OPERATING AGREEMENT
AGREEMENT,
dated as of the 7th day of March, 2007, effective as of the 9th
day of
January, 2007 (the “Agreement”), by and between Scantek Medical, Inc., a
Delaware corporation with an address at 0X Xxxx Xxxxx, Xxxxx Xxxxxx, XX 00000
(“Scantek”), Life Medical Technologies, Inc., a Delaware corporation with an
address at X.X. Xxx 000, Xxxxxxx, XX 00000 (“Life Medical”) and Xxxxx &
Fraade Enterprises, LLC, a New York limited liability company with an address
at
000 XxXxxx Xxxxxx, Xxxxxxxxx Xxxxxx, XX 00000 (“M&F”), (Scantek, Life
Medical and M&F are hereinafter referred to as the “Members”).
WITNESSETH:
WHEREAS,
the
Members have formed Gibraltar Global Marketing LLC as a Delaware limited
liability company (the “Company”) in order to distribute Scantek’s
BreastCare™/BreastAlert™ Differential Temperature Sensor/Breast Abnormality
Indicator device (the “Product”) throughout all of the current and future
countries and other governmental entities on the earth, excluding the countries
set forth on Exhibit A (all such countries and entities excluding the countries
set forth on Exhibit A, the “Territories”), which is annexed hereto and made a
part hereof; and
WHEREAS,
the
Members desire to set forth certain provisions with respect to the affairs,
operations and management of the Company.
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NOW,
THEREFORE,
in
consideration of the mutual covenants of the parties hereinafter set forth,
and
for other good and valuable consideration, the receipt and adequacy of which
is
hereby acknowledged,
IT
IS AGREED:
1. Recitals.
The
parties hereby adopt as part of this Agreement each of the recitals which is
contained above in the WHEREAS clauses, and agree that such recitals shall
be
binding upon the parties hereto by way of contract and not merely by way of
recital or inducement; and such clauses are hereby confirmed and ratified as
being accurate by each party hereto.
2. Formation;
Term; Membership Interests.
A.
The
Members have formed the Company as a limited liability company in the State
of
Delaware on January 9, 2007.
B.
The
term of the Company shall commence as of January 9, 2007 and shall be of
unlimited duration unless otherwise terminated as set forth in Article “8” of
this Agreement.
C.
The
Company shall have one hundred (100) Interests issued and outstanding, of which
ninety six (96) shall be Class A Interests and four (4) shall be Class B
Interests. The Class A and Class B Interests shall have identical rights, with
the exception that Class B Interests shall not have voting rights except as
required by law or as explicitly provided in Paragraph “M” of Article “4” of
this Agreement.
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D.
Scantek and Life Medical each own forty eight (48) Class A Interests, and
therefore shall each have fifty (50%) percent of the voting
Interests.
E.
M&F owns four (4) Class B Interests. At such time as the Company’s
securities are traded or quoted in the United States or any foreign country,
including, but not limited to, on any of the following exchanges or quotation
systems: Nasdaq National Market, Nasdaq SmallCap Market, OTC Bulletin Board,
Pink Sheets, London Stock Exchange, AIM, Borsa Italiana S.p.A., Bourse de
Montréal, Bolsa Mexicana de Valores or Tokyo Stock Exchange, M&F’s Class B
Interests shall be converted into Class A Interests.
3. Board
of Managers.
A.
The
Board of Managers of the Company (the “Board”) shall consist of six (6)
Managers.
B.
Managers shall be elected annually. Scantek and Life Medical agree to vote
their
Interests for the election of three (3) Managers selected by each of them.
Xx.
Xxxxxxxx X. Xxxx shall be one of Scantek’s three (3) Managers and shall serve as
Chairman of the Board.
C.
M&F shall have the right to designate an observer to the Board (the “M&F
Observer”), who shall have the right to attend all Board meetings and receive
all notices and other information which are given to the Managers. The M&F
Observer shall not be deemed to be a Manager, shall not have voting rights
and
shall not count towards a quorum.
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D.
The
Board shall meet at least once in each calendar quarter. The Secretary of the
Company shall give written notice pursuant to Paragraph “C” of Article “15” of
this Agreement to all Members and to the M&F Observer of the time and place
of each meeting of the Board at least five (5) business days prior to such
meeting.
E.
The
Secretary of the Company shall send the minutes of each meeting of the Board
to
all Members and to the M&F Observer within five (5) business days after such
meeting.
F.
Additional meetings of the Board may be called by any two Managers by written
notice pursuant to Paragraph
“C” of Article “15” of this Agreement
to the
other Managers and to the M&F Observer specifying the matters to be
considered at the meeting. The Chairman of the Board shall set the time and
place of the meeting within five (5) business days after receipt of such written
notice, which meeting shall be held within ten (10) business days after receipt
of such written notice.
G.
Notice
of Action to be Voted Upon by the Board.
If the
meeting of the Board has as one of its purposes any amendment to the Company’s
articles of organization, this Agreement or any other document, or the approval
of any document, including, but not limited to, any contract or a plan of
merger, consolidation, division, conversion or voluntary winding up and
liquidation of the Company, each Manager and the M&F Observer shall be
given, together with the written notice of the meeting, a copy of the relevant
document to be considered at the meeting, and with respect to any proposed
amendments, a copy of the original document to which an amendment is
proposed.
H.
Waiver
of Notice.
(i) Written
Waiver.
Whenever any written notice is required to be given pursuant to the Delaware
Limited Liability Company Act (“DLLCA”) or this Agreement, a waiver of such
notice in writing, signed by the person or persons entitled to the notice,
whether before or after the time stated therein, shall be deemed equivalent
to
the giving of such notice. Neither the business to be transacted at, nor the
purpose of, the meeting shall be required to be specified in the waiver of
notice of the meeting.
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(ii) Waiver
by Attendance.
Attendance of a person at any meeting shall constitute a waiver of notice of
the
meeting, except where a person attends a meeting for the express purpose of
objecting, at the commencement of the meeting, to the transaction of any
business because the meeting was not lawfully called or convened.
I.
The
Chairman of the Board shall preside at all meetings of the Board.
J.
A
quorum shall be five (5) Managers.
K.
The
votes of five (5) Managers shall be required to engage in any act for which
the
consent of the Board is required.
L.
Any
action which could be taken at a meeting of Managers may be taken through the
written consent of five (5) Managers in lieu of a meeting in accordance with
applicable law.
M.
In
addition to acts by the Company which require the consent of the Board as a
matter of law, the following acts shall require the consent of the
Board:
(i) Enter
into a distribution agreement;
(ii) Sell
or
modify any rights with respect to any Territory; or
(iii) Enter
into any subcontracting agreement.
N.
Adjournment.
