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UNITED STATES
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 earliest event reported: April 12, 1996
UCI Medical Affiliates, Inc.
(Exact name of registrant as specified in its charter)
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Delaware 0-13265 59-2225346
(State or other jurisdiction of incorporation) (Commission File Number) (IRS Employer Identification No.)
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6168 St. Andrews Road, Columbia, South Carolina 29212
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (803) 772-8840
No Change
(Former name or former address, if changed since last report.)
This document contains a total of 48 pages and the Exhibit Index is set forth on
sequentially numbered page 4.
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Pursuant to the terms of an Asset Purchase Agreement and Plan of Reorganization
dated and executed April 12, 1996 by and between Martin L. Schlein, M.D., P.A.
("Seller") and UCI Medical Affiliates of South Carolina, Inc., a South Carolina
corporation (the "Company") and the wholly-owned subsidiary of UCI Medical
Affiliates, Inc., a Delaware corporation ("UCI"), the Company has acquired
certain assets of (including patient list and goodwill) associated with the
medical practice owned and operated by Seller in Greenville, South Carolina for
a purchase price of $540,927 consisting of 125,187 shares of common stock of
UCI, the assumption of $27,000 of trade accounts payable, and cash of $75,776
paid $6,315 at closing and the remainder in 11 monthly installments with
interest at ten (10%) percent per annum. The consideration paid by the Company
in connection with this acquisition was determined by arms-length negotiations
between the Company and the Seller.
The practice operated by the Seller was one at which medical conditions not
involving an immediate threat to life were treated on an outpatient basis. The
Company has merged the operations of the Seller into those of one of its
existing centers in Greenville (Doctor's Care - Pelham).
All descriptions of the Asset Purchase Agreement noted herein are qualified in
their entirety by reference to such documents as Exhibits to this Current Report
on Form 8-K.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
a) Financial Statements of Business Acquired
It is impracticable to provide the required financial statements
for the businesses acquired at the time this Report on Form 8-K is
filed. UCI will file the required financial statements for the
Seller under cover of Form 8 as soon as practicable, but not later
than 60 days after this Report on Form 8-K is due to be filed.
b) Pro Forma Financial Information
It is impracticable to provide the required pro forma financial
information at the time this Report on Form 8-K is filed. UCI will
file the required pro forma financial information under cover of
Form 8 as soon as practicable, but not later than 60 days after
this Report on Form 8-K is due to be filed.
c) Exhibits
Exhibit 2.1 - Asset Purchase Agreement and Plan of Reorganization
dated and executed on April 12, 1996 by and between Martin L.
Schlein, M.D., P.A. and UCI Medical Affiliates of South Carolina,
Inc.
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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.
UCI Medical Affiliates, Inc.
(Registrant)
/s/ M.F. McFarland, III, M.D. /s/ Jerry F. Wells, Jr.
President, Chief Executive Officer and Vice President of Finance and
Chairman of the Board Chief Financial Officer
Date: April 25, 1996
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UCI MEDICAL AFFILIATES, INC.
EXHIBIT INDEX
TO
FORM 8-K
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EXHIBIT PAGE
NUMBER DESCRIPTION NUMBER
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2.1 Asset Purchase Agreement and Plan of Reorganization dated 6
and executed April 12, 1996 by and between Martin L. Schlein,
M.D., P.A. and UCI Medical Affiliates of South Carolina, Inc.
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EXHIBIT NO. 2.1
ASSET PURCHASE AGREEMENT
AND
PLAN OF REORGANIZATION
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ASSET PURCHASE AGREEMENT AND PLAN OF REORGANIZATION
This Asset Purchase Agreement And Plan of Reorganization ("Agreement") is
made to be effective as of the 12th day of April, 1996, by, between and among
UCI Medical Affiliates, Inc., a Delaware corporation ("UCI"), UCI Medical
Affiliates of South Carolina, Inc., a South Carolina corporation and wholly
owned subsidiary of UCI ("UCI of SC"), Doctor's Care, P.A., a South Carolina
professional corporation ("Doctor's Care"), Martin L. Schlein, M.D., P.A., a
South Carolina professional corporation ("Seller"), and Martin L.
Schlein, M.D. ("Schlein").
INTRODUCTION. Seller owns and operates a medical practice located at 4501
East North Street Extension, Taylors, South Carolina 29687 ("Premises"). Schlein
is the sole shareholder of Seller. UCI of SC owns and/or leases various
medical-related facilities and equipment in South Carolina and has contracted
with Doctor's Care to provide health care services at such facilities. Seller
and/or Schlein desires to (i) transfer Seller's patient records to Doctor's Care
(ii) enter into an employment agreement between Doctor's Care and Schlein, and
(iii) transfer to UCI of SC as of 11:59 p.m. on April 12, 1996 (the "Effective
Date") substantially all the assets of the Seller in exchange for certain shares
of the voting common stock of UCI in a transaction the parties intend will
qualify as a reorganization under Section 368(a)(1)(C) of the Internal Revenue
Code of 1986, as amended, all upon the terms and conditions set forth herein.
AGREEMENT. NOW, THEREFORE, in consideration of these premises and the
mutual covenants hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. SALE OF ASSETS TO UCI OF SC.
1.1 Transfer of Assets. At the Closing (as defined below), for the
consideration herein provided, Seller shall convey, transfer, assign and
deliver, or cause to be conveyed, transferred, assigned, and delivered, to UCI
of SC, and UCI of SC shall purchase and accept from Seller, all of Seller's
right, title, and interest (as the case may be) in and to following assets
(collectively "Assets"):
1.1.1 All of the accounts receivable, cash (including cash
received pursuant to Section 2.1 below), cash accounts, machinery,
equipment, computer and telephone systems (including hardware and
software), inventory, furniture, furnishings, office equipment, and related
tangible personal property respecting Seller's business conducted in the
Premises (the "Business"), including (without limitation) the items
described in Exhibit A attached hereto.
1.1.2 All of the goodwill, permits, licenses, computer software
and related intangible personal property of the Business and certain
equipment leases existing at the Closing (as defined below) which are
specifically itemized in Exhibit B attached hereto. Seller shall be
responsible for obtaining the necessary consents, if any, to assignment of
such intangible assets. The parties hereto acknowledge and agree that UCI
of SC shall not assume any equipment leases, personal property leases, real
property leases, or any other liabilities of Seller or Schlein other than
such leases set forth on Exhibit B attached hereto. As to the leases set
forth on Exhibit B, UCI of SC hereby agrees to assume all obligations
thereunder as of the Effective Date.
1.1.3 All of the inventory of the Business, wherever located.
1.1.4 All of Seller's repair and service contracts and warranties
(which are acceptable to UCI of SC in its sole discretion) used or useful
in the Business.
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1.2 Method of Transfer. The transfer and sale of the Assets will be
evidenced by appropriate Bills of Sale, assignments and other instruments
executed and delivered by Seller and/or Schlein to UCI of SC and/or Doctor's
Care at Closing (as defined below), as set forth in this Agreement.
1.3 Not a Sale of Business. This transaction constitutes the sale of assets
by Seller and not the sale of a business; provided, however, that anything
contained in this Agreement to the contrary notwithstanding, it is the intent of
the parties that UCI of SC purchase and acquire and Seller sell and transfer the
complete operating process of the Business and all properties and interest
necessary to operate the Business substantially as it is presently being
operated.
1.4 Possession. UCI of SC shall take, and Seller shall deliver, possession
of the Assets at completion of Closing (as defined below) to be effective as of
the Effective Date.
2. TRANSFER OF SELLER'S PATIENT RECORDS TO DOCTOR'S CARE.
2.1 Transfer of Patient Records. Immediately prior to the Closing (as
defined below), for and in consideration of Nine Thousand One Hundred Twenty
($9,120.00) Dollars and no other consideration, Seller and Schlein shall
transfer and deliver to Doctor's Care all of Schlein and Seller's right, title
and interest in and to any medical records in their possession that were made in
treating patients and all records transferred to Seller concerning prior
treatment of any patient (the "Patient Records").
2.2 Method of Transfer. The transfer of the Patient Records will be
evidenced by an appropriate bill of sale substantially in the form attached
hereto as Exhibit C, executed and delivered by Seller and Schlein to Doctor's
Care immediately prior to the Closing (as defined below), as set forth in this
Agreement.
2.3 Notices. Seller shall cause any public notices to be filed in a timely
manner and to otherwise comply with all requirements of the Physician's Patient
Records Act or any other applicable law, regulation, rule or ordinance related
to the transfer of the Patient Records.
2.4 Possession. Doctor's Care shall pick up and take, and Seller shall
relinquish, possession of the Patient Records at Closing (as defined below), to
be effective as of the Effective Date.
3. CONSIDERATION FOR ACQUISITIONS.
3.1 Purchase Price. The purchase price ("Purchase Price") for the Assets to
be acquired by UCI of SC shall be Four Hundred Ninety Thousand and No/100
($490,000.00) Dollars, plus an amount equal to Twenty-Three Thousand Nine
Hundred Twenty-Seven and 42/100 ($23,927.42) Dollars which represents thirty
(30%) percent of the outstanding accounts receivable balance of Seller as of the
close of business on April 9, 1996 as certified by Schlein as set forth in
Section 4.1 hereof. The Purchase Price shall be payable to Seller as follows:
3.1.1 Common Stock. UCI shall issue to Seller certificate(s)
representing in the aggregate One Hundred Twenty-Five Thousand One Hundred
Eighty-Seven (125,187) shares of the voting common stock of UCI, $0.05 par
value (the "Shares"). For purposes hereof, the price per share of the
Shares is Three and One-Half (3.5) Dollars which is the closing ask price
on the date immediately prior to the Effective Date. The Shares, when
issued, will be duly authorized, validly issued, fully paid and
non-assessable. The certificate evidencing the Shares shall bear a
restrictive legend in substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
STATE SECURITIES LAWS, HAVE BEEN TAKEN WITHOUT A VIEW TO THE
DISTRIBUTION THEREOF WITHIN THE MEANING OF SUCH ACT, AND MAY NOT
BE SOLD, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF
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EXCEPT IN ACCORDANCE WITH SUCH ACT AND THE RULES AND REGULATIONS
THEREUNDER AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES
LAWS. THE COMPANY WILL NOT TRANSFER SUCH SHARES EXCEPT UPON
RECEIPT OF EVIDENCE SATISFACTORY TO THE COMPANY, WHICH MAY INCLUDE
AN OPINION OF COUNSEL, THAT THE REGISTRATION PROVISIONS OF SUCH
ACT HAVE BEEN COMPLIED WITH, THAT SUCH REGISTRATION IS NOT
REQUIRED AND THAT SUCH TRANSFER WILL NOT VIOLATE ANY APPLICABLE
STATE SECURITIES LAWS.
Seller acknowledges that the Shares shall be "restricted stock"
under the Federal securities laws (meaning that it was purchased other than
through a registered public offering).
3.1.2 Additional Payment. UCI of SC shall pay to Seller as follows:
(1) The sum of Six Thousand Three Hundred Fourteen and 68/100
($6,314.68) Dollars shall be paid to Seller at Closing (as defined
below).
(2) The sum of Sixty-Nine Thousand Four Hundred Sixty-One and
53/100 ($69,461.53) Dollars, the balance of the Purchase Price,
shall be due and payable in eleven (11) equal monthly
installments, with the first payment due on or before May 12,
1996, pursuant to a promissory note substantially in the form
attached hereto as Exhibit D (the "Note").
4. CLOSING.
4.1 Transactions Prior to Closing. At Closing, Seller shall deliver to UCI
of SC, a report detailing the Seller's accounts receivable as of the close of
business on April 9, 1996. Such report shall include the name of each debtor,
amount owed, and date owed, as well as aggregate sum of the accounts receivable
due Seller. At Closing (as defined below), Schlein shall deliver to UCI of SC a
certificate stating that such report is accurate as of April 9, 1996, as set
forth in Section 4.3.4 hereof. All amounts related to such accounts receivable
which are collected by Seller and/or Schlein on or after April 10, 1996 shall be
transferred to UCI of SC at Closing (as defined below) as an Asset purchased by
UCI of SC hereunder.
4.2 Closing Date. The closing of the sale and purchase of the Assets and
related transactions ("Closing") shall take place on April 12, 1996, commencing
at 2:00 p.m. (local time), at the offices of Merline & Thomas, P.A. located at
665 N. Academy Street, Greenville, South Carolina or such other time and place
as may be mutually agreed upon in writing by the parties (alternatively
"Closing"). In the event Closing set forth in this Section 4 is changed to a
different date, all references in this Agreement to Closing shall be deemed to
refer to the time and date agreed upon by the parties, in the manner set forth
herein. The effective date for the transactions contemplated herein shall be
April 12, 1996 (the "Effective Date").
