MANAGEMENT SERVICES AND JOINT VENTURE AGREEMENT
THIS MANAGEMENT SERVICES AND JOINT VENTURE AGREEMENT ("Agreement") is
made and entered as of April 6, 2000 by and between Prime XX.xxx, Inc., on the
one hand (hereinafter "Principal"), and x-XxxXxxx.xxx, on the other hand
("Manager").
This Agreement is made with reference to the following facts,
circumstances, recitals and agreements:
A. Principal currently owns, manages, leases and/or operates a series of
facilities and businesses throughout the country all of which, in one form or
another, are engaged in the pharmaceutical industry, including, without
limitation, the assets listed on Schedule "A" attached hereto (hereinafter
"Subject Business"). Principal has rapidly expanded its business over the
past eighteen months and intends to continue on a plan of rapid expansion and
penetration of various markets within the pharmaceutical industry. As used
hereafter, the term "Subject Business" shall mean and refer to (i) the assets
and businesses described on Schedule "A" hereto, (ii) any and all of
Principal's businesses whether now existing or hereafter acquired, as well as
all (iii) any and all rights of development, examination, expansion,
evaluation or other means by which additional business opportunities beyond
those currently owned by Principal are acquired or annexed as a part of
Principal's business.
B. Principal has represented and continues to represent to Manager that
Principal has completed a comprehensive evaluation of the "Subject Business"
as well as a comprehensive evaluation of Manager's electronics systems and,
based upon these evaluations, (i) Principal has come to the conclusion that
the implementation into the Subject Business by Manager of Manager's
electronics systems and protocols will yield significant benefits to Principal
and (ii) Principal wishes to retain Manager for an exclusive term of thirty
(30) years to completely manage all aspects of the Subject Business both with
respect to the implementation of Manager's electronics systems into the
Subject Business and with respect to supervising, managing and employing the
human capital needed to maintain and grow the Subject Business in accordance
with Principal's business plans.
NOW, THEREFORE, in consideration of the recitals, covenants and
conditions contained herein, the parties hereto agree as follows:
1. MANAGER'S OBLIGATIONS:
1.1 Compliance With Principal's Agreements. Manager understands
and acknowledges that Principal has entered into a series of contracts,
agreements and understandings with third parties which Principal shall provide
to Manager and attach hereto as Exhibit "B" within five (5) days after
execution ("Principal's Agreements"). In carrying out its responsibilities
hereunder, Manager agrees to abide by all terms and conditions of all
Principal's Agreements. Such obligations of Manager shall include the
obligation by Manager to fund monies necessary to pay obligations set out in
the Principal's Agreements even if the revenues of the Subject Business are
insufficient to reimburse Manager for such advances. Nothing herein shall
constitute an assignment of Principal's Agreements to Manager, but, rather,
Manager shall merely act as Principal's agent for all purposes in connection
with carrying out all of Principal's obligations under Principal's Agreements.
1.2 Management Services and Administration. During the term of
this Agreement, Manager shall have the full, exclusive and complete authority
and discretion in the management and control of all business appertaining or
relating to the Subject Business, and all decisions permitted to be made by
Principal in the conduct of its business are hereby B for the term hereof B
delegated exclusively, irrevocably and unconditionally to Manager.
(i) Duty to Cooperate. Principal acknowledges that its
cooperation is critical to the ability of Manager to perform its duties
hereunder. Accordingly, Principal agrees to cooperate with Manager as
reasonably requested by Manager to enable Manager to render performance
hereunder.
(ii) Independent Contractor. In the performance of this
Agreement, it is mutually understood and agreed that Manager is at all times
acting and performing as an independent contractor with, and not the employee
of, Principal.