Any
regular or special meeting of the Board, including one which cannot be deemed
effective because a quorum has not attended, may be adjourned to another place
and time until a quorum shall be present or represented. When a meeting is
adjourned to another place and time, written notice need not be given of the
adjourned meeting if the place and time thereof are announced at the meeting
at
which the adjournment is announced; provided, however, that if the date of
any
adjourned meeting is more than fifteen (15) days after the date for which the
meeting was originally noticed, or if a new record date is fixed for the
adjourned meeting, written notice of the place and time of the adjourned meeting
shall be given in conformity herewith. At any adjourned meeting, any business
may be transacted which might have been transacted at the original
meeting.
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4. Member
Meetings.
A.
Manner
of Giving Notice.
Whenever written notice of a meeting of the Members is required to be given
pursuant to the Act or this Agreement, such notice shall be given pursuant
to
Paragraph “C” of Article “15” of this Agreement. Such notice shall specify the
time and place of the meeting and any other information required by the DLLCA
or
this Agreement.
B.
Annual
Meeting.
The
annual meeting of the Members shall be held on such date, at such time and
at
such place as shall be designated from time to time by the Board and stated
in
the notice of the meeting, at which the Members holding Class A Interests shall
transact such business as may properly be brought before the
meeting.
C.
Special
Meetings.
Special
meetings of the Members may be called at any time by (i) the Board or (ii)
Members holding twenty five (25%) percent or more of the Class A Interests.
The
meeting shall be held at the time requested by the person or persons calling
the
meeting as set forth in the notice.
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D.
Procedure
for Calling Meetings.
Upon
request of any person entitled to call a meeting, written notice of the meeting
of the Members shall be given by, or at the direction of, the Secretary or,
in
the absence of the Secretary, any other person authorized by the Board, to
each
Member of record, at least five (5) business days prior to the date upon which
the meeting is to be held. If notice is not given within twenty (20) days after
receipt of the request, the person or persons calling the meeting may give
the
notice. If the meeting of the Members is a special meeting, the notice shall
specify the matters to be considered at the meeting.
E.
Notice
of Action to be Voted Upon by the Members.
If the
meeting of the Members has as one of its purposes any amendment to the Company’s
articles of organization, this Agreement or any other document, or the approval
of any document, including, but not limited to, any contract or a plan of
merger, consolidation, division, conversion or voluntary winding up and
liquidation of the Company, each Member shall be given, together with the
written notice of the meeting, a copy of the relevant document to be considered
at the meeting, and with respect to any proposed amendments, a copy of the
original document to which an amendment is proposed.
F.
Waiver
of Notice.
(i)
Written
Waiver.
Whenever any written notice is required to be given pursuant to the DLLCA or
this Agreement, a waiver of such notice in writing, signed by the person or
persons entitled to the notice, whether before or after the time stated therein,
shall be deemed equivalent to the giving of such notice. Neither the business
to
be transacted at, nor the purpose of, the meeting shall be required to be
specified in the waiver of notice of the meeting.
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(ii)
Waiver
by Attendance.
Attendance of an authorized representative of a Member at any meeting shall
constitute a waiver of notice of the meeting, except where such authorized
representative attends a meeting for the express purpose of objecting, at the
commencement of the meeting, to the transaction of any business because the
meeting was not lawfully called or convened.
G.
Quorum.
At any
meeting of the Members, the presence of the Member or Members owning a majority
of the Class A Interests, in person or by proxy, shall constitute a quorum
unless a larger number is required by the DLLCA or this Agreement.
H.
Adjournment.
Any
regular or special meeting of the Members, including one which cannot be deemed
effective because a quorum has not attended, may be adjourned to another place
and time until a quorum shall be present or represented. When a meeting is
adjourned to another place and time, written notice need not be given of the
adjourned meeting if the place and time thereof are announced at the meeting
at
which the adjournment is announced; provided, however, that if the date of
any
adjourned meeting is more than fifteen (15) days after the date for which the
meeting was originally noticed, or if a new record date is fixed for the
adjourned meeting, written notice of the place and time of the adjourned meeting
shall be given in conformity herewith. At any adjourned meeting, any business
may be transacted which might have been transacted at the original
meeting.
I.
Action
by Members.
Except
as otherwise provided in the DLLCA or this Agreement, whenever any Company
action is to be taken by vote of the Members, it shall be authorized upon
receiving the affirmative vote of Members holding a majority of the Class A
Interests.
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J.
Organization.
At
every meeting of the Members, the Chairman of the Board, if there be one, or,
in
the case of a vacancy in the office or if the Chairman of the Board is not
present, one of the following persons present in the order stated: the Chief
Executive Officer, if there be one, the President, the Vice Presidents in their
order of rank and seniority, or a person chosen by a vote of the Members
present, shall act as chairman of the meeting. The Secretary, or, in the absence
of the Secretary, a person appointed by the chairman of the meeting, shall
act
as secretary of the meeting.
K.
Any
action which could be taken at a meeting of the Members may be taken through
the
written consent of Members holding a majority of the Class A Interests in lieu
of a meeting in accordance with applicable law.
L.
Voting
and Other Action by Proxy.
(i) General
Rule.
(a)
Every
Member holding Class A Interests may authorize another person to act for him,
her or it by proxy.
(b)
Any
vote of a Member, by proxy, shall constitute the presence of, or vote or action
by, or written consent or dissent of, said Member.
(c)
An
unrevoked proxy shall be valid for a period of three (3) years after the date
of
its execution unless a longer time is expressly provided therein.
(ii) Execution
and Filing.
Every
proxy shall be executed in writing by the Member or by the duly authorized
attorney-in-fact of the Member and filed with the Secretary of the Company.
A
telegram, telex, cablegram, datagram or similar transmission from a Member
or
attorney-in-fact, or a photographic, facsimile or similar reproduction of a
writing executed by a Member or attorney-in-fact may be treated as properly
executed for purposes of this Subparagraph “(ii)” of this Paragraph “L” of this
Article “4” of this Agreement.
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(iii) Revocation.
A
proxy, unless coupled with an interest, shall be revocable at will,
notwithstanding any other agreement or any provision in the proxy to the
contrary, but the revocation of a proxy shall not be effective until written
notice thereof has been given to the Secretary of the Company. A proxy shall
not
be revoked by the death or incapacity of the maker unless, before the vote
is
counted or the authority is exercised, written notice of the death or incapacity
is given to the Secretary of the Company.
M.
Non-Voting
Members.
Members
holding Class B Interests (“Non-Voting Members”) shall have the right to attend
all meetings of the Members and receive all notices and other information which
are given to Members holding Class A Interests. Non-Voting Members shall not
have voting rights and shall not count towards a quorum; provided, however,
that
if any action is taken to reduce the rights and privileges of the Class B
Interests, the holders of Class B Interests shall have the right to vote with
respect to such action, and such action shall be void unless approved by the
holders of two thirds (2/3) of the Class B Interests.
N.
Authority.
All
actions which require a vote of the Members, either (i) as a matter of law
or
(ii) which are listed below in this Paragraph “N” of this Article “4” of this
Agreement, shall require the vote of the Members owning two thirds (2/3) of
the
Class A Interests:
(a)
Merger, consolidation, division or reorganization of the Company;
(b)
An
amendment to the Company’s articles of organization;
(c)
Sale
or transfer of all or substantially all of the Company's
assets;
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(d)
Issuance of Interests;
(e)
Termination and dissolution of the Company (shall require a 2/3 vote of the
Class A Interests pursuant to Subparagraph “(ii)” of Paragraph “A” of Article
“8” of this Agreement).
