remote10ksb093007ex10-17.htm


    
      

      

    

    
      


      


      


      
 

      


      




    STOCK
      PURCHASE AGREEMENT

    


    


    AMONG

    


    


    REMOTEMDX,
      INC.,

    


    


    AND

    


    


    MIDWEST
      MONITORING AND SURVEILLANCE, INC.,

    


    


    GARY
      SHELTON, GARY BENGTSON, LARRY GARDNER AND SUE GARDNER

    


    


    EFFECTIVE
      DECEMBER 1, 2007

    


    


    


    


    


    


    


    


    


    


    


    
      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    


    STOCK
      PURCHASE
      AGREEMENT

     

    Agreement
      entered into effective as of December 1, 2007, by and among RemoteMDx, Inc.,
      a
      Utah corporation (the "Buyer"),
      Midwest Monitoring & Surveillance, Inc. (“MM&S”),
      a Minnesota corporation, Gary Bengtson (“Bengtson”),
      Gary Shelton (“Shelton”),
      Larry Gardner (“L.
      Gardner”), and Sue Gardner (“S.
      Gardner”) (Bengtson, Shelton, L. Gardner and S. Gardner are referred to
      individually herein as a “Seller,”
      and collectively, as the "Sellers").  The
      Buyer, MM&S and the Sellers are referred to collectively herein as the
      "Parties."

     

    RECITALS:

     

    Sellers
      in the aggregate own all of the outstanding capital stock of
      MM&S.

     

    Buyer
      proposes to purchase from the Sellers, and the Sellers will sell to the Buyer,
      a
      minimum of fifty-one percent (51%) and up to one hundred percent (100%) of
      the
      outstanding capital stock of MM&S in return for cash and shares of Buyer’s
      authorized but previously unissued common stock.

     

    Now,
      therefore, in consideration of the premises and the mutual promises herein
      made,
      and in consideration of the representations, warranties, and covenants herein
      contained, the Parties agree as follows.

    


    ARTICLE
      1

    DEFINITIONS

    


    
      	
               

            	
              1.1

            	
              Defined
                Terms.
                

            


    

     

    In
      this
      Agreement, the following terms will have the following meanings:

     

    "Adverse
      Consequences" means all actions, suits, proceedings, hearings,
      investigations, charges, complaints, claims, demands, injunctions, judgments,
      orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid
      in settlement, Liabilities, obligations, Taxes, liens, losses, expenses, and
      fees, including court costs and reasonable attorneys' fees and
      expenses.

    


    "Affiliate"
      has the meaning set forth in Rule 12b-2 of the regulations promulgated under
      the
      Securities Exchange Act.

    


    "Affiliated
      Group" means any affiliated group within the meaning of Code §1504(a) or
      any similar group defined under a similar provision of state, local or foreign
      law.

    


    “Audited
      Net Revenues” shall mean the actual Net Revenues of MM&S for the year
      ending December 31, 2007 as determined by the Post-Closing Audit.

    


    "Basis"
      means any past or present fact, situation, circumstance, status, condition,
      activity, practice, plan, occurrence, event, incident, action, failure to act,
      or transaction that forms or could form the basis for any specified
      consequence.

    


    "Buyer"
      has the meaning set forth in the preface above.

    


    "Closing"
      has the meaning set forth in Section 2.2 below.

    


    "Closing
      Date" has the meaning set forth in Section 2.2 below.

    


    "COBRA"
      means the requirements of Part 6 of Subtitle B of Title I of ERISA and Code
      §4980B and of any similar state law.

    


    


    
      
        
          
          

        

        
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    "Code"
      means the Internal Revenue Code of 1986, as amended.

    


    "Confidential
      Information" means any information concerning the businesses and affairs
      of MM&S that is not already generally available to the public.

    


    "Controlled
      Group" has the meaning set forth in Code §1563.

    


    "Deferred
      Intercompany Transaction" has the meaning set forth in Reg.
§1.1502-13.

    


    "Disclosure
      Schedule" has the meaning set forth in Section 5 below.

    


    "Employee
      Benefit Plan" means any "employee benefit plan" (as such term is defined
      in ERISA §3(3)) and any other employee benefit plan, program or arrangement of
      any kind.

    


    "Employee
      Pension Benefit Plan" has the meaning set forth in ERISA
§3(2).

    


    "Employee
      Welfare Benefit Plan" has the meaning set forth in ERISA
§3(1).

    


    "Environmental,
      Health, and Safety Requirements" shall mean all federal, state, local and
      foreign statutes, regulations, ordinances and other provisions having the force
      or effect of law, all judicial and administrative orders and determinations,
      all
      contractual obligations and all common law concerning public health and safety,
      worker health and safety, and pollution or protection of the environment,
      including without limitation all those relating to the presence, use,
      production, generation, handling, transportation, treatment, storage, disposal,
      distribution, labeling, testing, processing, discharge, release, threatened
      release, control, or cleanup of any hazardous materials, substances or wastes,
      chemical substances or mixtures, pesticides, pollutants, contaminants, toxic
      chemicals, petroleum products or byproducts, asbestos, polychlorinated
      biphenyls, noise or radiation, each as amended and as now or hereafter in
      effect.

    


    "ERISA"
      means the Employee Retirement Income Security Act of 1974, as
      amended.

    


    "ERISA
      Affiliate" means each entity which is treated as a single employer with
      MM&S for purposes of Code §414.

    


    “Escrow
      Agent” shall mean the escrow agent selected by Buyer to hold the Buyer
      Shares as provided in Section 2.1.

    


    "Excess
      Loss Account" has the meaning set forth in Reg. §1.1502-19.

    


    "Fiduciary"
      has the meaning set forth in ERISA §3(21).

    


    "Financial
      Statement" has the meaning set forth in Section 5.6 below.

    


    "GAAP"
      means United States generally accepted accounting principles as in effect from
      time to time.

    


    "Indemnified
      Party" has the meaning set forth in Section 9.4 below.

    


    "Indemnifying
      Party" has the meaning set forth in Section 9.4 below.

    


    


    
      
        
          
          

        

        
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    "Intellectual
      Property" means (a) all inventions (whether patentable or unpatentable
      and whether or not reduced to practice), all improvements thereto, and all
      patents, patent applications, and patent disclosures, together with all
      reissuances, continuations, continuations-in-part, revisions, extensions, and
      reexaminations thereof, (b) all trademarks, service marks, trade dress, logos,
      trade names, and corporate names, together with all translations, adaptations,
      derivations, and combinations thereof and including all goodwill associated
      therewith, and all applications, registrations, and renewals in connection
      therewith, (c) all copyrightable works, all copyrights, and all applications,
      registrations, and renewals in connection therewith, (d) all mask works and
      all
      applications, registrations, and renewals in connection therewith, (e) all
      trade
      secrets and confidential business information (including ideas, research and
      development, know-how, formulas, compositions, manufacturing and production
      processes and techniques, technical data, designs, drawings, specifications,
      customer and supplier lists, pricing and cost information, and business and
      marketing plans and proposals), (f) all computer software (including data and
      related documentation), (g) all other proprietary rights, and (h) all copies
      and
      tangible embodiments thereof (in whatever form or medium).

    


    "Knowledge"
      means actual knowledge after reasonable investigation.

    


    "Liability"
      means any liability (whether known or unknown, whether asserted or unasserted,
      whether absolute or contingent, whether accrued or unaccrued, whether liquidated
      or unliquidated, and whether due or to become due), including any liability
      for
      Taxes.

    


    "Most
      Recent Balance Sheet" means the balance sheet contained within the Most
      Recent Financial Statements.

    


    "Most
      Recent Financial Statements" has the meaning set forth in Section 5.6
      below.

    


    "Most
      Recent Fiscal Year End" has the meaning set forth in Section 5.6
      below.

    


    "Multiemployer
      Plan" has the meaning set forth in ERISA §3(37).

    


    “Net
      Revenues” means gross revenues less returns and allowances determined in
      accordance with GAAP.

    


    "Ordinary
      Course of Business" means the ordinary course of business consistent with
      past custom and practice (including with respect to quantity and
      frequency).

    


    "Party"
      has the meaning set forth in the preface above.

    


    "PBGC"
      means the Pension Benefit Guaranty Corporation.

    


    "Person"
      means an individual, a partnership, a corporation, an association, a joint
      stock
      company, a trust, a joint venture, an unincorporated organization, or a
      governmental entity (or any department, agency, or political subdivision
      thereof).

    


    “Post-Closing
      Adjustment Amount” shall mean the difference, if any, between the amount
      of $1,702,825.33 in revenues reported by MM&S for the six months ended June
      30, 2007 in the Most Recent Financial Statements less the Audited Net Revenues;
      if Audited Net Revenues are greater than $1,702,825.33, the Post-Closing
      Adjustment Amount shall be zero.

    


    


    
      
        
          
          

        

        
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    “Post-Closing
      Audit” shall mean the audit of MM&S’s financial statements for the
      year ending December 31, 2007, to be conducted following the Closing by the
      independent registered public accounting firm selected by Buyer (the “Auditor”).

    


    "Prohibited
      Transaction" has the meaning set forth in ERISA §406 and Code
§4975.

    


    "Purchase
      Price" has the meaning set forth in Section 2.1 below.

    


    "Reportable
      Event" has the meaning set forth in ERISA §4043.

    


    "Securities
      Act" means the Securities Act of 1933, as amended.

    


    "Securities
      Exchange Act" means the Securities Exchange Act of 1934, as
      amended.

    


    "Security
      Interest" means any mortgage, pledge, lien, encumbrance, charge, or other
      security interest, other than (a) mechanic's, materialmen's, and similar liens,
      (b) liens for Taxes not yet due and payable or for Taxes that the taxpayer
      is
      contesting in good faith through appropriate proceedings, (c) purchase money
      liens and liens securing rental payments under capital lease arrangements,
      and
      (d) other liens arising in the Ordinary Course of Business and not incurred
      in
      connection with the borrowing of money.

    


    "Seller"
      has the meaning set forth in the preface above.

    


    "Subsidiary"
      means any corporation with respect to which a specified Person (or a Subsidiary
      thereof) owns a majority of the common stock or has the power to vote or direct
      the voting of sufficient securities to elect a majority of the
      directors.

    


    "Tax"
      means any federal, state, local, or foreign income, gross receipts, license,
      payroll, employment, excise, severance, stamp, occupation, premium, windfall
      profits, environmental (including taxes under Code §59A), customs duties,
      capital stock, franchise, profits, withholding, social security (or similar),
      unemployment, disability, real property, personal property, sales, use,
      transfer, registration, value added, alternative or add-on minimum, estimated,
      or other tax of any kind whatsoever, including any interest, penalty, or
      addition thereto, whether disputed or not.

    


    "Tax
      Return" means any return, declaration, report, claim for refund, or
      information return or statement relating to Taxes, including any schedule or
      attachment thereto, and including any amendment thereof.

    


    "Third
      Party Claim" has the meaning set forth in Section 9.4 below.

    


    ARTICLE
      2

    PURCHASE
      AND
      CLOSING

    


    
      	
               

            	
              2.1

            	
              Purchase
                and Sale of
                MM&S Shares. 

            


    

    


    (A)         Buyer
      shall purchase from Sellers, and each Seller shall sell, convey, assign,
      transfer and deliver to Buyer, that number of shares of the common stock of
      MM&S (the “MM&S
      Shares”) free and clear of any lien and restriction on transfer set forth
      on Schedule 2.1(A)
      under the heading “Common Stock to be Sold” next to such Seller's name
      for the consideration specified below in Section
      2.1(B).

     

    


    


    
      
        
          
          

        

        
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    (B)         In
      consideration for the MM&S Shares to be sold pursuant to Section 2.1(A),
      Buyer shall pay to Sellers, in accordance with Schedule 2.1(B), an
      aggregate amount of $3,400,000 (the “Purchase
      Price”), minus the
      Post-Closing Adjustment Amount, if any.  The Purchase Price will be
      paid by delivery of $1,800,000 cash and up to 438,000 Buyer Shares valued for
      purposes of this Agreement at a price of $3.81 per share.  The
      Purchase Price shall be allocated among the Sellers in proportion to their
      respective holdings of MM&S Shares as set forth on Schedule
      2.1(B).  The Buyer Shares shall be held in escrow from the
      Closing Date until the completion of the Post-Closing Audit and verification
      of
      the Post-Closing Adjustment Amount.  The number of Buyer Shares
      delivered to Sellers out of escrow shall be reduced by the Post-Closing
      Adjustment Amount and the balance of the Buyer Shares in escrow following
      delivery of the adjusted number of Buyer Shares to Sellers will be returned
      to
      Buyer.

    


    
      	
               

            	
              2.2

            	
              Closing.
                

            


    

    


    (A)         Closing
      Date.  The Closing of the Transaction (the “Closing”)
      will occur at a location to be agreed upon by Buyer and Sellers at 10:00 a.m.
      on
      or before December 31, 2007, or such later date as the Parties may agree;
      provided, however, that the Closing shall occur no later than January 20,
      2008.  The date upon which the Closing actually occurs is referred to
      herein as the “Closing
      Date”.

