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): November 4, 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 November 4, 1998, the Company entered into an Agreement with
Aplomb, Inc., a Mississippi corporation ("Aplomb"), and the shareholders of
such entity. The Agreement provided for the issuance of 2,159,913 shares of
the Series "A" $12.50 Preferred Stock and 1,079,957 shares of the Series "A"
$8.00 Preferred Stock on an approximately pro rata basis to the shareholders
of Aplomb in exchange for all of the outstanding shares of Aplomb. The
closing of the Agreement was held on November 4, 1998. The assets of Aplomb
consist primarily of notes and mortgages receivable issued by the original
shareholders of Aplomb. The number of preferred shares issued by the Company
in this acquisition was based upon the face value of the notes and mortgages
receivable and an assumed value of the common stock of the Company for
purposes of this transaction only of $5.00 per share.
In connection with such transaction, each of the former shareholders of Aplomb
has agreed to grant to Sunni M. Wooley, the president, director, and a
principal shareholder of the Company, a proxy to vote the shares of common
stock issuable upon conversion of the preferred shares. Each proxy is valid
for a period of one year.
Also in connection with such transaction, the Company has agreed to issue
options to certain principals of the former shareholders of Aplomb to purchase
shares of common stock of the Company at $0.10 per share. The Company has
agreed to grant a total of 517,976 options to such persons, exercisable at any
time for a period of 1 year from the date of grant.
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 November 4, 1998 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: November 18, 1998 By /s/ Sunni M. Wooley, President and CFO
Exhibit 2.1
AGREEMENT
This Agreement (the "Agreement"), entered into this 4 day of November, 1998,
is by, between, and among Consolidated Medical Management, Inc., a publicly
held Montana corporation (hereinafter the "Purchaser"), Aplomb Inc., a
privately-held Mississippi corporation (hereinafter the "Private Company"),
and the shareholders 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 shares of Preferred 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 preferred 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 Mississippi 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 1,000 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 October 1, 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 October 1, 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 October 1, 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 October 1, 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 5,446,057 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 June 30, 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 June 30, 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, investi
gations 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 preferred 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,
is 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 dispose 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 13000 Justice Avenue Suite 6, Baton Rouge, Louisiana, at 3:00 PM on
October 15, 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 preferred 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 November 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.
13000 Justice Avenue Suite # 6
Baton Rouge, Louisiana 70816
Attention: Sunni M. Wooley
Private Company: Mr. Robert C. Coburn Sr.
120 S. George St
Petal, Ms. 39465
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: APLOMB, INC.
By /s/ Robert C. Coburn Sr. President
<PAGE>
SCHEDULE "A"
TO THE
AGREEMENT
NAME OF NO. OF SHARES OF NO. OF SHARES OF
SHAREHOLDER THE PRIVATE COMPANY THE PURCHASER
TO BE TRANSFERRED TO BE ISSUED
Colonial Financial Holding, Inc. 111 360,000
Myers And Raggio 111 360,000
Sam Love 111 360,000
Underwriters Trust or
Charles Coburn Trustee 445 1,439,956
Charles Walker Trustee 111 359,957
Innovative Trust 111 359,957
TOTAL SHARES 1,000 3,239,870
