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NATIONAL QUALITY CARE, INC.
1. Security and Issuer.
This statement on Schedule 13D (the "Statement") relates to the common stock,
par value $.001 per share (the "Company Common Stock"), of National Quality
Care, Inc. (f/k/a/ Sargent, Inc.), a Delaware Corporation (the "Company"),
which has its principal executive offices at 5901 West Olympic Boulevard, Suite
109, Los Angeles, California 90036.
2. Identity and Background.
This Statement is being filed by Michael M. Markow ("Mr. Markow"), a citizen of
the United States of America. Mr. Markow is engaged principally as a financial
and business consultant. The principal business address of Mr. Markow is 15760
Ventura Boulevard, Suite 1020, Encino, California 91436.
During the last five years, Mr. Markow has not been convicted in a criminal
proceeding and has not been a party to civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, Federal or
state securities laws or finding any violations with respect to such laws.
3. Source of Funds / Other Consideration; and
4. Purpose of Transaction.
Mr. Markow entered into a Nonqualified Stock Option Agreement (the "Agreement")
with the Company, dated as of December 10, 1996, pursuant to which the Board of
Directors of the Company authorized the granting to Mr. Markow, for services
previously rendered by Mr. Markow as a consultant to the Company, to purchase
590,000 shares of Common Stock of the Company, at the exercise price of $0.25
per share. The consulting services provided to the Company by Mr. Markow took
place during the period from July 1, 1996 to December 31, 1996 (the "Period").
During the Period, Mr. Markow provided the Company with consulting services
related to the location of strategic business partners for the Company and the
expansion of the dialysis facilities for the Company's business operations.
According to Section 4 of the Agreement, Mr. Markow is entitled to pay the
exercise price against cancellation of certain indebtedness in the amount of
$147,000 owing by the Company to Mr. Markow for consulting services rendered by
Mr. Markow to the Company during the Period, which amount shall only be payable
to Mr. Markow by the exercise of such options. In connection with and pursuant
to Section 4 of the Agreement, Mr. Markow has paid the exercise price of $0.25
per share for 590,000 shares of Common Stock of the Company by agreeing to
forgive and cancel, in full, that certain indebtedness in the amount of
$147,000 owing by the Company to Mr. Markow for consulting services rendered by
Mr. Markow to the Company during the Period.
The securities of the Company to which this Statement relates are held by Mr.
Markow as an investment. Except as otherwise set forth in this Statement, Mr.
Markow does not presently have any plans or proposals which relate to or would
result in: (i) the acquisition by any person of additional securities of the
Company, or disposition of securities of the Company (other than in the normal
course of business); (ii) an extraordinary corporate transaction, such as a
merger, reorganization or liquidation, involving the Company or any of its
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subsidiaries; (iii) a sale or transfer of a material amount of assets of the
Company or any of its subsidiaries; (iv) any change in the present Board of
Directors or management of the Company, including any plans or proposals to
change the number or terms of directors or to fill any existing vacation on such
Board of Directors; (v) any material change in the present capitalization or
dividend policy of the Company; (vi) any other material change in the Company's
business or corporate structure; (vii) changes in the Company's Amended and
Restated Certificate of Incorporation or Bylaws or other actions which may
impede the acquisition of control of the Company by any person; (viii) causing a
class of securities of the Company to be delisted from a national securities
exchange or to cause to be authorized to be quoted an Inter-dealer quotation
system of a registered national securities association; (ix) a class of equity
securities of the Company becoming eligible for termination of registration
pursuant to 12(g)(4) of the Exchange Act; or (x) any action similar to any of
those enumerated above.
Mr. Markow may acquire shares of Company Common Stock or sell some or all of the
shares of the Company Common Stock which may be owned by Mr. Markow from time to
time, depending on his evaluation of the Company's business, prospects and
financial condition, the market for the shares, other opportunities available to
Mr. Markow, general economic conditions, money and stock market conditions and
other future developments.
5. Interest in the Securities of the Issuer.
Pursuant to the Transactions set forth in Item 3 and 4 herein, Mr. Markow is the
record owner of 590,000 shares ("Mr. Markow's Shares") of Company Common Stock.
Mr. Markow's Shares constitute approximately 6.52% of the shares of Company
Common Stock issued and outstanding as of June 20, 1997 (based upon a total of
9,048,210).
In relation to Mr. Markow's Shares, Mr. Markow has: (i) the sole power to vote
all of the Mr. Markow's Shares; and (ii) the sole power to dispose all of the
Mr. Markow's Shares.
Except as set forth in Item 3 hereof, Mr. Markow has not effected any
transactions in shares of Company Common Stock during the past 60 days.
6. Contracts, Arrangements, Understandings or Relationships with
Respect to securities of the Issuer.