     

    (B)         Deliveries
      at the Closing.  At the Closing, (i) the Sellers will deliver
      to the Buyer the various certificates, instruments, and documents referred
      to in
      Section 8.1 below, (ii) the Buyer will deliver to the Sellers the various
      certificates, instruments, and documents referred to in Section 8.2 below,
      (iii)
      each of the Sellers will deliver to the Buyer stock certificates representing
      all of his MM&S Shares purchased hereunder, endorsed in blank or accompanied
      by duly executed assignment documents, (iv) the Buyer will deliver to each
      of
      the Sellers the cash consideration specified in Section 2.1(B) above; and (v)
      Buyer will deliver to the Escrow Agent the Buyer Shares forming part of the
      Purchase Price specified in Section 2.1(B) above.

    


    
      	
               

            	
              2.3

            	
              Buyer’s
                Option. 

            


    

    


    (A)         Option
      Price.  In consideration of the payment of the Purchase Price
      as provided above, Sellers hereby grant to Buyer the right, at its sole election
      and option, to purchase all remaining MM&S Shares on or before March 1,
      2009.  The price for such remaining MM&S Shares shall be an amount
      equal to two times the Net Revenues of MM&S for the 12 months ending
      December 31, 2008, as determined by the Auditor, multiplied by 49% (the “Buyer’s
      Option Price”).

    


    (B)         Exercise
      of Option.  Buyer may exercise its option at any time on or
      after January 1, 2009, by giving Sellers a minimum of fifteen (15) days written
      notice.  The closing of the purchase of the remaining MM&S Shares
      under this Section 2.3 shall occur on or before March 1, 2009 or such later
      date
      as the Parties may then agree.  The Buyer’s Option Price may be paid,
      at the sole option of Buyer, 50% in cash and 50% in shares of Buyer’s common
      stock valued at the market price for such shares averaged over the five trading
      days immediately preceding the closing date for such purchase.

    


    
      	
               

            	
              2.4

            	
              Sellers’
                Option.

            


    

    


    (A)         Option.  In
      the event Buyer fails or elects not to exercise its Buyer’s Option granted under
      Section 2.3, above, Sellers shall have the right, at their sole election and
      option (“Sellers’
      Option”), to require Buyer to purchase all but not less than all of the
      remaining MM&S Shares on or before March 1, 2009.

    


    


    
      
        
          
          

        

        
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    (B)         Exercise.  The
      purchase price for the MM&S Shares under this Section 2.4 shall be the
      Buyer’s Option Price.  Exercise of this Seller’s Option shall be made
      by giving Buyer written notice of such exercise no less than fifteen (15) days
      prior to the date set for closing of such sale.  The Seller’s Option
      purchase price may be paid, at the sole option of Buyer, 50% in cash and 50%
      in
      shares of Buyer’s common stock valued at the market price for such shares
      averaged over the five trading days immediately preceding the closing date
      for
      such purchase.

    


    (C)         Performance.  In
      the event Seller exercises the Sellers’ Option and Buyer fails to perform and
      complete its purchase of the remaining MM&S Shares as provided in this
      Section 2.4, and fails further to cure such breach within sixty (60) days
      thereafter, Buyer shall forfeit its ownership of the MM&S Shares acquired
      under Section 2.1, above, and shall return, convey, assign, and transfer and
      deliver such MM&S Shares to Sellers, free and clear of any lien or
      restriction on transfer to Sellers in the same amounts set forth opposite
      Sellers’ names on Schedule 2.1(B).

    


    2.5        Resolution
      of Personal Liabilities.  Upon the exercise and closing of
      either the Buyer’s Option or the Sellers’ Option granted above, MM&S shall
      undertake to obtain the release of the pledges and guarantees made by Sellers
      or
      any of them on behalf of MM&S, including, without limitation, all personal
      guarantees, pledges of real or personal property, liens and other arrangements
      in which Sellers or any of them has guaranteed or secured the performance of
      MM&S.  In addition, MM&S shall repay in full loans made by the
      Sellers or any of them to MM&S.

    


    ARTICLE
      3

    REPRESENTATIONS
      AND
      WARRANTIES

    REGARDING
      SELLERS

    


    Each
      Seller represents and warrants to the Buyer that the statements contained in
      this Article 3 are correct and complete as of the date of this Agreement and
      will be correct and complete as of the Closing Date (as though made then and
      as
      though the Closing Date were substituted for the date of this Agreement
      throughout this Article 3) with respect to himself or herself, except as set
      forth in Schedule
      3 attached hereto.

    


    3.1       Authorization
      of Transaction.  Seller has full power and authority to execute
      and deliver this Agreement and to perform his obligations
      hereunder.  This Agreement constitutes the valid and legally binding
      obligation of the Seller, enforceable in accordance with its terms and
      conditions.  Seller need not give any notice to, make any filing with,
      or obtain any authorization, consent, or approval of any government or
      governmental agency in order to consummate the transactions contemplated by
      this
      Agreement.

    


    3.2       Noncontravention.  Neither
      the execution and the delivery of this Agreement, nor the consummation of the
      transactions contemplated hereby, will (A) violate any constitution, statute,
      regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
      restriction of any government, governmental agency, or court to which the Seller
      or MM&S is subject or (B) conflict with, result in a breach of, constitute a
      default under, result in the acceleration of, create in any party the right
      to
      accelerate, terminate, modify, or cancel, or require any notice under any
      agreement, contract, lease, license, instrument, or other arrangement to which
      the Seller or MM&S is a party or by which he or it is bound or to which any
      of his or its assets is subject.

    


    3.3       Brokers'
      Fees.  Seller has no Liability or obligation to pay any fees or
      commissions to any broker, finder, or agent with respect to the transactions
      contemplated by this Agreement for which the Buyer could become liable or
      obligated.

    


    


    
      
        
          
          

        

        
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    3.4       Investment.  Seller
      (A) understands that the Buyer Shares have not been registered under the
      Securities Act, or under any state securities laws, and are being offered and
      sold in reliance upon federal and state exemptions for transactions not
      involving any public offering, (B) is acquiring the Buyer Shares solely for
      his
      own account for investment purposes, and not with a view to the distribution
      thereof, (C) is a sophisticated investor with knowledge and experience in
      business and financial matters, (D) has received certain information concerning
      the Buyer and has had the opportunity to obtain additional information as
      desired in order to evaluate the merits and the risks inherent in holding the
      Buyer Shares, (E) is able to bear the economic risk and lack of liquidity
      inherent in holding the Buyer Shares, and (F) is an Accredited
      Investor.

    


    3.5       MM&S
      Shares.  Seller holds of record and owns beneficially the
      number of MM&S Shares set forth next to his name in Schedule 2.1(A), free
      and clear of any restrictions on transfer (other than any restrictions under
      the
      Securities Act and state securities laws), Taxes, Security Interests, options,
      warrants, purchase rights, contracts, commitments, equities, claims, and
      demands.  Seller is not a party to any option, warrant, purchase
      right, or other contract or commitment that could require the Seller to sell,
      transfer, or otherwise dispose of any capital stock of MM&S (other than this
      Agreement).  Seller is not a party to any voting trust, proxy, or
      other agreement or understanding with respect to the voting of any capital
      stock
      of MM&S that will survive the Closing.

    


    ARTICLE
      4

    REPRESENTATIONS
      AND
      WARRANTIES

    REGARDING
      BUYER

    


    Buyer
      represents and warrants to the Sellers that the statements contained in this
      Article 4 are correct and complete as of the date of this Agreement and will
      be
      correct and complete as of the Closing Date (as though made then and as though
      the Closing Date were substituted for the date of this Agreement throughout
      this
      Article 4), except as set forth in Schedule 4 attached
      hereto.

    


    4.1       Organization
      of the Buyer.  The Buyer is a corporation duly organized,
      validly existing, and in good standing under the laws of the jurisdiction of
      its
      incorporation.

    


    4.2       Authorization
      of Transaction.  The Buyer has full power and authority
      (including full corporate power and authority) to execute and deliver this
      Agreement and to perform its obligations hereunder.  This Agreement
      constitutes the valid and legally binding obligation of the Buyer, enforceable
      in accordance with its terms and conditions.  The Buyer need not give
      any notice to, make any filing with, or obtain any authorization, consent,
      or
      approval of any government or governmental agency in order to consummate the
      transactions contemplated by this Agreement.

    


    4.3       Noncontravention.  Neither
      the execution and the delivery of this Agreement, nor the consummation of the
      transactions contemplated hereby, will violate any constitution, statute,
      regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
      restriction of any government, governmental agency, or court to which the Buyer
      is subject or any provision of its charter or bylaws.

    


    4.4       Brokers'
      Fees.  The Buyer has no Liability or obligation to pay any fees
      or commissions to any broker, finder, or agent with respect to the transactions
      contemplated by this Agreement for which any Seller could become liable or
      obligated.

    


    4.5       Investment.  The
      Buyer is not acquiring MM&S Shares with a view to or for sale in connection
      with any distribution thereof within the meaning of the Securities
      Act.

    


    


    
      
        
          
          

        

        
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    ARTICLE
      5

    REPRESENTATIONS
      AND
      WARRANTIES REGARDING MM&S

    


    The
      Sellers represent and warrant to the Buyer that the statements contained in
      this
      Article 5 are correct and complete as of the date of this Agreement and will
      be
      correct and complete as of the Closing Date (as though made then and as though
      the Closing Date were substituted for the date of this Agreement throughout
      this
      Article 5), except as set forth in the disclosure schedule delivered by the
      Sellers to the Buyer at the Closing and initialed by the Parties (the "Disclosure
      Schedule").  Nothing in the Disclosure Schedule shall be deemed
      adequate to disclose an exception to a representation or warranty made herein,
      however, unless the Disclosure Schedule identifies the exception with
      particularity and describes the relevant facts in detail.  Without
      limiting the generality of the foregoing, the mere listing (or inclusion of
      a
      copy) of a document or other item shall not be deemed adequate to disclose
      an
      exception to a representation or warranty made herein (unless the representation
      or warranty has to do with the existence of the document or other item
      itself).  The Disclosure Schedule will be arranged in paragraphs
      corresponding to the lettered and numbered paragraphs contained in this Article
      5.

    


    5.1       Organization,
      Qualification, and Corporate Power.  MM&S is a corporation
      duly organized, validly existing, and in good standing under the laws of the
      jurisdiction of its incorporation.  MM&S is duly authorized to
      conduct business and is in good standing under the laws of each jurisdiction
      where such qualification is required.  MM&S has full corporate
      power and authority and all licenses, permits, and authorizations necessary
      to
      carry on the businesses in which it is engaged and in which it presently
      proposes to engage and to own and use the properties owned and used by
      it.  Section 5.1 of the Disclosure Schedule lists the directors and
      officers of MM&S.  The Sellers have delivered to the Buyer correct
      and complete copies of the charter and bylaws of MM&S (as amended to
      date).  The minute books (containing the records of meetings of the
      stockholders, the board of directors, and any committees of the board of
      directors), the stock certificate books, and the stock record books of MM&S
      are correct and complete.  MM&S is not in default under or in
      violation of any provision of its charter or bylaws.

    


    5.2       Capitalization.  The
      entire authorized capital stock of MM&S consists of 600 shares of common
      stock, of which 300 shares are issued and outstanding and 300 shares are held
      in
      treasury.  All of the issued and outstanding MM&S Shares have been
      duly authorized, are validly issued, fully paid, and nonassessable, and are
      held
      of record by the respective Sellers as set forth in Section 5.2 of the
      Disclosure Schedule.  There are no outstanding or authorized options,
      warrants, purchase rights, subscription rights, conversion rights, exchange
      rights, or other contracts or commitments that could require MM&S to issue,
      sell, or otherwise cause to become outstanding any of its capital stock. There
      are no outstanding or authorized stock appreciation, phantom stock, profit
      participation, or similar rights with respect to MM&S. There are no voting
      trusts, proxies, or other agreements or understandings with respect to the
      voting of the capital stock of MM&S. A “Shareholders’
      Agreement” dated February 11, 2000, to which each of the Sellers is a
      party, shall be terminated and shall not survive the Closing.

    


    5.3       Noncontravention.  Neither
      the execution and the delivery of this Agreement, nor the consummation of the
      transactions contemplated hereby, will (i) violate any constitution, statute,
      regulation, rule, injunction, judgment, order, decree, ruling, charge, or other
      restriction of any government, governmental agency, or court to which MM&S
      is subject or any provision of the charter or bylaws of MM&S or (ii)
      conflict with, result in a breach of, constitute a default under, result in
      the
      acceleration of, create in any party the right to accelerate, terminate, modify,
      or cancel, or require any notice under any agreement, contract, lease, license,
      instrument, or other arrangement to which MM&S is a party or by which it is
      bound or to which any of its assets is subject (or result in the imposition
      of
      any Security Interest upon any of its assets).  MM&S needs not
      give notice to, make any filing with, or obtain any authorization, consent,
      or
      approval of any government or governmental agency in order for the Parties
      to
      consummate the transactions contemplated by this Agreement.