O.
The
Secretary of the Company shall send the minutes of each meeting of the Members
to all Members within five (5) business days after such meeting, and shall send
a copy of any resolution executed by written consent pursuant to Paragraph
“K”
of this Article “4” of this Agreement to all Members within five (5) business
days after the date of such resolution.
5. Officers.
A.
The
Members shall use their best efforts to cause the Managers which they selected
to elect Xx. Xxxxxxxx X. Xxxx as the CEO and Secretary of the
Company.
B.
The
Members shall use their best efforts to cause the Managers which they selected
to elect Xxxxxx Xxxxxx as the President and Treasurer of the
Company.
C.
The
CEO and President may each designate, by means of written notice to the Board
and the other officers, one or more designees with the authority to carry out
all or such portion of the duties of the CEO or President position, as the
case
may be, as the CEO or President shall determine, and shall specify such
designees in such written notice (the “Designees”). Any action taken by a
Designee acting within the scope of his or her authority shall be deemed to
have
been taken by the CEO or President, as the case may be.
D.
The
joint action of (i) the CEO and (ii) the President,
or in
either or both cases, their respective Designees acting within the scope of
their authority,
shall
bind the Company on any matter not requiring the consent of the Board pursuant
to Paragraph “M” of Article “3” of this Agreement.
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E.
Either
the CEO or President, or the Designee of either of them acting within the scope
of his or her authority, may sign any check of the Company for an amount of
less
than $10,000. The signatures of both the CEO and President, or in either or
both
cases, their respective Designees acting within the scope of their authority,
shall be required for any check of the Company for an amount of $10,000 or
greater.
F.
The
Board may designate and elect such additional officers of the Company as it
deems necessary.
6. Capitalization;
Capital Accounts.
A.
The
capitalization of the Company shall be one million ($1,000,000) dollars (the
“Capitalization”), payable as set forth in Paragraphs “B” and “C” of this
Article “6” of this Agreement.
B.
On, or
prior, to June 1, 2007, Life Medical shall contribute two hundred fifty thousand
($250,000) dollars to the Capitalization.
C.
On, or
prior, to March 1, 2008, Life Medical shall contribute an additional seven
hundred fifty thousand ($750,000) dollars to the Capitalization.
D.
No
Member shall be entitled to interest on any capital contributions.
E.
Except
as approved by a five sixths (5/6) vote of the Board, no Member shall have
the
right to redeem all or any part of such Member’s Interest, otherwise withdraw
such Member’s investment in the Company, or receive a return of his, her or its
capital contributions. In addition, no Member shall have a right to receive
any
distributions from the Company, except as provided in Article “7” of this
Agreement.
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F.
A
capital account (the “Capital Account”) shall be maintained for each Member.
Each Member’s Capital Account shall be credited with the amount of the
Capitalization contributed by such Member. A Member’s Capital Account shall be
increased by the amount, if any, of additional capital contributions and Net
Profits and gain allocated to such Member, and shall be decreased by the amount,
if any, of cash distributed to such Member and Net Losses, expenses and
deductions allocated to such Member.
G.
If a
Member’s entire Interest is transferred pursuant to the terms of Article “9” of
this Agreement, the transferee shall succeed to such Member’s Capital Account;
provided, however that if only a portion of such Member’s Interest is
transferred, the transferee shall succeed to such share of such Member’s Capital
Account which corresponds to a fraction, the numerator of which is the Interest
received by the transferee, and the denominator of which is the Interest which
such Member held prior to the transfer. For example, if Life Medical has a
48%
Interest and its Capital Account has $1,000,000, and Life Medical transfers
a
12% Interest to Company X, then Company X would succeed to $250,000 of Life
Medical’s capital account, which amount is arrived at by multiplying Life
Medical’s Capital Account of $1,000,000 by a fraction, the numerator of which is
12%, the Interest received by the transferee, and the denominator of which
is
48%, the Interest which Life Medical held prior to the transfer.
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7. Accounting;
Distributions.
A.
All
transactions of the Company shall be properly recorded in its books and records.
Each Member, or such person as a Member may designate by written notice to
the
Board, shall have access to the books and records of the Company.
B.
All
funds belonging to the Company shall be deposited in the name of the Company
in
banks or other depositories designated by the joint action of (i) the CEO and
(ii) the President, or in either or both cases, their respective Designees
acting within the scope of their authority.
C.
The
fiscal year of the Company shall begin upon each January 1.
D.
The
terms “Net Profits” and “Net Losses” with respect to a time period are hereby
defined as the taxable income or taxable loss of the Company attributable to
that period, as determined by the accountants regularly employed by the Company
in accordance with U.S. GAAP as consistently applied. At the end of each
calendar quarter (“Accounting Period”), there shall be a minimum distribution of
seventy five (75%) percent of Net Profits with respect to that Accounting Period
until Scantek receives full payment of the Purchase Price pursuant to the
Acquisition Agreement dated as of the 7th
day of
March, 2007 between Scantek and Life Medical (the “Acquisition Agreement”).
After Scantek receives full payment of the Purchase Price pursuant to the
Acquisition Agreement, the minimum distribution for each Accounting Period
shall
be thirty (30%) percent of Net Profits with respect to that Accounting
Period.
E.
Additional distributions shall be at the discretion of the
Board.
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F.
Each
Member shall receive the portion of the distribution made by the Company (the
“Distribution”) which shall be an amount determined by multiplying the total
Distribution by a fraction, the numerator of which shall be the number of
Interests owned by such Member, and the denominator of which shall be the total
number of Interests of the Company which are issued and outstanding. Until
such
time as Scantek receives full payment of the Purchase Price pursuant to the
Acquisition Agreement, Life Medical shall make a payment to Scantek equal to
twenty five (25%) percent of the Distribution to be credited towards the
Purchase Price pursuant to the Acquisition Agreement, which payment shall be
deducted by the Company from Life Medical’s portion of the Distribution and paid
to Scantek at the time such distributions are paid to Life Medical and Scantek.
For example, if Scantek has not received full payment of the Purchase Price
pursuant to the Acquisition Agreement, and the total Distribution is $100,000,
$25,000 would be deducted from Life Medical’s portion of the total Distribution
and paid to Scantek at the time such distributions are paid to Life Medical
and
Scantek. Such $25,000 would be deemed paid to Scantek by Life Medical to be
credited towards the Purchase Price pursuant to the Acquisition Agreement.
G.
All
distributions shall be made within thirty (30) days after the end of each
Accounting Period.
H.