4.3. Transactions at Closing. At the Closing:
4.3.1 Upon receipt of an investment letter in the form of Exhibit
E attached hereto duly executed by Seller and Schlein, UCI shall issue to
Seller a certificate evidencing the Shares pursuant to Section 3.1.1. If
such certificate is not available at Closing, UCI will provide Seller with
a copy of the instructions which UCI will forward to its transfer agent
instructing such agent to issue a certificate evidencing the Shares to
Seller.
4.3.2 Seller and Schlein shall execute and deliver to UCI of SC or
Doctor's Care, as applicable, the bills of sale, assignments, titles,
certificates, and other documents, agreements and instruments, in form and
substance required by this Agreement, as described in Section 4.4.
4.3.3 UCI of SC and Doctor's Care shall execute and deliver to
Seller and Schlein the documents, agreements and instruments in form and
substance required by this Agreement, as described in Section 4.5.
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4.3.4 Schlein shall execute and deliver to UCI of SC a
certification of the accounts receivable report described in Section 4.1
hereof in the form of Exhibit F attached hereto (the "Accounts Receivable
Certification").
4.3.5 Schlein and Doctor's Care shall each execute and deliver to
the other the employment agreement substantially in the form of Exhibit G
attached hereto (the "Employment Agreement").
4.3.6 All employees of Seller directly and primarily associated
with the Business will cease to be employees of Seller, and Doctor's Care
and/or UCI of SC may, subject to the exercise of Doctor's Care's and/or UCI
of SC's sole discretion, offer immediately or thereafter to hire any or all
of such persons. Doctor's Care and/or UCI of SC shall be entitled to hire
only those employees of Seller which Doctor's Care and/or UCI of SC elects
in its sole discretion to hire, and Doctor's Care and/or UCI of SC shall
not assume any liability whatsoever to any employee of Seller not hired by
Doctor's Care and/or UCI of SC. Seller will be responsible for paying and
reporting all costs and liabilities, including but not limited to
compensation, federal and state withholding taxes, federal and state
unemployment taxes, all employee benefit costs, and worker's compensation
claims incurred or accrued prior to the Effective Date. Notwithstanding the
foregoing, as soon as possible after Closing, UCI of SC shall offer
employment, in one of UCI of SC's Greenville, South Carolina locations, to
Susan Bennett, Schlein's secretary; and to Kristal Ridenour, Schlein's
receptionist, each upon the terms and conditions to be determined by UCI of
SC in its sole discretion. Notwithstanding the foregoing, as soon as
possible after Closing, UCI of SC shall offer employment, in UCI of SC's
Pelham office located in Greenville, South Carolina, to Patsy Davis,
Schlein's existing nurse, upon the terms and conditions to be determined by
UCI of SC in its sole discretion.
4.3.7 The Parties will take such other actions contemplated at
Closing by this Agreement.
4.4 Seller and Schlein's Documents. At Closing, Seller and Schlein shall
deliver or cause to be delivered, at Seller's expense, the following duly
executed, lawful and effective documents and instruments:
4.4.1 A bill of sale for tangible personal property and fixtures
composing portions of the Assets substantially in the form attached hereto
as Exhibit H to UCI of SC.
4.4.2 An assignment of intangible personal property composing
portions of the Assets substantially in the form attached hereto as Exhibit
I to UCI of SC.
4.4.3 An Investment Letter substantially in the form attached
hereto as Exhibit E to UCI.
4.4.4 The Accounts Receivable Certification substantially in the
form attached hereto as Exhibit F to UCI of SC.
4.4.5 The Employment Agreement substantially in the form
attached hereto as Exhibit G to Doctor's Care.
4.4.6 Seller will deliver to UCI of SC copies of such duly filed
UCC termination statements, mortgages or lien satisfactions and other
documents, as are reasonably required by UCI of SC to evidence UCI of SC's
clear, marketable and insurable title to the Assets.
4.4.7 Copy of all current data, contracts and information for the
Business.
4.4.8 Certified Resolutions of the directors and shareholders of
Seller authorizing the transaction contemplated herein.
4.5 Documents of UCI, UCI of SC or Doctor's Care. At Closing UCI, Doctor's
Care and/or UCI of SC, at their expense, shall deliver or cause to be delivered
to Seller or Schlein (as the case may be) the following duly executed, lawful,
and effective documents and instruments:
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4.5.1 UCI will deliver a certificate evidencing the Shares, or if
such certificate is not available, a copy of the instructions which UCI
will forward to its transfer agent instructing such agent to issue a
certificate evidencing the Shares to Seller.
4.5.2 Doctor's Care will deliver the Employment Agreement
substantially in the form attached hereto as Exhibit G.
4.5.3 UCI of SC will deliver the Note substantially in the form
attached hereto as Exhibit D.
4.5.4 Certified Resolutions of the directors of UCI, UCI of SC,
and Doctor's Care, respectively, authorizing the transaction contemplated
herein.
4.6 Conditions of Title. At Closing, the Assets shall be conveyed by
appropriate instruments of conveyance free and clear of all claims, security
interests, liens and encumbrances except personal property and ad valorem taxes
for the year of Closing (which shall be prorated as provided in this Agreement),
or leases which remain outstanding which have been assumed by UCI of SC.
4.7 Transactions Subsequent to Closing.
4.7.1 Employment Matters. Nothing contained herein shall be
construed to create any liability for UCI, UCI of SC or Doctor's Care to
present or past employees of Seller, or to the South Carolina Employment
Security Commission or any other person or entity or regulatory agency for
periods prior to the Effective Date.
4.7.2 Confidentiality. Seller shall hold in confidence all
documents and information concerning the Business and the Assets (except
that Seller may, after reasonable notice to UCI of SC disclose such
documents and information, or copies or summaries thereof, to any
governmental authority reviewing the transactions contemplated hereby or as
required in Seller's reasonable judgment pursuant to federal or state laws
or court order).
4.7.3 Taxes. Seller shall file such tax returns and reports and
pay such taxes as are required for periods ending with the Effective Date.
4.7.4 Creditors. Seller shall promptly pay all of Seller's valid
liabilities and perform all of Seller's valid obligations which Seller has
incurred in connection with the Assets or the operation of the Business.
4.7.5 Miscellaneous Required Acts. The parties hereto shall take
such other actions and comply with other obligations as are required after
Closing under this Agreement or under documents ancillary hereto.
4.8 Other Actions. The parties hereto agree that they will at any time and
from time to time do, execute, acknowledge and deliver, or will cause to be
done, executed, acknowledged and delivered, all such further acts, deeds,
assignments, transfers, conveyances, documents, instruments and assurances as
may be reasonably required by the other party in order to carry out fully and to
effectuate the transactions herein contemplated under, and in accordance with,
the provisions of this Agreement.
5. REPRESENTATIONS AND WARRANTIES OF SELLER AND SCHLEIN. Seller and Schlein
hereby jointly and severally warrant, represent, and
covenant as follows:
5.1 Authority. Seller is a corporation duly organized, validly existing and
in good standing under the laws of the State of South Carolina. Schlein is the
sole shareholder and director of Seller. Seller has full power and authority to
execute this Agreement and to consummate the transactions contemplated
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hereby. When executed and delivered, this Agreement shall constitute valid and
binding obligations of Seller and Schlein enforceable in accordance with its
terms and conditions except as enforcement may be limited by applicable
bankrupt, insolvency or similar laws effecting creditors rights generally and by
principles of equity. Neither the execution nor the delivery of this Agreement
nor the consummation of the transactions contemplated hereby, nor the compliance
with any of the terms and conditions hereof, will result in the breach by Seller
or Schlein of any of the terms or conditions of any contract, agreement,
judgment or instrument, or to the best of their knowledge any law, to which
Seller or Schlein is bound, or constitute a default of such indenture, mortgage,
deed of trust, order, judgment, other contract, agreement, or instrument, or to
the best of their knowledge any law.
5.2 Compliance with Laws. To the best of Seller and Schlein's knowledge,
Seller is in compliance with all laws, ordinances, and regulations that govern
such Seller's ownership and present use of the Assets, the violation of which
would have an adverse effect on the Assets or the Business. To the best of
Seller and Schlein's knowledge, all of the Assets sold hereunder substantially
comply with applicable environmental, zoning health, OSHA, consumer products,
and fire safety regulations.
5.3 Title to Assets. At Closing, Seller will have, and shall be entitled to
convey, good, marketable and insurable title to the Assets and the condition of
title as required by Section 4.5. At Closing, Seller will not be indebted to any
contractor, laborer, mechanic, material man or any other person or entity for
work, labor, materials or services in connection with the Assets for which any
such person or entity could claim a lien against the Assets.
5.4 Consents. No consent of any third party is required in connection with
Seller's transfer and assignment of the Assets hereunder.
5.5 Litigation. There are no judicial or administrative actions or
proceedings pending, or to the best of Seller's and/or Schlein's knowledge,
threatened that question the validity of this Agreement or any transaction
contemplated hereby or that relate to the Assets, or to the conduct of Business,
including but not limited to condemnation or bankruptcy proceedings, which if
adversely determined would have a material adverse effect upon Seller's and/or
Schlein's ability to enter into this Agreement or perform its obligations
hereunder or upon the use, enjoyment, or value of the Assets for UCI of SC
and/or Doctor's Care.
5.6 Insurance Coverage. Seller maintains policies of insurance covering the
Assets in amounts and against such losses and risks as are customary for
facilities such as the Business in their present usage, as well as general
public liability "occurrence" coverage in the amount of $1,000,000 per
occurrence and $1,000,000 in the aggregate, and same will be outstanding and
duly in force through Closing.
5.7 Normal Course. Seller shall have operated the Assets in the normal and
ordinary course of business since at least January 1, 1994, and shall have paid
or caused to be paid promptly when due all city, county and state ad valorem
taxes and similar taxes and assessments and all utility charges and assessments
imposed upon or assessed against the Assets prior to the Closing. Seller shall
exercise its best efforts to preserve the goodwill of the employees, patients,
suppliers and others having business relationships with the Business through
Closing.
5.8 Creditors, Solvency, and Bankruptcy. Seller and Schlein shall not
hinder, delay, defraud, or avoid any obligation to any past, present or future
creditor in the transactions contemplated by this Agreement. Seller is currently
solvent and will not be rendered insolvent as a result of the transactions
contemplated hereby. Seller has not initiated, nor does it intend to initiate
with respect to itself as debtor, has had initiated or expects to have initiated
against it as debtor, any proceeding under federal or any state's bankruptcy,
insolvency or similar laws.
5.9 Labor and Employee Benefit Matters. Seller is not a party to any
agreement with any labor organization. Seller has not maintained or sponsored
for any employee or former employee of Seller any fringe or benefit plans,
including without limitation, any retirement, pension, profit sharing,
thrift-savings, non-qualified deferred compensation, incentive compensation,
stock bonus, stock option (qualified or non-
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qualified), cash bonus, employee stock ownership (including, without limitation,
payroll related employee stock ownership), insurance, medical, welfare or
vacation plans of any kind and any "employee benefit plan" (as defined in
Section 3(3) of Title I of the Employment Retirement Income Security Act of
1974, as amended ("ERISA") or any voluntary employees' beneficiary association
(as defined in Section 501(c) (9) of the Internal Revenue Code) or combination
of the foregoing. Seller has not incurred any accumulated funding deficiency
within the meaning of ERISA or any liability to the Pension Benefit Guaranty
Corporation established under ERISA, nor has any tax been assessed against
Seller for the alleged violation of the Internal Revenue Code with respect to
the Business or its operation.
5.10 Payables and Taxes. Seller will pay all accounts payable and taxes,
assessments, and charges respecting the Assets incurring prior to the Effective
Date within a reasonable amount of time following Closing and will protect the
reputation of UCI of SC by promptly paying all the valid debts and obligations
of Seller which have been incurred in connection with the operation of the
Business prior to the Effective Date and which affect the Assets.
5.11 Workers' Compensation. There are no worker compensation or similar
claims or actions pending, or to the best of Seller and Schlein's knowledge
threatened, and Seller and/or Schlein does not know of facts which would make
such claims timely, by past or present employees of Seller.
5.12 Status of Assets. The Assets sold hereunder constitute all of the
assets of the Business and include all property, rights, and intangibles
necessary for UCI of SC and/or Doctor's Care to operate after Closing a business
similar to the Business as presently conducted. All material inventory systems,
machinery, equipment, and other tangible property which are portions of the
Assets are generally sound, in good repair, may be safely operated within all
applicable standards or regulations in their present conditions, and are in
merchantable condition. All material contracts, commitments, and similar rights
which are portions of the Assets to the best of Schlein's and Seller's knowledge
are valid, binding, enforceable, and without known default in violation of law.
