Exhibit 2.1
INTEREST TRANSFER AGREEMENT
THIS INTEREST TRANSFER AGREEMENT is made and entered into by and among
MIDDLESEX MRI CENTER, INC., a Massachusetts corporation ("Middlesex MRI") and
MDI REHAB, INC., a Massachusetts corporation ("MDI Rehab") (Middlesex MRI and
MDI Rehab are sometimes each referred to as a "Partner" and collectively as the
"Partners"), as the sole general partners of MVA REHABILITATION ASSOCIATES, a
Massachusetts general partnership (the "Partnership"), and the MEDICAL
DIAGNOSTICS AND REHABILITATION, LLC, a Delaware limited liability company (the
"Transferee").
WHEREAS, the Partners are the sole partners of the Partnership, holding one
hundred percent (100%) of the general partnership interests of the Partnership,
existing under and evidenced by the Amended and Restated Agreement of
Partnership of MVA Rehabilitation Associates dated as of January 31, 1995 (the
"Partnership Agreement");
WHEREAS, Middlesex MRI acquired its general partnership interest in the
Partnership pursuant to that certain Interest Transfer Agreement, dated as of
October 1, 1996, from The MVA Center for Rehabilitation, Inc., and succeeded to
all of the rights and obligations of The MVA Center for Rehabilitation, Inc.
under and pursuant to the Partnership Agreement;
WHEREAS, Middlesex MRI holds a 25% general partnership interest in the
Partnership and desires to sell, transfer and convey to the Transferee (i) on
the date hereof, for the consideration set forth herein, all of Middlesex MRI's
right, title and interest in and to a 24% general partnership interest in the
Partnership (the "MRI Interest"), as such interest is described in the
Partnership Agreement, and withdraw from the Partnership Agreement with respect
to the transferred MRI Interest, and (ii) on June 1, 1999, for the consideration
set forth herein, all of Middlesex MRI's right, title and interest in and to a
1% general partnership interest in the Partnership (the "Assigned Interest"), as
such interest is described in the Partnership Agreement, and withdraw from the
Partnership Agreement with respect to the Assigned Interest;
WHEREAS, MDI Rehab holds a 75% general partnership interest in the
Partnership and desires to sell, transfer and convey to the Transferee, for the
consideration set forth herein, all of MDI Rehab's right, title and interest in
and to its 75% general partnership interest in the Partnership (the "MDI
Interest"), as such interest is described in the Partnership Agreement, and
withdraw from the Partnership Agreement; and
WHEREAS, the Transferee desires to acquire the MDI Interest, the MRI
Interest and the Assigned Interest, for the consideration set forth herein, and
to be admitted to the Partnership as a substitute General Partner in the place
and stead of MDI Rehab with respect to the MDI Interest and in the place and
stead of Middlesex MRI with respect to the MRI Interest and the Assigned
Interest;
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NOW, THEREFORE, in consideration of the mutual agreements and covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Sale of the MRI Interest, the Assigned Interest and the MDI Interest.
(a) MRI Interest. Simultaneously herewith, and in exchange for the
consideration set forth is Section 2 hereof, Middlesex MRI hereby sells,
transfers and conveys to the Transferee all of Middlesex MRI's right, title
and interest in and to the MRI Interest and all of Middlesex MRI's rights
under the Partnership Agreement with respect to the MRI Interest,
including, without limitation, (i) all rights of Middlesex MRI to receive
monies and other property or assets due and to become due to Middlesex MRI
under or pursuant to the Partnership Agreement, (ii) all claims of
Middlesex MRI for damages arising out of or for breach of or default under
the Partnership Agreement, (iii) all rights of Middlesex MRI to receive
proceeds or benefit of any indemnity, warranty, or other payments with
respect to the Partnership Agreement, and (iv) all rights of Middlesex MRI
to perform thereunder and to compel performance and otherwise exercise all
remedies thereunder. The Transferee hereby accepts from Middlesex MRI the
MRI Interest and agrees to become a substitute General Partner of the
Partnership in the place and stead of Middlesex MRI with respect to the MRI
Interest.