It is
expressly intended that the Company be treated as a limited liability company
taxable as a partnership by the applicable provisions of the Internal Revenue
Code of 1986, as the same may be amended from time to time, or any provisions
of
any future law which covers the subject matter of the Internal Revenue Code
of
1986, and that in every respect all of the terms and provisions of this
Agreement shall at all times be so construed and interpreted as to give effect
to this intent. If the Internal Revenue Service of the United States (the “IRS”)
or any governmental authority having jurisdiction shall in any way or at any
time determine that any provision or provisions of this Agreement affects the
status of the Company as a limited liability company taxable as a partnership,
then and in such event the Board shall have the authority to and shall modify,
amend or supplement the terms and provisions of this Agreement to the extent
necessary to comply with the rules, regulations and requirements of the IRS
or
any other governmental authority having jurisdiction, in order that the Company
be treated as a limited liability company taxed as a partnership, and the
Members thereof taxable as partners of a partnership, which modification or
amendment shall be retroactively applied to the date of this
Agreement.
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8. Termination
and Dissolution.
A.
Termination
and Dissolution.
The
Company shall be terminated and dissolved upon the occurrence of any of the
following:
(i)
Any
event which makes it unlawful for the Company’s business to be continued;
(ii)
The
vote of two-thirds (2/3) of the Class A Interests;
(iii)
The
sale of all or substantially all of the Company’s assets; or
(iv)
The
entry of a decree of judicial dissolution pursuant to Section 18-802 of the
DLLCA.
B.
Liquidation.
Upon
termination and dissolution of the Company for any reason, the Company shall
cease to engage in further business, except to the extent necessary to perform
existing obligations, and the CEO and the President, or in either or both cases,
their respective Designees acting within the scope of their authority,
(“Liquidators”) shall jointly wind up the affairs of the Company and liquidate
or distribute the Company’s assets.
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(i)
All
assets of the Company may be sold in connection with any liquidation at public
or private sale, at such price and upon such terms as the Liquidators, in their
sole and absolute discretion, may deem advisable, provided that such Liquidators
are acting within their fiduciary duties pursuant to Delaware law. Any Member
and any partnership, corporation or other firm in which any Member is in any
way
interested may purchase assets at such sale.
(ii)
The
Liquidators shall (a) cause the Company’s accountants to make a full and proper
accounting of the assets, liabilities and operations of the Company, as of
and
through the last day of the month in which the dissolution occurs, (b) liquidate
the assets as promptly as is consistent with obtaining a reasonable value for
such assets, but in no event later than one (1) year after the occurrence of
an
event of dissolution, and (c) apply and distribute the proceeds therefrom
pursuant to Section 18-804 of the DLLCA.
(iii)
Distributions of the Company’s assets may be made either in kind or in money, or
partly in kind and partly in money, in the sole and absolute discretion of
the
Liquidators. All distributions in kind shall be valued as of the date of
distribution as determined by the Liquidators in their sole and absolute
discretion. The Liquidators shall not be required to give to the various persons
interested similar or like property. For example, if the Liquidators are
distributing assets and cash, the Liquidators, in their sole and absolute
discretion, may give one distributee cash and give the other distributees assets
or a combination of assets and cash.
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(iv)
Upon
dissolution and completion of the winding up of the Company and distribution
of
its assets, the Liquidators shall cause to be executed and filed with the
Delaware Court of Chancery, a certificate of cancellation pursuant to Section
18-203 of the DLLCA.
9. Transfer.
A.
The
Members shall not sell, assign, transfer, encumber or otherwise dispose of,
any
Interests now owned or hereafter acquired by them, except as provided for in
this Article “9” of this Agreement.
B.
If
Scantek or Life Medical (the “Selling Party”) receives a bona fide offer for its
Interests from a third party (the “Offeror”) pursuant to a written offer which
shall state (i) the identity and contact information of the Offeror, and if
an
entity, the type of entity and state or country of formation, (ii) the number
of
Interests to be purchased, (iii) the price per Interest, (iv) the proposed
closing date of the purchase and (v) any other material terms and conditions
of
the proposed purchase, including, but not limited to, the terms of payment
(the
“Interests Offer”; the Interests which are the subject of the Interests Offer
are hereinafter referred to as the “Offered Interests”), the Selling Party shall
first offer the Offered Interests to the Company by giving it written notice
pursuant to Paragraph “C” of Article “15” of this Agreement, which written
notice shall include a copy of the Interests Offer. The notice shall be deemed
to be an offer to sell the Offered Interests to the Company at the price, terms
and conditions set forth in the Interests Offer. Such notice shall remain open
for ten (10) days after the notice is given to the Company (the “Company
Offering Period”). The Company shall have the irrevocable and exclusive first
option, but not obligation, to purchase all or a portion of the Offered
Interests. The Company may accept such offer by giving the Selling Party written
notice of such acceptance within the Company Offering Period. If the offer
to
sell to the Company is not accepted or is accepted only in part within the
Company Offering Period, the Selling Party must then provide written notice
pursuant to Paragraph “C” of Article “15” of this Agreement to the other of
Scantek or Life Medical (the “Second Party”). The offer to the Second Party
shall remain open for five (5) days after notice is given to the Second Party
(the “Second Party Offering Period”). Within the Second Party Offering Period,
the Second Party may accept the offer to purchase all or the remaining Offered
Interests, as the case may be, by giving the Selling Party written notice of
such acceptance. If the offer to the Company and the Second Party to purchase
all or the remaining Offered Interests, as the case may be, is rejected, and
the
Company and the Second Party have not agreed to purchase, in the aggregate,
all
of the Offered Interests, the Selling Party shall thereupon be at liberty to
sell all of the Offered Interests pursuant to the Interests Offer, solely upon
the terms and conditions which were specified in the Interests Offer and solely
to the Offeror, and if such sale is consummated, written notice thereof shall
be
sent to the other Members. If the Selling Party does not sell, assign, transfer
or otherwise dispose of all of the remaining Offered Interests pursuant to
the
Interests Offer within one hundred twenty (120) days after giving written notice
to the Second Party, then the Selling Party shall not thereafter sell, assign,
transfer, or otherwise dispose of the remaining Offered Interests without again
first offering same to the Company and the Second Party pursuant to this
Paragraph “B” of this Article “9” of this Agreement.
18
C.
If a
Selling Party or Parties propose to transfer any Interests of the Company to
a
third-party Offeror in a bona fide sale, then no sale, assignment, transfer
or
disposition shall be made unless the Offeror agrees to purchase, and the Selling
Party agrees to include in such sale, such number of M&F’s Interests as are
set forth in Paragraph “D” of this Article “9” of this Agreement for the same
price per Interest and upon the same terms and conditions and at the same time
as the Selling Party, in which case M&F shall be obligated to sell such
number of Interests to the Offeror pursuant to the terms and conditions which
were specified in the Interests Offer.
19
D.