(iii) Manager Not Responsible for Medical Matters. The
parties hereto understand and acknowledge that certain responsibilities
hereunder related to the Subject Business will necessarily involve the
interaction by Manager with health care professionals who are or will render
medical or related professional advice in connection with or related to the
Subject Business. In this regard, Principal represents and warrants to
Manager that none of Principal's business, none of the revenues which
Principal has historically realized in the past from the Subject Business, and
none of the revenues which Principal intends to realize in the future from the
Subject Business, involve the rendering of professional medical advice or care
whatsoever by Principal. The parties therefore agree that to the extent the
rendering of professional medical judgment or advice occurs within the Subject
Business, any and all such matters (whether medical, ethical or professional)
requiring professional medical judgment shall remain the responsibility of
medical staff and allied health professionals employed or engaged by persons
other than Principal and Manager. Manager shall have no responsibility for
such judgments or for such matters; provided, however, that Manager agrees to
use its best efforts to comply with any reasonable and lawful directives of
responsible third parties regarding professional medical advice appertaining
to the Subject Business.
1.3 Staffing. During the term hereof and in order for Manager to
carry out the terms of this Agreement, Principal intends that Manager may B
within Manager's full discretion B (a) hire any and all current or future
employees of Principal to become employees of Manager, (b) hire any personnel
not currently affiliated with Principal to provide services with respect to
the Subject Business, (c) utilize current employees of Manager in connection
with Manager's responsibilities hereunder and (d) take any other action with
respect to the Subject Business which Manager deems (in its sole and absolute
discretion) is necessary or appropriate to preserve the current and future
value derived and to be derived from the Subject Business. Principal shall
have no right hereunder to have any of its officers, directors or employees
involved in the management of the Subject Business, it being the intention of
the parties that Principal shall have no involvement or connection B directly
or indirectly B with respect or appertaining to the Subject Business.
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2. FINANCIAL MATTERS; ACCOUNTS; MANAGEMENT FEE
2.1 Bank Account and Accounting. Manager shall exclusive authority
over all bank accounts of Principal currently in existence as well as over all
future bank accounts which Manager may establish -- within its sole and
absolute discretion -- relative to the ongoing business conducted at the
Subject Business (hereinafter collectively "bank accounts"). Manager shall be
the only party authorized to draw upon any bank accounts set up to handle the
management of the Subject Business. Manager shall be the only party
authorized to have access to information concerning the bank accounts set up
to handle the management of the Subject Business. Whether or not Manager
chooses to set up bank accounts with regard to the Subject Business, Manager
shall provide to Principal a full accounting of all financial matters
appertaining or relating to Manager's operation of the Subject Business, but
Manager shall only have an obligation to do so after the passage of sixty (60)
days following receipt of a written request by Principal for such an
accounting.
2.1.1 No Further Guaranty By Principal Xx. Xxxxx. The parties
hereto acknowledge that Xxxx Xxxxx, M.D., the largest shareholder of the
Principal, has guaranteed certain lines of credit and other bank debt, and the
parties hereto agree that B subsequent to the execution of this Agreement B no
further bank debt or other monies may be drawn down in any manner appertaining
to Principal unless and until it is done in such a fashion that Xx. Xxxxx is
not a guarantor on any future advances of such bank debt occurring after the
date of execution hereof.
2.2 Disbursements. All monies received by Manager arising from
its management of the Subject Business shall be disbursed monthly in the
following order of priority: First, to pay any and all operating expenses
appertaining or relating to the Subject Business in the order of priority
chosen by Manager within Manager's absolute discretion, such operating
expenses to include, without limitation, general operating expenses, special
operating expenses, capital improvements and expenditures, property repair and
maintenance expenses, utility charges, property taxes, payroll taxes, legal,
accounting and other general administrative expenses (hereinafter collectively
"expenses"); and then Second if money is still available after payment of
expenses, then such money shall be utilized to pay any previously unreimbursed
expenses of any kind arising out of, appertaining or related to the Subject
Business (hereinafter collectively "unreimbursed expenses"); and then Third if
money is still available after payment of expenses and unreimbursed expenses,
then such money shall be utilized to pay off all principal and interest owed
under any debt or other obligation in which Principal is the primary obligor
and Xxxx Xxxxx, M.D. is a guarantor thereof pursuant to a written guaranty
obligation ("payoff of guaranteed obligations"); and Fourth if money is still
available after payment of expenses and unreimbursed expenses and payoff of
guaranteed obligations, then such money shall be utilized to pay Manager its
management fee set forth on Schedule "C" attached hereto (hereinafter
"Manager's Fee"). At the time of each anniversary date after execution of
this Agreement, Manager shall disburse to Principal any money remaining from
the operation of the Subject Business after deduction of expenses,
unreimbursed expenses and Manager's Fee.