(b) The Assigned Interest. Effective as of June 1, 1999, and in
exchange for the consideration set forth is Section 2 hereof, Middlesex MRI
hereby agrees to sell, transfer and convey to the Transferee all of
Middlesex MRI's right, title and interest in and to the Assigned Interest
and all of Middlesex MRI's rights under the Partnership Agreement with
respect to the Assigned Interest, including, without limitation, (i) all
rights of Middlesex MRI to receive monies and other property or assets due
and to become due to Middlesex MRI under or pursuant to the Partnership
Agreement, (ii) all claims of Middlesex MRI for damages arising out of or
for breach of or default under the Partnership Agreement, (iii) all rights
of Middlesex MRI to receive proceeds or benefit of any indemnity, warranty,
or other payments with respect to the Partnership Agreement, and (iv) all
rights of Middlesex MRI to perform thereunder and to compel performance and
otherwise exercise all remedies thereunder. Effective as of June 1, 1999,
the Transferee hereby accepts from Middlesex MRI the Assigned Interest and
agrees to become a substitute General Partner of the Partnership in the
place and stead of Middlesex MRI with respect to the Assigned Interest.
Notwithstanding anything to the contrary contained in this Agreement, in
the event the Transferee makes all of the payments pursuant to Section 2
hereof on a date prior to June 1, 1999, the Assigned Interest shall be
transferred to the Transferee effective as of the date of the last payment.
(c) MDI Interest. Simultaneously herewith, and in exchange for the
consideration set forth is Section 2 hereof, MDI Rehab hereby sells,
transfers and conveys to the Transferee all of MDI Rehab's right, title and
interest in and to the MDI Interest and all of MDI Rehab's rights under the
Partnership Agreement with respect to the MDI Interest, including, without
limitation, (i) all rights of MDI Rehab to receive monies and other
property or assets due and to become due to MDI Rehab under or pursuant to
the
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Partnership Agreement, (ii) all claims of MDI Rehab for damages arising out
of or for breach of or default under the Partnership Agreement, (iii) all
rights of MDI Rehab to receive proceeds or benefit of any indemnity,
warranty, or other payments with respect to the Partnership Agreement, and
(iv) all rights of MDI Rehab to perform thereunder and to compel
performance and otherwise exercise all remedies thereunder. The Transferee
hereby accepts from MDI Rehab the MDI Interest and agrees to become a
substitute General Partner of the Partnership in the place and stead of MDI
Rehab with respect to the MDI Interest.
2. Consideration.
(a) MRI Interest and MDI Interest. The purchase price for the MRI
Interest and the MDI Interest shall be equal to the sum of the following
deferred payments payable to Middlesex MRI and MDI Rehab by wire transfer
or by certified or bank cashier's check in the amounts and on the dates set
forth below (together with the deferred payments described in Section 2(c)
hereof, the "Deferred Payments"):
Payment Amount Payment Due Date
-------------- ----------------
$25,000.00 April 1, 1999
$150,000.00 May 1, 1999
$95,000.00 June 1, 1999
$210,000.00 July 1, 1999
The Deferred Payments shall be allocated to the Partners in the following
proportions: 24% to Middlesex MRI and 75% to MDI Rehab.
(b) The Assigned Interest. The purchase price for the Assigned Interest
shall be equal to $50,000 payable to Middlesex MRI on December 15, 1999 by
wire transfer or by certified or bank cashier's check.
(c) Payments to the Partnership. As additional consideration for the MRI
Interest and the MDI Interest, the following Deferred Payments shall be
contributed to the capital of the Partnership by the Transferee, in cash,
in the amounts and on the dates set forth below:
Payment Amount Payment Due Date
-------------- ----------------
$50,000.00 March 15, 1999
$105,000.00 April 1, 1999
$105,000.00 May 1, 1999
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$110,000.00 June 1, 1999
The Transferee acknowledges and agrees that the Deferred Payments described
in this Section 2(c) shall be contributed to the capital of the Partnership
by the Transferee notwithstanding anything to the contrary contained in the
Partnership Agreement, and that Middlesex MRI shall be under no obligation
to make any proportionate contributions to the capital of the Partnership.
