Document:

EXHIBIT
10.149

    CONFIDENTIAL
TREATMENT REQUESTED

    

    Ferring
Pharmaceuticals, Inc.

    4
Gatehall Drive, 3rd
Floor

    Parsippany,
NJ  07054

     

    March
___, 2009

    

    Vyteris,
Inc.

    13-01
Pollitt Drive

    Fair
Lawn, NJ   07410

    

    Ladies
and Gentlemen:

    

    Ferring
Pharmaceuticals, Inc., a Delaware corporation (“Ferring”), Vyteris,
Inc., a Delaware corporation (“Vyteris”), and
Vyteris, Inc., a Nevada corporation (“Parent”) hereby agree
as follows:

    

    1.            License
Agreement.   Reference is hereby made to the License and
Development Agreement dated as of September 27, 2004, as amended, between
Ferring and Vyteris (the “License
Agreement”).

     

    (a)           Attached
hereto as Schedule
1 is a draft of the calendar year 2009 “patch development budget”
provided by Vyteris to Ferring pursuant to Section 2.04 of the License Agreement
(the “2009 Patch
Development Budget”).  Promptly following the execution and
delivery of this letter agreement, Vyteris and Ferring shall agree upon a final
2009 Patch Development Budget.  The existing 50/50 sharing arrangement
with respect to annual development costs incurred to carry out the Development
Plan described in the License Agreement shall remain in
place.  However, solely with respect to up to $6,600,000 of the 2009
Patch Development Budget, Ferring agrees that, subject to adequate confirmation
and approval by Ferring, in its sole reasonable discretion, regarding the use of
such funds consistent with the Development Plan, Ferring shall pay half of such
budgeted amount ($3,300,000) in full first.  With respect to each such
payment made by Ferring with respect to calendar year 2009 (including, without
limitation, prior to the execution of this letter agreement) in excess of the
amounts due in accordance with the original 50/50 sharing arrangement (the
“Excess
Amounts”), Ferring shall be deemed to have paid such Excess Amounts on
account of and on behalf of Vyteris’s obligation under the existing 50/50
sharing arrangement; and such Excess Amounts shall be deemed loans by Ferring to
Vyteris (which loans Vyteris shall repay to Ferring (i) by making payment, on
account of and for the benefit of Ferring, of Ferring’s 50/50 sharing obligation
with respect to the second half of such $6,600,000 ($3,300,000) of such
Development Costs, but in any event, no later than December 31, 2009, or (ii) if
earlier, upon the termination of the License Agreement or the breach by Vyteris
or Parent of the License Agreement, the Supply Agreement (as defined below), the
Technical Agreement (as defined below), or any of the Transaction Documents (as
defined below).  In connection therewith, Vyteris shall invoice
Ferring on a semi-monthly basis based on actual costs incurred during the prior
semi-monthly period.  All such payments shall continue to be subject
to year-end reconciliation and the other provisions set forth in Section 2.04 of
the License Agreement.  With respect to any amounts in the final 2009
Development Patch Development Budget in excess of $6,600,000, such amounts shall
be paid after Ferring and Vyteris pay the amounts set forth in this paragraph
(and the original 50/50 sharing arrangement shall apply with respect
thereto).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    (b)           Section
5.05(b) of the License Agreement is hereby amended and restated to read in its
entirety as follows:

     

    “In each
subsequent twelve month period, the revenue share percentage that shall be paid
by Ferring to Vyteris shall be as follows:

     

    
      	
               
      

            	
              ·

            	
              *% of the first $100 million of
      Net Sales during such
period;

            

    

     

    
      	
               
      

            	
              ·

            	
              *% of Net Sales between
      $100-200 million during such period;
and

            

    

     

    
      	
               
      

            	
              ·

            	
              *% of Net Sales exceeding
      $200 million in each such
period.”

            

    

     

    (c)           Except
as set forth above, the License Agreement shall remain in full force and
effect.

     

    2.            Supply
Agreement.  Reference is hereby made to the Supply Agreement
dated September 27, 2004, as amended, between Ferring and Vyteris the (“Supply Agreement”)
and the Technical Agreement entered into by and between Ferring and Vyteris in
connection with (the “Technical
Agreement”).

     

    (a)           The
following is hereby added as a new Section 8.5 of the Supply
Agreement:

     

    “At
Ferring's expense, Vyteris hereby agrees that it shall permit a Ferring
manufacturing/production employee or representative to be onsite at Vyteris’
Fair Lawn, New Jersey facility during calendar year 2009, at such times as are
reasonably requested by Ferring, for observation and review purposes solely with
respect to activities related to Ferring.  With respect to such
observation and review, the provisions of Article 6 of this Agreement
(Confidentiality) shall apply.  During calendar years 2009 and 2010,
Ferring agrees that it shall not directly solicit for employment any employee of
Vyteris whom Ferring is first introduced to directly as a result of the exercise
by Ferring of such observation and review rights.”

     

    (b)           Except
as set forth above, the Supply Agreement and the Technical Agreement shall
remain in full force and effect.

     

    3.            PMK150.

     

    (a)           Attached
hereto as Schedule
2 is a description of machinery commonly referred to as PMK150 and used
by Vyteris in connection with its performance of its obligations pursuant to the
License Agreement and
Supply Agreement (together with all replacement and spare parts and
accessories, the “PMK150”).  Vyteris
hereby represents and warrants to Ferring that there are no manufacturer or
other warranties in favor of Vyteris and/or its affiliates relating to the
PMK150.

     

    *
confidential treatment requested.

    
      
         

      

      
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    (b)           Vyteris
and Parent hereby, jointly and severally,  represent and warrant to
Ferring that (i) Vyteris owns all good and marketable right, title and interest
in and to the PMK150, free and clear of any and all liens, security interests,
pledges, attachments, mortgages, charges, claims, conditions or other similar
encumbrances or restrictions of any kind, including, without limitation, any
conditional sale agreement or other title retention agreement (collectively,
“Liens”),
except for the Lien in favor of Spencer Trask Specialty Group (“Spencer Trask”); and
upon execution and delivery of the Bill of Sale (as defined below), Ferring
shall acquire all absolute unconditional right, title and interest in and to the
Purchased Assets (as defined below), free and clear of all Liens (i.e., Spencer
Trask shall release its Lien); (ii) the PMK150 conforms to the specifications
set forth on Schedule
2 hereto and is in good working order and operating condition, free of
any material defects (latent and otherwise); (iii) the PMK150 complies in all
material respects with all applicable requirements of all applicable and
relevant occupational safety and health laws and the regulations promulgated
thereunder; and (iv) the PMK150 is located at the facilities of Vyteris located
at 13-01 Pollitt Drive, Fair Lawn, New Jersey.

     

    (c)           Vyteris
and Parent hereby, jointly and severally, represent and warrant to Ferring that
(i) Vyteris is a wholly-owned subsidiary of Parent, that Parent is a
holding-company without operations other than as relate to its ownership of
Vyteris, and that Parent’s only asset is its capital stock of Vyteris; and (ii)
except as set forth on Schedule 3, there is
no actual or threatened claim, lawsuit, action or proceeding against or
involving Vyteris or Parent.

     

    (d)           Simultaneously
with the execution and delivery of this letter agreement, Vyteris and Ferring
shall enter into an Assignment and Bill of Sale in the form attached hereto as
Exhibit A (the
“Bill of Sale”)
pursuant to which Vyteris shall sell and assign to Ferring, and Ferring shall
purchase from Vyteris, the PMK150 and all related records, documentation and
warranties (collectively, the “Purchased Assets”),
free and clear of all Liens.  The Bill of Sale is hereby incorporated
by reference into this Agreement as if fully set forth herein.

     

     (i)            The
purchase price to be paid by Ferring to Vyteris for the Purchased Assets is One
Million Dollars ($1,000,000) (the “Purchase Price”) and
shall be paid by Ferring to Vyteris as follows:

     

    (a)           credit
for the principal amounts owed by Vyteris to Ferring pursuant to (i) the
Promissory Note dated July 8, 2008 made by Parent, as nominee and agent for
Vyteris, to Ferring in the original principal amount of $50,000 (the "$50,000 Note") (which
principal amount equals $50,000), and (ii) the Promissory Note dated December
15, 2008 made by Parent, as nominee and agent for Vyteris, to Ferring in the
original principal amount of $200,000 (the "$200,000 Note")
(which principal amount equals $200,000) are hereby credited in full against the
Purchase Price;

     

    (b)           Ferring
shall make a payment to Vyteris in the amount of $250,000 on the date hereof;
and

     

    (c)           On
April 30, 2009, Ferring shall make a payment to Vyteris in the amount of (i)
$500,000, less credit for (ii) interest payments owed by Vyteris to Ferring
pursuant to the (A) the $50,000 Note; (B) the $200,000 Note; and (C) the
Promissory Note dated July 8, 2008 made by Parent, as nominee and agent for
Vyteris, to Ferring in the original principal amount of $2,500,000 (the “$2,500,000
Note”).

    
      
         

      

      
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     (ii)           The
parties hereby acknowledge and agree that the loans made by Ferring and
represented by the $50,000 Note, the $200,000 Note and the $2,500,000 Note were
each made by Ferring to Parent, as nominee and agent for Vyteris.  The
parties hereby acknowledge and agree that the Purchase Price constitutes the
Fair Market Value of the Purchased Assets.  As used in this letter
agreement, the “Fair Market Value” means the price determined by the parties to
be the price which a willing buyer would pay for assets in an arm’s length
transaction to a willing seller who is under no compulsion to sell such
assets.

     

     (iii)          The
Parties hereby acknowledge and agree that, in accordance with Section 4 of the
$2,500,000 Note, Ferring has elected to offset the principal amount due by
Ferring thereunder against the $2,500,000 payment due by Ferring pursuant to
Section 5.02(ii) of the License Agreement.

     

    (e)           Simultaneously
with the execution and delivery of this letter agreement, Vyteris and Ferring
shall enter into an Equipment Lease Agreement in the form attached hereto as
Exhibit B (the
“Equipment
Lease”) pursuant to which Ferring shall lease to Vyteris the Purchased
Assets.   As set forth in the Equipment Lease, in lieu of Vyteris
paying the lease payments to Ferring in cash, at Ferring’s option Ferring shall
receive a dollar-for-dollar credit against, at Ferring’s option, (i) the option
exercise price described below with respect to the PMK300, and/or (ii) amounts
due by Ferring to Vyteris pursuant to the License Agreement (e.g., milestone payments),
the Supply Agreement and/or any other agreement between the
parties.  The Equipment Lease is hereby incorporated by reference into
this Agreement as if fully set forth herein.  General terms shall
include, without limitation, lease payments of $1000 per month, a term of 10
years and covenants by Vyteris to maintain the Equipment in proper working
order.  Without otherwise limiting the provisions of the Section 6(b)
of the Equipment Lease, the insurance referred to in Section 6(b) of the
Equipment Lease shall include the insurance set forth on Schedule 3(a)
attached hereto.

     

    4.            PMK300.

     

    (a)           Attached
hereto as Schedule
4 is a description of a piece of machinery commonly referred to as PMK300
(together with all replacement and spare parts and accessories, the “PMK300”).  There
are no manufacturer and other warranties in favor of Vyteris and/or Parent
relating to the PMK300.

     

    (b)           Vyteris
and Parent hereby, jointly and severally, represent and warrant to Ferring that
(i) Vyteris owns all good and marketable right, title and interest in and to the
PMK300, free and clear of any and all Liens; and upon consummation by Ferring of
the transactions contemplated by the Option (as defined below), Ferring shall
acquire all absolute unconditional right, title and interest in and to the
PMK300 Assets (as defined below), free and clear of all Liens; (ii) the PMK300
conforms to the specifications: set forth on Schedule 4 hereto and
is in good working order and operating condition, free of any material defects
(latent and otherwise); (iii) the PMK300 complies in all material respects with
all applicable requirements of all applicable and relevant occupational safety
and health laws and the regulations promulgated thereunder; and (iv) the PMK300
is located at the facilities of Herro Hoeflinger Harro Höfliger
Verpackungsmaschinen GmbH, Werk Satteldorf, Industriestraße 6, 74589 Satteldorf,
GERMANY.

    
      
         

      

      
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    (c)           Vyteris
hereby grants to Ferring the right to purchase the PMK300 and all related
records, documentation and warranties (collectively, the “PMK300 Assets”), free
and clear of all Liens (the “Option”).   In
order to exercise the Option, Ferring shall notify Vyteris in writing, prior to
the expiration of the Option Period (as defined below), that Ferring desires to
exercise the Option, in which case the parties shall promptly negotiate and
enter into a purchase agreement and other related documents (including, without
limitation, transfer documents and a legal opinion in favor of Ferring) in
connection therewith.  As used herein, the “Option Period” means
the period of time beginning on the date of this letter agreement and ending on
the second anniversary of the letter agreement.