The information related to accounts receivable provided to UCI of SC is
materially accurate, and to the best of Schlein's and Seller's knowledge,
reflects valid, binding, and enforceable rights of the Business, which shall be
lawfully transferred to UCI of SC hereunder.
5.13 No Adverse Conditions. Except as previously disclosed in writing to
UCI of SC, there are no material adverse conditions or circumstances that may
interfere with the use and enjoyment of, or opportunity to resell or encumber,
any of the Assets, or might otherwise impede UCI of SC's ability to operate a
business similar to the Business utilizing the Assets.
5.14 Brokerage. Neither Seller nor Schlein has dealt with any broker in
connection with this transaction, and no brokerage commission nor claim thereof
shall accrue or become payable to any person or entity respecting this
transaction.
5.15 Disclosures. To the best of Seller's and Schlein's knowledge, all
information and data furnished by Seller and/or Schlein to UCI, UCI of SC or
Doctor's Care with respect to the Assets and the Business will be materially
true, correct, and complete, and not materially misleading.
5.16 Representations and Warranties at Closing. Except as expressly
otherwise permitted in this Agreement, the representations and warranties of
Seller and/or Schlein set forth in this Agreement shall be true as of the
Effective Date as though such representations and warranties were made on such
date, unless they reference a specific earlier date whereupon, as of the
Effective Date, they shall be true as at the earlier date referenced.
6. REPRESENTATIONS AND WARRANTIES OF UCI, DOCTOR'S CARE AND UCI OF SC. UCI,
Doctor's Care and UCI of SC hereby jointly and severally represent, warrant, and
covenant as follows:
6.1 Organization and Good Standing. UCI is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Delaware
and has full corporate power to carry on its
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businesses and to own and operate its properties and assets as presently owned
and operated. UCI of SC is a corporation duly organized, validly existing, and
in good standing under the laws of the State of South Carolina and has full
corporate power to carry on its businesses and to own and operate its properties
and assets as presently owned and operated. Doctor's Care is a professional
association duly organized, validly existing, and in good standing under the
laws of the State of South Carolina and has full corporate power to carry on its
businesses and to own and operate its properties and assets as presently owned
and operated.
6.2 Authority of Buyer. UCI, Doctor's Care and UCI of SC each have taken
all corporate action necessary to approve and authorize the execution of this
Agreement, and to consummate the transactions contemplated hereby. Each of their
respective representatives signing this Agreement has full power and authority
to execute this Agreement in the indicated capacity and to consummate the
transactions contemplated hereby. When executed and delivered, this Agreement
shall constitute valid and binding obligations of UCI, Doctor's Care and UCI of
SC, enforceable in accordance with its terms and conditions except as
enforcement may be limited by applicable bankrupt, insolvency or similar laws
effecting creditors rights generally and by principles of equity. Neither the
execution nor the delivery of this Agreement nor the consummation of the
transactions contemplated hereby, nor the compliance with any of the terms and
conditions hereof, will result in the breach by UCI, UCI of SC, or Doctor's Care
of any of the terms or conditions of any contract, agreement, judgment or
instrument, or to the best of their knowledge any law, to which UCI, UCI of SC,
or Doctor's Care is bound, or constitute a default of such indenture, mortgage,
deed of trust, order, judgment, other contract, agreement, or instrument, or to
the best of their knowledge any law.
6.3 Brokerage. Neither UCI, Doctor's Care, nor UCI of SC has dealt with any
broker in connection with this transaction, and no brokerage commission nor
claim therefor shall accrue or become payable to any person or entity respecting
this transaction.
6.4 Consents. No consent of any third party is required in connection with
the purchase and acceptance of the Assets from Seller hereunder.
6.5 Litigation. There are no judicial or administrative actions or
proceedings pending, or to the best knowledge of UCI, Doctor's Care or UCI of
SC, threatened that question the validity of this Agreement or any transaction
contemplated hereby, which if adversely determined would have a material adverse
effect upon their ability to enter into this Agreement or perform their
respective obligations hereunder.
6.6 Creditors, Solvency and Bankruptcy. UCI, Doctor's Care or UCI of SC
shall not hinder, delay, defraud or avoid any obligations to any past, present
or future creditor of UCI, Doctor's Care or UCI of SC respectively in the
transactions contemplated by this Agreement. The above-mentioned parties are
currently solvent and will not be rendered insolvent as a result of the
transactions contemplated hereby. UCI, Doctor's Care or UCI of SC do not intend
to initiate with respect to themselves as debtors, nor do they expect to have
initiated against themselves as debtors, any proceeding under federal or any
state's bankruptcy, insolvency or similar laws.
6.7 Rule 144(e) Requirements. Notwithstanding anything contained herein to
the contrary, unless UCI goes private as described in Section 13(e) of the
Securities Exchange Act of 1934, as amended, UCI shall comply with the public
information requirements of Rule 144(e) promulgated under the Securities Act of
1933, as amended, so long as compliance with Rule 144(e) is required to effect a
sale of the Shares under Rule 144. UCI hereby acknowledges that there is no
present intention for UCI to go private as described in Section 13(e) of the
Securities Exchange Act of 1934, as amended.
6.8 Representations and Warranties at Closing. Except as expressly
otherwise permitted in this Agreement, the representations and warranties of
UCI, Doctor's Care and UCI of SC set forth in this Agreement shall be true as of
the Effective Date as though such representations and warranties were made on
such date, unless they reference a specific earlier date whereupon, as of the
Effective Date, they shall be true as at the earlier date referenced.
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7. CONDITIONS PRECEDENT.
7.1 Conditions of UCI, UCI of SC and Doctor's Care. The obligations of UCI,
UCI of SC and Doctor's Care hereunder shall be subject, to the extent not
waived, to the satisfaction of each of the following conditions at the Closing:
7.1.1 Representation and Warranties. The representations and
warranties of Seller and Schlein contained in this Agreement shall be true
and correct in all material respects as of the date when made and, except
for changes specifically contemplated by this Agreement, on and as of the
Effective Date as though such representations and warranties had been made
as of the Effective Date.
7.1.2 Deliveries. The release of documents which Seller is
obligated to make under Section 4 shall have been made.
7.2 Conditions of Seller and Schlein. The obligations of Seller and Schlein
hereunder shall be subject, to the extent not waived, to the satisfaction of
each of the following conditions at the Closing:
7.2.1 Representation and Warranties. The representations and
warranties of UCI, UCI of SC, and Doctor's Care contained in this Agreement
shall be true and correct in all material respects as of the date when made
and, except for changes specifically contemplated by this Agreement, on and
as of the Effective Date as though such representations and warranties had
been made as of the Effective Date.
7.2.2 Deliveries. The release of documents which UCI, UCI of SC,
and Doctor's Care is obligated to make under Section 4 shall have been
made.
8. COST AND EXPENSES.
8.1 Transactional Cost. The parties hereto shall be responsible for their
respective attorney's fees, accountants' fees, experts' fees, and other expenses
incurred by them in connection with the negotiations and Closing of this
transaction; provided however, in the event litigation is commenced to enforce
any rights under this Agreement or to pursue any other remedy available to any
party, all legal expense or other direct costs of litigation of the prevailing
party shall be paid by the other party.
8.2 Proration of Taxes and Charges. All personal property taxes, public
utility charges and like charges (which are not terminated and paid as of
Closing by Seller), if any, relating to the personal (tangible and intangible)
property comprising the Assets shall be prorated as of the Effective Date, in
accordance with regular accounting procedure. Settlement at Closing will be made
on proration of estimates of such taxes and charges. If, as the result of such
proration at Closing, a net balance is owed by Seller to UCI of SC, or visa
versa, the amount thereof shall be paid to such party at or within thirty (30)
days after receipt of the next succeeding payment notice.
8.3 Sales Taxes. Seller shall be responsible for, and shall pay,
all sales taxes, if any, applicable to the sale of the Assets as called for
herein.
9. INDEMNITY RIGHTS.
9.1 General Indemnity.
9.1.1. Seller and Schlein shall jointly and severally indemnify
and hold UCI, Doctor's Care and UCI of SC and their respective officers,
directors and agents harmless, from any and all losses, damages, liabilities,
claims, suits, demands, penalties, assessments, obligations, causes of actions
or costs (including reasonable litigation expenses and reasonable legal fees)
asserted against or incurred by UCI, Doctor's Care or UCI of SC as a result of
any breach by Seller and/or Schlein of any covenant, warranty,
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<PAGE>
representation, or agreement, made by Seller and/or Schlein herein or in written
agreements related hereto including but not limited to reasonable litigation
expenses and reasonable legal fees that might be incurred because of such
breach.
9.1.2. UCI, UCI of SC, and Doctor's Care shall jointly and
severally indemnify and hold Seller and Schlein and their respective officers,
directors and agents harmless, from any and all losses, damages, liabilities,
claims, suits, demands, penalties, assessments, obligations, causes of actions
or costs (including reasonable litigation expenses and reasonable legal fees)
asserted against or incurred by Seller or Schlein as a result of any breach by
UCI, UCI of SC, and/or Doctor's Care of any covenant, warranty, representation,
or agreement, made by UCI, UCI of SC, and/or Doctor's Care herein or in written
agreements related hereto including but not limited to reasonable litigation
expenses and reasonable legal fees that might be incurred because of such
breach.
9.2 Special Indemnities. Seller and Schlein shall jointly and severally
indemnify and hold UCI, UCI of SC and Doctor's Care and their respective
officers, directors, and agents harmless from any and all losses, damages,
liabilities, claims, suits, demands, penalties, assessments, obligations, causes
of action, or costs (including reasonable litigation expenses and reasonable
legal fees) asserted against or incurred by UCI, Doctor's Care, or UCI of SC as
a result of:
9.2.1 Award or Settlement. Any lawsuit or similar claim against
Seller and/or Schlein arising from events or conditions prior to the
Effective Date.
9.2.2 Title to Assets. Any challenge to: (a) Seller's title to the
Assets, or (b) the transfer of such title and interest to the Assets to UCI
of SC or Doctor's Care pursuant to the Agreement.
9.2.3 Accounts Payable. Any accounts payable, taxes, assessments,
or charges of Seller and/or Schlein.
9.3 Set Off and Recoupment. In addition to any other available remedies,
UCI of SC, UCI, and Doctor's Care shall have the right of set off and recoupment
against amounts coming due to Seller or Schlein under this Agreement, Note, or
any other document executed in connection therewith in the event Seller and/or
Schlein breaches this Agreement or any document executed in connection therewith
or any right of indemnification arises in favor of UCI, UCI of SC, or Doctor's
Care under this Agreement. Seller and Schlein retain the right to lawfully
contest any such set off or recoupment in an action to collect any amounts due
Seller and/or Schlein under this Agreement, Note, or any document executed in
connection therewith. The inclusion of this special set off or recoupment
provision shall not effect the availability, if any, of rights of set off or
recoupment arising at law or in equity.
10. EXISTING LIABILITIES. Except as set forth in Section 1.1.2 hereof, neither
UCI, Doctor's Care nor UCI of SC assumes any, and hereby expressly disclaims
all, obligations or liabilities of Seller, contingent or absolute, including
(without limitation) liabilities for (i) federal or state income, payroll,
property, or sales taxes for any period, or (ii) any tort, contract, or
statutory liability resulting from or alleged to have resulted from the Business
prior to the Effective Date or operations of Seller prior to Effective Date,
except for the obligations arising and maturing after the Effective Date to
perform under those contracts expressly assumed by UCI of SC hereunder. All
property taxes assessed against the Assets sold hereby shall be prorated as of
the Effective Date, and Seller shall promptly pay when due, or reimburse UCI of
SC for, all such taxes which remain the Seller's responsibility.
11. RISK OF LOSS. In the event the Assets or any substantial part thereof shall
be damaged or destroyed prior to the Effective Date due to any casualty or
event, or there shall occur any actions for condemnation or eminent domain
having a material adverse affect on the Assets or any substantial part thereof,
Seller shall promptly notify UCI of SC that such damage, destruction, or action
has occurred and the estimated extent thereof. In case the amount of such
damage, destruction, condemnation or eminent domain is in excess of 10% of the
Purchase Price, including but not limited to the value of the Shares more fully
described in
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Section 3.1, of all of the Assets immediately before such damage or destruction,
then UCI of SC must within five (5) days of receipt of such notice either:
11.1 Termination. Terminate this Agreement by giving Seller written notice
of such termination and thereupon all parties shall be released of all further
liability to the others; or
11.2 Adjustment. Alternatively, and subject to the fulfillment of the
conditions set forth herein, require the consummation of the transactions
provided for in this Agreement and, in such case (or in case of any damage by
fire or other casualty, or condemnation or eminent domain action not entitling
UCI of SC to terminate this Agreement), all proceeds of insurance covering the
Assets and all of the claims arising as a result of such damage or destruction
to such Assets or all proceeds of such condemnation or eminent domain action for
such Assets shall become the property of UCI of SC. In the event UCI of SC
elects to require the consummation of the transactions contemplated herein,
Seller shall not compromise or settle any such claim or action at any time
without the written consent of UCI of SC which shall not be unreasonably
withheld. Seller shall cooperate with the collection of such amounts. Further,
in such event, the representations and warranties of Seller and Schlein, as set
forth in Section 5 shall be modified equitably to account for such claim or
action.