2.3 Loan Provisions. Any unreimbursed expenses owed to Manager
hereunder, whether directly or indirectly, that have not been repaid under
section 2.2 above shall be repaid to Manager by Principal upon the termination
of this Agreement.
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3. TERM AND TERMINATION:
3.1 Term. The term of this Agreement shall be for a period of thirty
(30) years commencing on the date of execution hereof and terminating on the
thirty-year anniversary date hereof.
3.2 Termination.
(a) Principal shall have no right to terminate this Agreement
unless and until one of the following events occur (hereinafter collectively
referred to as "Manager Default"), after which Principal shall have the right
B but not the obligation B to declare a termination of this Agreement in
accordance with the termination protocols set forth below:
(i) appointment of a receiver or trustee to manage the assets
of Manager;
(ii) assignment for the benefit of creditors of the assets of
Manager;
(iii) any act of bankruptcy by Manager; and/or
(iv) breach of any material term of this Agreement, where such
breach has not been cured within ninety (90) days after the giving of written
notice of the breach, specifying the nature of the breach, and complying with
all provisions regarding mediation set forth herein.
(b) Manager shall have no right to terminate this Agreement unless
and until one of the following events occur (hereinafter "Principal Default"),
after which Manager shall have the right B but not the obligation B to declare
a termination of this Agreement in accordance with the termination protocols
set forth below:
(i) appointment of a receiver or trustee to manage the assets
of Principal;
(ii) assignment for the benefit of creditors of the assets of
Principal;
(iii) any act of bankruptcy by Principal;
(iv) breach of any material term of this Agreement, where such
breach has not been cured within ninety (90) days after the giving of written
notice of the breach, specifying the nature of the breach, and complying with
all provisions regarding mediation set forth herein; and/or
(v) any other conduct by Principal which interferes with or
renders more difficult Manager's unobstructed operation of the Subject
Business.
3.3 Notice of Default. Neither a Manager Default or Principal Default
shall be deemed to have occurred unless the non-defaulting Party has complied
with the escalation procedure set forth in Section 4 and the non-defaulting
Party has given written notice (a "Default Notice") to the defaulting Party in
accordance with the requirements of this Section 3.3. A Default Notice shall
specify in reasonable detail the events which the non-defaulting Party
believes have occurred and which constitute or evidence a Default, the
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provisions of this Agreement which have not been performed or complied with,
and the actions which, in the opinion of the non-defaulting Party, would be
required to fulfill the requirements of this Agreement and cure the Default.
A Default shall not be deemed to have occurred unless and until ninety (90)
days has lapsed since the non-defaulting Party provided notice to the
defaulting party of the Default and the defaulting Party has not cured the
Default. An immaterial failure to comply precisely with the foregoing notice
requirements shall render inoperative the validity of a Default Notice, even
if the defaulting Party was not prejudiced by such failure. For purposes of
this Agreement, all Defaults shall be deemed curable and no Default shall be
deemed to occur unless and until the non-defaulting Party provides, in
writing, an outline of the acts necessary to achieve a cure.
3.4 Termination for Default. Only upon (a) the occurrence of any
Default which is not excused pursuant to this Agreement, (b) the inability to
resolve the dispute under Section 4, (c) the delivery of a Default Notice to
the defaulting Party as provided in Section 3.3, (d) the circumstance where a
specific remedy for the Default is not set forth above and/or such a specific
remedy is so set forth but compliance with such remedial procedure has not
yielded a resolution of the Default and (e) the defaulting Party's failure to
cure the Default set out in the Default Notice prior to the expiration of the
cure period specified in Section 3.3 above and any extension of that cure
period, the defaulting Party shall be deemed to be in breach of this Agreement
and the non-defaulting Party shall have the right to terminate this Agreement
by delivering written notice of termination to the defaulting Party.