     

     (i)           The
option exercise price to be paid by Ferring to Vyteris shall be in an amount and
upon payment terms mutually agreed upon by the parties in good
faith.

     

     (ii)          Vyteris
hereby covenants and agrees that during the Option Period (and, if Ferring
exercises the Option, until such time as Ferring and Vyteris consummate the sale
by Vyteris to Ferring of the PMK300 Purchased Assets), the representations and
warranties set forth in paragraph 4(b) shall remain true and accurate in all
respects and Vyteris shall maintain the insurance listed on Schedule 5 attached
hereto.

     

    5.            Representations and
Warranties.  Vyteris and Parent, jointly and severally, hereby
represent and warrant to Ferring, and Ferring hereby represents and warrants to
Vyteris that:

     

    (a)           It
is duly and validly existing under the laws under which it was organized and is
qualified and in good standing in the State of New Jersey; except that, with
respect to Parent, Vyteris and Parent represent and warrant that Parent is not
in good standing in the State of New Jersey, that Parent is not “doing business”
in the State of New Jersey and that such failure of Parent to be in good
standing is not in violation or contrary to any law or regulation.  It has the
requisite power and authority to execute, deliver and perform this letter
agreement and all of the other documents and instruments executed and delivered
by it in accordance herewith (collectively with this letter agreement, the
“Transaction
Documents”).  It has obtained all necessary authorizations to
approve the execution, delivery and performance by it of each of the Transaction
Documents to which it is a party.  Each of the Transaction Documents
to which it is a party has been duly executed and delivered by it.

     

    (b)           Each
of the Transaction Documents to which it is a party is its legal, valid and
binding obligation, enforceable against it in accordance with its
terms.  The execution, delivery and performance of each of the
Transaction Documents to which it is a party does not and will not, under any
circumstance whatsoever: (i) conflict with, constitute a default, or result in a
default or other breach of or under the certificate of incorporation or bylaws
of such party or any agreement to which such party is a party or by which it or
its assets is bound; (ii) permit any entity or individual to either terminate or
to accelerate any liability or other obligation, or to impose any penalty under
or to otherwise modify, or exercise rights under, or cancel or require any
notice under, or otherwise violate any  agreement to which such party
is a party or by which it or its assets is bound; or (iii) otherwise result in a
Lien, except for Liens in favor of Ferring as contemplated by the Transaction
Documents.

    
      
         

      

      
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    (c)           No
governmental or other authorization, approval or other consent of any kind or
nature by or on behalf of such party is required arising out of or otherwise
relating to the execution, delivery or performance of the Transaction Documents
to which it is a party and such party is not prohibited by any law from
consummating the transactions contemplated by any of the Transaction Documents
to which it is a party.  No litigation or other proceeding is pending
against it that questions the validity of any of the Transaction Documents or
any transaction contemplated thereby.

     

    6.            Indemnification; Security
Interests; Subordination; Additional Agreements.

     

    (a)           Vyteris
and Parent, jointly and severally, hereby agree to indemnify and hold harmless
(and at the request of Ferring, defend) Ferring and its parent and other
affiliates and their respective successors and permitted assigns, and the
officers, directors, managers, employees, members, partners, stockholders,
agents and representatives of each of the foregoing (collectively, the “Buyer Indemnitees”),
from and against, and shall pay to the Buyer Indemnitees the amount of, any and
all liabilities, losses, damages, expenses (including, without limitation,
reasonable attorneys’ fees), causes of action, suits, claims or judgments
arising from, resulting from or based upon (i) any breach of or inaccuracy in
the representations and warranties of Vyteris and/or Parent contained in any of
the Transaction Documents, the License Agreement, the Supply Agreement and/or
the Technical Agreement, (ii) any breach of the covenants or agreements of
Vyteris and/or Parent contained in any of the Transaction Documents, the License
Agreement, the Supply Agreement and/or the Technical Agreement, or (iii) the
actual or alleged use, operation, delivery or transportation of the Purchased
Assets (and, if Ferring exercises, the Option, the PMK300 Assets) prior to the
sale and assignment thereof to Ferring pursuant to the Transaction Documents or
while Vyteris and/or Parent otherwise has possession or control
thereof.

     

    (b)           To
secure the obligations of Vyteris pursuant to the existing and new agreements
between the parties, Vyteris shall grant to Ferring a security interest in all
of the assets of Vyteris (including, without limitation, the PMK300 machinery
and the Product (as defined in the License Agreement), work in process supplies,
inventories, machinery and equipment); provided, however, that with respect to
patent rights, such collateral shall only include the patents and patent
applications (i) referred to in the License Agreement, (ii) made, created,
developed or reduced to practice in connection with the License Agreement, and
(iii) any other patents and patent applications owned or controlled by Vyteris
and necessary, useful or desirable to Ferring’s manufacture, marketing, sale
testing, development or use of the Product, including, without limitation the
patents and patent applications listed on Schedule 6 attached
hereto, together with certain other assets, all as more fully described in the
Vyteris Security Agreement (as defined below).  In furtherance
thereof, simultaneously with the execution and delivery of this letter
agreement, Vyteris shall execute and delivery to Ferring a Security Agreement in
the form attached hereto as Exhibit C (the “Vyteris Security
Agreement”) and any other UCC-1 statements, collateral assignments of
patents and other documents reasonably requested by Ferring.  The
Vyteris Security Agreement is hereby incorporated by reference into this
Agreement as if fully set forth herein.   Additionally, Vyteris
shall, upon the request of Ferring at any time on the date hereof or thereafter,
take all steps that Ferring deems advisable or necessary in order for Ferring to
obtain and/or perfect its security interest (including, at the request of
Ferring, that Vyteris shall execute appropriate German security documents, move
the PMK300 machinery to the United States and/or obtain a legal opinion, from a
law firm and in form satisfactory to Ferring, with respect to such
perfection).  The German security documents shall substantially
conform to the draft security transfer agreement (Sicherungsübereignungsvertrag)
attached hereto as Exhibit G and shall
be executed by the parties (including Spencer Trask) within twenty (20) bank
working days from the execution and delivery of this Letter
Agreement.  The German security documents shall form an integral part
of the Vyteris Security Agreement and their content shall be incorporated in
full into the Vyteris Security Agreement by way of reference.  Vyteris
shall pay all costs and expenses incurred by Ferring in connection with
perfecting its security interest (including, without limitation, all costs and
expenses of German legal counsel).   The Vyteris Security
Agreement shall terminate on the Security Interest Termination Date (as defined
in the Vyteris Security Agreement).

    
      
         

      

      
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    (c)           To
secure the obligations of Parent pursuant to the existing and new agreements
between the parties, Parent shall grant to Ferring a security interest in all of
the assets of Parent.  In furtherance thereof, simultaneously with the
execution and delivery of this letter agreement, Parent shall execute and
delivery to Ferring a Parent Security Agreement in the form attached hereto as
Exhibit D (the
“Parent Security
Agreement”) and any other UCC-1 statements and other documents reasonably
requested by Ferring.  The Parent Security Agreement is hereby
incorporated by reference into this Agreement as if fully set forth
herein.   Additionally, Parent shall, upon the request of Ferring
at any time on the date hereof or thereafter, take all steps that Ferring deems
advisable or necessary in order for Ferring to obtain and/or perfect its
security interest.  Parent and/or Vyteris shall pay all costs and
expenses incurred by Ferring in connection with perfecting its security
interest.  The Parent Security interest shall terminate on the
Security Interest Termination Date.

     

    (d)           Simultaneously
with the execution and delivery of this letter agreement, Spencer Trask shall
fully release and discharge all Liens with respect to the PMK150, and (ii) enter
into a Subordination and Agreement in the form attached hereto as Exhibit
E.  Additionally, immediately prior to consummation of the
transactions contemplated by exercise by Ferring of the Option, Spencer Trask
shall fully release and discharge all Liens with respect to the
PMK300.  In connection with the foregoing, Spencer Trask hereby shall
authorize Ferring to take any and all actions (including, as appropriate, filing
UCC-3 termination statements) necessary or desirable, as determined by Ferring
in good faith.

     

    (e)           Simultaneously
with the execution and delivery by the parties of this letter agreement, Vyteris
shall deliver to Ferring the legal opinion of Jolie Kahn, Esq., counsel to
Vyteris, in form and substance satisfactory to Ferring, in the form attached
hereto as Exhibit
F.

    
      
         

      

      
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    (f)           Until
the Security Interest Termination Date, Vyteris nor Parent may not make any
payments to any related party shareholders or entities controlled by related
party shareholders (“related party shareholder” is defined as those shareholders
listed on Schedule
8 attached hereto), except for (i) compensation under existing employment
agreements and consulting fees payable to officers and a certain corporate
director at rates no greater than the rates in effect on January 1, 2009 and
otherwise upon terms no more favorable to such officers and director than under
past practices, and compensation paid to Parent’s Board of Directors pursuant to
arrangements in effect either pursuant to the existing Board compensation plan
or otherwise as in effect on January 1, 2009, and (ii) amounts pre-approved by
Ferring in writing, in each instance, in Ferring’s sole discretion.

     

    (g)         
Notwithstanding anything contained in the Vyteris Security Agreement to the
contrary, Ferring hereby agrees that if, and only if, (i) Ferring has confirmed
in writing that neither Vyteris nor Parent has breached or defaulted under or
with respect to (nor has Ferring alleged in good faith that such breach or
default has occurred under or with respect to) any of the Transaction Documents,
the License Agreement, the Supply Agreement and/or the Technical Agreement, and
(ii) Spencer Trask has reaffirmed in writing (in form and substance reasonably
satisfactory to Ferring in its sole discretion) that the Subordination and
Agreement remains in full force and effect, Ferring shall (A) allow Vyteris to
grant or allow the imposition of a lien or security interest upon the Collateral
(as defined in the Vyteris Security Agreement) in connection with the making of
loans to Vyteris by one or more New Third Party Lenders, and (B) subordinate its
liens and security interests created by the Vyteris Security Agreement to such
New Third Party Lenders to the extent that the value of the Collateral (as
defined in the Vyteris Security Agreement) at the time or times that Ferring
exercises its rights and remedies pursuant to the Vyteris Security Agreement (as
determined by Ferring in its sole discretion good faith) exceeds $3,300,000; it
being understood and agreed that Ferring’s liens and security interests shall
remain senior to the New Third Party Lenders with respect to at least $3,300,000
of value of the Collateral.  In connection with the foregoing
subordination, Ferring agrees to execute a subordination agreement with New
Third Party Lenders in form and substance reasonably satisfactory to Ferring in
its sole discretion.  As used herein, a “New Third Party
Lender” means a third party accredited investor and/or financial
institution (but not Spencer Trask) that is not affiliated in any way with
Vyteris, Parent, Spencer Trask or any related party shareholders or entities
controlled by related party shareholders (as described in paragraph 6(f)
above).

     

    (h)           So
long the License Agreement and/or the Supply Agreement is in effect, Ferring
shall receive notice of all regularly scheduled and unscheduled meetings of the
Board of Directors of Vyteris and Parent, and subject to having designated an
observer (which may be only one person and not subject to change unless the
designated person is no longer employed or retained by Ferring), who has signed
Vyteris’s and Parent's standard nondisclosure agreement (of which Ferring shall
not be a third party beneficiary), such observer may attend Vyteris’s and
Parent's regularly scheduled and unscheduled meetings of its Board of Directors
and shall receive the materials distributed or made available to the voting
members of the Board in connection with such meetings; provided, however, that
such observer shall not have a right to vote or otherwise pass on any matters
brought to the attention of the Board at such meetings, and such observer shall
be excluded from any discussions regarding any matters related to
Ferring.

    
      
         

      

      
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    7.            Miscellaneous.

     

    (a)           Each
of the Transaction Documents shall be governed by and construed in accordance
with the laws of the State of New Jersey without giving effect to conflicts of
law principles.

     

    (b)           Each
of the Transaction Documents may be executed in counterparts and delivered by
facsimile, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.  The parties hereby
submit to the exclusive jurisdiction of the state and federal courts located in
the City of Newark, State of New Jersey for the sole purpose of the Transaction
Documents and any controversy arising thereunder. VYTERIS AND FERRING EACH WAIVE
THEIR RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION ARISING FROM THE
TRANSACTION DOCUMENTS.