The
number of Interests which M&F shall sell pursuant to Paragraph “C” of this
Article “9” of this Agreement shall equal the total number of Interests owned by
M&F multiplied by a fraction, the numerator of which shall be the number of
Interests which the Selling Party or Parties propose to sell, and the
denominator of which shall be 96. For example, if Scantek determines to sell
36
of its 48 Interests (or ¾) to a third-party Offeror in a bona fide sale, M&F
shall sell 1.5 Interests, which number is arrived at by multiplying the total
number of Interests owned by M&F, 4, by a fraction, the numerator of which
is the number of Interests which the Selling Party proposes to sell, 36, and
the
denominator of which is 96, which equals 4 X (36/96) = 1.5 Interests.
E.
All
sales, assignments, transfers, and other dispositions of any Interest pursuant
to this Agreement, shall have as a condition precedent thereto the requirement
that the purchaser, assignee or transferee execute a document in form and
substance which is satisfactory to the Company’s counsel, agreeing to be bound
by all of the terms and conditions of this Agreement. Upon the execution of
said
document, the purchaser, assignee or transferee shall have all of the rights
and
obligations pursuant to this Agreement. All Members of the Company, other than
those selling all of their interests, shall be obligated to execute such
document, and shall have all rights and obligations pursuant to this Agreement
relative to such purchaser, assignee or transferee.
20
10. Representations
and Warranties.
A. Scantek,
Life Medical and M&F each represent and warrant to the other parties as
follows:
(i) It
is a
corporation, or in the case of M&F, a limited liability company, with all of
the requisite power and authority to carry on its businesses as presently
conducted in all jurisdictions where presently conducted.
(ii) It
has
full right, power and legal capacity to enter into this Agreement and to
consummate the transactions contemplated hereby. The execution of this Agreement
by it and the consummation by it of the transactions contemplated hereby have
been duly approved and authorized by all necessary action by its Board of
Directors or in the case of M&F, its members, and no further authorization
shall be necessary on its part for the performance and consummation by it of
the
transactions contemplated hereby.
(iii) The
performance of this Agreement by it in accordance with its terms shall not
result in any breach of, or constitute a default under, or result in the
imposition of any lien or encumbrance upon any of its property or cause an
acceleration under any arrangement, agreement or other instrument to which
it is
a party, whether jointly or severally, or by which any of its assets are
bound.
(iv) The
execution, delivery and performance of this Agreement in accordance with its
terms does not and will not require the consent, authorization or approval
of
any governmental agency or authority.
21
(v) No
representation or warranty of it which is contained in this Agreement, or in
a
writing furnished or to be furnished pursuant to this Agreement, contains or
shall contain any untrue statement of a material fact, or omits or shall omit
to
state any material fact which is required to make the statements which are
contained herein or therein, in light of the circumstances under which they
were
made, not misleading. There is no material fact relating to the business,
affairs, operations, conditions (financial or otherwise) or prospects of it
which would materially adversely affect same which has not been disclosed to
the
other parties hereto.
(vi) It
shall
not be a defense to a suit against it for damages for any misrepresentation
or
breach of covenant or warranty by another party hereto that such party knew
or
had reason to know that any covenant, representation or warranty in this
Agreement or furnished or to be furnished to such party contained untrue
statements.
11. Survival
of Representations, Warranties and Covenants.
All
covenants, agreements, representations and warranties made in or in connection
with this Agreement shall survive its termination, and shall continue in full
force and effect after its termination, it being understood and agreed that
each
of such covenants, agreements, representations and warranties is of the essence
of this Agreement and the same shall be binding upon and shall inure to the
benefit of the parties hereto, their successors and assigns.
22
12. Confidentiality
and Non-Competition.
A. As
used
in this Agreement, “Confidential Information” shall mean oral or written
information which is directly or indirectly presented to a Member, its past,
present or future subsidiaries, parents, officers, consultants, directors,
stockholders, affiliates, attorneys, employees, agents and its and their
respective Immediate Families (as defined below; all of the foregoing are
hereinafter collectively referred to as “Agents”) by another Member or the
Company or their respective Agents, including, but not limited to, information
which is developed, conceived or created by that other Member or by the Company,
as the case may be, or disclosed to a Member or its Agents or known by or
conceived or created by a Member or its Agents during the term or after the
termination of this Agreement if disclosed to a Member or its Agents or known
by
or conceived or created by a Member or its Agents as a result of this Agreement,
with respect to another Member or the Company, as the case may be, either of
their businesses or any of their products, processes, and other services
relating thereto relating to the past or present business or any plans with
respect to future business of that other Member or the Company, as the case
may
be, or relating to the past or present business of a third party or plans with
respect to future business of a third party which are disclosed to a Member
or
its Agents. Confidential Information includes, but is not limited to, all
documentation, hardware and software relating thereto, and information and
data
in written, graphic and/or machine readable form, products, processes and
services, whether or not patentable, trademarkable or copyrightable or otherwise
protectable, including, but not limited to, information with respect to
discoveries; know-how; ideas; computer programs, source codes and object codes;
designs; algorithms; processes and structures; product information; marketing
information; price lists; cost information; product contents and formulae;
manufacturing and production techniques and methods; research and development
information; lists of clients and vendors and other information relating
thereto; financial data and information; business plans and processes;
documentation with respect to any of the foregoing; and any other information
of
a Member or the Company that such Member or the Company, as the case may be,
informs another Member or its Agents or that a Member or its Agents should
know,
by virtue of its or their position or the circumstances in which that Member
or
its Agents learned such other information, is to be kept confidential including,
but not limited to, any information acquired by a Member or its Agents from
any
sources prior to the commencement of this Agreement. Confidential Information
also includes similar information obtained by the Company in confidence from
its
vendors, licensors, licensees, customers and/or clients. Confidential
Information may or may not be labeled as confidential. Notwithstanding anything
contained in this Paragraph “A” of this Article “12” of this Agreement to the
contrary, the restrictions with respect to Confidential Information shall not
be
applicable to Scantek with respect to the Product or any of Scantek’s
intellectual property.
23
“Immediate
Family” shall include the following: (i) any spouse, parent, spouse of a parent,
mother-in-law, father-in-law, brother-in-law, sister-in-law, child, spouse
of a
child, adopted child, spouse of an adopted child, sibling, spouse of a sibling,
grandparent, spouse of a grandparent, and any issue or spouse of any of the
foregoing, and (ii) such child or issue of such child which is born and/or
adopted during or after the term of this Agreement and the issue (whether by
blood or adoption) of such person. For purposes of this Agreement, an Immediate
Family shall also be deemed to include any affiliate of a member of that
Immediate Family, as defined in Rule 405 of the Securities Act of 1933, as
amended, and any trust created for the benefit of one or more persons in that
Immediate Family.