    


    


    
      
        
          
          

        

        
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    5.4       Brokers'
      Fees.  MM&S has no Liability or obligation to pay any fees
      or commissions to any broker, finder, or agent with respect to the transactions
      contemplated by this Agreement.

    


    5.5       Title
      to
      Assets.  MM&S has good and marketable title to, or a valid
      leasehold interest in, the properties and assets used by it, located on its
      premises, or shown on the Most Recent Balance Sheet or acquired after the date
      thereof, free and clear of all Security Interests, except for properties and
      assets disposed of in the Ordinary Course of Business since the date of the
      Most
      Recent Balance Sheet.

    


    5.5       Subsidiaries.  MM&S
      has no Subsidiaries.

    


    5.6       Financial
      Statements.  Attached hereto as Exhibit B are the following
      financial statements (collectively the "Financial
      Statements") of MM&S: (i) unaudited consolidating balance sheets and
      statements of income, changes in stockholders' equity, and cash flow as of
      and
      for the fiscal years ended December 31, 2005 and 2006 (the "Most
      Recent Fiscal Year End") for MM&S; and (ii) unaudited consolidated
      and consolidating balance sheets and statements of income, changes in
      stockholders' equity, and cash flow (the "Most
      Recent Financial Statements") as of and for the 6 months ended June 30,
      2007 for MM&S.  The Financial Statements (including the notes
      thereto) present fairly the financial condition of MM&S as of such dates and
      the results of operations of MM&S for such periods, are correct and
      complete, and are consistent with the books and records of MM&S (which books
      and records are correct and complete) ; provided, however, that the Most Recent
      Financial Statements are subject to normal year-end adjustments (which will
      not
      be material individually or in the aggregate) and lack footnotes and other
      presentation items.

    


    5.7       Events
      Subsequent to Most Recent Fiscal Year End.  Since the Most
      Recent Fiscal Year End, there has not been any material adverse change in the
      business, financial condition, operations, results of operations, or future
      prospects of MM&S.  Without limiting the generality of the
      foregoing, since that date:

    


    (A)         MM&S
      has not sold, leased, transferred, or assigned any of its assets, tangible
      or
      intangible, other than for a fair consideration in the Ordinary Course of
      Business;

    


    (B)         MM&S
      has not entered into any agreement, contract, lease, or license (or series
      of
      related agreements, contracts, leases, and licenses) either involving more
      than
      $10,000 or outside the Ordinary Course of Business;

    


    (C)         No
      party (including MM&S) has accelerated, terminated, modified, or cancelled
      any agreement, contract, lease, or license (or series of related agreements,
      contracts, leases, and licenses) involving more than $10,000 to which MM&S
      is a party or by which it is bound;

    


    (D)         MM&S
      has not imposed any Security Interest upon any of its assets, tangible or
      intangible;

    


    (E)          MM&S
      has not made any capital expenditure (or series of related capital expenditures)
      either involving more than $10,000 or outside the Ordinary Course of
      Business;

    


    


    
      
        
          
          

        

        
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    (F)          MM&S
      has not made any capital investment in, any loan to, or any acquisition of
      the
      securities or assets of, any other Person (or series of related capital
      investments, loans, and acquisitions) either involving more than $10,000 or
      outside the Ordinary Course of Business;

    


    (G)         MM&S
      has not issued any note, bond, or other debt security or created, incurred,
      assumed, or guaranteed any indebtedness for borrowed money or capitalized lease
      obligation either involving more than $10,000 singly or $10,000 in the
      aggregate;

    


    (H)         MM&S
      has not delayed or postponed the payment of accounts payable and other
      Liabilities outside the Ordinary Course of Business;

    


    (I)           MM&S
      has not cancelled, compromised, waived, or released any right or claim (or
      series of related rights and claims) either involving more than $10,000 or
      outside the Ordinary Course of Business;

    


    (J)          MM&S
      has not granted any license or sublicense of any rights under or with respect
      to
      any Intellectual Property;

    


    (K)         There
      has been no change made or authorized in the charter or bylaws of
      MM&S;

    


    (L)          MM&S
      has not issued, sold, or otherwise disposed of any of its capital stock, or
      granted any options, warrants, or other rights to purchase or obtain (including
      upon conversion, exchange, or exercise) any of its capital stock;

    


    (M)        MM&S
      has not declared, set aside, or paid any dividend or made any distribution
      with
      respect to its capital stock (whether in cash or in kind) or redeemed,
      purchased, or otherwise acquired any of its capital stock;

    


    (N)         MM&S
      has not experienced any damage, destruction, or loss (whether or not covered
      by
      insurance) to its property;

    


    (O)         MM&S
      has not made any loan to, or entered into any other transaction with, any of
      its
      directors, officers, and employees outside the Ordinary Course of
      Business;

    


    (P)         
      MM&S has not entered into any employment contract or collective bargaining
      agreement, written or oral, or modified the terms of any existing such contract
      or agreement;

    


    (Q)         MM&S
      has not granted any increase in the base compensation of any of its directors,
      officers, and employees outside the Ordinary Course of Business;

    


    (R)         MM&S
      has not adopted, amended, modified, or terminated any bonus, profit-sharing,
      incentive, severance, or other plan, contract, or commitment for the benefit
      of
      any of its directors, officers, and employees (or taken any such action with
      respect to any other Employee Benefit Plan);

    


    (S)         
      MM&S has not made any other change in employment terms for any of its
      directors, officers, and employees outside the Ordinary Course of
      Business;

    


    (T)          MM&S
      has not made or pledged to make any charitable or other capital contribution
      outside the Ordinary Course of Business;

    


    


    
      
        
          
          

        

        
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    (U)         There
      has not been any other material occurrence, event, incident, action, failure
      to
      act, or transaction outside the Ordinary Course of Business involving MM&S;
      and

    


    (V)         MM&S
      has not committed to any of the foregoing.

    


    5.8       Undisclosed
      Liabilities.  MM&S has no Liability (and there is no Basis
      for any present or future action, suit, proceeding, hearing, investigation,
      charge, complaint, claim, or demand against any of them giving rise to any
      Liability), except for (i) Liabilities set forth on the face of the Most Recent
      Balance Sheet (rather than in any notes thereto) and (ii) Liabilities which
      have
      arisen after the Most Recent Fiscal Year End in the Ordinary Course of Business
      (none of which results from, arises out of, relates to, is in the nature of,
      or
      was caused by any breach of contract, breach of warranty, tort, infringement,
      or
      violation of law).

    


    5.9       Legal
      Compliance.  MM&S and its predecessors and Affiliates has
      complied with all applicable laws (including rules, regulations, codes, plans,
      injunctions, judgments, orders, decrees, rulings, and charges thereunder) of
      federal, state, local, and foreign governments (and all agencies thereof),
      and
      no action, suit, proceeding, hearing, investigation, charge, complaint, claim,
      demand, or notice has been filed or commenced against any of them alleging
      any
      failure so to comply.

    


    
      	
               

            	
              5.10

            	
              Tax
                Matters. 

            


    

    


    (A)         MM&S
      has filed all Tax Returns that it was required to file.  All such Tax
      Returns were correct and complete in all respects.  All Taxes owed by
      MM&S (whether or not shown on any Tax Return) have been
      paid.  MM&S currently is not the beneficiary of any extension of
      time within which to file any Tax Return.  No claim has ever been made
      by an authority in a jurisdiction where MM&S does not file Tax Returns that
      it is or may be subject to taxation by that jurisdiction.  There are
      no Security Interests on any of the assets of MM&S that arose in connection
      with any failure (or alleged failure) to pay any Tax.

    


    (B)         MM&S
      has withheld and paid all Taxes required to have been withheld and paid in
      connection with amounts paid or owing to any employee, independent contractor,
      creditor, stockholder, or other third party.

    


    (C)         No
      Seller or director or officer (or employee responsible for Tax matters) of
      MM&S expects any authority to assess any additional Taxes for any period for
      which Tax Returns have been filed.  There is no dispute or claim
      concerning any Tax Liability of MM&S either (i) claimed or raised by any
      authority in writing or (ii) as to which any of the Sellers and the directors
      and officers (and employees responsible for Tax matters) of MM&S has
      Knowledge based upon personal contact with any agent of such
      authority.  Section 5.10(C) of the Disclosure Schedule lists all
      federal, state, local, and foreign income Tax Returns filed with respect to
      MM&S for taxable periods ended on or after December 31, 2000, indicates
      those Tax Returns that have been audited, and indicates those Tax Returns that
      currently are the subject of audit.  The Sellers have delivered to the
      Buyer correct and complete copies of all federal income Tax Returns, examination
      reports, and statements of deficiencies assessed against or agreed to by
      MM&S since December 31, 2000.

    


    (D)         MM&S
      has not waived any statute of limitations in respect of Taxes or agreed to
      any
      extension of time with respect to a Tax assessment or deficiency.

    


    


    
      
        
          
          

        

        
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    (E)          MM&S
      has not filed a consent under Code §341(f) concerning collapsible
      corporations.  MM&S has not made any payments, is not obligated to
      make any payments, or is not a party to any agreement that under certain
      circumstances could obligate it to make any payments that will not be deductible
      under Code §280G.  MM&S has not been a United States real property
      holding corporation within the meaning of Code §897(c) (2) during the applicable
      period specified in Code §897(c) (1) (A) (ii).  MM&S is not a
      party to any Tax allocation or sharing agreement.  MM&S (1) has
      not been a member of an Affiliated Group filing a consolidated federal income
      Tax Return (other than a group the common parent of which was MM&S) or (2)
      has no Liability for the Taxes of any Person (other than MM&S) under Reg.
§1.1502-6 (or any similar provision of state, local, or foreign law), as a
      transferee or successor, by contract, or otherwise.

    


    (F)          Section
      5.10(F) of the Disclosure Schedule sets forth the following information with
      respect to MM&S as of the most recent practicable date: (i) the basis of
      MM&S in its assets; (ii) the amount of any net operating loss, net capital
      loss, unused investment or other credit, unused foreign tax, or excess
      charitable contribution allocable to MM&S; and (iii) the amount of any
      deferred gain or loss allocable to MM&S arising out of any Deferred
      Intercompany Transaction.

    


    (G)         The
      unpaid Taxes of MM&S (i) did not, as of November 30, 2007, exceed the
      reserve for Tax Liability (rather than any reserve for deferred Taxes
      established to reflect timing differences between book and Tax income) set
      forth
      on the face of the Most Recent Balance Sheet (rather than in any notes thereto)
      and (ii) do not exceed that reserve as adjusted for the passage of time through
      the Closing Date in accordance with the past custom and practice of MM&S in
      filing its Tax Returns.

    


    
      	
               

            	
              5.11

            	
              Real
                Property.
                

            


    

    


    (A)        
      Section 5.11(A) of the Disclosure Schedule lists and describes briefly all
      real
      property that MM&S owns.  With respect to each such parcel of
      owned real property:

    


    (i)          The
      identified owner has good and marketable title to the parcel of real property,
      free and clear of any Security Interest, easement, covenant, or other
      restriction, except for installments of special assessments not yet delinquent
      and recorded easements, covenants, and other restrictions which do not impair
      the current use, occupancy, or value, or the marketability of title, of the
      property subject thereto;

    


    (ii)         There
      are no pending or, to the Knowledge of any of the Sellers and the directors
      and
      officers (and employees with responsibility for real estate matters) of
      MM&S, threatened condemnation proceedings, lawsuits, or administrative
      actions relating to the property or other matters affecting materially and
      adversely the current use, occupancy, or value thereof;

    


    (iii)         The
      legal description for the parcel contained in the deed thereof describes such
      parcel fully and adequately, the buildings and improvements are located within
      the boundary lines of the described parcels of land, are not in violation of
      applicable setback requirements, zoning laws, and ordinances (and none of the
      properties or buildings or improvements thereon are subject to "permitted
      non-conforming use" or "permitted non-conforming structure" classifications),
      and do not encroach on any easement which may burden the land, and the land
      does
      not serve any adjoining property for any purpose inconsistent with the use
      of
      the land, and the property is not located within any flood plain or subject
      to
      any similar type restriction for which any permits or licenses necessary to
      the
      use thereof have not been obtained;

    


    (iv)         All
      facilities have received all approvals of governmental authorities (including
      licenses and permits) required in connection with the ownership or operation
      thereof and have been operated and maintained in accordance with applicable
      laws, rules, and regulations;

    


    


    
      
        
          
          

        

        
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    (v)         There
      are no leases, subleases, licenses, concessions, or other agreements, written
      or
      oral, granting to any party or parties the right of use or occupancy of any
      portion of the parcel of real property;

    


    (vi)        There
      are no outstanding options or rights of first refusal to purchase the parcel
      of
      real property, or any portion thereof or interest therein;

    


    (vii)       There
      are no parties (other than MM&S) in possession of the parcel of real
      property, other than tenants under any leases disclosed in Section 5.11 of
      the
      Disclosure Schedule who are in possession of space to which they are
      entitled;

    


    (viii)      
      All facilities located on the parcel of real property are supplied with
      utilities and other services necessary for the operation of such facilities,
      including gas, electricity, water, telephone, sanitary sewer, and storm sewer,
      all of which services are adequate in accordance with all applicable laws,
      ordinances, rules, and regulations and are provided via public roads or via
      permanent, irrevocable, appurtenant easements benefitting the parcel of real
      property; and

    


    (ix)        Each
      parcel of real property abuts on and has direct vehicular access to a public
      road, or has access to a public road via a permanent, irrevocable, appurtenant
      easement benefitting the parcel of real property, and access to the property
      is
      provided by paved public right-of-way with adequate curb cuts
      available.