Except as set forth in Item 3 and 4 of this Statement, Mr. Markow does not have
any contracts, arrangements, understandings or relationships (legal or
otherwise) with any person with respect to any securities of the Company,
including but not limited to the transfer or voting of any of the securities,
finder's fees, joint ventures, loan or option arrangements, puts or calls,
guarantees of profits, division of profits or loss, or the giving or withholding
of proxies.
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7. Material to be Filed as Exhibits.
a. National Quality Care, Inc. Nonqualified Stock Option
Agreement, dated as of December 10, 1996, by and among National Quality Care,
Inc. and Michael Markow.
("Mr. Markow")
/s/ Michael Markow
---------------------------------
Michael Markow
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Exhibit "A"
NATIONAL QUALITY CARE, INC.
NONQUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of December 10, 1996 by and between National Quality
Care, Inc., a Delaware corporation (the "Company"), and Michael Markow
("Optionee").
R E C I T A L
The Board of Directors of the Company (the "Board of Directors") has authorized
the granting to Optionee, for services previously rendered by Optionee as a
consultant to the Company, of a non-qualified stock option to purchase the
number of shares of Common Stock of the Company specified in Paragraph 1 hereof,
at the price specified therein, such option to be for the term and upon the
terms and conditions hereinafter stated.
A G R E E M E N T
NOW, THEREFORE, in consideration of the premises and of the undertakings of the
parties hereto contained herein, it is hereby agreed:
1. Number of Shares; Option Price. Pursuant to said action of the
Board of Directors, the Company hereby grants to Optionee, in consideration of
consulting services performed for the benefit of the Company, during the period
from July 1, 1996 to December 31, 1996, related to the location of strategic
business partners for the Company and the expansion of the dialysis facilities
for the Company's business operations, the option ("Option") to purchase up to
590,000 shares ("Option Shares") of Common Stock of the Company, at the exercise
price of $0.25 per share.
2. Term. This Option shall expire two (2) years from the date
first written above.
3. Shares Subject to Exercise. The 590,000 Options shall vest and
be exercisable on the following dates: (a) 190,000 Options on April 18, 1997,
(b) 200,000 Options on June 18, 1997, and (c) 200,000 Options on August 18,
1997, and shall thereafter remain subject to exercise for the term specified in
Paragraph 2 hereof.
4. Method and Time of Exercise. The Option may be exercised by
written notice delivered to the Company stating the number of shares with
respect to which the Option is being exercised, together with a check made
payable to the Company in the amount of the purchase price of such shares plus
the amount of applicable federal, state and local withholding taxes, and the
written statement provided for in Paragraph 10 hereof, if required by such
Paragraph 10; provided, however, with respect to the 590,000 Options set forth
in paragraph 1 hereof, Optionee shall be entitled to pay the exercise price
against cancellation in full of certain indebtedness in the amount of $147,000
owing by the Company to Optionee for services previously rendered by Optionee as
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a consultant to the Company during the period from July 1, 1996 to December 31,
1996, which amount shall only be payable to Optionee by the exercise of such
Options. Not less than 100 shares may be purchased at any one time unless the
number purchased is the total number purchasable under such Option at the time.
Only whole shares may be purchased.
5. Tax Withholding. As a condition to exercise of this Option,
the Company may require the Optionee to pay over to the Company all applicable
federal, state and local taxes which the Company is required to withhold with
respect to the exercise of this Option. At the discretion of the Company and
upon the request of the Optionee, the minimum statutory withholding tax
requirements may be satisfied by the withholding of shares of Common Stock
otherwise issuable to the Optionee upon the exercise of this Option.
6. Exercise on Termination of Employment. This Option shall not
terminate as a result of the termination of Optionee's services as a consultant
to the Company.
7. Nontransferability. This Option may not be assigned or
transferred except, if applicable, by will or by the laws of descent and
distribution, and may be exercised only by Optionee during Optionee's lifetime
and after Optionee's death, by Optionee's representative or by the person
entitled thereto under Optionee's will or the laws of intestate succession.
8. Optionee Not a Shareholder. Optionee shall have no rights as a
shareholder with respect to the Common Stock of the Company covered by the
Option until the date of issuance of a stock certificate or stock certificates
to him upon exercise of the Option. No adjustment will be made for dividends or
other rights for which the record date is prior to the date such stock
certificate or certificates are issued.
9. No Right to Perform Services. Nothing in this Option shall
confer upon the Optionee any right to perform services for the Company, or shall
interfere with or restrict in any way the rights of the Company to discharge or
terminate Optionee as an independent contractor or consultant at any time for
any reason whatsoever, with or without good cause.