3.5 Effect of Termination. Upon termination of this Agreement (and
irrespective of which Party terminates this Agreement), all of the following
shall apply:
(a) Manager shall turn over to Principal a complete set of
books and records appertaining to the Subject Business within thirty (30) days
after the termination has become effective and all cure periods and other
required time has lapsed; and
(b) Subject to subsection c below, Manager shall have no further
right to operate the Subject Business, whether directly or indirectly; and
(c) All sums due Manager hereunder, whether appertaining to
expenses, unreimbursed expenses or the Management Fee shall be due and payable
by Principal to Manager within 180 days after the effectiveness of the
termination, and Manager shall have the full power and discretion to not
return the operation of the Subject Business back to Principal unless and
until such sums (if any) are paid in full.
4. DISPUTE ESCALATION AND MEDIATION
The parties hereto agree that they will use all reasonable efforts
to resolve any disputes arising out of this Agreement in a co-operative and
expeditious manner. If the staff members for each party are unable to resolve
the dispute within ten (10) days after it arises, either party hereto may
escalate the dispute to Manager's Chief Executive Officer then to Principal's
Chairman (hereinafter collectively "Mediation Officers"). Upon such
escalation, the Mediation Officers shall meet in person to discuss the
outstanding issues and attempt in good faith to reach a resolution. If the
foregoing procedure fails to resolve the dispute within sixty (60) days after
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such meeting, the parties hereto shall be entitled to any and all remedies
provided by law.
5. STANDARDS OF PERFORMANCE, COMPLIANCE WITH LAWS:
Manager shall perform its duties under this Agreement in good faith
in compliance with the business judgment rule, while complying with all
applicable federal, state and municipal laws and regulations. Notwithstanding
any provision of this Agreement to the contrary, Manager:
(a) shall not be liable in connection with the performance of
its duties hereunder, except for its own wilful and intentional misconduct;
(b) shall not be liable for any error of judgment made in good
faith in connection with the performance of its duties hereunder, unless it
shall be proven in a court of law that Manager engaged in wilful and
intentional misconduct; and
(c) shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the written
direction of Principal.
6. REPRESENTATIONS AND WARRANTIES:
6.1 Corporate Existence. Each party to this Agreement is a
corporation duly organized, validly existing and in good standing under the
applicable law as may be applicable to the particular entity in question.
Each party to this Agreement is duly qualified to do business, and is in good
standing as a foreign corporation in the State of California and in each other
jurisdiction where the party actively conducts business, except where the
failure to be so qualified or licensed would not have a material adverse
effect on that party.
6.2 Corporate Power; Authorization; Enforceable Obligations. Each
party to this Agreement has taken corporate action on its part sufficient
under the laws of California, and under its Certificate of Incorporation and
By-Laws to authorize the execution, delivery and carrying out of this
Agreement on its behalf. Each party to this Agreement has the corporate power
and authority to execute, deliver and perform this Agreement and to consummate
the transactions contemplated hereby without the necessity of any act or
consent of any other entity. The execution, delivery and performance of this
Agreement by each party to this Agreement has been duly authorized by all
necessary corporate action. This Agreement has been, and the other
agreements, documents and instruments required to be executed and delivered by
each party hereto will be, duly executed and delivered by each party hereto
and constitute valid and legally binding obligations of each party,
enforceable against each in accordance with the terms hereof and thereof.
6.3 No Conflicts. The execution, delivery and performance of this
Agreement and any other documents executed concurrently herewith, does not and
will not violate, conflict with or result in the breach of any term, condition
or provision of, or require the consent of any other person under: (a) any
contract, agreement, law or governmental rule or regulation to which any party
hereto is subject, (b) any judgment, order, writ, injunction or decree of any
court, arbitrator or governmental or regulatory authority applicable to any
party, and/or (c) the charter documents or code of regulations of, or any
securities issued by, any party hereto. Each party has the absolute and
unfettered right to enter into this Agreement and carry out its obligations
hereunder.
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6.4 Unencumbered. With respect to all of the Subject Business and
with the exception of encumbrances not exceeding $1,250,000 that have come
about in the ordinary course of business after December 31, 2000, there are no
encumbrances appertaining or relating thereto except those listed on the most
recent financial statements provided by Principal to Manager.