    


    (B)         Section
      5.11(B) of the Disclosure Schedule lists and describes briefly all real property
      leased or subleased to MM&S.  Section 5.11(B) of the Disclosure
      Schedule also identifies the leased or subleased properties for which title
      insurance policies are to be procured in accordance with this
      Agreement.  The Sellers have delivered to the Buyer correct and
      complete copies of the leases and subleases listed in Section 5.11(B) of the
      Disclosure Schedule (as amended to date).  With respect to each lease
      and sublease listed in the Disclosure Schedule:

    


    (i)         
      The lease or sublease is legal, valid, binding, enforceable, and in full force
      and effect;

    


    (ii)         The
      lease or sublease will continue to be legal, valid, binding, enforceable, and
      in
      full force and effect on identical terms following the consummation of the
      transactions contemplated hereby;

    


    (iii)        No
      party to the lease or sublease is in breach or default, and no event has
      occurred which, with notice or lapse of time, would constitute a breach or
      default or permit termination, modification, or acceleration
      thereunder;

    


    (iv)        No
      party to the lease or sublease has repudiated any provision
      thereof;

    


    (v)         There
      are no disputes, oral agreements, or forbearance programs in effect as to the
      lease or sublease;

    


    (vi)       
      With respect to each sublease, the representations and warranties set forth
      in
      subsections (i) through (v) above are true and correct with respect to the
      underlying lease;

    


    (vii)       
      MM&S has not assigned, transferred, conveyed, mortgaged, deeded in trust, or
      encumbered any interest in the leasehold or subleasehold;

    


    


    
      
        
          
          

        

        
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    (viii)       All
      facilities leased or subleased thereunder have received all approvals of
      governmental authorities (including licenses and permits) required in connection
      with the operation thereof and have been operated and maintained in accordance
      with applicable laws, rules, and regulations;

    


    (ix)        All
      facilities leased or subleased thereunder are supplied with utilities and other
      services necessary for the operation of said facilities; and

    


    (x)         The
      owner of the facility leased or subleased has good and marketable title to
      the
      parcel of real property, free and clear of any Security Interest, easement,
      covenant, or other restriction, except for installments of special easements
      not
      yet delinquent and recorded easements, covenants, and other restrictions which
      do not impair the current use, occupancy, or value, or the marketability of
      title, of the property subject thereto.

    


    
      	
               

            	
              5.12

            	
              Intellectual
                Property. 

            


    

    


    (A)         MM&S
      owns or has the right to use pursuant to license, sublicense, agreement, or
      permission all Intellectual Property necessary or desirable for the operation
      of
      the business of MM&S as presently conducted and as presently proposed to be
      conducted.  Each item of Intellectual Property owned or used by
      MM&S immediately prior to the Closing will be owned or available for use by
      MM&S on identical terms and conditions immediately subsequent to the
      Closing.  MM&S has taken all necessary action to maintain and
      protect each item of Intellectual Property that it owns or uses.

    


    (B)         MM&S
      has not interfered with, infringed upon, misappropriated, or otherwise come
      into
      conflict with any Intellectual Property rights of third parties, and none of
      the
      Sellers and the directors and officers (and employees with responsibility for
      Intellectual Property matters) of MM&S has ever received any charge,
      complaint, claim, demand, or notice alleging any such interference,
      infringement, misappropriation, or violation (including any claim that MM&S
      must license or refrain from using any Intellectual Property rights of any
      third
      party).  To the Knowledge of any of the Sellers and the directors and
      officers (and employees with responsibility for Intellectual Property matters)
      of MM&S, no third party has interfered with, infringed upon,
      misappropriated, or otherwise come into conflict with any Intellectual Property
      rights of MM&S.

    


    (C)         Section
      5.12(C) of the Disclosure Schedule identifies each patent or registration which
      has been issued to MM&S with respect to any of its Intellectual Property,
      identifies each pending patent application or application for registration
      which
      MM&S has made with respect to any of its Intellectual Property, and
      identifies each license, agreement, or other permission which MM&S has
      granted to any third party with respect to any of its Intellectual Property
      (together with any exceptions).  The Sellers have delivered to the
      Buyer correct and complete copies of all such patents, registrations,
      applications, licenses, agreements, and permissions (as amended to date) and
      have made available to the Buyer correct and complete copies of all other
      written documentation evidencing ownership and prosecution (if applicable)
      of
      each such item.  Section 5.12(C) of the Disclosure Schedule also
      identifies each trade name or unregistered trademark used by MM&S in
      connection with any of its businesses. With respect to each item of Intellectual
      Property required to be identified in Section 5.12(C) of the Disclosure
      Schedule:

    


    (i)          MM&S
      possesses all right, title, and interest in and to the item, free and clear
      of
      any Security Interest, license, or other restriction;

    


    (ii)         The
      item is not subject to any outstanding injunction, judgment, order, decree,
      ruling, or charge;

    


    


    
      
        
          
          

        

        
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    (iii)         No
      action, suit, proceeding, hearing, investigation, charge, complaint, claim,
      or
      demand is pending or, to the Knowledge of any of the Sellers and the directors
      and officers (and employees with responsibility for Intellectual Property
      matters) of MM&S, is threatened which challenges the legality, validity,
      enforceability, use, or ownership of the item; and

    


    (iv)        MM&S
      has never agreed to indemnify any Person for or against any interference,
      infringement, misappropriation, or other conflict with respect to the
      item.

    


    (D)         Section
      5.12(D) of the Disclosure Schedule identifies each item of Intellectual Property
      that any third party owns and that MM&S uses pursuant to license,
      sublicense, agreement, or permission.  The Sellers have delivered to
      the Buyer correct and complete copies of all such licenses, sublicenses,
      agreements, and permissions (as amended to date).  With respect to
      each item of Intellectual Property required to be identified in Section 5.12(D)
      of the Disclosure Schedule:

    


    (i)          The
      license, sublicense, agreement, or permission covering the item is legal, valid,
      binding, enforceable, and in full force and effect;

    


    (ii)         The
      license, sublicense, agreement, or permission will continue to be legal, valid,
      binding, enforceable, and in full force and effect on identical terms following
      the consummation of the transactions contemplated hereby;

    


    (iii)        
      No party to the license, sublicense, agreement, or permission is in breach
      or
      default, and no event has occurred which with notice or lapse of time would
      constitute a breach or default or permit termination, modification, or
      acceleration thereunder;

    


    (iv)         No
      party to the license, sublicense, agreement, or permission has repudiated any
      provision thereof;

    


    (v)         With
      respect to each sublicense, the representations and warranties set forth in
      subsections (i) through (iv) above are true and correct with respect to the
      underlying license;

    


    (vi)        The
      underlying item of Intellectual Property is not subject to any outstanding
      injunction, judgment, order, decree, ruling, or charge;

    


    (vii)       
      No action, suit, proceeding, hearing, investigation, charge, complaint, claim,
      or demand is pending or, to the Knowledge of any of the Sellers and the
      directors and officers (and employees with responsibility for Intellectual
      Property matters) of MM&S, is threatened which challenges the legality,
      validity, or enforceability of the underlying item of Intellectual Property;
      and

    


    (viii)       MM&S
      has not granted any sublicense or similar right with respect to the license,
      sublicense, agreement, or permission.

    


    (E)          To
      the Knowledge of any of the Sellers and the directors and officers (and
      employees with responsibility for Intellectual Property matters) of MM&S,
      MM&S will not interfere with, infringe upon, misappropriate, or otherwise
      come into conflict with, any Intellectual Property rights of third parties
      as a
      result of the continued operation of its businesses as presently conducted
      and
      as presently proposed to be conducted.

    


    


    
      
        
          
          

        

        
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    5.13     Tangible
      Assets.  MM&S owns or leases all buildings, machinery,
      equipment, and other tangible assets necessary for the conduct of its businesses
      as presently conducted and as presently proposed to be
      conducted.  Each such tangible asset is free from defects (patent and
      latent), has been maintained in accordance with normal industry practice, is
      in
      good operating condition and repair (subject to normal wear and tear), and
      is
      suitable for the purposes for which it presently is used and presently is
      proposed to be used.

    


    5.14     Inventory.  The
      inventory of MM&S consists of raw materials and supplies, manufactured and
      purchased parts, goods in process, and finished goods, all of which is
      merchantable and fit for the purpose for which it was procured or manufactured,
      and none of which is slow-moving, obsolete, damaged, or defective, subject
      only
      to the reserve for inventory writedown set forth on the face of the Most Recent
      Balance Sheet (rather than in any notes thereto) as adjusted for the passage
      of
      time through the Closing Date in accordance with the past custom and practice
      of
      MM&S.

    


    5.15     Contracts.  Section
      5.15 of the Disclosure Schedule lists the following contracts and other
      agreements to which MM&S is a party:

    


    (A)         Any
      agreement (or group of related agreements) for the lease of personal property
      to
      or from any Person providing for lease payments in excess of $10,000 per
      annum;

    


    (B)         Any
      agreement (or group of related agreements) for the purchase or sale of raw
      materials, commodities, supplies, products, or other personal property, or
      for
      the furnishing or receipt of services, the performance of which will extend
      over
      a period of more than one year, result in a material loss to MM&S, or
      involve consideration in excess of $10,000;

    


    (C)         Any
      agreement concerning a partnership or joint venture;

    


    (D)         Any
      agreement (or group of related agreements) under which it has created, incurred,
      assumed, or guaranteed any indebtedness for borrowed money, or any capitalized
      lease obligation, in excess of $10,000 or under which it has imposed a Security
      Interest on any of its assets, tangible or intangible;

    


    (E)          Any
      agreement concerning confidentiality or noncompetition;

    


    (F)          Any
      agreement with any of the Sellers and their Affiliates (other than
      MM&S);

    


    (G)         Any
      profit sharing, stock option, stock purchase, stock appreciation, deferred
      compensation, severance, or other material plan or arrangement for the benefit
      of its current or former directors, officers, and employees;

    


    (H)         Any
      collective bargaining agreement;

    


    (I)          Any
      agreement for the employment of any individual on a full-time, part-time,
      consulting, or other basis providing annual compensation in excess of $10,000
      or
      providing severance benefits;

    


    (J)          Any
      agreement under which it has advanced or loaned any amount to any of its
      directors, officers, and employees outside the Ordinary Course of
      Business;

    


    


    
      
        
          
          

        

        
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    (K)         Any
      agreement under which the consequences of a default or termination could have
      a
      material adverse effect on the business, financial condition, operations,
      results of operations, or future prospects of MM&S; or

    


    (L)          Any
      other agreement (or group of related agreements) the performance of which
      involves consideration in excess of $10,000.

    


    The
      Sellers have delivered to the Buyer a correct and complete copy of each written
      agreement listed in Section 5.15 of the Disclosure Schedule (as amended to
      date)
      and a written summary setting forth the terms and conditions of each oral
      agreement referred to in the Disclosure Schedule.  With respect to
      each such agreement: (i) the agreement is legal, valid, binding, enforceable,
      and in full force and effect; (ii) the agreement will continue to be legal,
      valid, binding, enforceable, and in full force and effect on identical terms
      following the consummation of the transactions contemplated hereby; (iii) no
      party is in breach or default, and no event has occurred which with notice
      or
      lapse of time would constitute a breach or default, or permit termination,
      modification, or acceleration, under the agreement; and (iv) no party has
      repudiated any provision of the agreement.

    


    5.16     Notes
      and
      Accounts Receivable.  All notes and accounts receivable of
      MM&S are reflected properly on their books and records, are valid
      receivables subject to no setoffs or counterclaims, are current and collectible,
      and will be collected in accordance with their terms at their recorded amounts,
      subject only to the reserve for bad debts set forth on the face of the Most
      Recent Balance Sheet (rather than in any notes thereto) as adjusted for the
      passage of time through the Closing Date in accordance with the past custom
      and
      practice of MM&S.

    


    5.17     Powers
      of
      Attorney.  There are no
      outstanding powers of attorney executed on behalf of MM&S.

    


    5.18     Insurance.  Section
      5.18 of the Disclosure Schedule sets forth the following information with
      respect to each insurance policy (including policies providing property,
      casualty, liability, and workers' compensation coverage and bond and surety
      arrangements) to which MM&S has been a party, a named insured, or otherwise
      the beneficiary of coverage at any time within the past ten (10)
      years:

    


    (A)         the
      name, address, and telephone number of the agent;

    


    (B)         the
      name of the insurer, the name of the policyholder, and the name of each covered
      insured;

    


    (C)         the
      policy number and the period of coverage;

    


    (D)         the
      scope (including an indication of whether the coverage was on a claims made,
      occurrence, or other basis) and amount (including a description of how
      deductibles and ceilings are calculated and operate) of coverage;
      and

    


    (E)          a
      description of any retroactive premium adjustments or other loss-sharing
      arrangements.