12. MISCELLANEOUS.
12.1 Entire Agreement. This Agreement, including the Exhibits hereto,
embodies the entire Agreement and understanding between the parties hereto as to
the matters herein addressed and supersedes all prior agreements and
understandings relating to the subject matter hereof.
12.2 No Waiver. No failure to exercise, and no delay in exercising any
right, power or remedy hereunder or under any document delivered pursuant hereto
shall impair any right, power or remedy which the parties hereto may have, nor
shall any such delay be construed to be a waiver of any such rights, powers or
remedies, or any acquiescence in any breach or default under this Agreement, nor
shall any waiver of any breach or default of any party hereunder be deemed a
wavier of any default or breach subsequently occurring.
12.3 Survival. All representations, warranties, covenants, and agreements
herein contained shall survive the Closing hereunder.
12.4 Amendment. No provision of this Agreement or any document or
instrument relating to the Agreement, may be amended, modified, supplemented,
changed, waived, discharged, or terminated, unless the parties hereto consent
thereto in writing.
12.5 Notices. All notices, requests, approvals, consents, demands and other
communication provides for or permitted hereunder shall be in writing, signed by
an authorized representative of the sender and addressed to the respective party
at the address set forth below:
UCI of SC: UCI Medical Affiliates of South Carolina, Inc.
6168 St. Andrews Road
Columbia, SC 29212-3132
Attn.: Stephen S. Seeling, Esq.
UCI: UCI Medical Affiliates, Inc.
6168 St. Andrews Road
Columbia, SC 29212-3132
Attn.: Stephen S. Seeling, Esq.
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<PAGE>
Doctor's Care: Doctor's Care, P.A.
6168 St. Andrews, Road
Columbia, SC 29212-3132
Attn.: M.F. McFarland, III, MD
Seller: Martin L. Schlein, M.D., P.A.
701 McDaniel Ave.
Greenville, SC 29605
Attn: Martin L. Schlein, MD
Schlein: Martin L. Schlein, MD
701 McDaniel Ave.
Greenville, SC 29605
A party hereto may change its respective address by notice in writing given
to the other parties to this Agreement. Any notice, request, approval, consent,
demand or other communication shall be effective upon the first to occur of the
following; (i) when delivered to the party to whom such notice, request,
approval, consent, demand or the communication is being given, or (ii) five (5)
business days after being duly deposited in the US mail, certified, return
receipt requested.
12.6 Severability of Provisions. In case any one or more of the provisions
contained in this Agreement should be invalid, illegal or unenforceable in any
respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby.
12.7 Successors and Assigns. This Agreement shall be binding upon the
parties, and their respective successors, heirs, and assigns, and shall inure to
the benefit of the parties and their respective successors, heirs, and permitted
assigns.
12.8 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one Agreement, and
any party hereto may execute this Agreement by signing any such counterpart. The
authorized attachment of counterpart signature pages shall constitute execution
by the parties.
12.9 Choice of Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of South Carolina.
12.10 Jurisdiction. The parties hereto consent to jurisdiction, subject to
proper service of process, in the State of South Carolina regarding any disputes
arising hereunder.
12.11 Usage. The section and paragraph headings contained in this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Terms such as "hereof" , "hereunder",
"hereto", "herein", and words of similar import shall refer to this Agreement in
its entirety and all references to "Articles", "Paragraphs", "Sections", and
similar cross references shall refer to specified portions of this Agreement,
unless the context clearly requires otherwise.
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12.12 Further Instruments and Acts. From time to time at a party's request,
whether at or after Closing and without further consideration, the other
party(ies) shall execute and deliver such further instruments of conveyance,
transfer and assignment and upon reimbursement for actual reasonable
out-of-pocket expenses take such other action as the requesting party reasonably
may require to more effectively convey and transfer to the requesting party the
properties to be conveyed, transferred and assigned hereunder, and, if
necessary, will assist the requesting party in the collection or reduction to
possession of such property. In addition, each party agrees to provide
reasonable access to records respecting the Business as are requested by the
other party(ies) for proper purpose with good cause shown (subject to
appropriate confidentiality agreements to be negotiated as such time) and agree
to reasonably cooperate in resolving any matters resulting from the transactions
contemplated hereby.
12.13 Assignment. This Agreement is not assignable by any party without the
prior written consent of the other parties hereto.
12.14 Reorganization. The exchange described herein is intended to qualify
as a reorganization under Section 368(a)(1)(C) of the Internal Revenue Code of
1986, as amended, and the parties hereto agree to report the exchange
accordingly in their respective state and federal income tax filings. After the
Closing, Seller shall promptly distribute to Schlein in liquidation of Seller
all of Seller's assets remaining after payment of Seller's liabilities.
[SIGNATURE PAGE ATTACHED]
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IN WITNESS WHEREOF, the parties have executed this Asset Purchase Agreement
and Plan of Reorganization under seal, with the corporate parties acting by and
through their duly authorized officers, effective as of the date first above
written.
UCI:
UCI MEDICAL AFFILIATES, INC.
By: /s/ Stephen S. Seeling
Its: Secretary
UCI OF SC:
UCI MEDICAL AFFILIATES OF SOUTH CAROLINA, INC.
By: /s/ Stephen S. Seeling
Its: Secretary
DOCTOR'S CARE:
DOCTOR'S CARE, P.A.
By: /s/ Stephen S. Seeling
Its: Secretary
SELLER:
MARTIN L. SCHLEIN, M.D., P.A.
By: /s/ Martin L. Schlein, M.D., P.A.
Its: President
SCHLEIN:
/s/ Martin L. Schlein
Martin L. Schlein, M.D.
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<PAGE>
EXHIBITS TO ASSET PURCHASE AGREEMENT
AND
PLAN OF REORGANIZATION
(EXHIBIT 2.1)
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION PAGE NO.
<S> <C> <C>
Exhibit A List of Assets 21
Exhibit B Leases to be Assumed 22
Exhibit C Bill of Sale - Medical Records 23
Exhibit D Promissory Note 24
Exhibit E Investment Letter 26
Exhibit F Accounts Receivable Certification 29
Exhibit G Employment Agreement 31
Exhibit H Bill of Sale 44
Exhibit I Assignment 46
</TABLE>
20
<PAGE>
EXHIBIT A
LIST OF ASSETS
Office Equipment List
Adding Machines
Sterilizer
EKG Machine
Suture Sets
Paper Filing Section
Chart Holders (one section only)
3 Exam Tables and 1 Antique Exam Table
1 Table for OR/Lab
Staplers
Tape Dispensers
Typewriter
Histofreezer
Thermometers
8 Glass Jars
Magnifying Glass for Head
Woods Lamp
2 Head Lights
Welch Allen Attachment for Rigid Sigmoidoscopy
Scissors
Metal Equipment Boxes for Sterilizer
EKG Cart
3 Gooseneck Lamps
1 Lamp for PAP Smears
Paper Cutter
One Hole Puncher
Centrifuge
Lahey Stand
Step Stool from Lab
Garbage Cans
Pulm Aide Breathing Machine
Scale
Other Assets
Fax Machine
Copy Machine
Large Cabinet
Pictures
Copy Paper
Fax Paper
Shelves
Stools
Examining Tables
Desks
Chairs
21
<PAGE>
EXHIBIT B
LEASES TO BE ASSUMED
As of Closing, UCI Medical Affiliates of South Carolina, Inc. ("UCI of SC")
shall assume that certain Paid IV Plus computer lease dated as of May 9, 1994,
by and between Martin L. Schlein, M.D. ("Schlein") and Companion Technologies, a
copy of which has been delivered to UCI of SC. Schlein shall be responsible for
obtaining the necessary consents, if any, to the assignment of such lease.
No other leases, liabilities, or contracts shall be assumed by UCI of SC.
22
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EXHIBIT C
BILL OF SALE - MEDICAL RECORDS
KNOW ALL MEN BY THESE PRESENTS, THAT MARTIN L. SCHLEIN, M.D. AND MARTIN L.
SCHLEIN, M.D., P.A., a South Carolina professional association (collectively the
"Grantor"), for and in consideration of the sum of Nine Thousand One Hundred
Twenty and no/100 Dollars ($9,120.00), and other good and valuable consideration
to it in hand, paid at or before the ensealing and delivery of these presents,
by Doctor's Care, P.A., a South Carolina professional association ("Grantee"),
the receipt, sufficiency and adequacy of which is hereby acknowledged and
subject to the terms hereof, has bargained and sold and by these presents does
sell, assign, transfer, remise, release and quitclaim unto the said Grantee, its
successors and assigns, all of the Grantor's right, Chief Financial Officer and
interest in and to the following goods and chattels:
All patient medical records and files owned by Grantor with
respect to Grantor's medical practice located at 4501 East North
Street Extension, Taylors, South Carolina 29687.
TO HAVE AND TO HOLD the same unto said Grantee, its successors and assigns
forever.
IN WITNESS WHEREOF, this Bill of Sale has been executed by Grantor to be
effective as of the 12th day of April, 1996.
WITNESSES: MARTIN L. SCHLEIN, M.D., P.A.
/s/ David A. Merline, Jr. By: /s/ Martin L. Schlein, M.D.
Its: President (SEAL)
/s/ Mary S. Rose
/s/ Martin L. Schlein, M.D.
MARTIN L. SCHLEIN, M.D.
/s/ David A. Merline, Jr.
/s/ Mary S. Rose
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EXHIBIT D
PROMISSORY NOTE
$69,461.53 Columbia, S.C.
Subject to Set Off April 12, 1996
FOR VALUE RECEIVED, UCI Medical Affiliates of South Carolina, Inc., a
South Carolina corporation (the "Borrower"), hereby promises to pay, in lawful
money of the United States of America, to the order of Martin L. Schlein, M.D.,
P.A., a South Carolina professional association (the "Lender"), the principal
sum of Sixty-Nine Thousand Four Hundred Sixty-One and 53/100 ($69,461.53)
Dollars, subject to set off as provided hereunder.
Interest shall accrue from April 12, 1996 on the principal balance
outstanding hereunder from time to time until paid in full at the fixed simple
rate per annum equal to ten (10.0%) percent calculated based upon a 360-day year
and the actual number of days elapsed. Equal payments of principal and interest
in the amount of Six Thousand Six Hundred Thirty-Four and 79/100 ($6,634.79)
Dollars shall be due and payable commencing on May 12, 1996, and continuing
thereafter on the twelfth (12th) day of each month for the succeeding ten (10)
consecutive months. Payments hereunder shall be made to the Lender at 701
McDaniel Avenue, Greenville, South Carolina 29605, or at such other place as the
Lender may designate from time to time in writing. All interest hereunder not
paid when due after the expiration of the applicable grace period shall bear
interest at the same rate as principal hereunder.
Anything contained in this Note to the contrary notwithstanding, Buyer
shall have the right of set off and recoupment against amounts coming due
hereunder in the event that Lender or Martin L. Schlein, M.D. ("Schlein")
breaches that certain Asset Purchase Agreement And Plan Of Reorganization dated
as of April 12, 1996, by and among Borrower, Lender, UCI Medical Affiliates,
Inc., and Schlein or any document executed in connection therewith including but
not limited to the Employment Agreement (collectively the "Agreement"). In the
event Borrower elects to exercise the right of set off and recoupment set forth
herein, upon notice to the Lender the principal amount hereof shall be deemed
reduced by the amount of any set off or recoupment to which the Borrower is
entitled, and all interest and payments accruing thereafter shall be calculated
based upon such reduced principal amount. The Lender's right to lawfully contest
such set off or recoupment in any action to collect this Note shall not be
impaired by Borrower's exercise of such set off or recoupment rights. The
inclusion of this special set off or recoupment provision shall not affect the
availability, if any, of rights of set off or recoupment arising at law or in
equity.
The occurrence of the following shall constitute an "Event of Default"
under the Note: (i) Borrower, after the expiration of the applicable grace
period hereinafter set forth, fails to pay when due any principal or interest
payment hereunder (except for any amount then subject to an unresolved but duly
asserted set off or recoupment dispute), or (ii) breach by Doctor's Care, P.A.