The Transferee further agrees that, immediately upon contribution to the
Partnership of the Deferred Payments described in this Section 2(c), it
shall cause the Partnership to pay each such Deferred Payment to The MVA
Center for Rehabilitation, Inc. (the "MVA Center") pursuant to that certain
Agreement for Judgment entered into between the Partnership and the MVA
Center on or about March 8, 1999, in connection with civil action No.
98-5183-B, filed in the Massachusetts Superior Court Department of The
Trial Court. The Transferee shall give notice to Middlesex MRI upon making
payment of each such payment to the MVA Center mandated hereunder, and
shall provide evidence thereof upon reasonable request therefor by
Middlesex MRI.
(d) Terms of Payment. Payment of all deferred payments by the Transferee
pursuant to this Section 2 shall be made on or before the due date set
forth herein for such payment, with the understanding that time shall be of
the essence with respect to each such payment. Notwithstanding the
preceding sentence, the Transferee shall have a ten (10) day grace period
to make the payment due on July 1, 1999 (i.e., until July 10, 1999),
without any requirement of notice or demand.
(e) Default. Any failure by the Transferee to make payment of any
deferred payment required under this Section 2, any failure by the
Transferee to cause the Partnership to make any required payment by the
Partnership to MVA Center pursuant to the Agreement for Judgment, or any
breach of this Interest Transfer Agreement by any party hereto shall be
deemed an event of default hereunder ("Default") and each of the
Transferee, Middlesex MRI and MDI Rehab shall have all of the rights
accorded to such party under this Interest Transfer Agreement and by law to
enforce the terms of this Agreement. Upon Default by the Transferee in the
due and punctual payment of any payment due hereunder (and upon the
happening of any such other event described in any of the security
documents described below in Section 3), all of the payments to be made by
the Transferee under Section 2 hereof shall, at the option of either
Partner, become immediately due and payable, without presentment, protest,
notice or demand. In the event of any Default, the party that prevails in
any enforcement action, whether by litigation or by settlement, shall be
reimbursed by the opposing party or parties for its (or their) legal fees
and disbursements incurred in connection with such enforcement action.
3. Security for Deferred Payments.
(a) Pledge of Partnership Interest. The obligation of the Transferee
to pay the Deferred Payments shall be secured by a first priority security
interest in and to the MDI Interest and the MRI Interest in the
Partnership. The Transferee hereby grants to MDI Rehab a first priority
security interest in and to the MDI Interest, including, without
limitation, any rights to distributions in liquidation or otherwise, with
respect to such MDI
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Interest, for the purpose of securing all of the obligations of the
Transferee to MDI Rehab under this Agreement. The Transferee hereby
represents and warrants to MDI Rehab that it has good and marketable title
to the MDI Interest and that the MDI Interest is free and clear of all
liens, claims, and encumbrances whatsoever, except for the first priority
security interest therein described herein. MDI Rehab shall have all of the
rights and remedies of a secured party under the Uniform Commercial Code as
enacted and in effect in the Commonwealth of Massachusetts (the "UCC"). The
Transferee agrees to execute and deliver to MDI Rehab such UCC financing
statements and such other documents and instruments (including, without
limitation, a pledge agreement from the Transferee with respect to the
security interest granted hereby) and to take such further actions as may
be reasonably requested by MDI Rehab in order to perfect and maintain the
first priority security interest granted hereby. Similarly, the Transferee
hereby grants to Middlesex MRI a first priority security interest in and to
the MRI Interest, including, without limitation, any rights to
distributions in liquidation or otherwise, with respect to such MRI
Interest, for the purpose of securing all of the obligations of the
Transferee to Middlesex MRI under this Agreement. The Transferee hereby
represents and warrants to Middlesex MRI that it has good and marketable
title to the MRI Interest and that the MRI Interest is free and clear of
all liens, claims, and encumbrances whatsoever, except for the first
priority security interest therein described herein. Middlesex MRI shall
have all of the rights and remedies of a secured party under the Uniform
Commercial Code as enacted and in effect in the Commonwealth of
Massachusetts (the "UCC"). The Transferee agrees to execute and deliver to
Middlesex MRI such UCC financing statements and such other documents and
instruments (including, without limitation, a pledge agreement from the
Transferee with respect to the security interest granted hereby) and to
take such further actions as may be reasonably requested by Middlesex MRI
in order to perfect and maintain the first priority security interest
granted hereby.