6.5 Litigation. As of the date of execution hereof, (a) each party
hereto represents and warrants that there is not now any pending litigation,
including any arbitration, investigation or other proceeding before any court,
arbitrator or governmental or regulatory authority, or, to each party's
knowledge, threatened against each party, which if decided adversely against
that party would have a material adverse effect on the business of that party
and (b) neither party is subject to any judgment, order, writ, injunction, or
decree of any court, arbitrator or governmental or regulatory authority which
has a material adverse effect on its business.
6.6 Compliance with Laws. To the best knowledge of each party to
this Agreement, each party hereto has complied in all material respects with
all laws, regulations and orders applicable to their business. Principal
warrants and represents that it has obtained all governmental permits or
licenses required in order to conduct the Subject Business, and the present
use of its properties and the conduct of the Subject Business does not violate
in any material respect any law, regulation, ordinance, decree, injunction or
order. No notice or warning from any governmental authority with respect to
any failure or alleged failure of Principal to comply with any law, regulation
or order has been issued or given, nor is any such notice or warning proposed
or threatened so far as is known to Principal.
6.7 Environmental Compliance. To the best knowledge of Principal,
Principal has previously complied with, and is currently complying with, in
all material respects, all laws appertaining and relating to the environment,
including any and all federal, state or local environmental, health and/or
safety-related laws, regulations, standards, decisions of courts, ordinances,
rules, codes, orders, decrees, directives, guidelines, permits, or permit
conditions applicable to the operation of the Subject Business. Principal
has not caused or permitted any Hazardous Materials (as defined below) to be
brought upon, stored, manufactured, generated, handled, released, treated or
disposed or used on, under or about or in connection with the operation of
Subject Business, except for routine office, pharmaceutical, clinic or
hospital supplies and material, janitorial supplies and material used in
connection with the Subject Business in usual and customary quantities and
which are used, handled and disposed of in compliance with all applicable
Environmental Laws, as defined above ("Permitted Hazardous Materials"). As
used herein "Hazardous Materials" means any chemical, substance, material,
controlled substance, object, condition, waste, organism or combination
thereof, which is or may be hazardous to human health or safety or to the
environment due to its radioactivity, ignitability, corrositivity, reactivity,
toxicity, carcingenicity, mutagenicity, infectiousness or other harmful or
potential harmful properties or effects, including, without limitation, the
Permitted Hazardous Materials, petroleum and petroleum products, asbestos,
radon, polychlorinated biphenyls, refrigerants and all of those chemicals,
substances, materials, controlled substances, conditions, wastes, organisms or
combinations thereof which are now or become listed, defined or regulated in
any manner by any Environmental Law.
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6.8 Financial Statements. All financial statements provided by
Principal to Manager prior to the execution of this Agreement were prepared in
accordance with generally accepted accounting principles consistently applied,
and fairly present the financial position and results of operations of the
Subject Business as of the date of the financial statements. The financial
statements can be reconciled with the financial records maintained and the
accounting methods applied by Principal for federal income tax purposes.
6.9 Patents, Trademarks, Trade Names. Principal currently owns or
has the full right to use all patents, inventions, trademarks, trade names,
copyrights, technology, know-how and processes, registrations or applications
therefore, used in or necessary for the Subject Business (hereinafter
"Rights"). No claims have been asserted by any person to the use of any of
the Rights or challenging or questioning the validity or effectiveness of any
such Rights, and to the best knowledge of either party, there is no valid
basis for any such claim. The use of the Rights by Manager does not infringe
on the rights of any person. No director, officer or employee of Principal
owns directly or indirectly, in whole or in part, any of the Rights or
interest therein which Principal has used, is presently using, or the use of
which is necessary for the Subject Business are now conducted.
