No Material Liabilities of Purchaser. As of the
Closing Date the Purchaser shall have no liabilities which in the
aggregate exceed $50,000.00, that are not disclosed and the
corporation balance sheet.
8. Securities Law Provisions.
8.1 Restricted Securities. Each of the parties hereto,
severally and not jointly, represents that he, she, or it is aware
that the shares issued or transferred to him, her, or it will not
have been registered pursuant to the Securities Act of 1933, as
amended (the "1933 Act"), or any state securities act, and thus will
be restricted securities as defined in Rule 144 promulgated by the
Securities and Exchange Commission (the "SEC"). Therefore, under
current interpretations and applicable rules, he, she, or it will
probably have to retain such shares for a period of at least one
year and at the expiration of such one year period his, her, or its
sales may be confined to brokerage transactions of limited amounts
requiring certain notification filings with the SEC and such
disposition may be available only if the issuer is current in its
filings with the SEC under the Securities Exchange Act of 1934, as
amended, or other public disclosure requirements.
8.2 Non-distributive Intent. Each of the parties
hereto, severally and not jointly, covenants and warrants that the
shares received are acquired for his, her, or its own account and
not with the present view towards the distribution thereof and he,
she, or it will not dispose of such shares except (i) pursuant to an
effective registration statement under the 1933 Act, or (ii) in any
other transaction which, in the opinion of counsel acceptable to the
issuer, is exempt from registration under the 1933 Act, or the rules
and regulations of the SEC thereunder. In order to effectuate the
covenants of this subsection, an appropriate legend will be placed
upon each of the certificates of common stock issued or transferred
pursuant to this Agreement, and stop transfer instructions shall be
placed with the transfer agent for the securities.
8.3 Evidence of Compliance with Private Offering
Exemption. Each of the parties hereto, severally and not jointly,
hereby represents and warrants that he, she, or it, either
individually or together with his, her, or its representative, has
such knowledge and experience in business and financial matters that
he, she, or it is capable of evaluating the risks of this Agreement
and the transactions contemplated hereby, and that the financial
capacity of such party is of such proportion that the total cost of
such person's commitment in the shares would not be material when
compared with his, her, or its total financial capacity. Upon the
written request of the issuer of the securities issued or
transferred pursuant to this Agreement, any party hereto shall
provide such issuer with evidence of compliance with the
requirements of any federal or state exemption from registration.
The Purchaser and the Private Company shall each file, with the
assistance of the other and its respective legal counsel, such
notices, applications, reports, or other instruments as may be
deemed by each of them to be necessary or appropriate in an effort
to document reliance on such exemptions, unless an exemption
requiring no filing is available in the particular jurisdiction, all
to the extent and in the manner as may be deemed by such parties to
be appropriate.
9. Closing.
9.1 Time and Place. The Closing of this transaction
("Closing") shall take place at 13005 Justice Avenue, Baton Rouge,
Louisiana, at 10:00 a.m. on June 30, 1998, or at such other time and
place as the parties hereto shall agree upon. Such date is referred
to in this Agreement as the "Closing Date. "
9.2 Documents To Be Delivered by the Private Company and
the Shareholder. At the Closing the Private Company and the
Shareholder shall deliver to the Purchaser the following documents:
a. Certificates for the number of shares of
common Company in the manner and form required by subsection 1.1
hereof.
b. The certificate required pursuant to
subsection 6.3 hereof.
c. Such other documents of transfer,
certificates of and documents as the Purchaser may reasonably request.
9.3 Documents To Be Delivered by the Purchaser. At the
Closing shall deliver to the Private Company and the Shareholder the
following documents:
a. Certificates for the number of shares of
common as determined in sub-section 1.2 hereof.
b. The certificate required pursuant to
subsection 7.3 hereof.
c. Such other documents of transfer,
certificates of and documents as the Private Company and the
Shareholder may reasonably request.
10. Termination. This Agreement may be terminated by
the Purchaser or the Private Company by notice to the other if, (i)
at any time prior to the Closing Date any event shall have occurred
or any state of facts shall exist that renders any of the conditions
to its or their obligations to consummate the transactions
contemplated by this Agreement incapable of fulfillment, or (ii) on
June 30, 1998, if the Closing shall not have occurred. Following
termination of this Agreement no party shall have liability to
another party relating to such termination, other than any liability
resulting from the breach of this Agreement by a party prior to the
date of termination.
