Exhibit 2.15a
BOST1-637123-2
AMENDMENT TO
AFFILIATION AGREEMENT AND AGREEMENT AND PLAN OF MERGER
THIS AMENDMENT (the "Amendment Agreement") to an AFFILIATION
AGREEMENT AND AGREEMENT AND PLAN OF MERGER, dated January 17,
1998 (the "Affiliation Agreement") is entered into as of the 19th
day of January, 1998, by and among Omega Orthodontics of Woodland
Hills, Inc., a Delaware corporation ("Subsidiary" or "Surviving
Entity"), Omega Orthodontics, Inc., a Delaware corporation
("OMEGA"), Azani Dental Services, Inc., a Delaware corporation
(the "MSO"), Xxxxxx Xxxxx, D.D.S. ("Xx. Xxxxx") who is duly
licensed to practice orthodontics in the State of California (the
"State") and Xxxxxx Xxxxx, D.D.S., Inc., a California
professional dental corporation (the "Orthodontic Entity").
RECITALS
A. The parties hereto have entered into the Affiliation
Agreement.
B. The parties hereto wish to make certain amendments to
the Affiliation Agreement in order to taken into account certain
additional value of the MSO attributable to a practice conducted
by the Orthodontic Entity at its location at 00000 Xxxxxxxx Xxxx,
Xxxxx, Xxxxxxxxxx 00000.
C. A written amendment to the Affiliation Agreement is
necessary to effect such amendments.
NOW, THEREFORE, in consideration of the foregoing recitals
and the mutual promises contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged to the full satisfaction of the parties
hereto, the parties hereto agree to amend the Affiliation
Agreement as follows:
1. Recitals. Paragraph B of the Recitals shall be amended
and restated to provide as follows:
"B. The MSO provides management services to the Orthodontic
Entity, which owns and operates an orthodontic practice (the
"Practice") in Tarzana and Encino (the "Valley Practice") with
offices located at 00000 Xxxxx Xxxxxx, Xxxxx 000, Xxxxxxx,
Xxxxxxxxxx 00000 (which offices are being moved to 0000 Xxxxxx
Xxxx., Xxxxx 000, Xxxxxx Xxxxxxxxxx 00000-0000) (the "Valley
Office") and in Acton (the "Acton Practice") with offices located
at 00000 Xxxxxxxx Xxxx, Xxxxx, Xxxxxxxxxx 00000 (the "Desert
Office") (the Valley Office and the Desert Office together being
referred to herein as the "Orthodontic Offices") and furnishes
orthodontic care to the general public through the services of
Xx. Xxxxx affiliated with the Orthodontic Entity."
2. Merger Consideration. Article I shall be amended and
restated to provide as follows:
"ARTICLE 1.
MERGER
1.1 Merger; Consideration and Payment.
(a) At the Effective Time (as hereinafter defined) and
subject to the terms and conditions hereinafter set forth, the
parties hereto agree to cause the Merger to be consummated by
filing with the Delaware Secretary of State and the State
Secretary of State (if required) a Certificate of Merger (the
"Certificate of Merger") in the form required by applicable law,
duly executed and acknowledged by the Surviving Entity, and
taking all such further actions as may be required by law to make
the Merger effective. The Merger shall become effective upon the
filing of the Certificate of Merger with the Delaware Secretary
re Secretary
of State and the State Secretary of State (if required) (the
"Effective Time"), and the Subsidiary will be the surviving
entity.
(b) At the Effective Time, the Interests of the MSO
outstanding immediately prior to the Effective Time shall, on
such date, by virtue of the Merger and upon surrender to OMEGA of
the certificates therefor, duly endorsed and transferable, free
and clear of any liens, encumbrances, restrictions or claims of
any kind (other than those liens, encumbrances, restrictions and
claims expressly disclosed to OMEGA and affirmatively accepted by
OMEGA prior to the Effective Time), without any further action on
the part of any holder thereof, be converted into the right to
receive an aggregate consideration (the "Consideration") of:
(i) Sixty Thousand Two Hundred and Eighty Six Dollars
($60,286) in cash (the "Cash Component");
(ii) Thirty Thousand Dollars ($30,000) to be
represented by a promissory note (the "Purchase Note") payable to
Xx. Xxxxx (the "Note Component") in the form attached hereto as
Exhibit A-1; and
(iii) One Hundred Thousand Dollars ($100,000) to be
represented by issuance to Xx. Xxxxx of shares of OMEGA common
stock ("OMEGA Stock") based on a value per share equal to the
average daily closing sales price per share of OMEGA common stock
on the NASDAQ Small Cap Market for each business day (Monday
through Friday, not including legal holidays) of the calendar
week ending on the Friday immediately preceding the date of
Closing (as hereinafter defined) rounded down to the nearest
whole number of shares (the "Stock Component"), which shall
thereupon be issued to Xx. Xxxxx, fully paid and nonassessable.
1.2 Adjustment and Audit.
(a) The Consideration is based on the value of the
Interests as determined by OMEGA from the information set forth
in the Financial Statement. At OMEGA's option, OMEGA will cause
an audit (the "Audit") of the Financial Statement and the books
and records of the Orthodontic Entity to be completed prior to
Closing to confirm the accuracy and completeness of the
information in the Financial Statement.