("Doctor's Care") of that certain Employment Agreement by and between Doctor's
Care and Martin L. Schlein, M.D. ("Schlein") executed in connection with the
Agreement which remains uncured to Schlein's reasonable satisfaction after the
expiration of the applicable grace period therein set forth. Upon the occurrence
of an Event of Default as hereinabove defined, then at any time thereafter the
Lender may declare the entire remaining principal balance due hereunder,
together with all accrued interest thereon, immediately due and payable. The
applicable grace period hereunder shall be ten (10) days and shall begin to run
upon receipt by Borrower of written notice from Lender of a potential default
hereunder.
The invalidity of any provision of this Note shall not affect the
validity of any other provision hereof. The acceptance after maturity of any
payment with respect to this Note shall not constitute a waiver of the right of
Lender to demand the payment in full of any unpaid balance. No delay or failure
on the part
24
<PAGE>
of the Lender in the exercise of any right or remedy shall operate as a waiver
thereof, and no single exercise of any right or remedy shall preclude Lender
from the exercise of any other or further rights or remedies.
In the event this Note is placed in the hands of an attorney for
collection (but not for resolution of any disputes on a set off or recoupment of
the amount due hereunder), all expenses of the Lender, including reasonable
attorneys' fees, shall be added to the principal amount of this Note and
collected as a part hereof. This Note shall be governed by and construed in
accordance with the laws of the State of South Carolina. Jurisdiction and venue
for the enforcement of this Note shall be exclusively in the courts for the
State of South Carolina.
Borrower expressly waives demand, presentment, protest and notice of
non-payment or dishonor and all other notices or demands whatsoever (except for
notices expressly set forth herein), and such parties agree to remain bound
hereby until all amounts due hereunder are paid in full, notwithstanding any
extension of time for payment which may be granted, even though the period of
extension be indefinite.
The Borrower reserves the right to prepay this Note in whole or in part
at any time without fee or penalty; provided, however, that any partial payment
shall be applied first to accrued interest and then to the reduction of the
principal.
EXECUTED as of this 12th day of April, 1996.
UCI MEDICAL AFFILIATES OF SOUTH
CAROLINA, INC. (SEAL)
By: /s/ Stephen S. Seeling
Its: Secretary
Notice Address for Borrower:
6168 St. Andrews Road
Columbia, South Carolina 29212
Attn: Stephen Seeling, Esquire
25
<PAGE>
EXHIBIT E
INVESTMENT LETTER
TO: UCI Medical Affiliates, Inc.
6168 St. Andrews Road
Columbia, SC 29160
Attn: President
RE: Issuance of Common Stock in UCI Medical Affiliates, Inc.
Dear Sir:
On this date, you are issuing to Martin L. Schlein, M.D., P.A., a South
Carolina professional corporation ("Transferee"), One Hundred Twenty-Five
Thousand One Hundred Eighty-Seven (125,187) shares (the "Shares") of the common
stock, $0.05 par value, of UCI Medical Affiliates, Inc. (the "Company"). In
consideration of your agreement to issue the Shares to Transferee, Transferee
and Martin L. Schlein, M.D., the sole shareholder of Transferee ("Schlein"),
hereby represent and warrant to you and hereby covenant and agree with you, as
follows:
1. Transferee is acquiring the Shares solely for Transferee's own
account and not as nominee for, representative of, or otherwise on behalf of any
other person or entity. Transferee is acquiring the Shares with the intention of
holding the Shares for investment purposes only, and Transferee has no present
intention of participating, directly or indirectly, in a subsequent sale,
transfer or other distribution of the Shares, or of dividing Transferee's
interest in the Shares with any other person or entity. Transferee has not
offered any of the Shares for sale or other disposition, and Transferee shall
not make any sale, transfer or other disposition of the Shares in violation of
state or federal law.
2. Schlein is an "accredited investor" as that term is defined in Rule
501 of Regulation D promulgated by the Securities and Exchange Commission
("SEC") under the Securities Act of 1933 (the "Act"). NOTE: An "accredited
investor" includes any individual who: (a) has a net worth (with spouse) in
excess of $1,000,000; (b) has had an individual income in excess of $200,000 (or
joint income with spouse in excess of $300,000) in each of the two most recent
years and who reasonably expects an income of the same level for the current
year; or (c) is an executive office or director of the Company. (For purposes of
this paragraph, calculate net worth as the sum of the fair market value of all
assets, including all real estate, automobiles, savings, stocks, bonds,
individual retirement accounts, pension and profit sharing plans, limited
partnership interest and other investments, less all current and long term
liabilities).
3. The Transferee and Schlein, each considers itself to be a
sophisticated investor in companies similarly situated to the Company, and
Transferee and Schlein have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of the
prospective investment in the Shares. Transferee and Schlein understands that
there is no public market for the Shares, no public market for the Shares is
likely to develop and it may not be possible for Transferee to readily liquidate
its investment. Transferee and Schlein are aware that Transferee's investment in
the Company is speculative and involves a high degree of risk of loss arising
from, among other things, substantial market, operational, competitive and other
risks, and having made their own evaluation of the risks associated with this
investment.
4. The Shares were not offered to Transferee by means of any form of
general or public solicitation or general advertising, or publicly disseminated
advertisements or sales literature, including (a) any advertisement, article,
notice, or other communication published in any newspaper, magazine, or similar
media, or broadcast over television or radio or (b) any seminar or meeting to
which Transferee was invited by any of the foregoing means of communications.
5. Schlein's investment in the Shares is reasonable and consistent with
the nature and size of its present investments and net worth, Schlein has no
need for liquidity in the investment represented by the
26
<PAGE>
Shares, and Schlein is financially able to bear the economic risk of this
investment, including the ability to afford holding the Shares for an indefinite
period of time and to afford a complete loss of this investment.
6. Transferee is aware that the Company may offer and sell additional
shares of common stock in the future, thereby diluting its percentage equity
ownership of the Company.
7. Transferee understands that as a publicly traded company, the
Company files with the SEC various reports, including quarterly and annual
financial statements, annual reports to shareholders, and proxy statements, and
that all of such reports, statements and information are available to the
public, including Transferee, from the SEC and directly from the Company.
Transferee has been given the opportunity to obtain copies of such public
information and to ask questions of, and receive answers from, you with respect
to the Company and the Shares, concerning the terms and conditions of the
issuance of the Shares by you to Transferee, and has been given the opportunity
to obtain such additional information necessary to verify the accuracy of any
information provided to Transferee by you in order for Transferee to evaluate
the merits and risks of an investment in the Shares to the extent that you
possess such information or could acquire it without unreasonable effort or
expense. Transferee has been furnished with all information concerning the
Shares and the Company that Transferee desires.
8. In regard to any economic or legal considerations related to the
Shares, Transferee has relied on the advice of, or consulted with, only
Transferee's own advisors, and Transferee has not relied upon you, the Company,
the Company's legal counsel or the accountants for the Company regarding the
Shares or the transaction contemplated by this Investment Letter.
9. Transferee understands and acknowledges that the issuance of the
Shares to Transferee was not registered under the Act or under the securities
laws of any state in reliance upon an exemption or exemptions contained in the
Act (and the regulations promulgated thereunder) and applicable state securities
laws. Consequently, Transferee understands that the Shares cannot be
subsequently transferred unless they are registered under the Act and applicable
state securities laws, or unless an exemption from such registration
requirements is available. Transferee understands and acknowledges that any
certificate evidencing the Shares will bear a legend restricting the transfer of
such Shares consistent with the foregoing, and Transferee understands that a
notation may be made in the stock records of the Company restricting the
transfer of any of the Shares in a manner consistent with the foregoing.
10. Transferee understands and acknowledges that neither the Company
nor you are under any obligation to register the Shares for public sale or,
except as set forth in the Asset Purchase Agreement And Plan of Reorganization
dated the date hereof, to comply with the conditions of Rule 144 promulgated by
the SEC under the Act or to take any other action necessary in order to make
available any exemption for the subsequent transfer of the Shares without
registration.
11. Transferee is a South Carolina corporation, and its principal place
of business is located in the State of South Carolina at the address shown under
its signature evidencing its execution of this Investment Letter, and it has no
present intention of removing itself from its existing state of residence.
Schlein is a South Carolina resident and has no present intention of removing
itself from its existing state of residence
12. Transferee confirms that the representations it has previously made
to the Company and those contained in this Investment Letter are correct and
complete as of the date hereof, and that if there should occur any material
change in such representations prior to the receipt of the Shares by Transferee,
it agrees that it will immediately furnish such revised or corrected
representations or information to the Company.
This Investment Letter shall be binding upon the Transferee and the
Transferee's heirs, executors, administrators, successors, representatives and
assigns and shall enure to the benefit of you, your heirs, executors,
administrators, successors and assigns. This Investment Letter shall be governed
and construed in accordance with the laws of the State of South Carolina.
27
<PAGE>
TRANSFEREE:
Number of Shares of MARTIN L. SCHLEIN, M.D., P.A.
UCI Medical Affiliates, Inc.
to be issued:
By: /s/ Martin L. Schlein, M.D., President
Martin L. Schlein, M.D.
125,187 Shares Its: President
Date: April 12, 1996 701 McDaniel Avenue
(Street Address)
Greenville, South Carolina 29605
(City, State, Zip)
SCHLEIN:
/s/ Martin L. Schlein, M.D.
Martin L. Schlein, M.D.
701 McDaniel Avenue
(Street Address)
Greenville, South Carolina 29605
(City, State, Zip)
28
<PAGE>
EXHIBIT F
ACCOUNTS RECEIVABLE CERTIFICATION
STATE OF SOUTH CAROLINA )
) CERTIFICATION
COUNTY OF GREENVILLE )
PERSONALLY APPEARED BEFORE ME, Martin L. Schlein, M.D. ("Schlein"),
individually and on behalf of Martin L. Schlein, M.D., P.A., a South Carolina
professional corporation ("Seller"), who first being duly sworn, deposes,
states, affirms, and certifies that he is the President of Seller with knowledge
of the business and affairs of Seller, and the list of accounts receivable
attached hereto as Schedule 1 and incorporated herein by reference is a valid,
true, accurate, and complete record of the accounts receivable of Seller as of
the close of business on April 9, 1996, and reflect valid, binding, and
enforceable rights of the Seller which shall be lawfully transferred to UCI
Medical Affiliates of South Carolina, Inc., a South Carolina corporation ("UCI
of SC"), pursuant to that certain Asset Purchase Agreement and Plan of
Reorganization described below.
This Certification is executed and delivered to UCI of SC, in
connection with that certain Asset Purchase Agreement and Plan of Reorganization
by and among Seller, Schlein, UCI of SC, UCI Medical Affiliates, Inc., and
Doctor's Care, P.A., dated as of April 12, 1996.
Executed as of this 12th day of April, 1996.
/s/ Martin L. Schlein, M.D.
Martin L. Schlein, M.D.
SWORN to before me this 12th
day of April, 1996.
Mary S. Rose (L.S.)
Notary Public for South Carolina
My Commission Expires: 02/14/2005
29
<PAGE>
SCHEDULE 1
Accounts Receivable
<TABLE>
<CAPTION>
Total Aging Report
UNAPPLIED CURRENT 31-60 61-90 91-120 120 + TOTAL
<S> <C> <C> <C> <C> <C> <C> <C>
Report Totals -1,594.66 18,398.25 15,375.98 12,465.28 2,918.94 32,194.27 79,758.06
Percent of Total Aged 22.6% 18.9% 15.3% 3.6% 39.6%
</TABLE>
30
<PAGE>
EXHIBIT G
EMPLOYMENT AGREEMENT
STATE OF SOUTH CAROLINA )
) EMPLOYMENT AGREEMENT
COUNTY OF GREENVILLE )
THIS EMPLOYMENT AGREEMENT is made and entered into as of this 12th day
of April, 1996, by and between Doctor's Care, P. A., a South Carolina
professional association with its principal office in Columbia, South Carolina
("Employer"), and Martin L. Schlein, M.D. ("Employee").
WHEREAS, Employee is the sole shareholder of Martin L. Schlein, M.D.,
P.A., a South Carolina professional association ("Seller").
WHEREAS, as of the date hereof, Seller sold substantially all its
assets to UCI Medical Affiliates of South Carolina, Inc., a South Carolina
corporation ("UCI of SC"), pursuant to that certain Asset Purchase Agreement And
Plan Of Reorganization (the "Purchase Agreement") by and among Seller, UCI of
SC, Employer, Employee, and UCI Medical Affiliates, Inc., a Delaware corporation
("UCI").
WHEREAS, UCI of SC has contracted with Employer to provide health care
services at medical facilities that are owned or leased by UCI of SC.
WHEREAS, Employer is a South Carolina professional association and
wishes to employ the Employee to render medical services for it.