    


    


    
      
        
          
          

        

        
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    With
      respect to each such insurance policy: (i) the policy is legal, valid, binding,
      enforceable, and in full force and effect; (ii) the policy will continue to
      be
      legal, valid, binding, enforceable, and in full force and effect on identical
      terms following the consummation of the transactions contemplated hereby; (iii)
      neither MM&S nor any other party to the policy is in breach or default
      (including with respect to the payment of premiums or the giving of notices),
      and no event has occurred which, with notice or the lapse of time, would
      constitute such a breach or default, or permit termination, modification, or
      acceleration, under the policy; and (iv) no party to the policy has repudiated
      any provision thereof.  MM&S has been covered during the past ten
      (10) years by insurance in scope and amount customary and reasonable for the
      businesses in which it has engaged during the aforementioned
      period.  Section 5.18 of the Disclosure Schedule describes any
      self-insurance arrangements affecting MM&S.

    


    5.19     Litigation.  Section
      5.19 of the Disclosure Schedule sets forth each instance in which MM&S (A)
      is subject to any outstanding injunction, judgment, order, decree, ruling,
      or
      charge or (B) is a party or, to the Knowledge of any of the Sellers and the
      directors and officers (and employees with responsibility for litigation
      matters) of MM&S, is threatened to be made a party to any action, suit,
      proceeding, hearing, or investigation of, in, or before any court or
      quasi-judicial or administrative agency of any federal, state, local, or foreign
      jurisdiction or before any arbitrator.  None of the actions, suits,
      proceedings, hearings, and investigations set forth in Section 5.19 of the
      Disclosure Schedule could result in any material adverse change in the business,
      financial condition, operations, results of operations, or future prospects
      of
      MM&S. None of the Sellers and the directors and officers (and employees with
      responsibility for litigation matters) of MM&S has any reason to believe
      that any such action, suit, proceeding, hearing, or investigation may be brought
      or threatened against MM&S.

    


    5.20     Product
      Warranty.  Each product
      manufactured, sold, leased, or delivered by MM&S has been in conformity with
      all applicable contractual commitments and all express and implied warranties,
      and MM&S has no Liability (and there is no Basis for any present or future
      action, suit, proceeding, hearing, investigation, charge, complaint, claim,
      or
      demand against it giving rise to any Liability) for replacement or repair
      thereof or other damages in connection therewith, subject only to the reserve
      for product warranty claims set forth on the face of the Most Recent Balance
      Sheet (rather than in any notes thereto) as adjusted for the passage of time
      through the Closing Date in accordance with the past custom and practice of
      MM&S.  No product manufactured, sold, leased, or delivered by
      MM&S is subject to any guaranty, warranty, or other indemnity beyond the
      applicable standard terms and conditions of sale or lease.  Section
      5.20 of the Disclosure Schedule includes copies of the standard terms and
      conditions of sale or lease for MM&S (containing applicable guaranty,
      warranty, and indemnity provisions).

    


    5.21     Product
      Liability.  MM&S has no Liability (and there is no Basis
      for any present or future action, suit, proceeding, hearing, investigation,
      charge, complaint, claim, or demand against any of them giving rise to any
      Liability) arising out of any injury to individuals or property as a result
      of
      the ownership, possession, or use of any product manufactured, sold, leased,
      or
      delivered by MM&S.

    


    5.22     Employees.  To
      the Knowledge of any of the Sellers and the directors and officers (and
      employees with responsibility for employment matters) of MM&S, no executive,
      key employee, or group of employees has any plans to terminate employment with
      MM&S.  MM&S is not a party to or bound by any collective
      bargaining agreement, nor has it experienced any strikes, grievances, claims
      of
      unfair labor practices, or other collective bargaining
      disputes.  MM&S has not committed any unfair labor
      practice.  None of the Sellers and the directors and officers (and
      employees with responsibility for employment matters) of MM&S has any
      Knowledge of any organizational effort presently being made or threatened by
      or
      on behalf of any labor union with respect to employees of MM&S.

    


    


    
      
        
          
          

        

        
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              5.23

            	
              Employee
                Benefits. 

            


    

    


    (A)        
      Section 5.23(A) of the Disclosure Schedule lists each Employee Benefit Plan
      that
      MM&S maintains, to which MM&S contributes or has any obligation to
      contribute, or with respect to which MM&S has any material Liability or
      potential Liability.

    


    (i)         
      Each such Employee Benefit Plan (and each related trust, insurance contract,
      or
      fund) has been maintained, funded and administered in accordance with the terms
      of such Employee Benefit Plan and complies in form and in operation in all
      material respects with the applicable requirements of ERISA, the Code, and
      other
      applicable laws.

    


    (ii)         All
      required reports and descriptions (including annual reports (IRS Form 5500),
      summary annual reports, and summary plan descriptions) have been timely filed
      and/or distributed in accordance with the applicable requirements of ERISA
      and
      the Code with respect to each such Employee Benefit Plan. The requirements
      of
      COBRA have been met with respect to each such Employee Benefit Plan which is
      an
      Employee Welfare Benefit Plan subject to COBRA.

    


    (iii)        All
      contributions (including all employer contributions and employee salary
      reduction contributions) which are due have been made within the time period
      prescribed by ERISA to each such Employee Benefit Plan which is an Employee
      Pension Benefit Plan and all contributions for any period ending on or before
      the Closing Date which are not yet due have been made to each such Employee
      Pension Benefit Plan or accrued in accordance with the past custom and practice
      of MM&S and its Subsidiaries.  All premiums or other payments for
      all periods ending on or before the Closing Date have been paid with respect
      to
      each such Employee Benefit Plan which is an Employee Welfare Benefit
      Plan.

    


    (iv)        Each
      such Employee Benefit Plan which is intended to meet the requirements of a
      "qualified plan" under Code §401(a) has received a determination from the
      Internal Revenue Service that such Employee Benefit Plan is so qualified, and
      nothing has occurred since the date of such determination that could adversely
      affect the qualified status of any such Employee Benefit Plan.

    


    (v)         The
      market value of assets under each such Employee Benefit Plan which is an
      Employee Pension Benefit Plan (other than any Multiemployer Plan) equals or
      exceeds the present value of all vested and nonvested Liabilities thereunder
      determined in accordance with PBGC methods, factors, and assumptions applicable
      to an Employee Pension Benefit Plan terminating on the date for
      determination.

    


    (vi)        The
      Sellers have delivered to the Buyer correct and complete copies of the plan
      documents and summary plan descriptions, the most recent determination letter
      received from the Internal Revenue Service, the most recent annual report (IRS
      Form 5500, with all applicable attachments), and all related trust agreements,
      insurance contracts, and other funding arrangements which implement each such
      Employee Benefit Plan.

    


    (B)         With
      respect to each Employee Benefit Plan that MM&S, and any ERISA Affiliate
      maintains, to which any of them contributes or has any obligation to contribute,
      or with respect to which any of them has any material Liability or potential
      Liability:

    


    (i)         
      No such Employee Benefit Plan which is an Employee Pension Benefit Plan (other
      than any Multiemployer Plan) has been completely or partially terminated or
      been
      the subject of a Reportable Event. No proceeding by the PBGC to terminate any
      such Employee Pension Benefit Plan (other than any Multiemployer Plan) has
      been
      instituted or, to the Knowledge of any of the Sellers and the directors and
      officers (and employees with responsibility for employee benefits matters)
      of
      MM&S, threatened.

    


    


    
      
        
          
          

        

        
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    (ii)         There
      have been no Prohibited Transactions with respect to any such Employee Benefit
      Plan. No Fiduciary has any Liability for breach of fiduciary duty or any other
      failure to act or comply in connection with the administration or investment
      of
      the assets of any such Employee Benefit Plan. No action, suit, proceeding,
      hearing, or investigation with respect to the administration or the investment
      of the assets of any such Employee Benefit Plan (other than routine claims
      for
      benefits) is pending or, to the Knowledge of any of the Sellers and the
      directors and officers (and employees with responsibility for employee benefits
      matters) of MM&S, threatened.  None of the Sellers and the
      directors and officers (and employees with responsibility for employee benefits
      matters) of MM&S has any Knowledge of any Basis for any such action, suit,
      proceeding, hearing, or investigation.

    


    (iii)        MM&S
      has not incurred, and none of the Sellers and the directors and officers (and
      employees with responsibility for employee benefits matters) of MM&S has any
      reason to expect that MM&S will incur, any Liability to the PBGC (other than
      with respect to PBGC premium payments not yet due) or otherwise under Title
      IV
      of ERISA (including any withdrawal liability as defined in ERISA §4201) or under
      the Code with respect to any such Employee Benefit Plan which is an Employee
      Pension Benefit Plan, or under COBRA with respect to any such Employee Benefit
      Plan which is an Employee Welfare Benefit Plan.

    


    (iv)        None
      of MM&S and any ERISA Affiliate has incurred any Liability on account of a
      "partial withdrawal" or a "complete with drawl" (within the meaning of ERISA
      §§4205 and 4203, respectively) from any Multiemployer Plan, no such Liability
      has been asserted, and there are no events or circumstances which could result
      in any such partial or complete withdrawal; and none of MM&S and any ERISA
      Affiliate is bound by any contract or agreement or has any obligation or
      Liability described in ERISA §4204.  Each Multiemployer Plan complies
      in form and has been administered in accordance with the requirements of ERISA
      and, where applicable, the Code, and each Multiemployer Plan is qualified under
      Code §401(a).

    


    (v)         MM&S
      does not maintain, contribute to or have an obligation to contribute to, or
      have
      any material Liability or potential Liability with respect to, any Employee
      Welfare Benefit Plan providing medical, health, or life insurance or other
      welfare-type benefits for current or future retired or terminated employees,
      their spouses, or their dependents (other than in accordance with
      COBRA).

    


    5.24     Guaranties.  MM&S
      is not a guarantor of or otherwise liable for any Liability or obligation
      (including indebtedness) of any other Person.  Section 5.24 of the
      Disclosure Schedule lists the obligations of MM&S that have been guaranteed
      personally by any Seller or officer or director of MM&S.

    


    5.25     Environmental,
      Health, and
      Safety Matters.

    


    (A)         MM&S
      and its predecessors and Affiliates has complied and is in compliance with
      all
      Environmental, Health, and Safety Requirements.

    


    (B)         Without
      limiting the generality of the foregoing, MM&S and its Affiliates have
      obtained and complied with, and is in compliance with, all permits, licenses
      and
      other authoriza­tions that are required pursuant to Environmental, Health,
      and Safety Requirements for the occupation of its facilities and the operation
      of its business; a list of all such permits, licenses and other authorizations
      is set forth on the attached "Environmental and
      Safety
      Permits Schedule."

    


    (C)         Neither
      MM&S nor its predecessors or Affiliates has received any written or oral
      notice, report or other information regarding any actual or alleged violation
      of
      Environmental, Health, and Safety Requirements, or any liabilities or potential
      liabilities (whether accrued, absolute, contingent, unliquidated or otherwise),
      including any investigatory, remedial or corrective obligations, relating to
      any
      of them or its facilities arising under Environmental, Health, and Safety
      Requirements.

    


    


    
      
        
          
          

        

        
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    (D)         None
      of the following exists at any property or facility owned or operated by
      MM&S: (1) underground storage tanks, (2) asbestos-containing material in any
      form or condition, (3) materials or equipment containing polychlorinated
      biphenyls, or (4) landfills, surface impoundments, or disposal
      areas.

    


    (E)          None
      of MM&S or its predecessors or Affiliates has treated, stored, disposed of,
      arranged for or permitted the disposal of, transported, handled, or released
      any
      substance, including without limitation any hazardous substance, or owned or
      operated any property or facility (and no such property or facility is
      contaminated by any such substance) in a manner that has given or would give
      rise to liabilities, including any Liability for response costs, corrective
      action costs, personal injury, property damage, natural resources damages or
      attorney fees, pursuant to the Comprehensive Environmental Response,
      Compensation and Liability Act of 1980, as amended ("CERCLA"),
      the Solid Waste Disposal Act, as amended ("SWDA") or any other Environmental,
      Health, and Safety Requirements.

    


    (F)          Neither
      this Agreement nor the consummation of the transaction that is the subject
      of
      this Agreement will result in any obligations for site investigation or cleanup,
      or notification to or consent of government agencies or third parties, pursuant
      to any of the so-called "transaction-triggered" or "responsible property
      transfer" Environmental, Health, and Safety Requirements.

    


    (G)         Neither
      MM&S nor any of its predecessors or Affiliates has, either expressly or by
      operation of law, assumed or undertaken any Liability, including without
      limitation any obligation for corrective or remedial action, of any other Person
      relating to Environmental, Health, and Safety Requirements.

    


    (H)         No
      facts, events or conditions relating to the past or present facilities,
      properties or operations of MM&S or any of its predecessors or Affiliates
      will prevent, hinder or limit continued compliance with Environmental, Health,
      and Safety Requirements, give rise to any investigatory, remedial or corrective
      obligations pursuant to Environmental, Health, and Safety Requirements, or
      give
      rise to any other liabilities (whether accrued, absolute, contingent,
      unliquidated or otherwise) pursuant to Environmental, Health, and Safety
      Requirements, including without limitation any relating to onsite or offsite
      releases or threatened releases of hazardous materials, substances or wastes,
      personal injury, property damage or natural resources damage.