     

    (c)           Vyteris
and Parent shall execute and deliver to Ferring, upon Ferring’s request, such
instruments and assurances as Ferring deems necessary or advisable in order to
consummate the transactions contemplated by the Transaction
Documents.  At request of Ferring, Vyteris shall execute, or join
Ferring in executing, financing statements pursuant to the Uniform Commercial
Code or comparable statute, rule or regulation.

     

    (d)           All
notices under any of the Transaction Documents shall be delivered by facsimile
(confirmed by overnight delivery) or by overnight delivery with a reputable
overnight delivery service, to the address of the respective parties set forth
above.  Notices shall be effective on the day following the date of
transmission if sent by facsimile, and on the business day following the date of
delivery to the overnight delivery service if sent by overnight
delivery.  A party may change its address listed above by notice to
the other party given in accordance with this section.

     

    (e)           The
parties hereto acknowledge that the Transaction Documents set forth the entire
agreement and understanding of the parties and supersedes all prior written or
oral agreements or understandings with respect to the subject matter
thereof.  No modification of any of the terms of any of the
Transaction Documents shall be deemed to be valid unless in writing and signed
by an authorized agent or representative of both parties hereto.  No
course of dealing or usage of trade shall be used to modify the terms and
conditions therein.  A waiver of a default shall not be a waiver of
any other or a subsequent default.

     

    (f)           Each
of the Transaction Documents is binding upon, and inures to the benefit of, the
parties hereto and their respective administrators, successors and
assigns.  Neither Vyteris nor Parent may assign or otherwise transfer
(by assignment, stock sale, merger or otherwise) any of the Transaction
Documents without the prior written consent of Ferring.  Each
provision of each of the Transaction Documents shall be considered separable;
and if, for any reason, any provision or provisions herein are determined to be
invalid and contrary to any existing or future law, such invalidity shall not
impair the operation of or affect those portions of the applicable Transaction
Documents which are valid.

     

    [Signature
Page Follows]

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

    

    Please
confirm your agreement to the foregoing by executing the enclosed duplicate
original of this letter in the space provided below and returning it to
Ferring.

     

    
      
        
          	
                  FERRING
      PHARMACEUTICALS, INC.

                
	 
      	 
      
	
                  By:

                	
                  /s/
      Wayne C. Anderson 

                
	 
      	
                  Name: Wayne
      C. Anderson

                
	 
      	
                  Title:  
      President and CEO

                

        

      

    

    

    ACCEPTED
AND

    AGREED
TO:

    

    
      
        	
                VYTERIS,
      INC., a Delaware corporation

              
	 
      	 
      
	
                By:

              	
                /s/
      Haro Hartounian

              
	 
      	
                Name: Haro
      Hartounian

              
	 
      	
                Title:  
      Chief Executive Officer

              

      

    

    

    ACCEPTED
AND AGREED TO:

    

    
      
        	
                VYTERIS,
      INC., a Nevada corporation

              
	 
      	 
      
	
                By:

              	
                /s/
      Haro Hartounian

              
	 
      	
                Name:
      Haro Hartounian

              
	 
      	
                Title:  
      Chief Executive Officer

              

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    SCHEDULES AND
EXHIBITS

     

    
      
        	
                Schedule
      1

              	 
      	
                2009
      Patch Development Budget

              
	
                Schedule
      2

              	 
      	
                Description
      of PMK150

              
	
                Schedule
      3

              	 
      	
                Claims,
      Lawsuits, Actions

              
	
                Schedule
      3(a)

              	 
      	
                PMK150
      Insurance

              
	
                Schedule
      4

              	 
      	
                Description
      of PMK300

              
	
                Schedule
      5

              	 
      	
                PMK300
      Insurance

              
	
                Schedule
      6

              	 
      	
                Certain
      Patent Rights

              
	
                Schedule
      7

              	 
      	
                Materials
      and Supplies

              
	
                Schedule
      8

              	 
      	
                Related
      Parties

              
	 
      	 
      	 
      
	
                Exhibit
      A

              	 
      	
                Form
      of Bill of Sale

              
	
                Exhibit
      B

              	 
      	
                Form
      of Equipment Lease

              
	
                Exhibit
      C

              	 
      	
                Form
      of Vyteris Security Agreement

              
	
                Exhibit
      D

              	 
      	
                Form
      of Parent Security Agreement

              
	
                Exhibit
      E

              	 
      	
                Form
      of Subordination of Agreement

              
	
                Exhibit
      F

              	 
      	
                Form
      of Legal Opinion

              
	
                Exhibit
      G

              	 
      	
                Draft
      German Security Transfer
Agreement

              

      

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
1    Draft 2009 Patch Development Budget

     

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Schedule
2    Description of PMK150

    

    See
attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
3    Claims, Lawsuits, Actions

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
3(a)    PMK150 Insurance

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Schedule
4    Description of PMK300

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Schedule
5    PMK300 Insurance

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
6    Certain Patent Rights

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Schedule
7    Materials and Supplies

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
8    Related Parties

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
A    Form of Bill of Sale

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
B    Form of Equipment Lease

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
C    Form of Vyteris Security Agreement

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit
D    Form of Parent Security Agreement

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
E    Form of Subordination and Agreement

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
F    Form of Legal Opinion

    

    See
Attached

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Exhibit
G    Draft German Security Transfer
Agreement

     

    See
Attached (to be
finalized post-Closing)Exhibit
10.1

       

      ASSET PURCHASE
AGREEMENT

      

      This
ASSET PURCHASE AGREEMENT
(the “Agreement”), is entered into
as of November 19, 2009, by and among NEW JERSEY IMAGING PARTNERS,
INC., a New Jersey corporation (“Purchaser”), RADNET, INC., a Delaware corporation
and affiliate of Purchaser (“RadNet”), MODERN MEDICAL MODALITIES
CORPORATION, a New Jersey corporation (“Parent”), UNION IMAGING ASSOCIATES,
INC., a New Jersey corporation and wholly-owned subsidiary of Parent
(“UIA”), UNION IMAGING CENTER, LLC, a
New Jersey limited liability company and wholly-owned subsidiary of Parent
(“UIC”), and PET SCAN AT UNION IMAGING,
LLC, a New Jersey limited liability company and wholly-owned subsidiary
of Parent (“PET” and
together with UIA and UIC, individually a “Seller Company” and
collectively, “Seller
Companies”). Terms used herein and not otherwise defined shall have the
meanings set forth in Section 10
hereof.

      

      RECITALS

      

      WHEREAS, PET operates a
diagnostic imaging center (the “PET Center”) located at 418
Chestnut Street, Suite A, Union, New Jersey 07083 (the “PET Location”);

      

      WHEREAS, UIC and the JV
operate a diagnostic imaging center (the “UIC Center” and, together with
the PET Center, the “Imaging
Centers”) located at 441-445 Chestnut Street, Union, New Jersey 07083
(the “UIC
Location”);

      

      WHEREAS, Parent leases office
space and a storage facility located at 439 Chestnut Street, Union, New Jersey
(the “Storage Location”,
and together with the PET Location and the UIC Location, the “Locations”);

      

      WHEREAS, all of such business
operations and initiatives conducted at the Imaging Centers are collectively
referred to herein as the “Business”;

      

      WHEREAS, pursuant to the terms
of that certain Lease and Management Agreement dated as of July 30, 1991 by and
between UIA and Howard Kessler, M.D., P.A. d/b/a Union Imaging Associates, P.A.,
a New Jersey professional association (the “PA”), the PA provides certain
billing and professional reading services to each of the Imaging Centers (the
“Existing Services
Agreement”);

      

      WHEREAS, this Agreement is
entered into to enable Purchaser to (i) acquire all of the Acquired Assets,
except the Excluded Assets, used by or in connection with the Business, and (ii)
assume the Assumed Obligations, except the Retained Liabilities, with respect to
the Business, subject to the terms hereof; and

      

      WHEREAS, the Board of
Directors or Board of Managers, as applicable, of Parent and each Seller Company
have approved the sale of the Acquired Assets to, and the Assumption of the
Assumed Obligations by, Purchaser, upon the terms and subject to the conditions
set forth herein.

      

      NOW, THEREFORE, in
consideration of the above premises, the representations and warranties,
covenants and agreements, and subject to the conditions contained herein, and
for other good and valuable consideration, the receipt and adequacy of which are
hereby conclusively acknowledged, Parent, Seller Companies and Purchaser,
intending to become legally bound, hereby agree as follows:

      

      1.   Purchase
Of Acquired Assets

      

      1.1   Purchase
and Sale of Acquired Assets.  Subject to the terms and
conditions of this Agreement, Parent and each applicable Seller Company agrees
to sell, assign, convey and transfer to Purchaser, and Purchaser agrees to
purchase from each applicable Seller Company or Parent (as the case may be), at
the Closing, all of the assets used by or in connection with the Business,
wherever located, including, but not limited to, medical imaging equipment,
current inventory, machinery, fixtures and other equipment, telephone numbers,
Internet sites, leasehold improvements, intellectual property (to the extent
transferable), Purchaser approved Contracts to which any Seller Company is a
party, books and records, rights to all of Seller Companies’ Claims against
third parties (with the exception of any Claims arising out of the Excluded
Assets or Excluded Liabilities), prepaid expenses, deposits, customer lists,
Licenses (to the extent transferable), Seller Companies’ corporate, financial
and similar records, patient records, medical licenses, other medical assets and
other intangibles, free and clear of any Liens, Claims and Orders (other than
the Permitted Liens) (collectively, the “Acquired Assets”), except for
the assets specifically set forth on Schedule 1.1 attached
hereto (collectively, the “Excluded
Assets”).

      
        
           

        

        
          1

          
            

          

        

        
           

        

      

      

      1.2   Assumed
Obligations.  At the Closing, Purchaser shall assume and agree
to pay, satisfy, perform and discharge as the same shall become due only the
liabilities of Parent and Seller Companies, including all post-Closing
obligations under (i) existing Purchaser approved Contracts that are included
among the Acquired Assets (other than obligations or liabilities as the result
of the breach of any such Contract prior to the Closing Date), (ii) capital
leases of Parent and Seller Companies set forth on Schedule 1.2(a)
attached hereto (not to exceed an aggregate balance at Closing of One Hundred
Fifty Thousand Dollars ($150,000)) and (iii) operating and real property leases
of Parent and Seller Companies set forth on Schedule 1.2(a)
attached hereto (other than obligations relating to defaults thereunder that
arose prior to the Closing) (the “Assumed Obligations”),
pursuant to an Assignment and Assumption Agreement substantially in the form of
Exhibit 1.2(a)
attached hereto (the “Assumption Agreement”). Each
of the Contracts assumed hereunder is independently assumed subject to the
representations, warranties (including that such Contract is not in default on
the Closing Date), covenants and conditions made herein as to that
Contract.  Except as expressly set forth in this Section 1.2 and Schedule 1.2(a)
attached hereto, Purchaser shall not assume or otherwise be responsible at any
time for any liability, obligation, debt or commitment of any Seller Company or
Parent, whether absolute or contingent, accrued or unaccrued, asserted or
unasserted, or otherwise, including, but not limited to, any liabilities,
obligations, debts or commitments of Seller Companies or Parent (a) in respect
of any indebtedness for money borrowed or accounts payable; (b) under or in
respect of any equipment leases or other financing agreements other than in
respect of those specifically set forth as Assumed Obligations, but in no event
shall Purchaser be responsible for any fees or costs in connection with the
transfer of the equipment leases which are a part of the Assumed Liabilities or
for any service or maintenance agreements; (c) under any employment agreements,
consulting agreements, professional radiology service agreements with Seller
Companies (except those specifically assumed hereunder), management agreements
or other such agreements; (d) relating to any lease obligations of any kind
relating to real property, other than those included in the Assumed Obligations,
from and after the Closing, (e) relating to or arising out of any pending
claims, actions, arbitrations and/or other proceedings against Seller Companies;
(f) relating to recapture of any depreciation deduction or investment tax credit
of  Seller Companies; (g) relating to any claims, obligations or
liabilities in respect of environmental remediation or any violation of any
environmental laws or regulations, or any other violation or alleged violation
of applicable law or regulations by the Seller Companies; (h) relating to any
business operations other than the Business; (i) incident to, arising out of or
incurred with respect to this Agreement and the agreements, documents,
instruments, and transactions contemplated hereby; (j) which otherwise arise or
are asserted or incurred by reason of events, acts or transactions occurring, or
the operation of the Business, prior to or on the Closing Date; (k) for
outstanding checks and other similar obligations; (l) relating to the employee
benefit plans, employee policies, employee Contracts, employee programs and/or
arrangements of Seller Companies or any of their Subsidiaries and Affiliates
with Employees (including, but not limited to, any severance or bonus payments
payable to any Employee of any Seller Company); (m) relating to Product
Liability Claims; (n) relating to Taxes, (i) attributable to the Acquired Assets
or the Business with respect to any taxable period or portion thereof that ends
on or prior to the Closing Date or (ii) imposed on any Seller Company or Parent;
or (m) arising out of or relating to any diagnostic tests or other services
rendered by Seller Companies, including any relating to medical malpractice
(collectively, the “Excluded
Liabilities”).  Parent and Seller Companies agree to satisfy
and discharge each of the Excluded Liabilities as the same shall become
due.  Purchaser’s assumption of the Assumed Obligations shall in no
way expand the rights or remedies of third parties against Purchaser as compared
to the rights and remedies that such parties would have had against Parent or
any Seller Company had this Agreement not been consummated.