(b) Security Interest in Accounts Receivable. The obligation of the
Transferee to pay the Deferred Payments shall also be secured by a third
priority security interest in the accounts receivable of the Partnership.
This security interest shall be junior in priority only to those in favor
of The MVA Center for Rehabilitation, Inc. and the Springfield Institution
for Savings (the "Bank"); provided, however, that the Transferee represents
and warrants to and agrees with MDI Rehab and Middlesex MRI that the
indebtedness secured by the security interest granted to the Bank shall
not, at any time, exceed $555,000, and that the proceeds from the loan by
the Bank to the Transferee shall be used by the Transferee only to pay one
or more of the Deferred Payments set forth in Section 2 hereof. The
Partners and the Transferee agree to cause the Partnership to grant MDI
Rehab and Middlesex MRI a third priority security interest in the accounts
receivable of the Partnership, and to execute and deliver to MDI Rehab and
Middlesex MRI such UCC financing statements and such other documents and
instruments (including, without limitation, a security agreement from the
Partnership with respect to the security interest granted hereby) and to
take such further actions as may be reasonably requested by MDI Rehab and
Middlesex MRI in order to perfect and maintain the third priority security
interest granted hereby. To the extent required in order to permit such
third priority
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security interest, the Partners and the Transferee waive the provisions of
Section 1.6 of the Partnership Agreement.
4. Admission as a Substitute Partner. The Transferee is hereby admitted to
the Partnership as a substitute General Partner having in the aggregate the same
rights and Percentage Interests as MDI Rehab and Middlesex MRI with respect to
the MDI Interest and the MRI Interest, and effective as of June 1, 1999 with
respect to the Assigned Interest. The Transferee hereby agrees to be bound by
the terms and conditions of the Partnership Agreement.
5. Withdrawal. MDI Rehab hereby withdraws from the Partnership and is no
longer a Partner thereof. Middlesex MRI hereby withdraws from the Partnership
with respect to the MRI Interest and is no longer a Partner in the Partnership
with respect to the MRI Interest. The parties agree that, effective as of June
1, 1999, Middlesex MRI will withdraw from the Partnership with respect to the
Assigned Interest.
6. Effect of Withdrawal and Substitution. As of the effective date hereof,
that portion of the Capital Account of MDI Rehab and Middlesex MRI allocable to
the MDI Interest and to the MRI Interest, respectively, will be transferred to
the Transferee. From and after the effective date hereof, the portion of the
Profits or Losses of the Partnership and the portion of all other items of
income, gain, loss, deduction, or credit allocable to the MDI Interest and to
the MRI Interest on or after such date shall be credited or charged, as the case
may be, to the Transferee and not to MDI Rehab and Middlesex MRI. The Transferee
shall be entitled to all distributions or payments in respect to the MDI
Interest and to the MRI Interest made on or after the effective date hereof,
regardless of the source of those distributions or payments or when the same
were earned or received by the Partnership. As of June 1, 1999, that portion of
the Capital Account of Middlesex MRI allocable to the Assigned Interest shall be
transferred to the Transferee.
7. Representations and Warranties of the Partners. As an inducement to the
Transferee to enter into this Agreement, the Partners jointly and severally
represent and warrant to and agree with the Transferee as follows:
(a) Organization and Good Standing. The Partnership is a Massachusetts
general partnership, duly organized, validly existing and in good standing
under the laws of the Commonwealth of Massachusetts, and is qualified to do
business and in good standing in all jurisdictions in which the ownership
of assets or the nature and conduct of its business requires such
qualification, except where such failure to qualify is not material. The
Partnership has all requisite power to own its property and to carry on its
business as presently conducted, and the Partnership has complete and
unrestricted power and authority to perform this Agreement.