24
B. Except
as
required in the performance of a Member or its Agents’ obligations pursuant to
this Agreement, neither a Member nor its Agents shall, during or after the
Term,
directly or indirectly, use any Confidential Information or disseminate or
disclose any Confidential Information to any person, firm, corporation,
association or other entity. Each Member and its Agents shall take reasonable
measures to protect Confidential Information from any accidental, unauthorized
or premature use, disclosure or destruction. Information shall not be considered
Confidential Information if it: (i) is at the time of disclosure or thereafter
a
part of the public domain without breach of this Agreement by a Member or its
Agents; provided, however, that the act of copyrighting shall not cause or
be
construed as causing the copyrighted materials to be in the public domain,
(ii)
is disclosed as reasonably required in a proceeding to enforce a Member’s rights
under this Agreement or (iii) is disclosed as required by court order or
applicable law; provided, however, that if either a Member or its Agents is
legally requested or required by court order or applicable law, including,
but
not limited to, by oral questions, interrogatories, requests for information
or
documents, subpoenas, civil investigative demands or similar processes to
disclose any Confidential Information of another Member or the Company, that
Member or its Agents, as the case may be, shall promptly notify such other
Member or the Company, as the case may be, of such request or requirement so
that such other Member or the Company, as the case may be, may seek an
appropriate protective order; provided further, however; that if such protective
order is not obtained, that Member and its Agents agree to furnish only that
portion of the Confidential Information which they are advised by their
respective counsels is legally required.
25
C. Upon
termination of this Agreement for any reason or at any time upon request of
a
Member, each other Member and its Agents agree to deliver to the requesting
Member all materials of any nature which are in such other Members’ or their
Agents’ possession or control and which are or contain Confidential Information,
or which are otherwise the property of the requesting Member or any vendor,
licensor, licensee, customer or client of the requesting Member, including,
but
not limited to writings, designs, documents, records, data, memoranda, tapes
and
disks containing software, computer source code listings, routines, file
layouts, record layouts, system design information, models, manuals,
documentation and notes. In any such event, each other Member and its Agents
shall destroy all written documentation prepared by them for internal purposes
based in whole or in part on any Confidential Information of the Company or
the
requesting Member, as the case may be, and if applicable, such destruction
shall
be confirmed to the requesting Member in writing by an officer of each other
Member and/or its Agents.
D. Upon
the
sale of all of a Member’s Interest, all documents, records, notebooks, and
similar repositories of or containing Confidential Information, including copies
thereof, in its possession, whether prepared by it or others, shall be left
with
the Company.
E. Neither
a
Member nor its Agents shall assert any rights with respect to any other Member
or the Company, their business, or any of their products, processes and other
services relating thereto, or any Confidential Information as having been
acquired or known by such Member or its Agents prior to the commencement of
the
term of this Agreement.
26
F. In
order
to induce Scantek to enter into this Agreement, each other Member agrees, on
its
own behalf and on behalf of its Agents, that neither such other Member, nor
any
of its Agents, shall during the term of this Agreement and, for a period of
two
(2) years from the date of termination of this Agreement, (i) manufacture any
competing product, (ii) sell or market any product which competes either
directly or indirectly with the Product, (iii) directly or indirectly sell
or
market any product which competes either directly or indirectly with any product
manufactured, sold or marketed by Scantek, or (iv) directly or indirectly own,
manage, participate in the operation or control of, or be connected as an
officer, director, shareholder, partner, consultant, owner, employee, agent,
lender, donor, vendor or otherwise, or have any financial interest in or aid
or
assist anyone else in the conduct of any Competing Entity which manufactures,
distributes or offers for sale goods similar to the Product. For the purposes
herewith, the term “Competing Entity” shall mean any business or enterprise of
any and every kind whatsoever which is engaged in the manufacture, distribution
or sale of goods similar or having a similar purpose to the Product, anywhere
in
the world.
G. Each
Member agrees, on its own behalf and on behalf of its Agents, that it shall
not
during the term of this Agreement and for a period of five (5) years from the
date of termination of this Agreement (i) personally, or cause others to
personally induce or attempt to induce any employee to terminate their
employment with any other Member or the Company; (ii) interfere with or disrupt
any other Member or the Company's relationship with its suppliers, vendors,
customers or employees; or (iii) solicit or entice any person to leave their
employ with any other Member or the Company.
27
H. Each
Member agrees, on its behalf and on behalf of its Agents, that the duration,
scope and geographic area for which the provisions set forth in Paragraphs
“F”
and “G” of this Article “12” of this Agreement are to be effective are
reasonable. If any court of competent jurisdiction determines that any provision
of this Agreement is invalid or unenforceable by reason of such provision
extending the covenants and agreements contained herein for too great a period
of time or over too great a geographical area, or by reason of it being too
extensive in any other respect, such agreement or covenant shall be interpreted
to extend only over the maximum period of time and geographical area, and to
the
maximum extent in all other respects, as to which it is valid and enforceable,
all as determined by such court in such action. Any determination that any
provision of this Agreement is invalid or unenforceable, in whole or in part,
shall have no effect on the validity or enforceability of any remaining
provision of this Agreement.
I. Any
period of time set forth in this Agreement shall not be construed to permit
a
Member or its Agents to engage in any of the prohibited acts set forth in this
Agreement after such period if such acts would otherwise be prohibited by any
applicable statute, legal precedent or other agreement between the parties
hereto.
13. Specific
Performance; Injunction.
Each
party hereto recognizes and acknowledges that each of the other parties hereto
shall be irreparably damaged if this Agreement is breached. Therefore, in the
event of any breach by any party hereto of this Agreement (the “Breaching
Party”), each other party hereto (“Non-Breaching Parties”) shall have the right,
at its election, to obtain equitable relief, including, but not limited to,
an
order for specific performance of this Agreement or an injunction, without
the
need to: (i) post a bond or other security, (ii) prove any actual damage or
(iii) prove that money damages would not provide an adequate remedy. Resort
to
such equitable relief, however, shall not be construed to be a waiver of any
other rights or remedies which a Non-Breaching Party may have against the
Breaching Party for damages or otherwise.
28
14. Indemnification.
A.
Definitions.
For
purposes of this Article “14” of this Agreement:
(i)
"Indemnified Capacity" means any and all past, present and future service by
an
Indemnified Representative (as defined in Subparagraph “(ii)” of this Paragraph
“A” of this Article “14” of this Agreement) in one or more capacities as a
Manager, officer, employee or agent of the Company, or, at the request of the
Company, as a Manager, officer, employee, agent, fiduciary or trustee of another
limited liability company, corporation, partnership, joint venture, trust,
employee benefit plan or other entity or enterprise;
(ii)
"Indemnified Representative" means any and all Managers and officers of the
Company and any other person designated as an Indemnified Representative by
the
Board (which may, but need not, include any person serving at the request of
the
Company, as a Manager, officer, employee, agent, fiduciary or trustee of another
limited liability company, corporation, partnership, joint venture, trust,
employee benefit plan or other entity or enterprise);
(iii)
"Liability" means any damage, judgment, amount paid in settlement, fine,
penalty, punitive damages, excise tax assessed with respect to an employee
benefit plan, or cost or expense of any nature (including, without limitation,
attorneys' fees and disbursements); and
29
(iv)
"Proceeding" means any threatened, pending or completed action, suit, appeal
or
other proceeding of any nature, whether civil, criminal, administrative or
investigative, whether formal or informal, and whether brought by or in the
right of the Company, its Board, its Members or otherwise.
B.
General
Rule.