10. Restrictions on Sale of Shares. Optionee represents and agrees
that, upon Optionee's exercise of the Option in whole or part, unless there is
in effect at that time under the Securities Act of 1933 a registration statement
relating to the shares issued to him, he will acquire the shares issuable upon
exercise of this Option for the purpose of investment and not with a view to
their resale or further distribution, and that upon each exercise thereof
Optionee will furnish to the Company a written statement to such effect,
satisfactory to the Company in form and substance. Optionee agrees that any
certificates issued upon exercise of this Option may bear a legend indicating
that their transferability is restricted in accordance with applicable state or
federal securities law. Any person or persons entitled to exercise this Option
under the provisions of Paragraphs 5 and 6 hereof shall, upon each exercise of
the Option under circumstances in which Optionee would be required to furnish
such a written statement, also furnish to the Company a written statement to the
same effect, satisfactory to the Company in form and substance.
11. Registration. On or before thirty days after the date of this
Agreement, the Company shall, at the Company's expense, use its best efforts to
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file with the Securities and Exchange Commission ("SEC"), a registration
statement ("Registration Statement") on Form S-8 or other comparable form, in
such form as to comply with applicable federal and state laws for the purpose of
registering or qualifying the Option Shares for resale by Optionee, and prepare
and file with the appropriate state securities regulatory authorities the
documents reasonably necessary to register or qualify such securities, subject
to the ability of the Company to register or qualify such securities under
applicable state laws.
12. Notices. All notices to the Company shall be addressed to the
Company at the principal office of the Company at 5901 West Olympic Boulevard,
Suite 109, Los Angeles, California 90036, Telecopier No. (213) 933-8836, and all
notices to Optionee shall be addressed to Optionee at the address and telecopier
number of Optionee on file with the Company, or to such other address and
telecopier number as either may designate to the other in writing. A notice
shall be deemed to be duly given if and when enclosed in a properly addressed
sealed envelope deposited, postage prepaid, with the United States Postal
Service and followed by telecopier to the addressee. In lieu of giving notice
by mail as aforesaid, written notices under this Agreement may be given by
personal delivery to Optionee or to the Company (as the case may be).
13. [RESERVED]
14. Adjustments. If there is any change in the capitalization of
the Company affecting in any manner the number or kind of outstanding shares of
Common Stock of the Company, whether by stock dividend, stock split,
reclassification or recapitalization of such stock, or because the Company has
merged or consolidated with one or more other corporations (and provided the
Option does not thereby terminate pursuant to Section 2 hereof), then the number
and kind of shares then subject to the Option and the price to be paid therefor
shall be appropriately adjusted by the Board of Directors; provided, however,
that in no event shall any such adjustment result in the Company's being
required to sell or issue any fractional shares. Any such adjustment shall be
made without change in the aggregate purchase price applicable to the
unexercised portion of the Option, but with an appropriate adjustment to the
price of each Share or other unit of security covered by this Option.
15. Cessation of Corporate Existence. Notwithstanding any other
provision of this Option, upon the dissolution or liquidation of the Company,
the reorganization, merger or consolidation of the Company with one or more
corporations as a result of which the Company is not the surviving corporation,
or the sale of substantially all the assets of the Company or of more than 50%
of the then outstanding stock of the Company to another corporation or other
entity, the Option granted hereunder shall terminate; provided, however, that:
(i) each Option for which no option has been tendered by the surviving
corporation in accordance with all of the terms of provision;
(ii) immediately below shall, within five days before the effective date of such
dissolution or liquidation, merger or consolidation or sale of assets in which
the Company is not the surviving corporation or sale of stock, become fully
exercisable; or
(iii) in its sole and absolute discretion, the surviving corporation may, but
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shall not be so obligated to, tender to any Optionee, an option to purchase
shares of the surviving corporation, and such new option or options shall
contain such terms and provisions as shall be required substantially to preserve
the rights and benefits of this Option.
16. Invalid Provisions. In the event that any provision of this
Agreement is found to be invalid or otherwise unenforceable under any applicable
law, such invalidity or unenforceability shall not be construed as rendering any
other provisions contained herein invalid or unenforceable, and all such other
provisions shall be given full force and effect to the same extent as though the
invalid or unenforceable provision were not contained herein.
17. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
18. Counterparts. This Agreement may be executed in counterparts,
all of which shall be considered one and the same agreement, and shall become
effective when one or more counterparts have been signed by each of the parties
hereto and delivered to the other.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above written.
NATIONAL QUALITY CARE, INC.
("Company")
By: /s/ Victor Gura, M.D.
Victor Gura, M.D.,
Chief Executive Officer
Social Security Number
or Employer Identification
Number:
Michael Markow
("Optionee")
By: /s/ Michael Markow
Michael Markow
Social Security Number: ###-##-####
Address:
Michael Markow
c/o Worldwide Corporate Finance
15760 Ventura Boulevard
Suite 1020
Encino, California 91436
Telecopier No. (818) 783-1120