(b) Ownership of Interests. As of the date hereof, MDI Rehab owns of
record and beneficially the MDI Interest, Middlesex MRI owns of record and
beneficially the MRI Interest, and Middlesex MRI owns of record and
beneficially the Assigned Interest. MDI Rehab has good title to the MDI
Interest, free and clear of all encumbrances, liens, claims, restrictions,
or security interests of any nature whatsoever, and Middlesex MRI has
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good title to the MRI Interest and the Assigned Interest, free and clear of
all encumbrances, liens, claims, restrictions, or security interests of any
nature whatsoever.
(c) Absence of Outstanding Rights to Interests or Other Securities of
the Partnership. There are not authorized or outstanding any subscriptions,
options, warrants, rights or other agreements or instruments pursuant to
which any person has or may have the right to acquire from the Partnership
or from any of the Partners any partnership interests or other securities
of the Partnership.
(d) Binding Agreement. The Partners represent and warrant that this
Agreement has been duly authorized, and constitutes the valid and binding
obligation of the Partners, enforceable in accordance with its terms,
except as enforcement thereof may be limited by any applicable bankruptcy,
reorganization, insolvency, moratorium, or similar laws affecting rights of
creditors generally.
(e) Authority Relative to this Agreement. The execution and delivery of
this Agreement and the consummation of the transactions provided for herein
do not violate any provision of the Partnership Agreement of the
Partnership (except as may be waived herein) and, except as set forth on
Schedule 7(e) hereto, will not conflict with or effect a breach, violation,
default, or cause an event of default under any mortgage, lease, agreement,
obligation, instrument, order, judgment or decree to which the Partnership
or its Partners are a party or by which any of them or their respective
assets or properties may be bound, and does not, and will not, violate or
constitute a default under any statute, rule, regulation, order, or
ordinance of any governmental, judicial or arbitrating body applicable to
any of them.
8. Transferee's Warranties and Representations. Transferee represents and
warrants to and agrees with the Partners as follows:
(a) Organization and Good Standing. The Transferee is a limited
liability company duly organized, validly existing and in good standing
under the laws of the State of Delaware. Transferee has all requisite power
to own its property and to conduct its business and Transferee has complete
and unrestricted power and authority to perform this Agreement and the
transactions contemplated hereby.
(b) Binding Agreement. This Agreement constitutes the valid and binding
obligation of the Transferee enforceable in accordance with its terms and
the execution, delivery and performance of this Agreement, and such other
agreements, documents and instruments, and the transactions contemplated
hereby by the Transferee have been or will be duly and validly authorized
by the Transferee's members and managers, as applicable.
(c) Authority Relative to this Agreement. The Transferee has the power
to enter into this Agreement and to carry out its obligations hereunder.
The execution and delivery of this Agreement, and the consummation of the
transactions contemplated hereunder, have been duly authorized by the
Transferee's members and managers, as applicable, and do not and will not
violate any provisions of the limited liability company
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operating agreement of the Transferee and do not and will not cause an
event of default under any mortgage, lease, agreement, obligation,
instrument, order, judgment or decree to which it is a party. This
Agreement constitutes the legal, valid and binding obligation of the
Transferee enforceable in accordance with its terms, except as enforcement
hereof may be limited by any applicable bankruptcy, reorganization,
insolvency, moratorium, or similar laws affecting rights of creditors
generally.
(d) Investment Representations. The Transferee is purchasing the MDI
Interest and the MRI Interest for its own account for investment only, and
not with a view to, or for sale in connection with, and distribution of the
MDI Interest or the MRI Interest in violation of the Securities Act of
1933, as amended ("Securities Act"), any rule or regulation under the
Securities Act, or any applicable state securities laws. The Transferee has
had such opportunity as it has deemed adequate and has access to
information as it has deemed necessary about the business and affairs of
the Partnership to evaluate the merits and risks of its investment in the
Partnership.