      

      1.3   Method of
Conveyance.  The sale, transfer, conveyance and assignment by
the applicable Seller Companies of the Acquired Assets to Purchaser in
accordance with Section 1.1 hereof
shall be effected on the Closing Date at the Closing by the applicable Seller
Companies’ execution and delivery to Purchaser of instruments of transfer
including: (a) the bill of sale in substantially the form of Exhibit 1.3(a)
attached hereto (the “Bill of
Sale”), (b) an assignment of each of Parent and Seller Company’s real
property leases used in connection with the Business in substantially the form
of Exhibit 1.3(b)
attached hereto (each, an “Assignment of Lease”), and (c)
consents to the assignment of Purchaser approved Contracts by third parties
thereto in the form of Exhibit 1.3(d)
attached hereto.  On the Closing Date, all of the Acquired Assets
shall be transferred by the applicable Seller Companies to Purchaser free and
clear of any and all Liens, Claims and Orders.

       

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      1.4   Purchase
Price.  In consideration for the conveyance of the Acquired
Assets, and in reliance on the representations and warranties, covenants and
agreements of Parent and Seller Companies contained herein and the agreements,
documents, instruments, and transactions contemplated hereby, Purchaser agrees
to assume the Assumed Obligations and shall pay to Parent an aggregate cash
amount equal to (i) Five Million Dollars ($5,000,000); minus (ii) the
payment obligations of Parent or Seller Companies required to be made at Closing
in order to consummate the transactions contemplated hereby, as set forth on
Schedule 1.4
attached hereto (the “Payment
Obligations”), and (iii) the Escrow Amount and (iv) in addition to the
foregoing, RadNet shall issue to Parent Seventy-Five Thousand (75,000) shares of
RadNet common stock (the “RadNet Shares”)(the “Purchase Price”)
..  The cash portion of the Purchase Price shall be paid to Parent by
wire transfer of immediately available funds on the Closing Date.  The
transfer of the RadNet Shares shall be restricted in accordance with applicable
securities laws affecting shares not registered under the federal securities
laws.

      

      1.5   Allocation
of Purchase Price.  Parent, Seller Companies and Purchaser
agree to allocate the aggregate Purchase Price and, to the extent required, the
Assumed Liabilities and relevant transaction costs, among the Acquired Assets in
accordance with Section 1060 of the Code.  Parent, Seller Companies
and Purchaser agree that Purchaser shall prepare and provide a draft allocation
of the of the purchase price among the Acquired Assets within five (5) days
before the Closing Date, which shall be mutually agreed to by Purchaser, Parent
and Seller Companies in good faith as of the Closing Date.  Parent,
Seller Companies and Purchaser agree to resolve any disagreement with respect to
such allocation in good faith.  Parent, Seller Companies and Purchaser
(i) hereby undertake and agree to file timely any information that may be
required to be filed pursuant to Treasury Regulations promulgated under Section
1060(b) of the Code, and shall use the allocation determined pursuant to this
Section 1.5 in
connection with the preparation of Internal Revenue Service Form 8594 as such
form relates to the transactions contemplated by this Agreement and (ii) shall
each timely report the federal, state and local income and other Tax
consequences of the transactions contemplated by this Agreement in a manner
consistent with such allocation, including the preparation and filing of Form
8594 under Section 1060 of the Code (or any successor form or successor
provision of any future Tax law, and any comparable provision of state, or local
Tax law) with their respective federal, state and local income Tax returns for
the taxable year that includes the Closing Date.  Neither Purchaser
nor any Seller Company shall file any Tax Return inconsistent with the
allocation determined pursuant to this Section 1.5 except as
may be adjusted by subsequent agreement following an audit by the IRS or by
court decision.

      

      1.6   Intentionally
Omitted.

      

      1.7   Escrow
Amount.

      

      1.7.1   On
the Closing Date, Purchaser shall deposit with the Escrow Agent an aggregate
cash amount equal to Three Hundred Thousand Dollars ($300,000) (the “Escrow Amount”) for the
purpose of securing the indemnification obligations of Seller Companies and
Parent (the “Indemnification
Escrow Amount”) which may be used by Purchaser, in its sole and absolute
discretion, to satisfy any indemnification Claim under this Agreement or any
agreement or instrument contemplated by this Agreement.  The Escrow
Amount shall be held by the Escrow Agent pursuant to the terms of the escrow
agreement substantially in the form of Exhibit 1.7.1
attached hereto (the “Escrow
Agreement”).  The Escrow Amount shall be held as a trust fund
and shall not be subject to any Lien, attachment, trustee process or any other
judicial process of any creditor of any party, and shall be held and disbursed
solely for the purposes and in accordance with the terms of the Escrow
Agreement.

      

      1.7.2   Subject
to the terms and conditions of the Escrow Agreement, not later than three (3)
months after the Closing Date, Purchaser and Parent will cause the Escrow Agent
to remit to Parent One Hundred Thousand Dollars ($100,000) of the
Indemnification Escrow Amount, less the sum of any amounts which are owed to or
have been retained by Purchaser from the Indemnification Escrow Amount in
satisfaction of any indemnification Claims of Purchaser, any pending, unresolved
Claims of Purchaser, or any other obligations of any of the Seller Companies or
Parent under this Agreement or any agreements, documents, instruments, and
transactions contemplated hereby.

      

      1.7.3   Subject
to the terms and conditions of the Escrow Agreement, not later than six (6)
months after the Closing Date, Purchaser and Parent will cause the Escrow Agent
to remit to Parent One Hundred Thousand Dollars ($100,000) of the
Indemnification Escrow Amount, less the sum of any amounts which are owed to or
have been retained by Purchaser from the Indemnification Escrow Amount in
satisfaction of any indemnification Claims of Purchaser, any pending, unresolved
Claims of Purchaser, or any other obligations of any of the Seller Companies or
Parent under this Agreement or any agreements, documents, instruments, and
transactions contemplated hereby.

       

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      1.7.4   Subject
to the terms and conditions of the Escrow Agreement, not later than nine (9)
months after the Closing Date, Purchaser and Parent will cause the Escrow Agent
to remit to Seller the remaining Indemnification Escrow Amount held by
Purchaser, less the sum of any amounts which are owed to or have been retained
by Purchaser from the Indemnification Escrow Amount in satisfaction of any
indemnification Claims of Purchaser, any pending, unresolved Claims of
Purchaser, or any other obligations of any of Seller Companies or Parent under
this Agreement or any agreements, documents, instruments, and transactions
contemplated hereby (other than any amounts retained under Section
1.7.2).

      

      1.7.5   Upon
the final resolution of any unresolved Claims of Purchaser, if it is determined
that all, or any portion of the remaining Indemnification Escrow Amount, is due
to Parent, Purchaser and Parent shall cause the Escrow Agent to make such
payment to Parent, less any amount due to Purchaser.

      

      1.7.6   Purchaser
shall have the right, in its sole and absolute discretion, to satisfy any amount
owed to Purchaser in satisfaction of any indemnification Claim or any other
obligations of any of the Seller Companies or Parent under this Agreement or any
agreements, documents, instruments, and transactions contemplated hereby from
the Indemnification Escrow Amount or to recover such amounts directly from any
of the Seller Companies and Parent, jointly and severally.

      

      1.7.7   None
of the indemnification Claims of Purchaser under this Agreement or any
agreements, documents, instruments, and transactions contemplated hereby shall
be limited by the amount of the Indemnification Escrow Amount or limit
Purchaser’s rights and remedies under this Agreement or any agreements,
documents, instruments, and transactions contemplated hereby, including, but not
limited to, Section 8.

      

      1.7.8   The
adoption of this Agreement and the approval of the transactions hereby by the
board of directors of Parent and the stockholders (or members, as applicable)
and board of directors (or similar managing body) of each Seller Company shall
each constitute approval of the Escrow Agreement and of all of the arrangements
relating thereto, including without limitation the placement in escrow of the
Escrow Amount.

      

      1.8   Intentionally
Omitted.

      

      2.   Representations
And Warranties of Parent and Seller Companies.  Parent and each
Seller Company, jointly and severally, represents and warrants to Purchaser as
of the date hereof and as of the Closing Date as set forth below in this Section
2.  Each of the representations and warranties shall be deemed
material and Purchaser, in executing, delivering and consummating the
transactions under this Agreement, has relied and will rely upon the correctness
and completeness of each representation and warranty notwithstanding any
independent investigation and all the representations and warranties are
provided by Parent and Seller Companies to induce Purchaser to enter into this
Agreement and consummate the transactions contemplated hereby.

      

      2.1   Corporate
Organization, Etc..  Parent and each Seller Company is an
entity duly organized, validly existing and in good standing under the laws of
its jurisdiction of incorporation with full corporate or limited liability
company power and authority to carry on its business as it is now being
conducted and to own, operate and lease its properties and
assets.  Parent and each Seller Company is duly qualified or licensed
to do business and is in corporate and Tax good standing in every jurisdiction
in which the conduct of its business, the ownership or lease of its properties,
require it to be so qualified or licensed. Such jurisdictions are set forth in
Schedule 2.1(a)
attached hereto. True, complete and correct copies of Parent’s and each Seller
Company’s charter, articles of organization and bylaws (or similar documents, as
the case may be) as presently in effect are set forth in Schedule 2.1(b)
attached hereto. As of the date hereof, neither UIC nor PET has an operating
agreement, limited liability company agreement or other similar governance
document presently existing or in effect.

      

      2.2   Ownership. All of the authorized,
issued and outstanding equity interests, Options, and securities that are
convertible into, or exchangeable for, equity interests of each of Seller
Companies on a fully diluted basis as of the date hereof (the “Equity Interests”), and
without giving effect to any of the transactions contemplated hereby, are held
beneficially and of record by Parent.  All of the Equity Interests are
duly authorized, validly issued, fully paid and nonassessable, are free and
clear of any and all Liens, Orders, Contracts or other limitations whatsoever,
other than the Permitted Liens, and have been issued in compliance with all
applicable securities laws.  Parent is the record and beneficial owner
and holder of, and has good and marketable title to, the Equity Interests, free
and clear of any and all Liens, Orders, Contracts or other limitations
whatsoever, other than the Permitted Liens.  All of the Equity
Interests were acquired from third parties or Seller Companies in compliance
with all applicable Regulations, free and clear of any rescission and Contract
rights.  There are no existing agreements, Options, warrants, rights,
calls or commitments of any character to which any Seller Company is a party, or
by which any Seller Company is bound, providing for the issuance of any
additional Equity Interests, or for the repurchase or redemption of Equity
Interests, the voting, transfer, encumbrance of the Equity Interests or any
aspect of any Seller Company’s governance or dividends or distributions. There
are no outstanding Options or other instruments convertible into or exchangeable
for Equity Interests and no commitments to issue or sell such Equity
Interests.  No Seller Company has redeemed any Equity Interests in
violation of any Contract, Order or Regulation and there are no existing
Contracts or Options between Parent on the one hand, and any other Person, on
the other hand, regarding the Equity Interests.  No Seller Company has
any Contracts containing any profit participation features, stock appreciation
rights or phantom stock options, or similar Contracts that allow any Person to
participate in the equity of any Seller Company.  The equity ownership
record books of Seller Companies that have been delivered to Purchaser for
inspection prior to the date hereof are complete and correct in all material
respects.

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

       

      2.3   Subsidiaries.  No Seller Company
owns or is obligated, or has a right to, purchase any equity interest in or any
other security convertible into or exchangeable for an equity interest in any
entity.