(b) The Consideration shall be subject to adjustments
at Closing for: (i) prepaid and underpaid rent and other lease
obligations, if any leases are to be continued after Closing, as
well as for other agreed normal and customary prepaid and
underpaid expenses; (ii) any accrued but unpaid salaries, bonuses
and other compensation, fringe and health insurance benefits,
employment or payroll taxes and related employment obligations
and (iii) any accounts payable of the Orthodontic Entity which
have accrued prior to the Effective Time and which remain unpaid
as of such time (the "Accounts Payable").
(c) The Consideration shall also be subject to an
adjustment on March 1, 1999, to take into account the revaluation
of the Acton Practice. The parties hereto acknowledge that the
value of the Acton Practice as of the date hereof is Eighty
Thousand Two Hundred Eighty Six Dollars ($80,286). The adjusted
value of the Acton Practice shall be equal to One Hundred and
Twenty Percent (120%) of the numerical average of (i) collected
revenue of the Acton Practice for the preceding twelve calendar
months, and (ii) production of the Acton Practice for the
preceding twelve calendar months. For purposes of this
subsection (c) "collected revenue" shall mean gross collections
of all revenues generated by or on behalf of the PC at the Desert
Office, including, but not limited to, all fees and charges
collected as a result of professional orthodontic services
furnished to patients by the PC at the Desert Office and for any
other goods or services sold or provided to such patients, net of
any refunds. For purposes of this subsection (c) "production"
shall mean the sum of all new contracts entered into during the
preceding twelve months, plus all one time fees and charges
collected as a result of professional orthodontic services
furnished to patients by the PC at the Desert Office, plus any
net adjustments to such amounts during such period.
(d) The adjustments provided in subsection (b) hereof
to the Consideration payable hereunder, shall be applied in the
following order of priority; first to the Cash Component, and the
balance, if any, to the Stock Component. If the adjustment
provided in subsection (c) hereof to the Consideration payable
hereunder results in a decrease in the Consideration payable
hereunder, such adjustment shall be made by means of a reduction
in the principal amount of the Note Consideration (the "Note
Reduction") with the balance, if any, applied to the Cash
Component and then to the Stock Component. Any such reduction
shall be retroactive to the date of the Purchase Note. Any
excess interest payments due to such retroactive reduction in the
principal amount of the Purchase Note shall be credited against
the principal amount of the Purchase Note and shall be deemed to
reduce the outstanding balance as of the date of payment. If the
adjustment provided in subsection (c) hereof to the Consideration
payable hereunder, results in an increase in the Consideration
payable hereunder, such adjustment shall be made as follows: The
first Nine Thousand Dollars ($9,000) of any such adjustment shall
be payable to Xx. Xxxxx in cash, without interest. Any increase
in excess of Nine Thousand Dollars ($9,000) would be paid, Forty
Nine Percent (49%) in the form of cash, without interest, and
Fifty One Percent (51%) by the issuance of shares of OMEGA common
stock, based on a value per share equal to the average daily
closing sales price per share of OMEGA common stock on the NASDAQ
Small Cap Market for each business day (Monday through Friday,
not including legal holidays) of the calendar week ending on the
Friday immediately preceding March 1, 1999, rounded down to the
nearest whole number of shares, which shall thereupon be issued
to Xx. Xxxxx, fully paid and nonassessable.
1.3 Time and Place of Closing. The closing of the
transactions contemplated hereby (herein called the "Closing")
shall be held immediately before the Effective Time at the
offices of Xxxxxxxxx and Xxxxx, 0000 Xxxxxx Xxxx., Xxxxx 000,
Xxxxxx, Xxxxxxxxxx 00000-0000 on January 21, 1998, or at such
other place, date or time as may be fixed by mutual agreement of
the parties.
1.4 Filing Certificate of Merger. Contemporaneous with the
Closing, a duly executed Certificate(s) of Merger shall be filed
with the Delaware Secretary of State and the State Secretary of
State (if required).
1.5 Delivery of Records, Contracts, Interests. At the
Closing Xx. Xxxxx shall deliver or cause to be delivered to the
Subsidiary:
(a) All of the MSO's minute books, stock records and
other company books and records and the MSO's leases, contracts,
employment agreements, non-compete agreements, commitments and
rights, with such consents to the Merger as are necessary to
assure the Subsidiary of the full benefit of the same.
(b) Evidence of malpractice insurance coverage for Xx.
Xxxxx for the current and five (5) prior years."
3. Exhibit A-1. The Affiliation Agreement shall be
amended by the addition of Exhibit A-1 in the form attached
hereto.
4. Ratification of Other Provisions of Affiliation
Agreement. Except as provided herein, all other provisions,
terms and conditions of the Affiliation Agreement are hereby
ratified and confirmed.
IN WITNESS WHEREOF the parties hereto have caused this
Amendment Agreement to be executed as of the date set forth above
by their duly authorized representatives.
OMEGA ORTHODONTICS OF
WOODLAND HILLS, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx, Its President
Duly Authorized
OMEGA ORTHODONTICS, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
Its President and Chief Executive
Officer
Duly Authorized
AZANI DENTAL SERVICES, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx, Its President
Duly Authorized
XXXXXX XXXXX, D.D.S, INC.
By: /s/ Xxxxxx Xxxxx, D.D.S
Xxxxxx Xxxxx, D.D.S., Its President
Duly Authorized
Xxxxxx Xxxxx, D.D.S.
Xxxxxx Xxxxx, D.D.S.