9. Waivers and Consents.
(a) The Partners hereby consent to the withdrawal of MDI Rehab with
respect to the MDI Interest and to the withdrawal of Middlesex MRI with
respect to the MRI Interest, and to the admission of the Transferee as a
substitute General Partner with respect to the MDI Interest and the MRI
Interest. The parties hereby further consent to the withdrawal of Middlesex
MRI, effective June 1, 1999, with respect to the Assigned Interest.
(b) The Partners hereby consent to the transfer to the Transferee of
the MDI Interest, the MRI Interest and the Assigned Interest, and the
Partners hereby waive the requirement under Section 7.2(b) of the
Partnership Agreement that each be offered the right of first refusal to
purchase all, but not less than all, of the MDI Interest, the MRI Interest
and the Assigned Interest, as appropriate, prior to the transfer of said
interests pursuant hereto.
(c) The Partners hereby confirm that each of them and the Transferee
has executed all documents and instruments required by Section 7.2(a)(i) of
the Partnership Agreement.
(d) The Transferee hereby assumes all of the monetary obligations of
MDI Rehab and Middlesex MRI with respect to the MDI Interest and the MRI
Interest, respectively, pursuant to Section 7.2(a)(i) of the Partnership
Agreement and with respect to the Assigned Interest, effective as of June
1, 1999.
(e) The parties hereby waive payment to the Partnership of all
reasonable costs and expenses incurred by the Partnership in connection
with the transfer by MDI Rehab and Middlesex MRI of the MDI Interest and
the MRI Interest and the Assigned Interest, respectively, as required by
Section 7.2(a)(ii) of the Partnership Agreement.
10. Continuation of Partnership. The parties agree that the sale, transfer
and conveyance of the MDI Interest and the MRI Interest will not dissolve the
Partnership and the business of the Partnership will continue.
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11. Clionsky Release. Simultaneously with the execution hereof, Xxxxxxxx
Xxxxxxxx, M.D. ("Xx. Xxxxxxxx") agrees to execute a release of the Partners and
the Partnership from all liability under and pursuant to that certain employment
agreement entered into between the Partnership and Xx. Xxxxxxxx, dated August
21, 1998 (the "Release") in the form of Exhibit A attached hereto.
12. Caprius Release. On the date on which the Transferee has paid to each
of MDI Rehab and Middlesex MRI all of the payments payable to such Partners
pursuant to Section 2 hereof, the Partners agree to cause Caprius, Inc. to
release the Partnership from the indebtedness owed by the Partnership to
Caprius, Inc. as of the date hereof.
13. Indemnifications by the Transferee. The Transferee hereby agrees to
indemnify and hold harmless the Partnership, the Partners, and any of their
respective officers, directors, employees, or agents from any loss suffered by
the Partnership or from any claims, expenses, judgments and/or amounts paid in
settlement, reasonably incurred by them, arising out of any claim against any of
them by Xxxx X. Xxxxxx, M.D., individually, or on behalf of or by The MVA Center
for Rehabilitation, Inc. because of the sale, transfer and conveyance to the
Transferee of the MDI Interest and the MRI Interest. In addition, the Transferee
hereby agrees to indemnify and hold harmless the Partners, and any of their
respective officers, directors, employees, or agents from any claims, expenses,
judgments and/or amounts paid in settlement, reasonably incurred by them,
arising out of any claim against any of them for liabilities of the Partnership
incurred prior to the date hereof; provided, however, this indemnification shall
not extend to any liabilities for which the Partners have agreed to indemnify
the Transferee by the terms of this Interest Transfer Agreement.
14. Indemnification by the Partners. The Partners hereby jointly and
severally agree to indemnify and hold harmless the Partnership and the
Transferee from any claims, expenses, judgments and/or amounts paid in
settlement, reasonably incurred by them, arising out of any claim (other than
malpractice claims) against any of them relating to the operation of the
business of the Partnership at its former location in Malden, Massachusetts.