      

      2.4   Books and
Records.  The minute books
of Seller Companies that have been made available to Purchaser for inspection
are complete and correct in all material respects and contain all of the
proceedings of the directors and managers of each Seller Company, as
applicable.  A true and complete list of the incumbent managers,
directors and officers of each Seller Company, as applicable, is set forth in
Schedule 2.4
attached hereto.  No Seller Company has any of its records, systems,
controls, data or information recorded, stored, maintained, operated or
otherwise wholly or partly dependent upon or held by any means (including any
electronic, mechanical or photographic process, whether computerized or not)
that (including all means of access thereto and therefrom) are not under the
exclusive ownership and direct control of Seller Companies.

      

      2.5   Authorization,
Etc.

      

      2.5.1   Each
Seller Company and Parent have full power and authority to enter into this
Agreement and the agreements, documents and transactions contemplated hereby to
which Seller Companies or Parent are parties and to consummate the transactions
contemplated hereby and thereby.  The execution, delivery and
performance of this Agreement and all other agreements and transactions
contemplated hereby have been duly authorized by Parent and the Board of
Directors or the Board of Managers, as applicable, of each Seller Company, and
no other corporate proceedings on their part are necessary to authorize this
Agreement or any of the agreements, documents and transactions contemplated
hereby and thereby, except as provided in Section 4.10 hereto.  This
Agreement and all other agreements contemplated hereby to be entered into by
Seller Companies and/or Parent each constitutes a legal, valid and binding
obligation of Seller Companies and/or Parent enforceable against each Seller
Company and/or Parent in accordance with its terms, except as the same may be
limited by applicable bankruptcy, insolvency, rehabilitation, moratorium or
similar laws, now or hereafter in effect, of general application relating to or
affecting creditors’ rights, including, without limitation, the effect of
statutory or other laws regarding fraudulent conveyances and preferential
transfers, and for the limitations imposed by general principles of
equity.

      

      2.5.2   Except
as set forth in Schedule 2.5.2
attached hereto, the execution, delivery and performance by Seller Companies and
Parent of this Agreement, and all other agreements contemplated hereby, and the
fulfillment of and compliance with the respective terms hereof and thereof by
Seller Companies and Parent, do not and will not (a) conflict with or result in
a breach of the terms, conditions or provisions of, (b) constitute a default or
event of default under (whether with or without due notice, the passage of time
or both), (c) result in the creation of any Lien upon the Acquired Assets
pursuant to, (d) give any third party the right to modify, terminate or
accelerate any obligation under, (e) result in a violation of, or (f) require
any authorization, consent, approval, exemption or other action by, notice to,
or filing with any third party or Authority pursuant to, the charter, articles
of organization, bylaws or operating agreement (or similar constating documents)
of any Seller Company or Parent, as the case may be, or any applicable
Regulation, Order or Contract to which any Seller Company, Parent or their
respective assets and properties (including the Acquired Assets) or the Equity
Interests are subject.  Parent and each Seller Company have complied
with all applicable Regulations and Orders in connection with the execution,
delivery and performance of this Agreement and the agreements and transaction
contemplated hereby.

       

      
        
           

        

        
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      2.6   Title and
Related Matters.

      

      2.6.1   Except
as set forth in Schedule 2.6.1
attached hereto, Seller Companies have good and marketable title to all real and
personal, tangible and intangible, property and other assets reflected in the
Financial Statements or acquired after the Financial Statement Date, free and
clear of all Liens, Claims and Orders except Permitted Liens.  All
properties used in the Business for the periods covered by the Financial
Statements are reflected in the Financial Statements in accordance with and to
the extent required on an accrual accounting basis.  Schedule 2.6.1
attached hereto sets forth a complete and accurate summary of all leased assets
that have annual rental payments in excess of $10,000, describing the expiration
date of such lease, the name of the lessor, the annual rental payment and
whether a consent is required from the lessor to consummate the transactions
contemplated hereby.

      

      2.6.2   All
Parent’s and Seller Companies’ leases that are part of the Acquired Assets are
in full force and effect, and valid and enforceable in accordance with their
respective terms.  Neither Parent nor any Seller Company has received
any notice of, and there exists no event of default or event which constitutes
or would constitute (with notice or lapse of time or both), any default by
Parent, any Seller Company or any other Person under any lease.  All
rent and other amounts due and payable with respect to Parent’s and Seller
Companies’ leases that are part of the Acquired Assets have been paid through
the date of this Agreement, and all rent and other amounts due and payable with
respect to Parent’s and Seller Companies’ leases that are part of the Acquired
Assets and are due and payable on or prior to the Closing Date will have been
paid prior to the Closing Date.  All lessors under the leases that are
part of the Acquired Assets have consented (where such consent is necessary) or
prior to the Closing will have consented (where such consent is necessary) to
the transactions contemplated pursuant to this Agreement and the agreements,
documents and transactions contemplated hereby and thereby without requiring
material modification in the rights or obligations
thereunder.  Neither Parent nor any Seller Company has received any
written notice that the landlord with respect to any real property lease that is
part of the Acquired Assets would refuse to renew such lease upon expiration of
the period thereof upon substantially the same terms, except for rent increases
consistent with past experience or market rentals.

      

      2.6.3   None
of the Acquired Assets belonging to Parent or Seller Companies is or will be on
the Closing Date subject to any (i) Contracts of sale or lease except as set
forth in Schedule
2.6.3 attached hereto, except Contracts for the sale of inventory in the
ordinary and regular course of business or (ii) Liens, except for Permitted
Liens and the Liens set forth in Schedule 2.6.3
attached hereto.

      

      2.6.4   Except
as set forth in Schedule 2.6.4
attached hereto, the buildings, structures and improvements included within the
Acquired Assets’ real property (collectively, the “Improvements”) have complied
and comply in all material respects with all applicable Regulations, including
building and zoning ordinances and no material alteration, repair, improvement
or other work that could give rise to a Lien has been performed in respect to
such Improvements within the last 120 days.  The Improvements and the
mechanical systems situated therein, including without limitation the heating,
electrical, air conditioning and plumbing systems, are in good operating
condition and repair, ordinary wear and tear excepted, and are adequate and
suitable for the purposes for which they are presently being used, and the roof
of each Improvement is in satisfactory condition and is not in need of current
repair or replacement.  The Acquired Assets’ real property and its
continued use, occupancy and operation as currently used, occupied and operated
does not constitute a nonconforming use under any Regulation or Order affecting
the real property (other than possible set back violations, none of which will
have a Material Adverse Effect on the Business’s real property or its continued
use, occupancy and operation as currently used, occupied and operated), and the
continued existence, use, occupancy and operation of each Improvement, and the
right and ability to repair and/or rebuild such Improvements in the event of
casualty, is not dependent on any special Permit, exception, approval or
variance.  There is no pending or, to the knowledge of Parent and
Seller Companies, threatened or proposed proceeding or governmental action to
modify the zoning classification of, or to take by the power of eminent domain
(or to purchase in lieu thereof), or to classify as a landmark, or to impose
special assessments on, or otherwise to take or restrict in any way the right to
use, develop or alter, all or any part of the Business’ real property that would
have a Material Adverse Effect.  To the knowledge of Parent and Seller
Companies, there are no encroachments upon any of the Business’ real property,
and no portion of any Improvement owned by Parent or Seller Companies encroaches
upon any property not included within the Business’ real property or upon the
area of any easement affecting the Business’ real property.  Each
Improvement has direct access, adequate for the Business, in the ordinary
course, to a public street adjoining the Business’ real property on which such
Improvement is situated, and, to the knowledge of Parent and Seller Companies,
no existing way of access to any Improvement crosses or encroaches upon any
property or property interest not included in the Acquired Assets.

      

      2.6.5   There
has not been since the Financial Statement Date, and will not be prior to the
Closing Date, any sale, lease, or any other disposition or distribution by
Parent or any Seller Company of any Acquired Assets, now or hereafter owned by
it, except transactions in the ordinary and regular course of business or as
otherwise consented to by Purchaser.  Immediately after the Closing,
Purchaser will own, or have the unrestricted right to use, all properties and
assets that are used (or necessary) in connection with the Business, except for
the Excluded Assets, on the same economic basis as before the
Closing.

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      2.6.6   The
Acquired Assets constitute all of the assets necessary or appropriate for the
continued operation of the Business.

      

      2.6.7   All
of the Acquired Assets consisting of tangible assets are located at the
Locations and are in good working condition, except for reasonable wear and
tear, and are sufficient for the purposes for which such Acquired Assets are
currently used and for the purpose proposed to be used in the operations of the
Business pursuant to the transactions contemplated pursuant to this Agreement
and the agreements, documents and transactions contemplated hereby and
thereby.  No Seller Company nor Parent is aware of the need to replace
or purchase any material equipment for use in the operation of the Business
prior to Closing or after the Closing pursuant to the transactions contemplated
pursuant to this Agreement and the agreements, documents and transactions
contemplated hereby and thereby, except as related to the Imaging Centers
Capital Expenditures.  All such Acquired Assets are reflected in the
Financial Statements at net book value.

      

      2.7   Financial
Statements.

      

      2.7.1   Attached
hereto as Schedule
2.7.1 are (i) unaudited profit and loss statements and balance sheets of
each Seller Company for each twelve (12) month period ended September 30, 2009
and December 31, 2008 and (ii) a detailed calculation of the billings,
collections and scans performed in connection with the Business for the nine (9)
month period ended September 30, 2009 (collectively herein referred to as the
“Financial Statements”
and September 30, 2009 is herein referred to as the “Financial Statement
Date”).  The balance sheets fairly present the financial
position of each Seller Company as of the dates set forth therein, in accordance
with accrual accounting methods.  The Financial Statements were
prepared from the books and records of Seller Companies.  Seller
Companies do not utilize any percentage of completion or similar method of
accounting for revenue, income or cost recognition purposes.  No
Seller Company has in the past three (3) fiscal years written off any research
and development costs, incurred any reorganization, restructuring or similar
costs or changed the book value of any assets, liabilities or goodwill of any
business acquired by such Seller Company.  No Seller Company has any
obligation to make any Investments in any Person.  All properties used
in the Business during the period covered by the Financial Statements are
reflected in the Financial Statements in accordance with and to the extent
required by accrual accounting methods.

      

      2.7.2   Except
as set forth in Schedule 2.7.2
attached hereto, no Seller Company has any Indebtedness, obligation or liability
(whether accrued, absolute, contingent, unliquidated or otherwise, known or
unknown to Seller Companies, whether due or to become due) arising out of
transactions entered into at or prior to the Closing Date, or any state of facts
existing at or prior to the Closing Date, other than:  (i) liabilities
set forth in the September 30, 2009 balance sheets of Seller Companies, or (ii)
liabilities and obligations that have arisen after September 30, 2009 in the
ordinary course of business (none of which is a liability resulting from breach
of a Contract, Regulation, Order or warranty, tort, infringement or
Claim).

      

      2.7.3   Except
as set forth in Schedule 2.7.3
attached hereto, there is no Person that has Guaranteed, or provided any
financial accommodation of, any Indebtedness, obligation or liability of any
Seller Company or for the benefit of any Seller Company for the periods covered
by the Financial Statements other than as set forth in the Financial
Statements.  Seller Companies’ accounting systems and controls are
sufficient to detect material fraud and inaccuracies in the financial reporting
processes and reports.

      

      2.8   Absence
of Certain Changes.  Except as set forth on Schedule 2.8 attached
hereto, since the Financial Statement Date, there has not been any (a) Material
Adverse Change in the business, operations, properties, assets, condition
(financial or otherwise), results, plans, strategies or prospects of any Seller
Company; (b) damage, destruction or loss, whether covered by insurance or
not, having a cost of $10,000 or more, with regard to Seller Companies’ property
and business; (c) declaration, setting aside or payment of any dividend or
distribution (whether in cash, ownership interest or property) with respect to
any of the Equity Interests; (d) redemption or other acquisition of any of the
Equity Interests; (e) increase in the compensation payable to or to become
payable by any Seller Company to its officers or employees working in the
Business or any adoption of or increase in any bonus, insurance, pension or
other employee benefit plan, payment or arrangement made to, for or with any
such officers or employees or any Affiliate of any Seller Company; (f) entry
into any material Contract not in the ordinary course of business, including
without limitation, any borrowing from any new lender or in excess of the
existing credit limits or capital expenditure (except for the capital
expenditures set forth in Schedule 2.30
attached hereto); (g) change by any Seller Company in accounting methods or
principles or any write-down, write-up or revaluation of any Acquired Assets of
any Seller Company, except depreciation accounted for in the ordinary course of
business and write downs of inventory which reflect the lower of cost or market
and which are in the ordinary course of business and in accordance with accrual
accounting methods; (h) failure to promptly pay and discharge current
liabilities or agree with any party to extend the payment of any current
liability; (i) Lien placed on any of the Acquired Assets other than Permitted
Liens; (j) sale, assignment, transfer, lease, license or otherwise placement of
a Lien on any of the Acquired Assets, except in the ordinary course of business
consistent with past practice, or canceled any material debts or Claims;
(k) sale, assignment, transfer, lease, license or otherwise placement of a
Lien on any Intellectual Property rights or other intangible assets, disclosure
of any material confidential information to any Person or abandoned or permitted
to lapse any Intellectual Property rights; (l) making of, or commitment to make,
any charitable contributions or pledges exceeding in the aggregate $25,000; or
(m) agreement, whether orally or in writing, to do any of the
foregoing.