    


    5.26      Certain
      Business Relationships with MM&S.  Except as disclosed in
      Schedule 5.26 of the Disclosure Schedule, none of the Sellers and their
      Affiliates has been involved in any business arrangement or relationship with
      MM&S within the past 12 months, and none of the Sellers
      and their Affiliates owns any asset, tangible or intangible, which is used
      in
      the business of MM&S.

    


    5.27      Disclosure.  The
      representations and warranties contained in this Article 5 do not contain any
      untrue statement of a material fact or omit to state any material fact necessary
      in order to make the statements and information contained in this Article 5
      not
      misleading.

    


    ARTICLE
      6

    PRE-CLOSING
      COVENANTS

    


    


    
      
        
          
          

        

        
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    The
      Parties agree as follows with respect to the period between the execution of
      this Agreement and the Closing.

    


    6.1        General.  Each
      of the Parties will use his or its reasonable best efforts to take all action
      and to do all things necessary, proper, or advisable in order to consummate
      and
      make effective the transactions contemplated by this Agreement (including
      satisfaction, but not waiver, of the closing conditions set forth
      below).

    


    6.2        Notices
      and Consents.  The Sellers will cause MM&S to give any
      notices to third parties, and will cause MM&S to use its reasonable best
      efforts to obtain any third party consents, that the Buyer reasonably may
      request in connection with the matters referred to in Section 5.3
      above.  Each of the Parties will (and the Sellers will cause MM&S
      to) give any notices to, make any filings with, and use its reasonable best
      efforts to obtain any authorizations, consents, and approvals of governments
      and
      governmental agencies in connection with the matters referred to in Section
      3.3,
      Section 4.3, and Section 5.3 above.

    


    6.3        Preservation
      of Business.  The Sellers will cause MM&S to keep its
      business and properties substantially intact, including its present operations,
      physical facilities, working conditions, and relationships with lessors,
      licensors, suppliers, customers, and employees.

    


    6.4        Operation
      of Business.  The Sellers will not cause or permit MM&S to
      engage in any practice, take any action, or enter into any transaction outside
      the Ordinary Course of Business.  Without limiting the generality of
      the foregoing, the Sellers will not cause or permit MM&S to (i) declare, set
      aside, or pay any dividend or make any distribution with respect to its capital
      stock or redeem, purchase, or otherwise acquire any of its capital stock, (ii)
      offer or sell any equity or debt securities of MM&S for cash or other
      consideration, or (iii) otherwise engage in any practice, take any action,
      or
      enter into any transaction of the sort described in Section 5.7 above without
      the prior written consent of Buyer.

    


    6.5        Full
      Access.  Each of the Sellers will permit, and the Sellers will
      cause MM&S to permit, representatives of the Buyer to have full access at
      all reasonable times, and in a manner so as not to interfere with the normal
      business operations of MM&S, to all premises, properties, personnel, books,
      records (including Tax records), contracts, and documents of or pertaining
      to
      MM&S.

    


    6.6        Notice
      of
      Developments.  The Sellers will give prompt written notice to
      the Buyer of any material adverse development causing a breach of any of the
      representations and warranties in Article 5 above.  Each Party will
      give prompt written notice to the others of any material adverse development
      causing a breach of any of his or its own representations and warranties in
      Article 3 or Article 4 above.  No disclosure by any Party pursuant to
      this Section 6.6, however, shall be deemed to amend or supplement Schedules
      3 or
      4, or the Disclosure Schedule or to prevent or cure any misrepresentation,
      breach of warranty, or breach of covenant.

    


    6.7        Exclusivity.  None
      of the Sellers will (and the Sellers will not cause or permit MM&S to) (A)
      solicit, initiate, or encourage the submission of any proposal or offer from
      any
      Person relating to the acquisition of any capital stock or other voting
      securities, or any substantial portion of the assets, of MM&S (including any
      acquisition structured as a merger, consolidation, or share exchange) or (B)
      participate in any discussions or negotiations regarding, furnish any
      information with respect to, assist or participate in, or facilitate in any
      other manner any effort or attempt by any Person to do or seek any of the
      foregoing.  None of the Sellers will vote their MM&S Shares in
      favor of any such acquisition structured as a merger, consolidation, or share
      exchange.  The Sellers will notify the Buyer immediately if any Person
      makes any proposal, offer, inquiry, or contact with respect to any of the
      foregoing.

    


    
      
        
          
          

        

        
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    6.8       Shareholders’
      Agreement.  The Sellers shall cause the Shareholders’ Agreement
      to terminate effective with the Closing.

    


    ARTICLE
      7

    POST-CLOSING
      COVENANTS

    


    The
      Parties agree as follows with respect to the period following the
      Closing.

    


    7.1       General.  In
      case at any time after the Closing any further action is necessary or desirable
      to carry out the purposes of this Agreement, each of the Parties will take
      such
      further action (including the execution and delivery of such further instruments
      and documents) as any other Party reasonably may request, all at the sole cost
      and expense of the requesting Party (unless the requesting Party is entitled
      to
      indemnification under Article 8 below).  The Sellers acknowledge and
      agree that from and after the Closing the Buyer will be entitled to possession
      of all documents, books, records (including Tax records), agreements, and
      financial data of any sort relating to MM&S.

    


    7.2       Litigation
      Support.  In the event and for so long as any Party actively is
      contesting or defending against any action, suit, proceeding, hearing,
      investigation, charge, complaint, claim, or demand in connection with (i) any
      transaction contemplated under this Agreement or (ii) any fact, situation,
      circumstance, status, condition, activity, practice, plan, occurrence, event,
      incident, action, failure to act, or transaction on or prior to the Closing
      Date
      involving MM&S, each of the other Parties will cooperate with him or it and
      his or its counsel in the contest or defense, make available their personnel,
      and provide such testimony and access to their books and records as shall be
      necessary in connection with the contest or defense, all at the sole cost and
      expense of the contesting or defending Party (unless the contesting or defending
      Party is entitled to indemnification therefor under Article 8
      below).

    


    7.3       Operation
      of Business.  The Sellers will not cause or permit MM&S to
      engage in any practice, take any action, or enter into any transaction outside
      the Ordinary Course of Business.  Without limiting the generality of
      the foregoing, the Sellers will not cause or permit MM&S to (i) declare, set
      aside, or pay any dividend or make any distribution with respect to its capital
      stock or redeem, purchase, or otherwise acquire any of its capital stock, (ii)
      offer or sell any equity or debt securities of MM&S for cash or other
      consideration, or (iii) otherwise engage in any practice, take any action,
      or
      enter into any transaction of the sort described in Section 5.7 above without
      the prior written consent of Buyer.  Following the Closing, the number
      of members of the MM&S board of directors will be adjusted to five, of which
      Buyer shall appoint three and Sellers shall appoint two directors.

    


    7.4       Transition.  None
      of the Sellers will take any action that is designed or intended to have the
      effect of discouraging any lessor, licensor, customer, supplier, or other
      business associate of MM&S from maintaining the same business relationships
      with MM&S after the Closing as it maintained with MM&S prior to the
      Closing.  Each of the Sellers will refer all customer inquiries
      relating to the business of MM&S to the Buyer from and after the
      Closing.

    


    
      
        
          
          

        

        
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    7.5       Confidentiality.  Each
      of the Sellers will treat and hold as such all of the Confidential Information,
      refrain from using any of the Confidential Information except in connection
      with
      this Agreement, and deliver promptly to the Buyer or destroy, at the request
      and
      option of the Buyer, all tangible embodiments (and all copies) of the
      Confidential Information which are in his or its possession.  In the
      event that any of the Sellers is requested or required (by oral question or
      request for information or documents in any legal proceeding, interrogatory,
      subpoena, civil investigative demand, or similar process) to disclose any
      Confidential Information, that Seller will notify the Buyer promptly of the
      request or requirement so that the Buyer may seek an appropriate protective
      order or waive compliance with the provisions of this Section
      7.5.  If, in the absence of a protective order or the receipt of a
      waiver hereunder, any of the Sellers is, on the advice of counsel, compelled
      to
      disclose any Confidential Information to any tribunal or else stand liable
      for
      contempt, that Seller may disclose the Confidential Information to the tribunal;
      provided,
      however, that the disclosing Seller shall use his or its reasonable best
      efforts to obtain, at the reasonable request of the Buyer, an order or other
      assurance that confidential treatment will be accorded to such portion of the
      Confidential Information required to be disclosed as the Buyer shall
      designate.  The foregoing provisions shall not apply to any
      Confidential Information which is generally available to the public immediately
      prior to the time of disclosure.

    


    7.6       Covenant
      Not to Compete.  For a period of five years from and after the
      closing date of the exercise of either the Buyer’s Option or the Seller’s
      Option, none of the Sellers will engage directly or indirectly in any business
      that MM&S conducts as of the Closing Date in any geographic area in which
      MM&S conducts that business as of the Closing Date; provided, however,
      that no owner of less than 1% of the outstanding stock of any publicly-traded
      corporation shall be deemed to engage solely by reason thereof in any of its
      businesses.  If the final judgment of a court of competent
      jurisdiction declares that any term or provision of this Section 7.6 is invalid
      or unenforceable, the Parties agree that the court making the determination
      of
      invalidity or unenforceability shall have the power to reduce the scope,
      duration, or area of the term or provision, to delete specific words or phrases,
      or to replace any invalid or unenforceable term or provision with a term or
      provision that is valid and enforceable and that comes closest to expressing
      the
      intention of the invalid or unenforceable term or provision, and this Agreement
      shall be enforceable as so modified after the expiration of the time within
      which the judgment may be appealed.

    


    7.7       Registration
      of Buyer Shares.  Subject to the
      terms and conditions of this Agreement, the Buyer shall prepare and file with
      the SEC, within 90 days from the release of the Buyer Shares as provided in
      Section 2.1(B) of this Agreement, a registration statement on SB-2 (or, if
      the
      Company is then eligible, on Form S-3) under the Securities Act for the
      registration for the resale by Sellers of the Buyer Shares to be issued under
      this Agreement.

     

    ARTICLE
      8

    CONDITIONS
      TO OBLIGATIONS TO
      CLOSE

    


    8.1       Conditions
      to Obligation of Buyer.  The obligation
      of
      the Buyer to consummate the transactions to be performed by it in connection
      with the Closing is subject to satisfaction of the following
      conditions:

    


    (A)         The
      representations and warranties set forth in Article 3 and Article 5 above shall
      be true and correct in all material respects at and as of the Closing
      Date;

    


    (B)         The
      Sellers shall have performed and complied with all of their covenants hereunder
      in all material respects through the Closing;

    


    


    
      
        
          
          

        

        
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    (C)         MM&S
      shall have procured all of the third party consents specified in Section 6.3
      above;

    


    (D)         No
      action, suit, or proceeding shall be pending or threatened before any court
      or
      quasi-judicial or administrative agency of any federal, state, local, or foreign
      jurisdiction or before any arbitrator wherein an unfavorable injunction,
      judgment, order, decree, ruling, or charge would (i) prevent consummation of
      any
      of the transactions contemplated by this Agreement, (ii) cause any of the
      transactions contemplated by this Agreement to be rescinded following
      consummation, (iii) affect adversely the right of the Buyer to own MM&S
      Shares and to control MM&S, or (iv) affect adversely the right of any of
      MM&S to own its assets and to operate its business (and no such injunction,
      judgment, order, decree, ruling, or charge shall be in effect);

    


    (E)          MM&S
      shall not have granted any compensation or bonus to any employee in connection
      with the transactions contemplated hereunder other than as approved by
      Buyer;

    


    (G)         On
      or prior to the Closing Date, Sellers or MM&S, as the case may be, will have
      delivered to Buyer all of the following (dated as of the Closing Date, except
      as
      otherwise indicated):

    


    (1)         A
      certificate, dated not earlier than the fifth (5th) Business Day prior to the
      Closing Date, of the Minnesota Secretary of State stating that MM&S is in
      good standing;

     

    (2)         A
      certificate of each Seller and of an officer of the Company certifying that
      each
      of the conditions set forth in Sections 8.2(A) through (C) has been and is
      satisfied as of the time of the Closing;

     

    (3)         A
      certificate of the Secretary of MM&S (i) certifying that attached to such
      certificate are true and complete copies of (a) MM&S's articles of
      incorporation, as amended through and in effect on the Closing Date, (b)
      MM&S's bylaws, as amended through and in effect on the Closing Date, and (c)
      resolutions of MM&S's board of directors authorizing the execution, delivery
      and performance of this Agreement and the transaction documents to which
      MM&S is a party and consummation of the transactions contemplated by this
      Agreement and the transaction documents to which MM&S is a party, and
      (ii) certifying as to the incumbency of the officer(s) of MM&S
      executing this Agreement and the transaction documents on behalf of such
      entity;

     

    (4)         An
      opinion of counsel to MM&S and Sellers, in substantially the form attached
      as Exhibit E;
      and

     

    (5)         Such
      other documents or instruments as Buyer reasonably request and are reasonably
      necessary to effect the transactions contemplated by this Agreement;
      and

     

    (H)         All
      actions to be taken by the Sellers in connection with consummation of the
      transactions contemplated hereby and all certificates, opinions, instruments,
      and other documents required to effect the transactions contemplated hereby
      will
      be satisfactory in form and substance to the Buyer.