15. Assignment of Contract Rights and Liabilities; Indemnification. The
Partnership hereby transfers to the Partners, jointly and severally, all rights
of the Partnership under and pursuant to that certain non-competition agreement
entered into between the Partnership and Xxxx X. Xxxxxx, M.D. of Longmeadow,
Massachusetts ("Xx. Xxxxxx") dated _____, ______ ("Non-Competition Agreement"),
and all rights of the Partnership under and pursuant to that certain key
employment agreement entered into between the Partnership and Xx. Xxxxxx, dated
as of March 21, 1997 ("Employment Agreement"). The parties hereto hereby
acknowledge and consent to such transfer of contract rights . Upon the
reasonable request of the Partners, the Partnership shall, at the sole cost and
expense of the Partners, cooperate with and assist the Partners in their
efforts, if any, to enforce the Non-Competition Agreement and the Employment
Agreement. The parties further acknowledge and agree that the Partners shall
remain liable for any payments due Xx. Xxxxxx under either the Non-Competition
Agreement or the Employment Agreement, and the Partners hereby jointly and
severally agree to indemnify and hold harmless the Partnership and the
Transferee from any claims, expenses, judgments and/or amounts paid in
settlement, reasonably incurred by them, arising out of any claim against either
of them by Xx. Xxxxxx for payment under or pursuant to the Non-Competition
Agreement or the Employment Agreement. The Partners further agree that, in the
event either or both of them shall recover, whether by judgment or settlement,
any monies (the "Recovered Amount") from the
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enforcement of their rights under or pursuant to the Non-Competition Agreement
or the Employment Agreement, the Transferee shall be paid 10% of the Net
Recovered Amount, which amount shall be paid to the Transferee as soon as
practicable after receipt of such monies by either or both Partners. For
purposes hereof, "Net Recovered Amount" shall be equal to the Recovered Amount,
less all legal fees, costs and expenses incurred in connection with obtaining
the Recovered Amount.
16. Distributions from the Partnership; Sale or Transfer. Until payment in
full of all payments due under Section 2 hereof, no distributions shall be made
from the Partnership of either Net Cash From Operations or Net Cash From Sales
or Refinancings without the unanimous consent of Middlesex MRI and the
Transferee, except to the extent necessary to pay income taxes attributable to
the ownership by the partners of their respective Partnership interests in the
Partnership. In addition, until payment in full of all payments due under
Section 2 hereof, Xx. Xxxxxxxx shall not assign, transfer or convey the
beneficial ownership of a majority of the membership interests in the Transferee
and neither the Partnership nor its assets shall be sold, merged or consolidated
with or into any other entity.
17. Additional Capital Contributions. Sections 2.3 and 2.4 of the
Partnership Agreement are hereby deleted in their entirety, so that no partner
shall be obligated to make any additional capital contributions to the
Partnership without its consent, except as otherwise required by this Interest
Transfer Agreement or by law.
18. Brokerage. Each party represents and warrants to the other that it has
not engaged the services of any broker or finder hereunder in connection with
the transactions provided for in this Interest Transfer and Amendment and agrees
to indemnify and hold the other party harmless against any claims for brokers'
or finders' fees or compensation in connection with the transaction herein
provided for by any person, firm or corporation claiming a right to same because
of having been engaged by or having served such party.
19. Amendment of Exhibit. Exhibit A of the Partnership Agreement is hereby
amended to reflect the Transferee as a Partner and his possession of an 99%
Partnership interest in the Partnership. Exhibit A of the Partnership Agreement
is hereby further amended to reflect Middlesex MRI as a Partner and its
possession of a 1% Partnership interest in the Partnership.
20. Except as hereby amended, the Partnership Agreement is hereby ratified,
confirmed and approved.
21. Miscellaneous Provisions.
(a) Assignability. The rights of the Transferee under this Interest
Transfer Agreement may not be assigned by the Transferee without the prior
written consent of the Partners.
(b) Benefit. The terms of this Interest Transfer Agreement shall be
binding upon and inure to the benefit of the parties hereto, and their
respective heirs, executors, administrators, successors and assigns.