      
        
           

        

        
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      2.9   Intentionally
Omitted.

      

      2.10   Agreements
and Commitments.

      

      2.10.1   Except
as set forth in Schedule 2.10.1
attached hereto, in connection with the Business, neither Parent nor any Seller
Company is a party to any written or oral:

      

      (a)   pension,
profit sharing, Option, employee ownership purchase, stock appreciation right,
phantom stock option or other plan providing for deferred or other compensation
to employees of Seller Companies or any other employee benefit plan (other than
as set forth in Schedule 2.22
attached hereto), or any Contract with any labor union or labor
group;

      

      (b)   Contract
relating to loans to officers, directors, managers, Parent or any Affiliates
thereof;

      

      (c)   Contract
relating to the borrowing of money or the mortgaging, pledging or otherwise
placing a Lien on any Acquired Asset;

      

      (d)   Guarantee
that will be an Assumed Obligation;

      

      (e)   Contract
that will be an Acquired Asset under which Parent or any Seller Company has
advanced or loaned or agreed to advance or loan, any Person amounts in the
aggregate exceeding $10,000;

      

      (f)   Contract
pursuant to which Parent or any Seller Company is (and Purchaser will become)
lessor of or permits any third party to hold or operate any property, real or
personal, owned or controlled by Parent or Seller Companies;

      

      (g)   Contract
pursuant to which any Parent or any Seller Company is (and Purchaser will
become) lessee of any property, real or personal, owned or controlled by another
Person;

      

      (h)   warranty
Contract with respect to its services rendered or its products sold or
leased;

      

      (i)   Contract
or non-competition provision in any Contract prohibiting it from freely engaging
in any business or competing anywhere in the world;

      

      (j)   Contract
for the purchase, acquisition or supply of inventory and other property and
assets, whether for resale or otherwise in excess of $10,000;

      

      (k)   Contracts
with independent  agents, brokers, dealers or distributors which
provide for annual payments in excess of $10,000;

      

      (l)   employment,
consulting, sales, commissions, advertising or marketing Contracts;

      

      (m)   Contract
with Physicians;

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      

      (n)   Contracts
providing for “take or pay” or similar unconditional purchase or payment
obligations;

      

      (o)   Contracts
with Persons with which, directly or indirectly, an Affiliate or Parent also has
a Contract;

      

      (p)   Contract
that requires the consent of any Person, or contains any provision that would
result in a modification of any rights or obligation of any Person thereunder
upon a change in control of any Seller Company or the sale of the Acquired
Assets by Seller Companies or that would provide any Person any remedy
(including rescission or liquidated damages), in connection with the execution,
delivery or performance of this Agreement and the agreements, documents and the
consummation of the transactions contemplated hereby and thereby;

      

      (q)   nondisclosure
or confidentiality Contracts;

      

      (r)   power
of attorney or other similar Contract or grant of agency;

      

      (s)   third
party payor Contract or other Contract from which any Seller Company is
reimbursed or otherwise paid for the provision of healthcare services;
or

      

      (t)   Any
other Contract that is material to any Seller Company’s operations or business
prospects or involves consideration in excess of $25,000 annually, excluding any
purchase orders in the ordinary course of business.

      

      2.10.2   Parent
and each Seller Company has performed in all material respects all obligations
required to be performed by it and is not in default in any respect under or in
breach of nor in receipt of any Claim of default or breach under any material
Contract that is an Acquired Asset or to which Parent or such Seller Company is
subject (including without limitation all performance bonds, warranty
obligations or otherwise); no event has occurred that with the passage of time
or the giving of notice or both would result in a default, breach or event of
non-compliance under any material Contract that is an Acquired Asset to which
Parent or any Seller Company is subject (including without limitation all
performance bonds, warranty obligations or otherwise); neither Parent nor any
Seller Company has any present expectation or intention of fully performing all
such obligations; neither Parent nor any Seller Company has any knowledge of any
breach or anticipated breach by the other Persons to any such Contract to which
it is a party.

      

      2.10.3   Parent
and Seller Companies have delivered to Purchaser true and complete copies of all
the Contracts and documents listed in the schedules to this
Agreement.

      

      2.10.4   Schedule 2.10.4
attached hereto sets forth a complete and accurate list of each outstanding bid
or proposal for business submitted by Seller Companies in excess of
$10,000.

      

      2.10.5   Except
as set forth on Schedule 2.10.5
attached hereto, no party to any Contract has, within the twelve (12) months
preceding the date hereof, given Parent or any Seller Company written notice
repudiating any provision thereof or indicating an intention to exercise any
right of cancellation, termination or non-renewal thereof.

      

      2.10.6   Except
as set forth on Schedule 2.10.6
attached hereto, each Contract is assignable to Purchaser without the consent of
any third party or any increase in any payment or change in any term provided
for thereunder, and no Contract requires the consent of any other party, any
increase in any payment or change in any term provided for thereunder, in
connection with the transactions contemplated hereby.

      

      2.11   Government
Contracts.  Except as set forth on Schedule 2.11
attached hereto:

      

      2.11.1   Neither
Parent nor any Seller Company is a party to any Contract or subject to any
Regulation that would result in the termination of any Government Contract that
is part of the Business or that would impose any limitation on Seller Companies’
ability to perform a Government Contract that is part of the Business or to
continue the Business (whether as the Business is conducted prior to Closing or
as the Business is contemplated to be conducted pursuant to the transactions
contemplated pursuant to this Agreement and the agreements, documents and
transactions contemplated hereby and thereby).

      
        
           

        

        
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      2.11.2   No
payment has been made by Parent, any Seller Company or by any Person authorized
to act on its behalf, to any Person in connection with any Government Contract
of any Seller Company or Parent in violation of applicable United States or
foreign procurement Regulations, including without limitation any criminal or
civil Regulations relating to bribes or gratuities, or in violation of the
Foreign Corrupt Practices Act.

      

      2.11.3   With
respect to each Government Contract that is part of the Business to which any
Seller Company or Parent is a party:  (i) all representations and
certifications executed, acknowledged or set forth in or pertaining to such
Government Contract were complete and correct as of their effective date, and
each Seller Company and Parent have complied with all such representations and
certifications; (ii) neither the United States government nor any prime
contractor, subcontractor or other Person has notified a Seller Company or
Parent, either orally or in writing, that such Seller Company or Parent has
breached or violated any Regulation, or any certificate, representation, clause,
provision or requirement pertaining to such Government Contract; and (iii) no
termination for convenience or termination for default has occurred within the
last three (3) years, and no cure notice or show cause notice is currently in
effect pertaining to, such Government Contract.

      

      2.11.4   Neither
Parent, any Seller Company nor any of their directors, managers, officers,
employees or owners is (or during the last five (5) years has been) under
administrative, civil or criminal investigation or indictment by any
Governmental Entity with respect to any alleged irregularity, misstatement or
omission arising under or relating to any Government Contract that is part of
the Business.  During the last five (5) years, neither Parent, nor any
Seller Company has conducted or initiated any internal investigation or made a
voluntary disclosure to the United States government related to the
same.

      

      2.11.5   There
exist (i) no outstanding Claims against any Seller Company or Parent, either by
the United States government or by any prime contractor, subcontractor, vendor
or other third party, arising under or relating to any Government Contract that
is part of the Business, and (ii) no disputes between any Seller Company or
Parent, on the one hand, and the United States government, on the other hand,
under the Contract Disputes Act or any other federal Regulation or between any
Seller Company or Parent on the one hand, and any prime contractor,
subcontractor or vendor, on the other hand, arising under or relating to any
Government Contract that is part of the Business.

      

      2.11.6   No
Seller Company, nor any of their directors, managers, officers, employees or
owners is (or during the last five (5) years has been) suspended or debarred
from doing business with the United States government or other Authority or is
(or during such period was) the subject to a finding of nonresponsibility or
ineligibility for United States government contracting.

      

      2.12   Litigation.  Schedule 2.12
attached hereto sets forth a true and complete list of all Claims and Orders
involving any Seller Company and/or Parent and/or, to the knowledge of Seller
Companies and Parent, the PA since January 1, 2005 relating to the
Business.  Except as set forth in Schedule 2.12
attached hereto, to the best knowledge of Seller Companies and Parent, there is
no Claim or Order relating to the Business threatened against or affecting
Parent, any Seller Company, the PA, the Acquired Assets, the Business or the
Equity Interests, nor is there any reasonable basis
therefore.  Neither Parent, any Seller Company nor to the knowledge of
Seller Companies and Parent, the PA is in default under or with respect to any
Order described in Schedule 2.12
attached hereto.  Except as set forth on Schedule 2.12
attached hereto, Parent, each Seller Company and to the knowledge of Seller
Companies and Parent, the PA are fully insured with respect to each of the
matters set forth on Schedule 2.12
attached hereto and neither Parent, any Seller Company nor, to the knowledge of
Seller Companies and Parent, the PA has received any opinion or a memorandum or
advice from legal counsel to the effect that it is exposed, from a legal
standpoint, to any liability or obligations that could have an adverse effect in
excess of $10,000.  In connection with the Business, no Authorities
are currently conducting investigations, and there are no proceedings, against
any Seller Company, Parent or, to the knowledge of Seller Companies and Parent,
the PA and, to Seller Companies’ and Parent’s knowledge, no such investigation
or proceeding is being threatened.

      

      2.13   Taxes.

      

      2.13.1   Tax
Returns.  Seller Companies
have timely filed or caused to be timely filed or will timely file or cause to
be timely filed (taking into account any applicable extension of time within
which to file) with the appropriate Taxing Authorities all Federal, state,
foreign and local Tax returns, statements, forms, reports and other documents
(including elections, declarations, disclosures, schedules, estimates and
information tax returns) for Taxes (“Tax Returns”) that are
required to be filed by, or with respect to, the income or operations of the
Business or the ownership of the Acquired Assets on or prior to the Closing
Date.  Such Tax Returns are and will be true, correct and complete in
all material respects.  Other than as set forth on Schedule 2.13.1
attached hereto, Seller Companies have not requested any extension of time
within which to file any Tax Return.  The Tax Returns that covered or
will cover periods prior to the Closing Date have accurately reflected and will
accurately reflect all liability for Taxes of Seller Companies for the periods
covered thereby.

      
        
           

        

        
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      2.13.2   Payment
of Taxes.  Except as set
forth on Schedule 2.13.2, all Taxes and Tax liabilities due by or with respect
to the income, assets or operations of the Business and the ownership of the
Acquired Assets for all taxable years or other taxable periods that end on or
before the Closing Date and, with respect to any taxable year or other taxable
period beginning on or before and ending after the Closing Date, the portion of
such taxable year or period ending on and including the Closing Date have been
or will be timely paid in full.  In this regard, Seller Companies will
have paid all taxes to the State of New Jersey prior to the Closing Date
required for the New Jersey Department of Health and Senior Services to transfer
to Purchaser the Acute Care Facility License with respect to each of the Imaging
Centers.

      

      2.13.3   Other Tax
Matters.

      

      (a)   Except
as set forth on Schedule 2.13.3(a), since January 1, 2004, no Seller Company has
been, nor to its knowledge will be, the subject of an audit or other examination
of Taxes by the Taxing Authorities of any nation, state or locality with respect
to the income or operations of the Business or the ownership of the Acquired
Assets; and, to the knowledge of Parent, Seller Companies or any officer or
employee of Seller Companies, no such audit is contemplated or pending; and
neither Parent nor any Seller Company has received any written notices from any
Taxing Authority relating to any issue that could affect any Tax liability with
respect to the income or operations of the Business or the ownership of the
Acquired Assets.

      

      (b)   No
Seller Company nor Parent has entered into an agreement or waiver or been
requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of Taxes with respect to the
income or operations of the Business or the ownership of the Acquired Assets
that has not expired and is not presently contesting the Tax liability with
respect to the income or operations of the Business or the ownership of the
Acquired Assets before any Taxing Authority or court, tribunal or
agency.