WHEREAS, Employee is a licensed physician in South Carolina and desires
and is willing to become a professional employee of Employer, in accordance with
the following terms, conditions, and provisions:
NOW, THEREFORE, for and in consideration of the promises herein and
other valuable consideration, it is agreed that:
1. Employment Term. Subject to the provisions for termination as hereinafter
provided, the term of Employee's employment hereunder shall be ten (10) years
commencing on April 12, 1996. After the initial ten (10) year term, Employee's
employment hereunder shall be renewable from year to year unless either party
hereto delivers to the other party hereto written notice at least ninety (90)
days prior to the termination of the then existing term of such party's desire
not to renew Employee's employment hereunder.
2. Duties.
A. Employee shall devote his professional skill and attention to the
performance of services in the practice for the benefit of Employer's Doctor's
Care Pelham office in Greenville, South Carolina or such other office of
Employer within the Greenville, South Carolina area as shall be mutually agreed
upon by Employee and Employer. Employee's duty schedule shall be determined by
Employer in reasonable consultation with Employee, and Employee shall provide
such evening and weekend coverage as shall be needed and reasonably assigned to
Employee by Employer. Employee is to practice medicine for Employer for four (4)
days per week, averaging forty (40) hours per week which shall include no more
than one weekend per month and at least one "half day" off each business week
worked. Employer will not schedule Employee to work on Employee's five religious
holidays. Additionally, if an opening occurs during the term of this Agreement
for a full-time physician at any future Hilton Head Island, South Carolina
Doctor's Care location, Employee will be offered such employment opportunity
upon terms no less favorable than such terms set forth herein.
31
<PAGE>
B. Employee shall not engage in any outside professional activities
involving the personal services of Employee and yielding a financial return
without Employer's prior written consent. However, nothing stated herein shall
restrict or prevent employee from personally and on Employee's own account,
investing in stocks, bond securities, commodities, real estate, or other forms
of investments or preclude Employee from practicing medicine in a licensed
hospital's emergency room so long as such activity does not conflict with
Employee's practice of medicine with Employer.
C. Employee will actively and industriously pursue his profession in
Employer's interest, will faithfully adhere to the principles and ethics of the
profession, and will carefully avoid any and all personal acts, habits and
usages which might injure in any way, directly or indirectly, Employee's
professional reputation or that of any other Employee of Employer, or which
might otherwise be detrimental to any interest of Employer.
D. Employee hereby agrees that all fees received or collected as a
result of the services rendered by Employee hereunder, together with all other
emoluments, e.g., witness fees, report fees, speaker fees, etc., shall be the
property of Employer. Accordingly, Employee acknowledges that Employee's
employment does not confer upon Employee any ownership interest in or
professional claim upon any fees charged by Employer for Employee's services,
whether said fees are collected during Employee's employment or after
termination thereof. Notwithstanding the foregoing, Employee shall be entitled
to keep any fees or other compensation Employee receives for hospital emergency
room work performed by Employee pursuant to Section 2(B) above and Employer
shall have no claim as to such fees or other compensation.
3. Compensation.
A. Regular Compensation. For all services rendered under this
Agreement, Employer shall pay the Employee an initial annual salary as follows,
payable in biweekly installments unless otherwise requested by Employee and
approved by Employer (the "Regular Compensation"):
Period Regular Compensation
1st and 2nd Years of Employment $155,656.08
All Other Years of Employment $150,000.00
Notwithstanding the foregoing, during the term of Employee's employment
hereunder, the Regular Compensation shall be adjusted annually on each
anniversary date of the commencement of the term of this Agreement to reflect
any increase (but not decrease) in the numerical level of the Consumer Price
Index for all Urban Wage Earners and Clerical Workers (base year 1967=100) most
recently published by the Bureau of Labor Statistics of the United States
Department of Labor ("CPI"). Such annual adjustment shall be determined by
dividing the CPI indicator from the month immediately prior to the anniversary
date, by the CPI indicator published for the corresponding month of the prior
calendar year, and multiplying the resultant number by the then current Regular
Compensation set forth above (provided however, on the third anniversary of the
date such number shall be multiplied instead by $150,000.00). In the event the
CPI is not available in time to make the computation on any anniversary date,
the adjustment will be made retroactively to such anniversary date at such time
as the CPI is available. If the base for the CPI is so changed that 1967 prices
are no longer taken as representing 100, an appropriate adjustment will be
applied to the published indices so as to relate them to the aforesaid base in
which 1967 prices are taken as representing 100. In the event the CPI is
discontinued, such other substantially similar government index or publication
as chosen by Employer for a reasonable replacement shall be used for such annual
adjustment.
32
<PAGE>
B. Additional Compensation. During the term of Employee's employment
hereunder, in addition to Employee's Regular Compensation set forth above,
Employee shall be entitled to receive thirty-five (35%) percent of any monies
collected by Employer as the result of Employee performing the procedures or
treatment modalities set forth below ("Additional Compensation"):
Current Procedural Terminology Codes as published in the
American Medical Association's Physicians' Current Procedural Terminology, as
amended:
11600 - 11646
17260 - 17286
69110
36468 - 36471
11950 - 11954
115788
11000
11100
11441
17110
19120
21315
25075
57150
57500
21310
21315
21320
The total amount of the Additional Compensation shall be calculated monthly by
Employer and paid to Employee within thirty (30) days. Employer's calculation of
the Additional Compensation shall be conclusive and binding absent fraud or
manifest and material error. Upon written request by Employee, Employer shall
provide Employee with a computer printout detailing the calculation of such
Additional Compensation.
C. Changes in Compensation. Subject to Section 3(A) above, from time to
time, increases in the Employee's salary may be made, said increases to be
reflected on the "Schedule of Compensation" attached hereto and made apart
hereof; provided however nothing contained herein shall be construed to require
Employer to increase Employee's salary.
D. Bonuses. Employer may from time to time review Employee's
compensation arrangement with respect to the payment of a bonus for superior
performance and contributions to Employer. Factors to be considered in making a
bonus payment, if any, shall include but not be limited to Employee's
demonstrated commitment to quality care, the results of patient satisfaction
surveys and patient audits, Employee's ability to build and enhance a patient
base, and Employee's contribution to the Employer's accomplishment of company
goals; provided however that the decision to make bonus payments, if any, shall
be at the sole discretion of Employer.
E. Fringe Benefits.
a. As further consideration for the performance by Employee of
the services set forth herein, Employee shall be eligible on a
non-discriminatory basis for participation in any tax qualified deferred
compensation plan maintained by Employer and also for inclusion in any
group-term life and disability insurance plan maintained by Employer, provided
the Employee is deemed an eligible employee under such plans. Subject to the
terms herein and Employer's 401(k) plan and any legal limitations related
thereto, until the termination of Employee's employment hereunder, Employer
shall contribute to Employee's 401(k) account an amount equal to one-half (0.5)
of Employee's annual contribution to
33
<PAGE>
Employee's 401(k) account; provided however, Employer shall not contribute an
amount in excess of two and one-half (2.5%) percent of Employee's total
compensation set forth in this Section 3. Notwithstanding the foregoing,
Employee acknowledges that the decision to maintain any such plans, or to match
and/or contribute to any employee's 401(k) account, shall be in the sole
discretion of Employer and may be terminated by Employer at any time.
b. In addition to the foregoing, during the term of Employee's
employment hereunder, Employer shall pay on behalf of Employee the following
dues and fees:
(Bullet) Membership in the South Carolina Medical Society.
(Bullet) Membership in the American Medical Association.
(Bullet) Membership in the Greenville County Medical Society.
(Bullet) Membership in American Academy of Family Practice.
(Bullet) Annual medical license.
F. Health Insurance Coverage. Employer, at Employer's expense, shall
provide Employee, and Employee's immediate family living in his household, such
health and dental coverage as provided to other employees of Employer.
G. Vacation and Professional Meetings. Beginning with the first year of
employment hereunder, Employee shall be entitled to four (4) weeks of paid
vacation and an additional one (1) week of paid leave to attend conventions,
professional meetings, and continuing medical education ("CME"). Beginning in
the fifth (5th) year of employment hereunder and continuing until the
termination of Employee's employment hereunder, Employee shall be entitled to
five (5) weeks of paid vacation and an additional one (1) week of paid leave for
CME. Such vacation and CME are to be taken at such time or times as Employee may
reasonably request, subject to Employer's convenience and prior approval, which
approval shall not be unreasonably withheld. Vacation time and CME leave shall
not cumulate year to year without the prior written consent of Employer.
4. Facilities and Expenses.
A. Facilities. Employer shall provide and pay for office space and
facilities, furniture, fixtures, computer, equipment, supplies, employees and
assistants necessary and appropriate for the proper performance of the duties of
Employee.
B. Professional Liability Insurance. During the term of this Agreement,
Employer shall either pay, or upon proof of payment by the Employee reimburse
the Employee, for professional liability (malpractice) insurance covering the
Employee for services provided hereunder for claims as follows: the first One
Hundred Thousand Dollars ($100,000) in coverage shall be through the South
Carolina Medical Malpractice Joint Underwriters Association ("JUA"); the excess
coverage shall be provided through the South Carolina Patients' Compensation
Fund ("PCF"). Employee understands that the amount of coverage provided by JUA
and PCF may not be adequate to protect Employee against all claims and that the
responsibility of securing additional insurance coverage, if any, is solely that
of Employee.
5. Employee's Death. If Employee dies during the term of this Employee's
employment hereunder, Employer shall pay to Employee's named beneficiary, or in
default of the named beneficiary to Employee's estate, all salary accrued but
unpaid through the pay period which includes the date of Employee's death. For
purposes of this Section, Employee's named beneficiary shall be Edith Schlein.
Employee shall notify Employer in writing of any change in such named
beneficiary.
6. Patients and Records. Except as otherwise provided below, Employer and
Employee agree that all patient lists, records, and charts for patients treated
by Employee hereunder are the property of Employer, and that upon termination of
Employee's employment hereunder, Employee shall not be entitled to receive any
patient lists, records, or charts whether or not the Employee shall have seen or
attended any patient with
34
<PAGE>
which such terms are covered; provided however, that record keeping for patients
treated by Employee shall be the sole responsibility of Employee, and Employee
shall complete all such charts and records for such patients in accordance with
professional standards.
7. Policy Decisions. Subject to Section 2 above, it is understood that Employer
shall have the sole and exclusive right of management over the practice,
including without limitation, the determination of the professional standards to
be observed, the determination of the fees to be charged, and the determination
of the office hours to be maintained; provided however, Employer shall not
impose employment duties or constraints of any kind which would require Employee
to violate the ethics of the medical profession or any law.
8. Termination.
A. Mutual Agreement. Notwithstanding any other provision hereof, upon
the mutual agreement in writing between Employer and Employee, Employee's
employment hereunder shall terminate. All compensation (including without
limitation the Regular Compensation, Additional Compensation, and all
perquisites and fringe benefits) to which Employee would otherwise be entitled
(for periods after the effective date of such termination) shall be discontinued
and forfeited as of the effective date of such termination.
B. For Cause By Employer. Notwithstanding any other provision hereof,
Employer may terminate Employee's employment under this Agreement immediately at
any time for "cause." For purposes hereof the term "cause" shall be defined as
the commission of any of the following by Employee:
a. Loss or suspension of the right to conduct the practice of
medicine by Employee, or the loss, or suspension of any right or privilege
necessary or incident thereto;
b. Loss, suspension, or limitation of Employee's controlled
substance license;
c. Use of a false, fraudulent, or forged statement or document
or practice of a fraudulent, deceitful, or dishonest act in connection with a
medical licensing requirement;
d. Conviction of, pleading guilty to, or pleading nolo
contendere to a felony or other crime involving moral turpitude or drugs. For
purposes hereof, "drugs" includes a substance whose possession, use, or
distribution is governed by Section 44-53-110 through Section 44-53-580
(Narcotics and Controlled Substances) of the South Carolina Code or which is
listed in the then current edition of the Physician's Desk Reference;
e. Addiction to alcohol or drugs to such a degree as to render
Employee unfit to practice medicine or osteopathy;
f. Conviction of the illegal or unauthorized practice of
medicine or osteopathy;
g. Knowingly performing an act which in any way assists an
unlicensed person to practice medicine or osteopathy;
h. Sustaining a physical or mental disability which renders
further practice of medicine by Employee dangerous to the public;
i. Violation of the principles of ethics as adopted by the
State Board of Medical Examiners and published in its regulations;
j. Engaging in dishonorable, unethical, or unprofessional
conduct that is likely to deceive, defraud, or harm the public;
35
<PAGE>
k. Using a false or fraudulent statement in a document
connected with the practice of medicine;
l. Obtaining fees or assisting in obtaining fees under
dishonorable, false, or fraudulent circumstances;
m. Intentionally violating or attempting to violate, directly
or indirectly, or assisting in or abetting the violation of or conspiring to
violate the medical practice laws;
n. Violating the code of medical ethics adopted by the State
Board of Medical Examiners ("Board") in accordance with Section 40-47-20 of the
South Carolina Code or has been found by the Board to lack the ethical or
professional competence to practice medicine or osteopathy;
o. Death of Employee;
p. Insubordination or failure to comply with reasonable
instructions of Employer within ten (10) days after written notice to Employee
from Employer;
q. Breach by Employee of the terms and provisions of this
Agreement which remain uncured to Employer's reasonable satisfaction ten (10)
days after written notice to Employee from Employer; or
r. Breach by Employee and/or Seller of the terms and
provisions of the Purchase Agreement which remain uncured to Employer's
reasonable satisfaction at the expiration of the applicable grace period, if
any, therein, provided however, in the event no such applicable grace period is
set forth therein, the applicable grace period shall be ten (10) days and shall
begin to run upon receipt by Employee or Seller of written notice from Employer,
UCI of SC or UCI of a potential or actual breach thereunder.