    


    Buyer
      may
      waive any condition specified in this Section 8.1 if it executes a writing
      so
      stating at or prior to the Closing.

    


    8.2      
      Conditions
      to Obligation of the Sellers.  The obligation of the Sellers to
      consummate the transactions to be performed by them in connection with the
      Closing is subject to satisfaction of the following conditions:

    


    
      
        
          
          

        

        
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    (A)         The
      representations and warranties set forth in Article 4 above shall be true and
      correct in all material respects at and as of the Closing Date;

    


    (B)         The
      Buyer shall have performed and complied with all of its covenants hereunder
      in
      all material respects through the Closing;

    


    (C)         No
      action, suit, or proceeding shall be pending or threatened before any court
      or
      quasi-judicial or administrative agency of any federal, state, local, or foreign
      jurisdiction or before any arbitrator wherein an unfavorable injunction,
      judgment, order, decree, ruling, or charge would (i) prevent consummation of
      any
      of the transactions contemplated by this Agreement or (ii) cause any of the
      transactions contemplated by this Agreement to be rescinded following
      consummation (and no such injunction, judgment, order, decree, ruling, or charge
      shall be in effect);

    


    (D)         The
      Buyer shall have delivered to the Sellers a certificate to the effect that
      each
      of the conditions specified above in Section 8.1(A) through 8.1(E) is satisfied
      in all respects; and

    


    (E)          All
      actions to be taken by the Buyer in connection with consummation of the
      transactions contemplated hereby and all certificates, opinions, instruments,
      and other documents required to effect the transactions contemplated hereby
      will
      be reasonably satisfactory in form and substance to the Sellers.

    


    Sellers
      may waive any condition specified in this Section 8.2 if they execute a writing
      so stating at or prior to the Closing.

    


    ARTICLE
      9

    REMEDIES
      FOR BREACHES OF
      THIS AGREEMENT

    


    9.1        Survival
      of Representations and Warranties. All of the representations and
      warranties of the Parties contained in this Agreement shall survive the Closing
      hereunder (even if the damaged Party knew or had reason to know of any
      misrepresentation or breach of warranty or covenant at the time of Closing)
      and
      continue in full force and effect forever thereafter (subject to any applicable
      statutes of limitations).

    


    9.2        Indemnification
      Provisions
      for Benefit of the Buyer.

    


    (A)        
      In the event any of the Sellers breaches (or in the event any third party
      alleges facts that, if true, would mean any of the Sellers has breached) any
      of
      their representations, warranties, and covenants contained herein (other than
      the covenants in Section 2.1 above and the representations and warranties in
      Article 3 above), and, if there is an applicable survival period pursuant to
      Section 9.1 above, provided that the Buyer makes a written claim for
      indemnification against any of the Sellers pursuant to Section 12.7 below within
      such survival period, then each of the Sellers agrees to indemnify the Buyer
      from and against the entirety of any Adverse Consequences the Buyer may suffer
      through and after the date of the claim for indemnification (including any
      Adverse Consequences the Buyer may suffer after the end of any applicable
      survival period) resulting from, arising out of, relating to, in the nature
      of,
      or caused by the breach (or the alleged breach).

    


    


    
      
        
          
          

        

        
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    (B)         In
      the event any of the Sellers breaches (or in the event any third party alleges
      facts that, if true, would mean any of the Sellers has breached) any of his
      covenants in Section 2.1 above or any of his representations and warranties
      in
      Article 3 above, and, if there is an applicable survival period pursuant to
      Section 9.1 above, provided that the Buyer makes a written claim for
      indemnification against the Seller pursuant to Section 12.7 below within such
      survival period, then the Seller agrees to indemnify the Buyer from and against
      the entirety of any Adverse Consequences the Buyer may suffer through and after
      the date of the claim for indemnification (including any Adverse Consequences
      the Buyer may suffer after the end of any applicable survival period) resulting
      from, arising out of, relating to, in the nature of, or caused by the breach
      (or
      the alleged breach).

    


    (C)         Each
      of the Sellers agrees to indemnify the Buyer from and against the entirety
      of
      any Adverse Consequences the Buyer may suffer resulting from, arising out of,
      relating to, in the nature of, or caused by any Liability of MM&S (1) for
      any Taxes of MM&S with respect to any Tax year or portion thereof ending on
      or before the Closing Date (or for any Tax year beginning before and ending
      after the Closing Date to the extent allocable (determined in a manner
      consistent with Section 10.3) to the portion of such period beginning before
      and
      ending on the Closing Date), to the extent such Taxes are not reflected in
      the
      reserve for Tax Liability (rather than any reserve for deferred Taxes
      established to reflect timing differences between book and Tax income) shown
      on
      the face of the Most Recent Balance Sheet (rather than in any notes thereto),
      as
      such reserve is adjusted for the passage of time through the Closing Date in
      accordance with the past custom and practice of MM&S in filing its Tax
      Returns, and (2) for the unpaid Taxes of any Person (other than MM&S) under
      Reg. §1.1502-6 (or any similar provision of state, local, or foreign law), as a
      transferee or successor, by contract, or otherwise.

    


    9.3        Indemnification
      Provisions for Benefit of the Sellers.  In the event the Buyer
      breaches (or in the event any third party alleges facts that, if true, would
      mean the Buyer has breached) any of its representations, warranties, and
      covenants contained herein, and, if there is an applicable survival period
      pursuant to Section 9.1 above, provided that any of the Sellers makes a written
      claim for indemnification against the Buyer pursuant to Section 12.7 below
      within such survival period, then the Buyer agrees to indemnify each of the
      Sellers from and against the entirety of any Adverse Consequences the Seller
      may
      suffer through and after the date of the claim for indemnification (including
      any Adverse Consequences the Seller may suffer after the end of any applicable
      survival period) resulting from, arising out of, relating to, in the nature
      of,
      or caused by the breach (or the alleged breach).

    


    9.4        Matters
      Involving Third
      Parties.

    


    (A)         If
      any third party shall notify any Party (the "Indemnified Party")
      with respect to any matter (a "Third Party Claim")
      which may give rise to a claim for indemnification against any other Party
      (the
      "Indemnifying
      Party") under this Article 9, then the Indemnified Party shall promptly
      notify each Indemnifying Party thereof in writing; provided, however,
      that no delay on the part of the Indemnified Party in notifying any Indemnifying
      Party shall relieve the Indemnifying Party from any obligation hereunder unless
      (and then solely to the extent) the Indemnifying Party thereby is
      prejudiced.

    


    (B)         Any
      Indemnifying Party will have the right to defend the Indemnified Party against
      the Third Party Claim with counsel of its choice reasonably satisfactory to
      the
      Indemnified Party so long as (1) the Indemnifying Party notifies the Indemnified
      Party in writing within 15 days after the Indemnified Party has given notice
      of
      the Third Party Claim that the Indemnifying Party will indemnify the Indemnified
      Party from and against the entirety of any Adverse Consequences the Indemnified
      Party may suffer resulting from, arising out of, relating to, in the nature
      of,
      or caused by the Third Party Claim, (2) the Indemnifying Party provides the
      Indemnified Party with evidence reasonably acceptable to the Indemnified Party
      that the Indemnifying Party will have the financial resources to defend against
      the Third Party Claim and fulfill its indemnification obligations hereunder,
      (3)
      the Third Party Claim involves only money damages and does not seek an
      injunction or other equitable relief, (4) settlement of, or an adverse judgment
      with respect to, the Third Party Claim is not, in the good faith judgment of
      the
      Indemnified Party, likely to establish a precedential custom or practice
      materially adverse to the continuing business interests of the Indemnified
      Party, and (5) the Indemnifying Party conducts the defense of the Third Party
      Claim actively and diligently.

    


    


    
      
        
          
          

        

        
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    (C)         So
      long as the Indemnifying Party is conducting the defense of the Third Party
      Claim in accordance with Section 9.4(B) above, (1) the Indemnified Party may
      retain separate co-counsel at its sole cost and expense and participate in
      the
      defense of the Third Party Claim, (2) the Indemnified Party will not consent
      to
      the entry of any judgment or enter into any settlement with respect to the
      Third
      Party Claim without the prior written consent of the Indemnifying Party (not
      to
      be withheld unreasonably), and (3) the Indemnifying Party will not consent
      to
      the entry of any judgment or enter into any settlement with respect to the
      Third
      Party Claim without the prior written consent of the Indemnified Party (not
      to
      be withheld unreasonably).

    


    (D)         In
      the event any of the conditions in Section 9.4(B) above is or becomes
      unsatisfied, however, (1) the Indemnified Party may defend against, and consent
      to the entry of any judgment or enter into any settlement with respect to,
      the
      Third Party Claim in any manner it reasonably may deem appropriate (and the
      Indemnified Party need not consult with, or obtain any consent from, any
      Indemnifying Party in connection therewith), (2) the Indemnifying Parties will
      reimburse the Indemnified Party promptly and periodically for the costs of
      defending against the Third Party Claim (including reasonable attorneys' fees
      and expenses), and (3) the Indemnifying Parties will remain responsible for
      any
      Adverse Consequences the Indemnified Party may suffer resulting from, arising
      out of, relating to, in the nature of, or caused by the Third Party Claim to
      the
      fullest extent provided in this Article 9.

    


    (E)          Determination
      of Adverse
      Consequences.  All indemnification payments under this Article
      9 shall be deemed adjustments to the Purchase Price.

    


    (F)          Other
      Indemnification
      Provisions.  The foregoing indemnification provisions are in
      addition to, and not in derogation of, any statutory, equitable, or common
      law
      remedy (including without limitation any such remedy arising under
      Environmental, Health, and Safety Requirements) any Party may have with respect
      to MM&S or the transactions contemplated by this Agreement.  Each
      of the Sellers hereby agrees that he or she will not make any claim for
      indemnification against MM&S by reason of the fact that he or she was a
      director, officer, employee, or agent of any such entity or was serving at
      the
      request of any such entity as a partner, trustee, director, officer, employee,
      or agent of another entity (whether such claim is for judgments, damages,
      penalties, fines, costs, amounts paid in settlement, losses, expenses, or
      otherwise and whether such claim is pursuant to any statute, charter document,
      bylaw, agreement, or otherwise) with respect to any action, suit, proceeding,
      complaint, claim, or demand brought by the Buyer against such Seller (whether
      such action, suit, proceeding, complaint, claim, or demand is pursuant to this
      Agreement, applicable law, or otherwise).

    


    ARTICLE
      10

    TAX
      MATTERS

    


    The
      following provisions shall govern the allocation of responsibility as between
      Buyer and Sellers for certain tax matters following the Closing
      Date:

    


    10.1     Tax
      Periods Ending on or Before the Closing Date.  Buyer shall
      prepare or cause to be prepared and file or cause to be filed all Tax Returns
      for MM&S for all periods ending on or prior to the Closing Date which are
      filed after the Closing Date other than income Tax Returns with respect to
      periods for which a consolidated, unitary or combined income Tax Return of
      Seller will include the operations of MM&S.  Buyer shall permit
      MM&S to review and comment on each such Tax Return described in the
      preceding sentence prior to filing.  Sellers shall reimburse Buyer for
      Taxes of MM&S with respect to such periods within fifteen (15) days after
      payment by Buyer or MM&S of such Taxes to the extent such Taxes are not
      reflected in the reserve for Tax Liability (rather than any reserve for deferred
      Taxes established to reflect timing differences between book and Tax income)
      shown on the face of the Closing Balance Sheet.

    


    
      
        
          
          

        

        
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    10.2     Tax
      Periods Beginning Before and Ending After the Closing Date.  Buyer shall
      prepare or cause to be prepared and file or cause to be filed any Tax Returns
      of
      MM&S for Tax periods which begin before the Closing Date and end after the
      Closing Date.  Sellers shall pay to Buyer within fifteen (15) days
      after the date on which Taxes are paid with respect to such periods an amount
      equal to the portion of such Taxes which relates to the portion of such Taxable
      period ending on the Closing Date to the extent such Taxes are not reflected
      in
      the reserve for Tax Liability (rather than any reserve for deferred Taxes
      established to reflect timing differences between book and Tax income) shown
      on
      the face of the Closing Balance Sheet.  For purposes of this Section,
      in the case of any Taxes that are imposed on a periodic basis and are payable
      for a Taxable period that includes (but does not end on) the Closing Date,
      the
      portion of such Tax which relates to the portion of such Taxable period ending
      on the Closing Date shall (x) in the case of any Taxes other than Taxes based
      upon or related to income or receipts, be deemed to be the amount of such Tax
      for the entire Taxable period multiplied by a fraction the numerator of which
      is
      the number of days in the Taxable period ending on the Closing Date and the
      denominator of which is the number of days in the entire Taxable period, and
      (y)
      in the case of any Tax based upon or related to income or receipts be deemed
      equal to the amount which would be payable if the relevant Taxable period ended
      on the Closing Date.  Any credits relating to a Taxable period that
      begins before and ends after the Closing Date shall be taken into account as
      though the relevant Taxable period ended on the Closing Date.  All
      determinations necessary to give effect to the foregoing allocations shall
      be
      made in a manner consistent with prior practice of MM&S.