11. Miscellaneous.
11.1 Notices. All communications provided for herein
shall be in writing and shall be deemed to be given or made when
served personally or when deposited in the United States mail,
certified return receipt requested, addressed as follows, or at such
other address as shall be designated by any party hereto in written
notice to the other party hereto delivered pursuant to this subsection:
Purchaser: Consolidated Medical Management, Inc.
13005 Justice Avenue
Baton Rouge, Louisiana 70816
Attention: Sunni M. Wooley
Private Company: Michael W. Sciacchetano
8944 Norfolk Dr.
Baton Rouge, La. 70809
11.2 Default. Should any party to this Agreement default
in any of the covenants, conditions, or promises contained herein,
the defaulting party shall pay all costs and expenses, including a
reasonable attorney's fee, which may arise or accrue from enforcing
this Agreement, or in pursuing any remedy provided hereunder.
11.3 Assignment. This Agreement may not be assigned in
whole or in part by the parties hereto without the prior written
consent of the other party or parties, which consent shall not be
unreasonably withheld.
11.4 Successors and Assigns. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto,
their heirs, executors, administrators, successors and assigns.
11.5 Partial Invalidity. If any term, covenant,
condition, or provision of this Agreement or the application thereof
to any person or circumstance shall to any extent be invalid or
unenforceable, the remainder of this Agreement or application of
such term or provision to persons or circumstances other than those
as to which it is held to be invalid or unenforceable shall not be
affected thereby and each term, covenant, condition, or provision of
this Agreement shall be valid and shall be enforceable to the
fullest extent permitted by law.
11.6 Entire Agreement. This Agreement constitutes the
entire understanding between the parties hereto with respect to the
subject matter hereof and supersedes all negotiations,
representations, prior discussions, letters of intent, and
preliminary agreements between the parties hereto relating to the
subject matter of this Agreement.
11.7 Interpretation of Agreement. This Agreement shall
be interpreted and construed as if equally drafted by all parties
hereto.
11.8 Survival of Covenants, Etc. All covenants,
representations, and warranties made herein to any party, or in any
statement or document delivered to any party hereto, shall survive
the making of this Agreement and shall remain in full force and
effect until the obligations of such party hereunder have been fully
satisfied.
11.9 Further Action. The parties hereto agree to execute
and deliver such additional documents and to take such other and
further action as may be required to carry out fully the
transactions contemplated herein.
11.10 Amendment. This Agreement or any provision hereof
may not be changed, waived, terminated, or discharged except by
means of a written supplemental instrument signed by the party or
parties against whom enforcement of the change, waiver, termination,
or discharge is sought.
11.11 Full Knowledge. By their signatures, the parties
acknowledge that they have carefully read and fully understand the
terms and conditions of this Agreement, that each party has had the
benefit of counsel, or has been advised to obtain counsel, and that
each party has freely agreed to be bound by the terms and conditions
of this Agreement.
11.12 Headings. The descriptive headings of the various
sections or parts of this Agreement are for convenience only and
shall not affect the meaning or construction of any of the
provisions hereof.
11.13 Counterparts. This Agreement may be executed in two
or more partially or fully executed counterparts, each of which
shall be deemed an original and shall bind the signatory, but all of
which together shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto executed the
foregoing Agreement as of the day and year first above written.
PURCHASER: CONSOLIDATED MEDICAL MANAGEMENT, INC.
By: /s/ Sunni M. Wooley, President
PRIVATE COMPANY: UNITED MEDICAL SERVICES CORPORATION
By: /s/ Michael W. Sciacchetano, President
SCHEDULE "A"
TO THE
AGREEMENT AND PLAN OF REORGANIZATION
NAME OF NO. OF SHARES OF NO. OF SHARES OF
SHAREHOLDER THE PRIVATE COMPANY THE PURCHASER
TO BE TRANSFERRED TO BE ISSUED
Michael W. Schiacchetano 5.000 20,000
EXHIBIT 16.1
TERRENCE J. DUNNE, MBA, MST
Certified Public Accountant
Suite 100 Washington trust Bank Bldg.
West 717 Sprague
Spokane, Washington 99204
August 20, 1998
Board of Directors
Consolidated Medical Management, Inc.
13005 Justice Avenue
Baton Rouge, Louisiana 70816
Madam:
I acknowledge receipt of a copy of the disclosures set forth
in Item 4 of the Current Report on Form 8-K of Consolidated Medical
Management, Inc. dated July 10, 1998, made in response to Item 304
of Regulation S-B promulgated by the Securities and Exchange
Commission. This letter will confirm that I agree with the
statements made by the Company in such item.
Sincerely,
/s/
Terrence J. Dunne