All compensation (including without limitation the Regular Compensation,
Additional Compensation, and all perquisites and fringe benefits) to which
Employee would otherwise be entitled (for periods after the effective date of
such termination) shall be discontinued and forfeited as of the effective date
of such termination.
C. For Cause By Employee. Notwithstanding any other provision
hereof, Employee may terminate Employee's employment under this Agreement
immediately at any time upon:
a. Violation by Employer of the terms and provisions of this
Agreement which remain uncured to Employee's reasonable satisfaction ten (10)
days after written notice to Employer from Employee;
b. Upon the voluntary bankruptcy, involuntary bankruptcy which
remains pending after sixty (60) days, or assignment for the benefit of the
creditors of Employer or UCI of SC;
c. Breach by Employer and/or UCI of SC of the terms and
provisions of the Purchase Agreement which remain uncured to Employee's
reasonable satisfaction at the expiration of the applicable grace period, if
any, therein; provided however, in the event no such applicable grace period is
set forth therein, the applicable grace period shall be ten (10) days and shall
begin to run upon receipt by UCI, UCI of SC, or Employer of written notice from
Employee or Seller of a potential or actual breach thereunder.
d. Default by UCI of SC upon the expiration of the applicable
grace period of that certain Promissory Note executed by UCI of SC and delivered
to Seller in connection with the Purchase Agreement.
36
<PAGE>
e. Notwithstanding any provision hereof to the contrary, in
the event of a Change in Ownership as defined hereinbelow, unless this Agreement
is earlier terminated for any reason, Employee, in his sole discretion, may
elect to terminate Employee's employment hereunder. For purposes of this
Section, a "Change in Ownership" shall mean the first to occur of the following:
(1) Any person or entity, or any two or more persons
or entities acting as a group as defined in Section 13(d)(3) of the Federal
Securities and Exchange Act of 1934, other than an Affiliate as defined
hereinbelow, shall acquire ownership of more than fifty (50%) percent of the
outstanding voting stock of Employer or UCI of SC; or
(2) The acquisition of, or sale of all or
substantially all of the assets of Employer or UCI of SC, except to an Affiliate
as defined hereinbelow.
For purposes hereof, an "Affiliate" is any entity controlling, controlled by, or
under common control with Employer. For this purpose, "control" means legal or
beneficial ownership of fifty (50%) percent or more of the equity or voting
interests in an entity. Notwithstanding the foregoing, for purposes of this
Section, the dissolution of UCI of SC, or the merger of Employer, UCI of SC, or
UCI with Employer, UCI of SC, or UCI shall not be deemed a Change of Control.
D. Disability. In the event of the Employee's disability during
employment under this Agreement, then employment under this Agreement shall
terminate. For purposes of this Agreement, "disability" shall mean the inability
of Employee, due to sickness or other incapacity, to perform his duties under
this Agreement for a period in excess of ninety (90) substantially consecutive
days. Such termination shall become effective at Employer's election upon the
expiration of such ninety (90) day period of disability. Upon termination of
employment under this Agreement due to Employee's disability, the Employee shall
be entitled to payment of his Regular Compensation and Additional Compensation
up to the date of termination.
9. Non-Disclosure of Information. Except as otherwise required by a court of
competent jurisdiction, Employee shall not, at any time after the date hereof,
directly or indirectly, divulge or disclose for any purpose whatsoever any
confidential information that has been developed or obtained by, or disclosed
to, Employee by Employer and/or UCI of SC at any time or after the date hereof
(exclusive of such information as is in the public domain). Employee
acknowledges that such confidential information is of a special and unique
nature and value relating to matters of Employer's business, including, without
limitation, Employer's proprietary information, trade secrets, systems,
procedures, manuals, confidential reports, records, operational expertise,
locations and lists of patients and potential patients, pricing information and
lists, marketing materials and methods, the methods used and preferred by
Employer's patients, and the fees paid by them (all of which are deemed for all
purposes to be confidential, proprietary, and trade secrets of Employer).
Subject to Section 10(B), any confidential information in Employee's possession
shall be returned to Employer upon any termination or expiration of Employee's
employment hereunder.
10. Protection of Patients and Employees.
A. Representations.
a. The parties hereto acknowledge that Seller has conducted a
medical practice for a substantial number of years, and Employee has been an
officer, director, sole shareholder, and employee of Seller since Seller's
incorporation effective January 1, 1994. Thereby, Employee has made use of,
acquired, and added to confidential and proprietary information and trade
secrets of Seller, all of which are portions of the Assets of Seller (which
Assets are being sold to UCI of SC pursuant to the Purchase Agreement). Employee
also has developed unique relationships with patients, suppliers, and employees
of Seller and unique information and knowledge about the competitive market,
locations, potential patients, processes and prospects of Seller's business. UCI
of SC and/or Employer intends to operate the Assets acquired from Seller for UCI
of SC and Doctor's Care's business similar to Seller's business. The value of
UCI of SC's acquisition would be diminished in the event that Employee were to
violate the terms of this
37
<PAGE>
Section 10, or to assist another person or entity to violate the terms of this
Section 10, or to wrongfully divulge any confidential information.
b. UCI of SC and Employer have required, as a condition
precedent to its purchase of such Assets pursuant to the Purchase Agreement,
that Employee covenant not to divulge any confidential information and not to
violate the terms of this Section 10 as set forth herein. Employee has agreed to
provide such covenants as set forth herein as a material inducement to UCI of SC
and Employer to enter into and close the Purchase Agreement and in consideration
of the payments to be made hereunder and thereunder. Employee's covenants
contained herein are ancillary to the Purchase Agreement. Employee acknowledges
that he will benefit from the Purchase Agreement.
B. Existing Patients.
a. To Employee. Upon execution of this Agreement, Employee
shall provide to Employer a list (by name and address) of Employee's existing
patients ("Existing Patients") as of such date (the "List"). Notwithstanding
anything contained herein to the contrary, in the event Employee's employment
hereunder terminates for any reason other than termination by Employer for cause
pursuant to Section 8(B) or Employee's disability pursuant to Section 8(D), upon
written request to Employer, Employer shall provide to Employee, as soon as
reasonably possible, a copy of the records and charts of any Existing Patient on
the List provided that:
(1) Employee reimburses Employer for Employer's
reasonable costs and expenses incurred in providing copies of such records and
charts; and
(2) The release of such records and charts to
Employee of an Existing Patient is directed in a writing signed by such Existing
Patient or such Existing Patient's legal representative and delivered to
Employer; and
(3) Each party complies with all applicable laws and
the requirements of medical ethics.
b. To Employer. Notwithstanding the foregoing, during the term
of Employee's employment hereunder, and for a period of three (3) years after
the termination by Employer of Employee's employment hereunder for cause
pursuant to Section 8(B) or Employee's disability pursuant to Section 8(D),
Employee shall not, directly or through an Affiliate (as defined below), (i)
provide medical care or services (or assist another person or entity to provide
medical care or services) to any Existing Patient (as defined above), or (ii)
solicit or divert (or assist another person or entity to solicit or divert) any
Existing Patient (as defined above) from purchasing or using any of UCI of SC's
and/or Employer's services. Notwithstanding the foregoing, Employee shall not be
deemed to be in violation of any covenant contained herein as a result of
Employee's providing emergency care to any Existing Patient in a potentially
life-threatening situation or in any emergency room of a licensed hospital.
Notwithstanding anything contained herein to the contrary, the parties hereto
acknowledge that the provisions of this Section 10(B)(b) shall not apply in the
event Employee's employment hereunder terminates for any reason other than
pursuant to Section 8(B) or 8(D).
C. New Patients. Notwithstanding the foregoing, during the term of
Employee's employment hereunder, and for a period of three (3) years after the
termination of Employee employment hereunder for any reason, Employee shall not,
directly or through an Affiliate (as defined below), (i) provide medical care or
services (or assist another person or entity to provide medical care or
services) to any "New Patient" (as hereinafter defined), or (ii) solicit or
divert (or assist another person or entity to solicit or divert) any "New
Patient" (as hereinafter defined) from purchasing or using any of UCI of SC's
and/or Employer's services. For purposes of this Section, the term "New Patient"
shall mean any patient of Employee and/or Employer and shall include (without
limitation) every such person or employer to which Employee has provided medical
services during Employee's employment hereunder; provided however, the term "New
Patient" shall not be deemed to include any "Existing Patient" (as defined
above). Notwithstanding the foregoing,
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<PAGE>
Employee shall not be deemed to be in violation of any covenant contained herein
as a result of Employee's providing emergency care to any New Patient in a
potentially life-threatening situation or in any emergency room of a licensed
hospital.
D. Employees. In addition to (but not in limitation of) the
restrictions above set forth, during the term of Employee's employment
hereunder, and for a period of three (3) years after the termination of
Employee's employment hereunder for any reason, Employee shall not, directly or
through an Affiliate (as defined below) solicit or in any manner attempt to
solicit or induce any person employed by, or an agent of, UCI of SC or Employer
to terminate such person's association or contract of employment or agency, as
the case may be, with UCI of SC and/or Employer; provided however, the terms of
this Section 10(D) shall not apply to the Employee's employing or soliciting the
employment of Patsy Davis, Susan Bennett, or Kristal Ridenour.
E. Definition of Affiliate. For purposes of this Section 10, an
"Affiliate" of Employee is a Person (as defined below) that directly, or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with Employee. For purposes of this Agreement, a
"Person" includes, in addition to such person, all of the following persons: (i)
any relative or spouse of such person, or any relative of such spouse, any one
of whom has the same home as such person; (ii) any trust or estate in which such
person or any of the persons specified in Section 10(E)(i) of this Agreement
collectively own ten percent (10%) or more of the total beneficial interest, or
of which any of such persons serve as trustee, executor or in any other
capacity; and (iii) any corporation, partnership, limited liability company or
other organization in which such person or any of the persons specified in
Section 10(E)(i) of this Agreement are the beneficial owners collectively of ten
percent (10%) of any class of equity securities, of the equity interest, or of
the partnership interest.
11. Remedies.
A. Accounting for Lost Profits. If Employee shall violate any of the
provisions of Sections 9 or 10 hereof, UCI of SC and/or Employer shall be
entitled to recover any non-speculative lost profits incurred by UCI of SC
and/or Employer as a result of, growing out of, or in connection with, any such
violation by Employee. This remedy shall be in addition to, and not in
limitation of, any injunctive relief or other rights, remedies, or damages, to
which UCI of SC and/or Employer is or may be entitled as a result of this
Agreement.
B. Injunctive Relief. In the event of a breach or threatened breach by
Employee of any of the provisions of Sections 9 or 10, UCI of SC and Employer,
in addition to, and not in limitation of, any other rights, remedies, or damages
available to UCI of SC or Employer at law or in equity, shall be entitled to a
temporary restraining order, preliminary injunction, and permanent injunction in
order to prevent or restrain any such breach by Employee or by Employee's
partners, agents, representatives, servants, employers, employees, companies,
consulting clients, and/or any and all persons directly or indirectly acting for
or with Employee. Employee agrees that in the event of any breach by Employee of
the covenants set forth in this Agreement, UCI of SC and Employer shall suffer
irreparable harm for which the remedy of monetary damages may be inadequate.
C. Set Off. In addition to the other rights or remedies to which
Employer and/or UCI of SC may be entitled in the event of any breach by Employee
and/or Seller of this Agreement and/or the Purchase Agreement, UCI of SC and/or
Employer shall be entitled, at their option, to set off and recoup against the
payments becoming due pursuant to this Agreement, the Purchase Agreement and any
document executed in connection therewith, the amounts to which UCI of SC and/or
Employer may become entitled. Employee's right to lawfully contest such set off
or recoupment in any action to collect the amounts due hereunder shall not be
impaired by UCI of SC or Employer's exercise of such set off or recoupment
right.