6.10 Contracts and Arrangements. All contracts and agreements of
Principal referenced herein are valid, binding, in full force and effect and
enforceable in accordance with their terms. Principal is not in default or
breach and no event has occurred or shall occur by reason of the transactions
contemplated herein which would constitute a default or breach, where such
default or breach would entitle another party thereto to accelerate or
terminate any contracts or agreements or otherwise impose a penalty or
forfeiture thereunder (whether with or without notice, lapse of time or the
happening or occurrence of any other event), under any such contracts or
agreements. All such agreements are valid and binding agreements, and to the
best knowledge of Principal, there are no facts or circumstances which make a
default under any such agreement by any party thereto likely to occur
subsequent to the date hereof. Unless otherwise described herein or listed
on an Exhibit or Schedule hereto, Principal is not obligated under any
agreement that materially and adversely affects its business, property,
prospects, assets or condition, financial or otherwise.
6.11 All Assets Included. There is, and on the date of execution
hereof, there will be, no material asset that is owned by Principal that is
used in the conduct of Subject Business which is not included in the matters
which Manager has the exclusive right to manage hereunder.
6.12 Consents. Except as may be waived in writing by the parties
hereto, each party hereto has obtained the consents and approvals of all
parties whose consent or approval is necessary and provided such notices
(including as required by any applicable plant closing laws) for the valid and
effective consummation and completion of the transactions contemplated hereby
or as necessary in order that each party may validly, lawfully and effectively
perform and carry out its obligations hereunder, including without limitation,
without becoming in default under any agreement with any party or subjecting
itself to any claim or penalty.
6.13 Tax Matters. Principal has timely filed all federal, state
and local tax returns or extensions thereof relating to the operation of
Subject Business which were required to be filed. Principal has paid, or
where payment is not yet required, established adequate reserves for the
payment of all taxes with respect to the periods covered by such returns.
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Principal is not delinquent in the payment of any material tax, assessment or
governmental charge. Each of the returns and filings referred to above when
filed was complete and accurate in all material respects and included complete
and accurate representation of gross income, deductions or other tax
attributes. Principal has not consented to any waiver or extension of any
statute of limitations relating to the assessment or collection of any
federal, state or local tax of Principal. There are no deficiency assessments
against Principal. Principal is not a party to any tax allocation or sharing
agreements nor has Principal at any time been included in the filing of a
consolidated federal income tax return.
6.14 Material Misstatements or Omissions. No representation or
warranty by any party in this Agreement, the exhibits or any schedule hereto,
or any schedule or certificate furnished to pursuant hereto or in connection
with the transactions contemplated hereby contains any untrue statement of a
material fact. There is no fact known to Principal that could have a material
adverse effect on the financial condition or operation of the Subject
Business.
6.15 Compliance. No party hereto is in violation, breach or
default, whether or not declared, of any term of its Articles of Incorporation
or Bylaws, or any material term or provision of any agreement or other
instrument to which either is a party, or any material term or provision by
which any of the properties or assets covered hereby are bound. Each party
hereto has an absolute right to make the promises it is making hereunder.
7. MISCELLANEOUS:
7.1 Assignment. Except as otherwise provided herein, the parties
hereby agree that this Agreement shall not be assigned or transferred by
either party without the prior written consent of the other; provided,
however, that this Agreement may be assigned, in whole or in part, by Manager
in its sole discretion to any parent, affiliate, majority-owned subsidiary or
successor entity.
7.2 Choice of Law; Venue. This Agreement shall be construed and
governed by the laws of the State of California and the invalidity and
unenforceability of any provision hereof shall not affect the validity or
enforceability of any other provision. Any litigation occurring hereunder
shall occur exclusively in the County of Los Angeles, State of California.
7.3 Practice of Medicine. The parties hereto acknowledge that
Manager is not authorized or qualified to engage in any activity which may be
construed or deemed to constitute the practice of medicine. To the extent any
act or service herein required of Manager should be construed or deemed to
constitute the practice of medicine, the performance of said act or service by
Manager shall be deemed waived or forever unenforceable.
7.4 Modification. This Agreement shall not be modified or amended
except by a written document executed by both parties to this Agreement, and
two duplicate originals of such written modification(s) shall be attached to
an original of this Agreement by both parties.
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7.5 No Reciprocation. The parties hereby acknowledge and agree
that the benefits conferred upon each of them hereunder neither require nor
are in any way contingent upon the admission, recommendation, referral, or any
other arrangement for the provision of any item or service offered by Master
Manager to Manager, or by either of them to any patients of Groups, or the
Subject Business, its shareholders, officers, directors, employees,
contractors or agents.