    


    10.2     Cooperation
      on Tax
      Matters.

    


    (A)         Buyer,
      MM&S and Sellers shall cooperate fully, as and to the extent reasonably
      requested by the other party, in connection with the filing of Tax Returns
      pursuant to this Section and any audit, litigation or other proceeding with
      respect to Taxes.  Such cooperation shall include the retention and
      (upon the other party's request) the provision of records and information which
      are reasonably relevant to any such audit, litigation or other proceeding and
      making employees available on a mutually convenient basis to provide additional
      information and explanation of any material provided
      hereunder.  MM&S and Sellers agree (1) to retain all books and
      records with respect to Tax matters pertinent to MM&S relating to any
      taxable period beginning before the Closing Date until the expiration of the
      statute of limitations (and, to the extent notified by Buyer or Sellers, any
      extensions thereof) of the respective taxable periods, and to abide by all
      record retention agreements entered into with any taxing authority, and (2)
      to
      give the other party reasonable written notice prior to transferring, destroying
      or discarding any such books and records and, if the other party so requests,
      MM&S or Sellers, as the case may be, shall allow the other party to take
      possession of such books and records.

    


    (B)         Buyer
      and Sellers further agree, upon request, to use their best efforts to obtain
      any
      certificate or other document from any governmental authority or any other
      Person as may be necessary to mitigate, reduce or eliminate any Tax that could
      be imposed (including, but not limited to, with respect to the transactions
      contemplated hereby).

    


    (C)         Buyer
      and Sellers further agree, upon request, to provide the other party with all
      information that either party may be required to report pursuant to §6043 of the
      Code and all Treasury Department Regulations promulgated
      thereunder.

    


    


    
      
        
          
          

        

        
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    10.3     Tax
      Sharing Agreements.  All tax sharing agreements or similar
      agreements with respect to or involving MM&S shall be terminated as of the
      Closing Date and, after the Closing Date, MM&S shall not be bound thereby or
      have any Liability thereunder.

    


    10.4     Certain
      Taxes.  All transfer,
      documentary, sales, use, stamp, registration and other such Taxes and fees
      (including any penalties and interest) incurred in connection with this
      Agreement, shall be paid by Sellers when due, and Sellers will, at their own
      expense, file all necessary Tax Returns and other documentation with respect
      to
      all such transfer, documentary, sales, use, stamp, registration and other Taxes
      and fees, and, if required by applicable law, Buyer will, and will cause its
      affiliates to, join in the execution of any such Tax Returns and other
      documentation.

    


    ARTICLE
      11

    TERMINATION

    


    11.1     Termination
      of Agreement.  Certain of the Parties may terminate this
      Agreement as provided below:

    


    (A)         Buyer
      and Sellers may terminate this Agreement by mutual written consent at any time
      prior to the Closing;

    


    (B)         Buyer
      may terminate this Agreement by giving written notice to the Sellers at any
      time
      prior to the Closing (1) in the event any of the Sellers has breached any
      material representation, warranty, or covenant contained in this Agreement
      in
      any material respect, the Buyer has notified the Sellers of the breach, and
      the
      breach has continued without cure for a period of five (5) after the notice
      of
      breach or (2) if the Closing shall not have occurred on or before December
      31,
      2007, by reason of the failure of any condition precedent under Section 8.1
      hereof (unless the failure results primarily from the Buyer itself breaching
      any
      representation, warranty, or covenant contained in this Agreement);
      and

    


    (C)         Sellers
      may terminate this Agreement by giving written notice to the Buyer at any time
      prior to the Closing (1) in the event the Buyer has breached any material
      representation, warranty, or covenant contained in this Agreement in any
      material respect, any of the Sellers has notified the Buyer of the breach,
      and
      the breach has continued without cure for a period of five (5) days after the
      notice of breach or (2) if the Closing shall not have occurred on or before
      December 31, 2007, by reason of the failure of any condition precedent under
      Section 8.2 hereof (unless the failure results primarily from any of the Sellers
      themselves breaching any representation, warranty, or covenant contained in
      this
      Agreement).

    


    11.2       Effect
      of
      Termination.  If any Party terminates this Agreement pursuant
      to Section 11.1 above, all rights and obligations of the Parties hereunder shall
      terminate without any Liability of any Party to any other Party (except for
      any
      Liability of any Party then in breach).

    


    ARTICLE
      12

    MISCELLANEOUS

    


    12.1     Nature
      of Certain
      Obligations.

    


    (A)         The
      covenants of each of the Sellers in Section 2.1 above concerning the sale of
      his
      MM&S Shares to the Buyer and the representations and warranties of each of
      the Sellers in Article 3 above concerning the transaction are several
      obligations.  This means that the particular Seller making the
      representation, warranty, or covenant will be solely responsible to the extent
      provided in Article 9 above for any Adverse Consequences the Buyer may suffer
      as
      a result of any breach thereof.

    


    
      
        
          
          

        

        
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    (B)         The
      remainder of the representations, warranties, and covenants in this Agreement
      are joint and several obligations. This means that each Seller will be
      responsible to the extent provided in Article 9 above for the entirety of any
      Adverse Consequences the Buyer may suffer as a result of any breach
      thereof.

    


    12.2    
      Press
      Releases and Public Announcements.  No Party shall issue any
      press release or make any public announcement relating to the subject matter
      of
      this Agreement prior to the Closing without the prior written approval of the
      Buyer and the Sellers; provided, however,
      that any Party may make any public disclosure it believes in good faith is
      required by applicable law or any listing or trading agreement concerning its
      publicly-traded securities (in which case the disclosing Party will use its
      reasonable best efforts to advise the other Parties prior to making the
      disclosure).

    


    12.3    
      No
      Third-Party Beneficiaries.  This Agreement shall not confer any
      rights or remedies upon any Person other than the Parties and their respective
      successors and permitted assigns.

    


    12.4     Entire
      Agreement.  This Agreement (including the documents referred to
      herein) constitutes the entire agreement among the Parties and supersedes any
      prior understandings, agreements, or representations by or among the Parties,
      written or oral, to the extent they related in any way to the subject matter
      hereof.

    


    12.5     Succession
      and Assignment.  This Agreement shall be binding upon and inure
      to the benefit of the Parties named herein and their respective successors
      and
      permitted assigns.  No Party may assign either this Agreement or any
      of his or its rights, interests, or obligations hereunder without the prior
      written approval of the Buyer and the Sellers; provided, however,
      that the Buyer may (i) assign any or all of its rights and interests hereunder
      to one or more of its Affiliates and (ii) designate one or more of its
      Affiliates to perform its obligations hereunder (in any or all of which cases
      the Buyer nonetheless shall remain responsible for the performance of all of
      its
      obligations hereunder).

    


    12.6     Counterparts.  This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed an original but all of which together will constitute one and the same
      instrument.

    


    12.7     Notices.  All
      notices, requests, demands, claims, and other communications hereunder will
      be
      in writing.  Any notice, request, demand, claim, or other
      communication hereunder shall be deemed duly given if (and then two business
      days after) it is sent by registered or certified mail, return receipt
      requested, postage prepaid, and addressed to the intended recipient as set
      forth
      below:

    


    If
      to the Sellers:

    c/o
Midwest
      Monitoring and
      Surveillance

    1420
      North State Street

    Fairmont,
      MN  56031

    


    Copy
      to:

    Tuttle
      & Bergeson, P.A.

    Attn:
      Steve Bergeson, Esq.

    1275
      Ramsey Street, Suite 600

    Shakopee,
      MN 55379

    
       

      If
        to the Buyer:

      RemoteMDx,
        Inc.

      150
        West
        Civic Center Drive

      Suite
        400

      Sandy,
        Utah  84070

      



    

    


    
      
        
          
          

        

        
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            31
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    Copy
      to:

    Durham
      Jones & Pinegar, PC

    Attn:
      Kevin R. Pinegar, Esq.

    111
      East
      Broadway, Suite 900

    Salt
      Lake
      City, Utah 84111

    


    Any
      Party
      may send any notice, request, demand, claim, or other communication hereunder
      to
      the intended recipient at the address set forth above using any other means
      (including personal delivery, expedited courier, messenger service, telecopy,
      telex, ordinary mail, or electronic mail), but no such notice, request, demand,
      claim, or other communication shall be deemed to have been duly given unless
      and
      until it actually is received by the intended recipient.  Any Party
      may change the address to which notices, requests, demands, claims, and other
      communications hereunder are to be delivered by giving the other Parties notice
      in the manner herein set forth.

    


    12.8     Governing
      Law.  This Agreement shall be governed by and construed in
      accordance with the domestic laws of the State of Utah without giving effect
      to
      any choice or conflict of law provision or rule (whether of the State of Utah
      or
      any other jurisdiction) that would cause the application of the laws of any
      jurisdiction other than the State of Utah.

    


    12.9     Amendments
      and Waivers.  No amendment of any provision of this Agreement
      shall be valid unless the same shall be in writing and signed by the Buyer
      and
      the Sellers.  No waiver by any Party of any default,
      misrepresentation, or breach of warranty or covenant hereunder, whether
      intentional or not, shall be deemed to extend to any prior or subsequent
      default, misrepresentation, or breach of warranty or covenant hereunder or
      affect in any way any rights arising by virtue of any prior or subsequent such
      occurrence.

    


    12.10   Severability.  Any
      term or provision of this Agreement that is invalid or unenforceable in any
      situation in any jurisdiction shall not affect the validity or enforceability
      of
      the remaining terms and provisions hereof or the validity or enforceability
      of
      the offending term or provision in any other situation or in any other
      jurisdiction.

    


    12.11   Expenses.  Each
      of the Parties and MM&S will bear its own costs and expenses (including
      legal fees and expenses) incurred in connection with this Agreement and the
      transactions contemplated hereby.  The Sellers agree that MM&S has
      not borne or will not bear any of the Sellers' costs and expenses (including
      any
      of their legal fees and expenses) in connection with this Agreement or any
      of
      the transactions contemplated hereby.

    


    12.12   Construction.  Any
      reference to any federal, state, local, or foreign statute or law shall be
      deemed also to refer to all rules and regulations promulgated thereunder, unless
      the context requires otherwise.  The word "including" shall mean
      including without limitation.  The Parties intend that each
      representation, warranty, and covenant contained herein shall have independent
      significance.  If any Party has breached any representation, warranty,
      or covenant contained herein in any respect, the fact that there exists another
      representation, warranty, or covenant relating to the same subject matter
      (regardless of the relative levels of specificity) which the Party has not
      breached shall not detract from or mitigate the fact that the Party is in breach
      of the first representation, warranty, or covenant.

    


    12.13   Incorporation
      of Exhibits, Annexes, and Schedules.  The Exhibits, Annexes,
      and Schedules identified in this Agreement are incorporated herein by reference
      and made a part hereof.

     

     

    
      
         

      

      
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          32
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    12.14   Specific
      Performance.  Each of the Parties acknowledges and agrees that
      the other Parties would be damaged irreparably in the event any of the
      provisions of this Agreement are not performed in accordance with their specific
      terms or otherwise are breached.  Accordingly, each of the Parties
      agrees that the other Parties shall be entitled to an injunction or injunctions
      to prevent breaches of the provisions of this Agreement and to enforce
      specifically this Agreement and the terms and provisions hereof in any action
      instituted in any court of the United States or any state thereof having
      jurisdiction over the Parties and the matter, in addition to any other remedy
      to
      which they may be entitled, at law or in equity.

    


    12.15   Captions.  The
      captions used in this Agreement are for convenience of reference only and do
      not
      constitute a part of this Agreement and will not be deemed to limit,
      characterize or in any way affect any provision of this Agreement, and all
      provisions of this Agreement will be enforced and construed as if no caption
      had
      been used in this Agreement. 

    


    


    *****

    [Signatures
      are on the following page.]

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    
 

    
      
         

      

      
        -
          33
          -

        
          

        

      

      
         

      

    

     

    IN
      WITNESS WHEREOF, the Parties hereto have executed this Agreement on December 20,
      2007, effective December 1, 2007.

    


    REMOTEMDX,
      INC.

    


    


    


    By:  /s/  Michael
      G.
      Acton     

    Title:  Chief
      Financial
      Officer

    


    


    MIDWEST
      MONITORING AND SURVEILLANCE, INC.

    


    


    


    By:  /s/  Gary
      Shelton       

    Title:  President                
      

    


    


    /s/  Gary
      Bengtson           

    Gary
      Bengtson

    


    


    /s/  Gary
      Shelton              


    Gary
      Shelton

    


    


    /s/  Larry
      Gardner            

    Larry
      Gardner

    


    


    /s/  Sue
      Gardner               


    Sue
      Gardner

     

     

     

     

     

     

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