D. Alternatives/Survival. UCI of SC and/or Employer shall have the
option, in its sole discretion, to enforce the various restrictions of Sections
9, 10 and 11 cumulatively, in the alternative, or consecutively. The terms of
Sections 9, 10, and 11 hereof shall survive the termination of Employee's
employment hereunder.
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<PAGE>
E. Reasonableness of Restrictions. Employee has carefully read and
considered the provisions of Sections 9, 10, and 11, and, having done so,
voluntarily agrees that the restrictions set forth in those Sections, including,
but not limited to, the time period of restriction, and the scope of restricted
activities set forth in Section 10, are fair and reasonable and are reasonably
required for the protection of the legitimate interests of UCI of SC and
Employer, and its parent or subsidiary corporations, partnerships, officers,
directors, partners, employees and affiliates, including but not limited to UCI
Medical Affiliates, Inc. In the event that, notwithstanding the foregoing, any
of the provisions of Sections 9, 10, or 11 or any parts thereof shall be held to
be invalid or unenforceable, the remaining provisions or parts thereof shall
nevertheless continue to be valid and enforceable as though the invalid or
unenforceable portions or parts had not been included therein. In the event that
any provisions of Sections 9, 10, or 11 relating to the time period and/or the
areas of restriction and/or the scope of restricted activities and/or related
aspects shall be declared by a court of competent jurisdiction to exceed the
maximum restrictiveness such court deems reasonable and enforceable, the time
period and/or areas of restriction and/or the scope of restricted activities
and/or related aspects deemed reasonable and enforceable by the court shall
become and thereafter be the maximum restriction in such regard, and the
restriction shall remain enforceable to the fullest extent deemed reasonable by
such court.
12. Burden and Benefit. This Agreement shall be binding upon Employer's
successors and assigns and Employee's heirs, personal and legal representatives,
successors and assigns, and shall inure to the benefit of Employer's successors
and permitted assigns and Employee's heirs, personal representative, legal
representatives, successors, and permitted assigns. The terms of this Agreement
are intended to benefit UCI of SC.
13. Modifications. This Agreement can only be modified by a written agreement
duly signed by Employee and an authorized representative of Employer. Moreover,
in order to avoid uncertainty, ambiguity and misunderstandings in their
relationships, the parties hereto covenant and agree not to enter into any oral
agreement or understanding inconsistent or in conflict with this Agreement; and
the parties hereto further covenant and agree that any oral communication
allegedly or purportedly constituting such an agreement or understanding shall
be absolutely null, void and without effect.
14. Waiver. Any waiver by either party of any breach or any term or condition
hereof shall be effective only if in writing and such writing shall not be
deemed to be a waiver of any subsequent or other breach, term or condition of
this Agreement.
15. Assignments. Neither this Agreement nor any rights hereunder may be assigned
or otherwise transferred by any party hereto without the prior written consent
of the other parties hereto, except that this Agreement may be assigned by
Employer to an Affiliate of Employer without Employee's consent.
16. Cumulative Remedies. All rights and remedies of a party hereunder shall be
cumulative and in addition to such rights and remedies as may be available to a
party at law or equity.
17. Venue and Jurisdiction. The parties hereto hereby (i) agree that any
litigation, action or proceeding arising out of or relating to this Agreement
shall be instituted in a state or federal court located in Greenville County,
South Carolina, (ii) waive any objection which they might have now or hereafter
to any such litigation, action, or proceeding based upon improper venue or
inconvenient forum, and (iii) irrevocably submit to the jurisdiction of such
courts in any such litigation, action or proceeding. For all purposes of this
Agreement, the parties hereto further agrees that service of process may be
effected pursuant to United States mail.
18. Entire Agreement. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and supersedes all prior
contemporaneous written or oral agreements and representations between the
parties with respect thereto.
40
<PAGE>
19. Governing Law. The construction and interpretation of this Agreement shall
at all times and in all respects be governed by the laws of the State of South
Carolina.
20. Severability. The invalidity or unenforceability or any provision of this
Agreement shall not render invalid or unenforceable any other provision hereof.
21. Survival. All terms of this Agreement shall survive the Closing under the
Purchase Agreement.
22. Usage. Capitalized terms used herein which are not otherwise defined herein
shall have the meanings ascribed to them in the Purchase Agreement. The section
and paragraph headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. Terms such as "hereof", "hereunder", "hereto", "herein", and words of
similar import shall refer to this Agreement in its entirety and all references
to "Paragraphs", "Sections", and similar cross references shall refer to
specified portions of this Agreement, unless the context clearly requires
otherwise.
23. Enforcement. In the event litigation or other legal proceedings are
commenced to enforce any rights under this Agreement, all reasonable legal
expenses (including reasonable attorney's fees) and other direct costs of
litigation of the prevailing party shall be paid by the non-prevailing party.
All remedies specified herein are cumulative and non-exclusive, and parties
shall be entitled to seek or enforce any other rights or remedies available to
them at law or in equity.
24. Notices. Any notice, request, approval, consent, demand or other
communication shall be effective upon the first to occur of the following: (i)
upon receipt by the party to whom such notice, request, approval, consent,
demand or other communication is being given; or (ii) three (3) business days
after being duly deposited in the United States certified mail, return receipt
requested, and addressed as follows:
Employer: Doctor's Care, P.A.
6168 St. Andrews Road
Columbia, South Carolina 29212
Attn.: Stephen Seeling, Esquire
Employee: Martin L. Schlein, M.D.
701 McDaniel Avenue
Greenville, South Carolina 29601
The parties hereto may change their respective addresses by notice in writing
given to the other party to this Agreement.
[SIGNATURE PAGE ATTACHED]
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<PAGE>
IN WITNESS WHEREOF, the parties have executed this Employment Agreement
on the date first set forth above.
IN THE PRESENCE OF: EMPLOYER:
DOCTOR'S CARE, P.A.
/s/ David A. Merline, Jr.
Witness
By: /s/ Stephen S. Seeling
/s/ Mary S. Rose Its: Secretary
Witness
EMPLOYEE:
/s/ David A. Merline, Jr.
Witness
/s/ Martin L. Schlein, M.D.
Martin L. Schlein, M.D.
/s/ Mary S. Rose
Witness
- -------------------------------------------------------------------------------
GUARANTY
UCI Medical Affiliates of South Carolina, Inc. ("UCI of SC") hereby
guarantees the performance by Doctor's Care, P.A. of each and every one of the
terms contained in the foregoing Employment Agreement dated as of April 12, 1996
by and between Doctor's Care, P.A. and Martin L. Schlein, M.D.; provided
however, the parties thereto acknowledge that UCI of SC is not authorized, and
does not hereby guarantee, the providing of medical services.
UCI MEDICAL AFFILIATES OF SOUTH CAROLINA, INC.
/s/ David A. Merline, Jr.
Witness
By: /s/ Stephen S. Seeling
/s/ Mary S. Rose Its: Secretary
Witness
42
<PAGE>
SCHEDULE OF COMPENSATION
<TABLE>
<CAPTION>
Agreed To
Date Change Effective New Annual Salary Employer Employee
<S> <C> <C>
</TABLE>
43
<PAGE>
EXHIBIT H
BILL OF SALE
KNOW ALL MEN BY THESE PRESENTS, that MARTIN L. SCHLEIN, M.D., P.A., a South
Carolina professional corporation with offices at 4501 East North Street
Extension, Taylors, South Carolina 29687 (the "Seller"), for the consideration
paid by UCI MEDICAL AFFILIATES OF SOUTH CAROLINA, INC., a South Carolina
corporation with offices at 6168 St. Andrews Road, Columbia, South Carolina
29212 (the "Buyer") set forth in that certain Asset Purchase Agreement and Plan
of Reorganization dated as of April 12, 1996, by and among Seller, Buyer, UCI
Medical Affiliates, Inc., Doctor's Care, P.A., and Martin L. Schlein, M.D. (the
"Agreement"), the receipt and sufficiency whereof is hereby acknowledged, has
bargained and sold and by these presents does sell, assign and transfer unto
Buyer all of Seller's right, Chief Financial Officer and interest in and to, all
the accounts receivable, cash, cash accounts, machinery, equipment, computers,
telephone systems, inventory, furniture, furnishings, office equipment, and
other tangible personal property composing portions of the Assets described in
the Agreement, all as provided in the Agreement.
TO HAVE AND TO HOLD the same unto Buyer, its successors and assigns,
forever. AND Seller does for itself and its successors and assigns, covenant and
agree to and with Buyer, its successors and assigns, to warrant and defend the
sale and conveyance of the aforesaid assets hereby sold unto Buyer.
This Bill of Sale is made, executed and delivered pursuant to the
Agreement, and is subject to all of the terms, provisions, and conditions
thereof, including (without limitation) the indemnification therein. To the
extent of any conflict between the terms hereof and thereof, the terms of the
Agreement shall be controlling.
All capitalized terms not otherwise defined herein shall have the meanings
ascribed to them in the Agreement unless the context clearly requires otherwise.
IN WITNESS WHEREOF, Seller has duly executed this Bill of Sale to be
effective as of the 12th day of April, 1996.
IN THE PRESENCE OF: MARTIN L. SCHLEIN, M.D., P.A.
(CORPORATE SEAL)
/s/ David A. Merline, Jr. By: /s/ Martin L. Schlein, M.D.
(Witness) Its: President
/s/ Mary S. Rose
(Witness)
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<PAGE>
STATE OF SOUTH CAROLINA )
) PROBATE
COUNTY OF GREENVILLE )
PERSONALLY APPEARED before me the undersigned witness who, after first
being duly sworn, deposes and says that s/he saw the within named MARTIN L.
SCHLEIN, M.D., P.A., by MARTIN L. SCHLEIN, M.D., its President, sign, seal and,
as its act and deed, deliver the within written Bill of Sale for the uses and
purposes therein mentioned and that s/he with the other witness whose signature
appears above, witnessed the execution thereof.
/s/ David A. Merline, Jr.
Witness
SWORN to before me this 12th day of April, 1996.
/s/ Mary S. Rose (L.S.)
Notary Public for South Carolina
My Commission Expires: 02/14/2005
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<PAGE>
EXHIBIT I
ASSIGNMENT AND ASSUMPTION AGREEMENT
KNOW ALL MEN, that MARTIN L. SCHLEIN, M.D., P.A., a South Carolina
professional corporation, and MARTIN L. SCHLEIN, M.D. (collectively the
"Assignor"), for and in consideration of good and valuable consideration to it
in hand paid at or before the ensealing and delivery of these presents, by UCI
MEDICAL AFFILIATES OF SOUTH CAROLINA, INC., a South Carolina corporation
("Assignee"), the receipt and sufficiency whereof is hereby acknowledged, hereby
assigns to Assignee all of Assignor's right, title and interest in and to the
permits, licenses, computer software, and all other intangible assets and rights
composing portions of the Assets as described in the Asset Purchase Agreement
and Plan of Reorganization dated as of April 12, 1996, between Assignor,
Assignee, UCI Medical Affiliates, Inc., Doctor's Care, P.A., and Martin L.
Schlein, M.D. (the "Agreement"), all as provided in the Agreement, plus the
equipment lease set forth on Schedule 1 attached hereto.
Assignee hereby covenants with Assignor to assume and faithfully
perform and discharge all of the terms, covenants, liabilities and obligations
(subject to the Agreement) maturing and to be performed or discharged by
Assignor under the above assigned contracts beginning on the date hereof and
henceforth.
This Assignment is made, executed, and delivered pursuant to the
Agreement, and is subject to all the terms, provisions and conditions thereof,
including (without limitation) the mutual indemnifications therein. To the
extent of any conflict between the terms hereof and thereof, the terms of the
Agreement shall be controlling.
All capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Agreement unless the context clearly requires
otherwise.
[SIGNATURE PAGE ATTACHED]
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<PAGE>
IN WITNESS WHEREOF, the parties have duly executed this Assignment and
Assumption Agreement to be effective as of the 12th day of April, 1996.
ASSIGNOR:
MARTIN L. SCHLEIN, M.D., P.A.
By: /s/ Martin L. Schlein, M.D., P.A.
Its: President
/s/ Martin L. Schlein, M.D.
MARTIN L. SCHLEIN, M.D.
ASSIGNEE:
UCI MEDICAL AFFILIATES OF SOUTH CAROLINA, INC.
By: /s/ Stephen S. Seeling
Its: Secretary
47
<PAGE>
SCHEDULE 1
Equipment Leases To Be Assumed
UCI Medical Affiliates of South Carolina, Inc. ("UCI of SC") shall
assume that certain Paid IV Plus computer lease dated as of May 9, 1994, by and
between Martin L. Schlein, M.D. ("Schlein") and Companion Technologies, a copy
of which has been delivered to UCI of SC. Schlein shall be responsible for
obtaining the necessary consents, if any, to the assignment of such lease. No
other leases, liabilities, or contracts shall be assumed by UCI of SC.
48