7.6 Notices. All notices which either party is required or may
desire to give to the other under this Agreement shall be in writing, and
shall be given by addressing the same to such other party at the address
provided in writing from time to time during the performance of this
Agreement.
7.7 Waiver. No waiver by either of the parties hereto of any
failure by the other party to keep or perform any provision, covenant or
condition of this Agreement shall be deemed to be a waiver of any preceding or
succeeding breach of the same, or of any other provision, covenant or
condition. All rights and remedies herein granted or referred to are
cumulative; resort to one shall not preclude resort to another or any other
right or remedy provided by law.
7.8 Additional Documents. Each of the parties hereto agrees to
execute any document or documents that may be requested from time to time by
the other party to implement or complete such party's obligations pursuant to
this Agreement.
7.9 Entire Agreement. This Agreement contains the complete and
full agreement between the parties regarding the subject matter hereof. Other
than documents executed concurrently herewith, there have been no other oral
or written agreements having anything to do with the subject matter of this
Agreement.
7.10 Attorneys' Fees. Should either party institute any action or
proceeding to enforce this Agreement or any provision hereof or for damages by
reason of any alleged breach of this Agreement of any provision hereof, or for
a declaration of rights hereunder, the prevailing party in such action or
proceeding shall be entitled to receive from the other party all costs and
expenses, including reasonable attorneys= fees, incurred by the prevailing
party in connection with such action or proceeding.
7.11 Counterparts. This Agreement may be executed in counterparts,
each of which shall constitute an original document, but all of which together
shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first written above.
"PRINCIPAL"
PRIME XX.XXX., INC.
By: /s/ Xxxx Xxxxx
"PRINCIPAL"
PRIME XX.XXX., INC.
By: /s/ Xxxxx X. Xxxxxx
"MANAGER"
X-XXXXXXX.XXX
By: /s/ Xxxx X. Xxxxxxx
Exhibit "A"
Any and all of the assets, real property, tangible and intangible
personal property, rights and claims of every kind and nature whatsoever used
in, necessary or intended for, arising from or related to the operation of the
business of Principal, including, without limitation, the following:
1. all of the real property used in the operation of the business of
Principal, whether owned or leased by the Principal, including, without
limitation, all improvements, construction-in-progress and fixtures located
thereon;
2. all tangible personal property of every kind and nature used in the
operation of the business of Principal, whether owned or leased by the
Principal;
3. all intangible personal property used in the operation of the
business of Principal;
4. all patents, trademarks, trade names, business names, service marks,
trade secrets, copyrights and know-how including, without limitation, all of
Principal's right, title and interest in and to its trade names, logos
utilized in the operation of its business;
5. all telephone numbers used in connection with the operation of the
business of Principal; and
6. all licenses, permits, certificates, accreditations and other indicia
of authority relating to business operations appertaining to the business of
Principal (collectively, the "Licenses and Permits"); all rights or
obligations of Principal under all contracts, agreements, options and
commitments relating to the construction, renovation, ownership, servicing,
maintenance, occupancy and/or operation of Principal's business, or any part
thereof.
Exhibit "B"
To be attached by Principal and provided to Manager within five (5) days after
execution hereof.
Exhibit "C"
Manager's fee shall be:
1. On all net profits from the Subject Business under generally accepted
accounting principals consistently applied that are less than $5,000,000,
Manager shall receive 25% of such net profits;
2. On all net profits from the Subject Business under generally accepted
accounting principals consistently applied that are between $5,000,000 and
$15,000,000, Manager shall receive 50% net profits;
3. On all net profits from the Subject Business under generally accepted
accounting principals consistently applied that are between $15,000,000 and
$30,000,000, Manager shall receive 60% net profits;
4. On all net profits from the Subject Business under generally accepted
accounting principals consistently applied that are more than $30,000,000,
Manager shall receive 70% of such net profits.
The profit hurdle percentages set out above are cumulative over the life of
this Agreement, meaning, e.g., that once the cumulative historical net profits
reach $30,000,001 the Manager shall receive 70% of such net profits for over
the balance of this Agreement.