      

      (c)   All
Taxes that Seller Companies are required by law to withhold or collect with
respect to the income or operations of the Business or the ownership of the
Acquired Assets in connection with amounts paid or owing to any employee,
independent contractor, creditor, member or other third party have been duly
withheld or collected, and have been timely paid over to the proper Taxing
Authorities to the extent due and payable.

      

      (d)   There
are no existing or, to Parent’s and Seller’s Companies’ knowledge, threatened
Liens for Taxes upon the Acquired Assets or the Equity Interests except for
Liens for current Taxes not yet due and payable.

      

      (e)   Neither
Parent nor any Seller Company has received a written notice of a Claim made by
any Taxing Authority in a jurisdiction where a Seller Company does not file Tax
Returns with respect to the income or operations of the Business or the
ownership of the Acquired Assets that a Seller Company is or may be subject to
taxation by that jurisdiction with respect to the income or operations of the
Business or the ownership of the Acquired Assets.

      

      (f)   There
are no material security interests on any of the Acquired Assets that arose in
connection with any failure (or alleged failure) to pay any Taxes.

      

      (g)   No
Seller Company has been included in any “consolidated,” “unitary” or “combined”
Tax Return provided for under the law of the United States, any foreign
jurisdiction or any state or locality with respect to Taxes for any taxable
period for which the statute of limitations has not expired. The basis of any
depreciable assets, and the methods used in determining allowable depreciation
(including cost recovery) of each Seller Company, are, to the best knowledge of
Seller Companies, correct and in compliance with the Code.

      

      (h)   There
are no tax sharing, allocation, indemnification or similar agreements in effect
as between any Seller Company or any predecessor or Affiliate thereof and any
other party (including Parent or any predecessors or Affiliates thereof) under
which Purchaser or any Seller Company could be liable for any Taxes or other
Claims of any party.

      
        
           

        

        
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      (i)   Neither
Parent nor any Seller Company is a “foreign person” within the meaning of
Section 1445 of the Code.

      

      (j)   Neither
Parent nor any Seller Company has been a “United States real property holding
corporation” within the meaning of Section 897(c)(2) of the Code at any time
during the five-year period ending on the date hereof.

      

      (k)   No
indebtedness of any Seller Company consists of “corporate acquisition
indebtedness” within the meaning of Section 279 of the Code.

      

      (l)   No
Seller Company has applied for, been granted, or agreed to any accounting method
change for which such Seller Company will be required to take into account any
adjustment under Section 481 of the Code or any similar provision of the Code or
the corresponding tax laws of any nation, state or locality.

      

      (m)   No
Seller Company is a party to any agreement that would require Parent, such
Seller Company or any Affiliate thereof to make any payment that would
constitute an “excess parachute payment” for purposes of Sections 280G and 4999
of the Code.

      

      (n)   Seller
Companies have delivered or made available to Purchaser copies of each of the
Tax Returns for income Taxes filed on behalf of each Seller Company since
January 1, 2006.

      

      (o)   Seller
Companies have not engaged in a “reportable transaction” within the meaning of
Treasury Regulations Section 1.6011-4(b).

      

      (p)   No
power of attorney has been granted by any Seller Company with respect to any
matter relating to Taxes that is currently in force.

      

      2.14   Banking
Arrangements.  Schedule 2.14
attached hereto sets forth the name of each bank in or with which each Seller
Company has an account, credit line or safety deposit box, and a brief
description of each such account, credit line or safety deposit box, including
the names of all persons currently authorized to draw thereon or having access
thereto.

      

      2.15   Liens;
Indebtedness; Collateral.  Except as disclosed in Schedule 2.15
attached hereto (a) there are no Liens, Claims or Orders on or with respect to
the Business or any of the Acquired Assets or the Equity Interests, (b) Seller
Companies have no Indebtedness or liabilities of any nature, whether accrued,
absolute, contingent or otherwise with respect to the Business and the Acquired
Assets, (c) no Seller Company has pledged any of its accounts receivable or
Acquired Assets with respect to any liability, obligation or Indebtedness of
such Seller Company or otherwise to any Person, and (d) Parent has not pledged
any of the Equity Interests with respect to any liability, obligation or
Indebtedness of any Seller Company or otherwise to any Person.  Except
as disclosed in Schedule 2.15
attached hereto, there are no facts in existence on the date hereof known or
that should be known to any Seller Company or Parent that might reasonably serve
as the basis for any Lien, Claim or Order of any Seller Company or
Parent.

      

      2.16   Licenses.  Each
Seller Company has at all times had all material Permits needed or required by
law to operate the Business (collectively, the “Licenses”).  Schedule 2.16
attached hereto is an accurate list and summary description of all such Licenses
owned or held by Seller Companies relating to the ownership, development or
operations of the Business or any of the Acquired Assets, all of which are now
and as of Closing Date shall be in good standing and full force and effect and
not subject to meritorious challenge, and to the knowledge of Parent and Seller
Companies, no suspension or cancellation of any such Licenses is threatened and
there is no basis for believing that any such Licenses will not be renewable
upon expiration.

       

      
        
           

        

        
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      2.17   Compliance
with Law.

      

      2.17.1   Parent,
Seller Companies and to the knowledge of Parent and Seller Companies, the PA
have at all times been in material compliance with all applicable statutes,
rules, Regulations, Orders and requirements of all federal, state, and local
commissions, boards, bureaus, and agencies having jurisdiction over Parent,
Seller Companies, the PA and the Business and the operations of the Business at
each Location, including, but not limited to, the false claims, false
representations, anti-kickback and all other provisions of the Medicare/Medicaid
fraud and abuse laws (42 U.S.C. § 1320a-7 et seq.), the physician self-referral
provisions of the Stark Law (42 U.S.C. § 1395nn) and the Health Insurance
Portability and Accountability Act of 1996 (“HIPAA”), including the final
regulations promulgated thereunder. Parent, Seller Companies and to the
knowledge of Parent and Seller Companies, the PA have timely and accurately
filed all material reports, returns, data, and other information required by
federal, state, municipal or other governmental authorities that control,
directly or indirectly, Parent’s or Seller Companies’ activities to be filed
with any commissions, boards, bureaus, and agencies and has paid all sums
heretofore due with respect to such reports and returns.  No such
report or return has been inaccurate, incomplete or misleading. Parent and
Seller Companies have timely and accurately filed all requisite reimbursable
claims and other reports required to be filed or otherwise filed in connection
with all state and federal Medicare and Medicaid programs in which Parent and/or
Seller Companies participate that are due on or before the Closing Date or that
relate to services provided at the Locations on or before the Closing
Date.  There are no Claims pending or, to the knowledge of Parent and
Seller Companies, threatened or scheduled before any authority, including
without limitation any intermediary, carrier, or other state or federal agency
with respect to any Medicare and Medicaid claim filed by Parent and/or Seller
Companies and/or PA on or before the Closing Date, or program compliance
matters, that could have a detrimental effect on Parent and/or Seller Companies,
the operations or utility thereof, or the transactions contemplated pursuant to
this Agreement and the agreements, documents and transactions contemplated
hereby and thereby.  Except for routinely scheduled Medicare and
Medicaid program participation and certification surveys pursuant to Seller
Companies’ Medicare and Medicaid contracts and filings, no valid program
integrity review related to Parent, Seller Companies and to the knowledge of
Parent and Seller Companies, the PA has been conducted by any authority in
connection with the Medicare or Medicaid programs, and no such review is
scheduled, pending, or, to Parent’s or Seller Companies’ knowledge, threatened
against or affecting Seller Companies, the PA, the Business, the Acquired
Assets, or the consummation of the transactions contemplated pursuant to this
Agreement and the agreements, documents and transactions contemplated hereby and
thereby.

      

      2.17.2   With
respect to HIPAA, each Seller Company has in place plans, policies and or
procedures designed to comply with the Standards for Privacy of Individually
Identifiable Health Information, the Security Standards for the Protection of
Electronic Protected Health Information and the Standards for Electronic
Transactions and Code Sets promulgated pursuant to HIPAA and any New Jersey laws
relating to patient privacy and/or the security, use or disclosure of health
care records (collectively, the “HIPAA
Regulations”).  Schedule 2.17.2
attached hereto describes all plans and other efforts of Seller Companies to
comply with the HIPAA Regulations, if and to the extent applicable, whether such
plans and efforts have been put into place or are in process.  Schedule 2.17.2
attached  hereto includes but is not limited in any manner whatsoever
to any privacy compliance plan or security compliance plan of Seller Companies
(collectively or individually) in place or in development, and any plans,
analyses or budgets relating to information systems including but not limited to
necessary purchases, upgrades or modifications to further any of Seller
Companies’ efforts to comply with the HIPAA Regulations.  Seller
Companies have provided Purchaser with true, accurate and complete copies of
Seller Companies’ manuals and plans designed to comply with the HIPAA
Regulations.

      

      2.18   Rates and
Reimbursement Policies.  No Seller Company has any rate appeal
currently pending before any Authority or any administrator of any third-party
payor program.  No Seller Company nor Parent has any knowledge of any
applicable affecting rates or reimbursement procedures that has been enacted,
promulgated or issued within the eighteen (18) months preceding the Closing Date
or any such legal requirement proposed or currently pending in the State of New
Jersey or at the federal level that could have a Material Adverse Effect on any
Seller Company or may result in the imposition of additional Medicaid, Medicare,
charity, free care or welfare obligations, or other discounted or government
assisted patients of the Business.  No Seller Company nor Parent has
any knowledge of any impending proposed reduction in reimbursement from third
party or other payors.

      

      2.19   Physicians.  Schedule 2.19
attached hereto sets forth a list of each physician (the “Scheduled Physicians”) who has
or had a financial relationship (including without limitation, professional
reading, medical director, supervision, shared ancillary, and block lease
arrangement) with any Seller Company or the Imaging Centers within the twenty
four (24) calendar months immediately prior to Closing.  The aggregate
compensation, if any, paid to any physician set forth on Schedule 2.19
attached hereto is consistent with fair market value in arm’s length
transactions and the services contracted for do not exceed that which are
reasonably necessary to accomplish the commercially reasonable business purpose
of the services.  True, accurate and complete copies of any agreements
with the Scheduled Physicians have been provided to Purchaser.  Seller
Companies have properly disclosed to and obtained approval from CMS for each
physician who performs professional interpretations on behalf of Seller
Companies and any Imaging Center and for whom Seller Companies bill (the “Reading Physicians”) and has
caused each of the Reading Physicians to properly execute and file or cause to
be filed with the appropriate carrier or other Authority a Medicare 855-R
reassignment permitting Seller Companies to bill on behalf of such physician or
otherwise comply with the Medicare purchase diagnostic interpretation
rules.  Each Seller Company has properly disclosed to and obtained
approval from CMS for each physician who supervises the provision of any
diagnostic test at an Imaging Center (the “Supervising Physicians”, and,
together with the Reading Physicians and Scheduled Physicians, the “Physicians”), and each
Supervising Physician has properly executed a true, accurate and complete
Attachment 2 to the CMS 855-B application, which has been filed with the
appropriate carrier or other Authority.  To Parent’s and/or Seller
Companies’ knowledge, no Physician has threatened to discontinue or to terminate
his or her relationship with any Seller Company or otherwise not to read for any
Seller Company.  To Parent’s and/or Seller Companies’ knowledge, none
of the Physicians has expressed plans to retire from the practice of medicine in
the next five (5) years.

      
        
           

        

        
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      2.19.1   During
the three (3) years preceding the Closing Date, to Seller Companies’ knowledge,
Kessler and all other Physicians have been duly licensed and registered, and in
good standing by the State of New Jersey to engage in the practice of medicine,
and said license and registration have not been suspended, revoked or restricted
in any manner;

      

      2.19.2   During
the three (3) years preceding the Closing Date, to Seller Companies’ knowledge,
Kessler and all other Physicians have had current controlled substances
registrations issued by the State of New Jersey and the United States Drug
Enforcement Administration, which registrations have not been surrendered,
suspended, revoked or restricted in any manner;

      

      2.19.3   Except
as disclosed in Schedule 2.19.3
attached hereto, neither Parent nor any Seller Company, as applicable, has been
a party or subject to:

      

      (a)   Any
malpractice Claim (whether or not filed in court), settlement, settlement
allocation, judgment, verdict or decree;

      

      (b)   Any
disciplinary, peer review or professional review investigation, proceeding or
action instituted by any licensure board, hospital, medical school, health care
facility or entity, professional society or association, third-party payor, peer
review or professional review committee or body, or governmental
agency;

      

      (c)   Any
criminal complaint, indictment or criminal proceedings;

      

      (d)   Any
investigation or proceedings, whether administrative, civil or criminal,
relating to an allegation of filing false health care Claims, violating
anti-kickback or fee-splitting laws, or engaging in other billing
improprieties;

      

      (e)   Any
allegation, or any investigation or proceeding based on any allegation of
violating professional ethics or standards, or engaging in illegal, immoral or
other misconduct (of any nature or degree); or

      

      (f)   Any
denial or withdrawal of an application in any state for licensure as a
physician, for medical staff privileges at any hospital or other health care
entity, for board certification or recertification, for participation in any
third-party payment program, for state or federal controlled substances
registration, or for malpractice insurance.