The
Company shall indemnify an Indemnified Representative against any Liability
incurred in connection with any Proceeding in which the Indemnified
Representative may be involved as a party or otherwise by reason of the fact
that such person is or was serving in an Indemnified Capacity, including,
without limitation, Liabilities resulting from any actual or alleged breach
or
neglect of duty, error, misstatement or misleading statement, negligence or
act
giving rise to strict or products liability, except:
(i)
where
such indemnification is expressly prohibited by applicable law;
(ii)
where the conduct of the Indemnified Representative has been finally determined
on the merits or in defense of any Proceeding or in defense of any claim, issue
or matter therein or otherwise:
(a)
to
constitute fraud, gross negligence, willful misconduct or recklessness
sufficient in the circumstances to bar indemnification against Liabilities
arising from the conduct; or
(b)
to be
based upon or attributable to the receipt by the Indemnified Representative
from
the Company or a subsidiary of a personal benefit to which the Indemnified
Representative is not legally entitled;
30
(iii)
where the Indemnified Representative did not act in good faith in a manner
he
reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any criminal matter, he had reasonable cause to
believe his conduct was unlawful; or
(iv)
to
the extent such indemnification has been finally determined in a final
adjudication to be otherwise unlawful.
C.
Partial
Payment.
If an
Indemnified Representative is entitled to indemnification in respect of a
portion, but not all, of any Liabilities to which such person may be subject,
the Company shall indemnify such Indemnified Representative to the maximum
extent for such portion of the Liabilities.
D.
Presumption.
The
termination of a Proceeding by judgment, order, settlement or conviction or
upon
a plea of nolo contendere or its equivalent shall not of itself create a
presumption that the Indemnified Representative is not entitled to
indemnification.
15. Miscellaneous.
A. Headings.
Headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement.
B. Enforceability.
If
any
provision which is contained in this Agreement should, for any reason, be held
to be invalid or unenforceable in any respect under the laws of any state or
of
the United States, such invalidity or unenforceability shall not affect any
other provision of this Agreement. Instead, this Agreement shall be construed
as
if such invalid or unenforceable provisions had not been contained
herein.
31
C. Notices.
Any
notice or other communication required or permitted hereunder shall be
sufficiently given if sent by (i) mail by (a) certified mail, postage prepaid,
return receipt requested and (b) first class mail, postage prepaid (ii)
overnight delivery with confirmation of delivery or (iii) facsimile transmission
with an original mailed by first class mail, postage prepaid, addressed as
follows:
|
If
to Scantek:
|
Scantek
Medical, Inc.
|
|
|
0X
Xxxx Xxxxx
|
||
|
Xxxxx
Xxxxxx, Xxx Xxxxxx 00000
|
||
|
Attn:
Xx. Xxxxxxxx X. Xxxx, President
|
||
|
Fax
No.: (000) 000-0000
|
|
With
a copy to:
|
Xxxxx
& Fraade, P.C.
|
|
|
000
Xxxxxxx Xxxxxx
|
||
|
Xxx
Xxxx, Xxx Xxxx 00000
|
||
|
Attn:
Xxxxxxxxx X. Xxxxx, Esq.
|
||
|
Fax
No.: (000) 000-0000
|
32
|
With
a copy to:
|
Xxxxxx
X. Xxxxxx, Esq.
|
|
|
000
Xxxxxxx Xxxxxx
|
||
|
Xxx
Xxxx, Xxx Xxxx 00000
|
||
|
Fax
No.: (000)
000-0000
|
|
If
to Life Medical:
|
Life
Medical Technologies, Inc.
|
|
|
X.X.
Xxx 000
|
||
|
Xxxxxxx,
Xxx Xxxx 00000
|
||
|
Attn:
Xx. Xxxxxx Xxxxxx, President
|
||
|
Fax
No.: (000) 000-0000
|
|
With
a copy to:
|
Xxxxx
& Fraade, P.C.
|
|
|
000
Xxxxxxx Xxxxxx
|
||
|
Xxx
Xxxx, Xxx Xxxx 00000
|
||
|
Attn:
Xxxxxxxxx X. Xxxxx, Esq.
|
||
|
Fax
No.: (000) 000-0000
|
|
If
to M&F:
|
Xxxxx
& Fraade Enterprises, LLC
|
|
|
000
Xxxxxxx Xxxxxx
|
||
|
Xxx
Xxxx, XX 00000
|
||
|
Attn:
Xxxxxxxxx X. Xxxxx, Esq.
|
||
|
Fax
No.: (000) 000-0000
|
33
|
With
a copy to:
|
Xxxx
X. Xxxxxx, Esq.
|
|
|
00
Xxx Xxxxx
|
||
|
Xxx
Xxxxxxxx, XX 00000
|
||
|
Fax
No.: (000) 000-0000
|
or
in
each case to such other address and facsimile number as shall have last been
furnished by like notice. If all of the methods of notice set forth in this
Paragraph “C” of this Article “15” of this Agreement are impossible for any
reason, notice shall be in writing and personally delivered to the aforesaid
addresses. Each notice or communication shall be deemed to have been given
as of
the date so mailed or delivered as the case may be; provided, however, that
any
notice sent by facsimile shall be deemed to have been given as of the date
so
sent if a copy thereof is also mailed by first class mail on the date sent
by
facsimile. If the date of mailing is not the same as the date of sending by
facsimile, then the date of mailing by first class mail shall be deemed to
be
the date upon which notice is given; provided further, however, that any notice
sent by overnight delivery shall be deemed to have been given as of the date
of
delivery.
34
D. Governing
Law; Disputes.
This
Agreement shall in accordance with Section 5-1401 of the General Obligations
Law
of New York in all respects be construed, governed, applied and enforced under
the internal laws of the State of New York without giving effect to the
principles of conflicts of laws and be deemed to be an agreement entered into
in
the State of New York and made pursuant to the laws of the State of New York;
provided, however, that with respect to issues relating to the corporate
governance of the Company which are not specifically provided for in this
Agreement, the Limited Liability Company Act of the State of Delaware shall
be
applicable. Except as otherwise set forth in Article “13” of this Agreement, the
parties agree that they shall be deemed to have agreed to binding arbitration
with respect to the entire subject matter of any and all disputes relating
to or
arising under this Agreement including, but not limited to, the specific matters
or disputes as to which arbitration has been expressly provided for by other
provisions of this Agreement and that any such arbitration shall be commenced
exclusively in New York, New York. Any such arbitration shall be by a panel
of
three arbitrators and pursuant to the commercial rules then existing of the
American Arbitration Association in the State of New York, County of New York.
In all arbitrations, judgment upon the arbitration award may be entered in
any
court having jurisdiction. The parties specifically designate the courts in
the
City of New York, State of New York as properly having jurisdiction for any
proceeding to confirm and enter judgment upon any such arbitration award. The
parties hereby consent to and submit to the exclusive jurisdiction of the courts
of the State of New York in any action or proceeding and submit to personal
jurisdiction over each of them by such courts. The parties hereby waive personal
service of any and all process and specifically consent that in any such action
or proceeding brought in the courts of the State of New York, any service of
process may be effectuated upon any of them by certified mail, return receipt
requested, pursuant to Paragraph “C” of this Article “15” of this Agreement.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law.