(c) Modification and Waiver. No supplement, modification, waiver, or
termination of this Interest Transfer Agreement or any provision hereof
shall be binding
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unless executed in writing by all parties hereto. No waiver of any of the
provisions of this Assignment shall constitute a waiver of any other
provision (whether or not similar); nor shall such waiver constitute a
continuing waiver unless otherwise expressly provided.
(d) Notice. All necessary notices, payments, demands and requests
shall be in writing and shall be deemed duly given if mailed by certified
mail, postage prepaid, return receipt requested, and addressed as follows:
IF TO THE PARTNERS: MIDDLESEX MRI CENTER INC.
00 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
MDI REHAB, INC.
00 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
WITH A COPY TO: Posternak, Xxxxxxxxxx & Xxxx, L.L.P.
000 Xxxxxxx Xxxxx Xxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx, Esquire
O THE TRANSFEREE: MEDICAL DIAGNOSTIC AND
REHABILITATION, LLC
000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000
WITH A COPY TO: Xxxxx, Xxxxxxxx & Xxxxxx, LLP
00 Xxxxxxx Xxxxx
Xxxxx Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx, Esquire
Any party may change its address for notice by giving notice of change of
address in the manner set forth above.
(e) Headings. The headings of the Sections of this Interest Transfer
Agreement are for convenience of reference only and do not form a part
hereof and in no way modify, interpret or construe the meanings of the
parties.
(f) Entire Agreement. This Interest Transfer Agreement sets forth the
entire agreement and understanding between the parties as to the subject
matter hereof and merges and supersedes all prior discussions, agreements
and understandings with respect hereto.
(g) Governing Law. This Interest Transfer Agreement shall be governed
and construed and enforced in accordance with the laws of the Commonwealth
of Massachusetts.
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(h) Further Assurances. The Partners and the Transferee agree that
they will, without further consideration, from time to time hereafter, and
at their own expense, execute and deliver such other documents, and take
such other action, as may reasonably be requested in order to more
effectively consummate the transactions contemplated hereby, and confirm
and assure to the Transferee title to the MDI Interest, the MRI Interest
and the Assigned Interest being transferred or to be transferred hereunder.
The representations and warranties hereunder shall survive the date hereof
and the provisions of this paragraph (h) shall also survive the date
hereof.
(i) Counterparts. This Interest Transfer Agreement may be signed in
any number of counterparts, each of which shall be deemed an original, but
all of which shall constitute one and the same instrument.
(j) Certain Interpretative Matters. All pronouns used herein shall
include the neuter, masculine, or feminine. Each term appearing in this
Interest Transfer Agreement with initial capitalization and not defined
herein shall have the meaning ascribed to it in the Partnership Agreement.
[REMAINDER OF PAGE INTENTIONALLY OMITTED]
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IN WITNESS WHEREOF, the parties have executed this Agreement under seal as
of the 11th day of March, 1999.
MIDDLESEX MRI CENTER, INC.
By: /s/ Xxxx Xxxxxx
----------------------
Name: Xxxx Xxxxxx
Title: Pres.
MDI REHAB, INC.
By: /s/ Xxxx Xxxxxx
----------------------
Name: Xxxx Xxxxxx
Title: Pres.
MEDICAL DIAGNOSTIC AND
REHABILITATION, LLC
By: /s/ Xxxxxxxx X. Xxxxxxxx, Ph.D.
-----------------------------------
Xxxxxxxx X. Xxxxxxxx, Ph.D.
Title: Manager
The Partnership hereby joins in the foregoing Interest Transfer Agreement
with respect to Section 15 thereof in order to be bound thereby.
MVA REHABILITATION ASSOCIATES
BY MIDDLESEX MRI CENTER, INC., a partner
By: /s/ Xxxx Xxxxxx
----------------------
Name: Xxxx Xxxxxx
Title: Pres.
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List of Schedules and Exhibits
Schedule 7(e). Authority Relative to this Agreement
Exhibit A. Release by Xxxxxxxx Xxxxxxxx in favor of Middlesex MRI Center, Inc.
and MDI Rehab, Inc.
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