35
The
parties agree, further, that the prevailing party in any such arbitration as
determined by the arbitrators shall be entitled to such costs and attorney's
fees, if any, in connection with such arbitration as may be awarded by the
arbitrators. In connection with the arbitrators’ determination for the purpose
of which party, if any, is the prevailing party, they shall take into account
all of the factors and circumstances including, without limitation, the relief
sought, and by whom, and the relief, if any, awarded, and to whom. In addition,
and notwithstanding the foregoing sentence, a party shall not be deemed to
be
the prevailing party in a claim seeking monetary damages, unless the amount
of
the arbitration award exceeds the amount offered in a legally binding writing
by
the other party by fifteen (15%) percent or more. For example, if the party
initiating arbitration (“A”) seeks an award of one hundred thousand ($100,000)
dollars plus costs and expenses, the other party (“B”) has offered A fifty
thousand ($50,000) dollars in a legally binding written offer prior to the
commencement of the arbitration proceeding, and the arbitration panel awards
any
amount less than fifty-seven thousand five hundred ($57,500) dollars to A,
the
panel should determine that B has “prevailed”.
The
arbitration panel shall have no power to award non-monetary or equitable relief
of any sort. It shall also have no power to award (i) damages inconsistent
with
any applicable agreement between the parties or (ii) punitive damages or any
other damages not measured by the prevailing party’s actual damages; and the
parties expressly waive their right to obtain such damages in arbitration or
in
any other forum. In no event, even if any other portion of these provisions
is
held invalid or unenforceable, shall the arbitration panel have power to make
an
award or impose a remedy which could not be made or imposed by a court deciding
the matter in the same jurisdiction.
36
Discovery
shall be permitted in connection with the arbitration only to the extent, if
any, expressly authorized by the arbitration panel upon a showing of substantial
need by the party seeking discovery.
All
aspects of the arbitration shall be treated as confidential. The parties and
the
arbitration panel may disclose the existence, content or results of the
arbitration only as provided in the rules of the American Arbitration
Association in New York, New York. Before making any such disclosure, a party
shall give written notice to all other parties and shall afford such parties
a
reasonable opportunity to protect their interest.
E. Entire
Agreement.
This
Agreement and all documents and instruments referred to herein (i) constitute
the entire agreement and supersedes all prior agreements and understandings,
both written and oral, among the parties with respect to the subject matter
hereof and thereof, and (ii) are not intended to confer upon any person other
than the parties hereto any rights or remedies hereunder. Each party hereto
agrees that, except for the representations and warranties contained in this
Agreement, none of the parties hereto make any other representations or
warranties, and each hereby disclaims any other representations and warranties
made by itself or any of its officers, directors, managers, employees, agents,
financial and legal advisors or other representatives, with respect to the
execution and delivery of this Agreement or the transactions contemplated
hereby, notwithstanding the delivery or disclosure to the other or the other's
representatives of any documentation or other information with respect to any
one or more of the foregoing.
37
F. Further
Assurance.
The
Parties agree to execute any and all such other further instruments and
documents, and to take any and all such further actions, which are reasonably
required to effectuate this Agreement and the intents and purposes
hereof.
G. Non-Waiver.
Except
as
otherwise expressly provided herein, no waiver of any covenant, condition,
or
provision of this Agreement shall be deemed to have been made unless expressly
in writing and signed by the party against whom such waiver is charged; and
(i)
the failure of any party to insist in any one or more cases upon the performance
of any of the provisions, covenants, or conditions of this Agreement or to
exercise any option herein contained shall not be construed as a waiver or
relinquishment for the future of any such provisions, covenants, or conditions,
(ii) the acceptance of performance of anything required by this Agreement to
be
performed with knowledge of the breach or failure of a covenant, condition,
or
provision hereof shall not be deemed a waiver of such breach or failure, and
(iii) no waiver by any party of one breach by another party shall be construed
as a waiver with respect to any other or subsequent breach.
H. Counterparts.
This
Agreement may be executed simultaneously in one or more counterparts, each
of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
I. Expenses.
The
Company shall pay the expenses incident to the negotiation and preparation
of
this Agreement. Each party hereto shall pay its own expenses incident to the
preparation of all other documents necessary or appropriate to consummate the
transactions provided for herein, and shall bear the costs and expenses incurred
in closing and carrying out the transactions provided for by this
Agreement.
38
J. Construction.
Each
of
the parties hereto hereby acknowledges and agrees that (i) Xxxxx & Fraade,
P.C. drafted this Agreement on behalf of all of the parties to this Agreement,
(ii) each party has been separately advised by counsel other than Xxxxx &
Fraade, P.C. during the course of reviewing this Agreement and (iii) this
Agreement shall not, therefore, be construed more strictly against any party
responsible for its drafting regardless of any presumption or rule requiring
construction against the party whose attorney drafted this
Agreement.
K. Binding
Agreement.
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, executors, administrators, personal representatives,
successors and assignees.
L. Exhibits.
All
Exhibits annexed or attached to this Agreement are incorporated into this
Agreement by reference thereto and constitute an integral part of this
Agreement.
M. Facsimile
Signatures.
Any
signature which is delivered via facsimile shall be deemed to be an original
and
have the same force and effect as if such facsimile signature were the original
thereof.
39
N. Modifications.
This
Agreement may not be changed, modified, extended, terminated or discharged
orally, except by a written agreement specifically referring to this Agreement
which is signed by all of the parties to this Agreement.
IN
WITNESS WHEREOF,
the
parties hereto have caused this Agreement to be executed as of the date first
above written.
|
Scantek
Medical, Inc.
|
||
| |
|
|
| By: | ||
|
Title
|
||
|
Life
Medical Technologies, Inc.
|
||
| |
|
|
| By: | ||
|
Title
|
||
|
Xxxxx
& Fraade Enterprises, LLC
|
||
| |
|
|
| By: | ||
|
Title
|
||
40
Exhibit
A
- Excluded Countries
|
Afghanistan
|
|
Bosnia
& Herzegovina
|
|
Canada
|
|
Croatia
|
|
France
|
|
Jordan
|
|
Libya
|
|
Morocco
|
|
Qatar
|
|
Serbia
& Montenegro
|
|
Syria
|
|
United
States
|
|
Algeria
|
|
Brazil
|
|
Chile
|
|
Egypt
|
|
Iran
|
|
Kuwait
|
|
Macedonia
|
|
Oman
|
|
Saudi
Arabia
|
|
Slovenia
|
|
Tunisia
|
|
Wales
|
|
Bahrain
|
|
Bulgaria
|
|
China
|
|
England
|
|
Iraq
|
|
Lebanon
|
|
Malaysia
|
|
Pakistan
|
|
Scotland
|
|
Sudan
|
|
United
Arab Emirates
|
|
Yemen
|
41