      

      2.19.4   With
respect to all operations, practices, real property, plants, structures,
machinery, equipment and other property, employees, products and services and
all other aspects of the Business and Seller Companies have continuously
operated in compliance with all applicable Regulations and Orders, including,
without limitation, all Regulations relating to the safe conduct of business,
environmental protection, quality and labeling, antitrust, consumer protection,
sanitation, fire, zoning, building and occupational safety, and in addition,
with respect to Seller Companies, in compliance with all applicable Regulations
and Orders relating to equal opportunity, discrimination and health. There are
no Claims pending, or, to the knowledge of Parent and Seller
Companies,  threatened, nor has any Seller Company nor Parent received
any written notice regarding any violations of any Regulations or Orders
enforced by any Authority claiming jurisdiction over Seller Companies, Parent,
the Business or the Acquired Assets.

      

      2.19.5   Seller
Companies hold all material registrations, accreditations and other
certifications required for the conduct of the Business by any Authority or
trade group and Seller Companies have operated in compliance with the terms and
conditions of all such registrations, accreditations and
certifications.  Neither Parent any Seller Company nor, to the
knowledge of Seller Companies and Parent, the PA has received any notice
alleging that any Seller Company or, to the knowledge of Seller Companies and
Parent, the PA has failed to hold any such material registration, accreditation
or other certification.

      
        
           

        

        
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      2.20   Improper
and Other Payments.  (a) No Seller Company, nor any director,
manager, officer, key employee thereof, nor, to Parent’s or Seller Companies’
knowledge, any agent or representative of any Seller Company nor any Person
acting on behalf of any Seller Company or Parent, has made, paid or received any
unlawful bribes, kickbacks or other similar payments to or from any Person or
Authority, (b) no contributions have been made, directly or indirectly, to a
domestic or foreign political party or candidate, (c) no improper foreign
payment (as defined in the Foreign Corrupt Practices Act) has been made, and (d)
the internal accounting controls of Seller Companies are believed by Parent’s
and Seller Companies’ management to be adequate to detect any of the foregoing
under the circumstances of the Business currently and previously.

      

      2.21   Intellectual
Property.

      

      2.21.1   Schedule 2.21.1
attached hereto is a complete and accurate list of all Intellectual Property
used or held for use in the Business by Seller Companies or
Parent.  To the extent indicated on such schedule, the Intellectual
Property set forth on Schedule 2.21.1
attached hereto has been duly registered in, filed in or issued by the United
States Patent and Trademark Office, United States Copyright Office, a duly
accredited and appropriate domain name registrar, the appropriate offices in the
various states of the United States and the appropriate offices of other
jurisdictions (foreign and domestic), and each such registration, filing and
issuance remains in full force and effect as of the Closing
Date.  Copies of all items of Business Intellectual Property on Schedule 2.21.1
attached hereto and other material Intellectual Property used or held for use in
the Business, which
have been reduced to writing or other tangible form, have been delivered by
Seller Companies to Purchaser (including, without limitation true and complete
copies of all related licenses, and amendments and modifications
thereto).

      

      2.21.2   Except
as set forth in Schedule 2.21.2
attached hereto, no Seller Company is a party to any license or Contract,
whether as licensor, licensee, or otherwise with respect to any Intellectual
Property. To the extent any Intellectual Property is used under license in the
Business by Seller Companies, no notice of a material default has been sent or
received by any Seller Company under any such license that remains uncured, and
the execution, delivery or performance of Seller Companies’ obligations
hereunder will not result in such a default.  Each such license
agreement is a legal, valid and binding obligation of Seller Companies and each
of the other parties thereto, enforceable in accordance with the terms
thereof.

      

      2.21.3   Seller
Companies exclusively own or are licensed to use all of the Business
Intellectual Property used or held for use in the Business, free and clear of
any Liens, Orders and other adverse Claims, without obligation to pay any
royalty or any other fees with respect thereto.  Seller Companies do
not use any Intellectual Property other than the Business Intellectual Property
and other Intellectual Property licensed to Seller Companies pursuant to valid
and enforceable license agreements.  To the knowledge of Parent and
Seller Companies, Seller Companies’ use of the Business Intellectual Property
(including, without limitation, the manufacturing, marketing, licensing, sale or
distribution of products and the general conduct and operations of the Business)
does not violate, infringe, misappropriate or misuse any intellectual property
rights of any third party.  No Business Intellectual Property has been
cancelled, abandoned or otherwise terminated and all renewal and maintenance
fees in respect thereof have been duly paid.  There are no actions
that must be taken or payments that must be made by Seller Companies within 180
days following the Closing Date that, if not taken, will adversely affect
Business Intellectual Property.  Seller Companies have the exclusive
right to file, prosecute and maintain all applications and registrations with
respect to the Business Intellectual Property.

      

      2.21.4   Neither
Parent nor any Seller Company has received any written notice or Claim from any
third party challenging the right of any Seller Company to use any of the
Business Intellectual Property or other Intellectual Property.  The
Business Intellectual Property, together with the other Intellectual Property
licensed to Seller Companies pursuant to valid and enforceable license
agreements, constitutes all the Intellectual Property necessary to operate the
Business as of the Closing Date and thereafter, in the manner in which it is
presently operated and pursuant to the transactions contemplated pursuant to
this Agreement and the agreements, documents and transactions contemplated
hereby and thereby.

      

      2.21.5   Except
as set forth in Schedule 2.21.5
attached hereto, no Seller Company has made any Claim in writing of a violation,
infringement, misuse or misappropriation by any third party (including, without
limitation, any employee or former employee of such Seller Company) of its
rights to, or in connection with any Business Intellectual Property, which Claim
is still pending.  Except as set forth in Schedule 2.21.5
attached hereto, no Seller Company has entered into any Contract to indemnify
any other Person against any charge of infringement of any Intellectual
Property, other than indemnification provisions contained in purchase orders or
license agreements arising in the ordinary course of business.

      
        
           

        

        
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      2.21.6   To
the best knowledge of Parent and Seller Companies, there are no pending or
threatened Claims by any Person or Authority of any violation, infringement,
misuse or misappropriation by Seller Companies of any Intellectual Property
owned by any third party, or of the invalidity of any patent or registration of
a copyright, trademark, service mark, domain name, or trade name included in
Business Intellectual Property.  No Seller Company nor Parent knows of
any valid basis for any such Claim(s).

      

      2.21.7   Seller
Companies have taken all necessary and reasonable steps to protect and preserve
the confidentiality of all trade secrets, know-how, source codes, databases,
customer lists, schematics, ideas, algorithms and processes and all use,
disclosure or appropriation thereof by or to any third party has been pursuant
to the terms of a written agreement between such third party and Seller
Companies.  No Seller Company has breached any Contracts of
non-disclosure or confidentiality.

      

      2.21.8   None
of the Intellectual Property used, owned or licensed by HealthIXS Corporation, a
wholly-owned subsidiary of Parent, is used in, related to, licensed by or
necessary in any manner whatsoever for the operation of the Business or the
ownership of the Acquired Assets.

      

      2.21.9   For
the twelve (12) month period prior to the Closing Date, the Internet domain
names and URLs of Business Intellectual Property (together with any content and
other materials accessible and/or displayed thereon, the “Sites”) direct and resolve to
the appropriate Internet protocol addresses and are, and have been, maintained
and accessible to Internet users on those certain computers used by Seller
Companies to make the Sites so accessible (the “Server”) approximately
twenty-four (24) hours per day, seven (7) days per week (“24/7”) and are and have been
operational for downloading content from the Server on a 24/7
basis.  Seller Companies have fully operational back-up copies of the
Sites (and all related software, databases and other information), made from the
current versions of the Sites as accessible to Internet users on the Server (and
copied directly therefrom), which copies will have been made at least every two
weeks from the date hereof until the Closing Date.  Such back-up
copies are kept in a safe and secure environment, fit for the back-up of media,
and are not located at the same location of the Server.  Seller
Companies have no reason to believe that the Sites will not operate on the
Server or will not continue to be accessible to Internet users on a 24/7 basis
prior to, at the time of, and after the Closing Date.

      

      2.22   Employee
Benefit Plans.

      

      2.22.1   Schedule 2.22
attached hereto sets forth a true, complete and correct list of all “employee
benefit plans”, as defined in § 3(3) of the Employee Retirement Security Act of
1974, as amended and the rules and regulations promulgated thereunder
(collectively, “ERISA”),
all benefit plans as defined in § 6039D of the Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder (the “Code”), and all other bonus,
incentive compensation, deferred compensation, profit sharing, ownership
interest option, severance, supplemental unemployment, layoff, salary
continuation, retirement, pension, health, life insurance, disability, group
insurance, vacation, holiday, sick leave, fringe benefit or welfare plan or
employment, consulting, change in control, independent contractor, professional
services, confidentiality, or non-competition agreement or any other similar
plan, agreement, policy or understanding (whether oral or written, qualified or
non-qualified) and any trust, insurance, escrow or other funding arrangement
related thereto (i) which is currently or has been at any time within the
last five (5) years maintained or contributed to by Parent, Seller Companies or
any ERISA Affiliate for the benefit of any Employee of the Business, or (ii)
with respect to which Parent, Seller Companies or any ERISA Affiliate has any
liability or obligations to any current or former Employee, or the dependents of
any current or former Employee, of the Business, regardless of whether funded,
or (iii) that could result in the imposition of liability or obligation of any
kind or nature, whether accrued, absolute, contingent, direct, indirect, known
or unknown, perfected or inchoate or otherwise and whether or not now due or to
become due, to Seller Companies (all of which are collectively referred to as
the “Benefit
Plans”).

      

      2.22.2   Neither
Parent, Seller Companies, nor any ERISA Affiliate have been liable at any time
within the last ten (10) years for contributions to a defined benefit pension
plan that is subject to Section 412 of the Code, Section 302 of ERISA and/or
Title IV of ERISA.  Parent and Seller Companies sponsor a money
purchase pension plan that is subject to Section 412 of the Code and Section 302
of ERISA.  There are no “accumulated funding deficiencies” within the
meaning of ERISA or the Code or any federal excise tax or liability on account
of any deficient fundings in respect of the Benefit Plans.  No
reportable event(s) (within the meaning of ERISA) or prohibited transaction(s)
(within the meaning of the Code) has occurred in respect of the Benefit
Plans.

      
        
           

        

        
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      2.22.3   Seller
Companies have heretofore provided to Purchaser, with respect to each of the
Benefit Plans, true, accurate and complete copies of the following documents as
applicable: (i) the Benefit Plan document and all amendments or a written
summary of any Benefit Plan not reduced to writing, (ii) the Form 5500 filings
(to the extent applicable) for each Benefit Plan for the 2007 calendar year;
(iii) the most recently issued IRS favorable determination, opinion, or
notification letter (to the extent applicable) for each Benefit Plan; (iv) all
personnel, payroll and employment manuals and policies related to any Employee
for the 2007 or the 2008 calendar year, and (v) such other documents, records or
other materials related thereto reasonably requested by Purchaser prior to the
Closing Date.

      

      2.22.4   There
have been no prohibited transactions, breaches of fiduciary duty or other
material breaches or violations of any law applicable to the Benefit Plans and
related funding arrangements that could subject Seller Companies or Purchaser to
any material liability.  Each Benefit Plan intended to be qualified
under Section 401(a) of the Code has a current favorable determination letter
(or, in the case of a standardized form or paired plan, a favorable opinion or
notification letter), and no event has occurred which could cause any Benefit
Plan to become disqualified for purposes of Section 401(a) of the
Code.  Each Benefit Plan has been operated in all material respects in
compliance with applicable law, including Section 401(a) of the Code and ERISA,
as applicable, and in accordance with its terms.

      

      2.22.5   All
required reports, tax returns, documents and plan descriptions of the Benefit
Plans have been timely filed with the Internal Revenue Service and the U.S.
Department of Labor (“DOL”) and/or, as appropriate,
provided to participants in the Benefit Plans.

      

      2.22.6   There
are no pending Claims relating to any Benefit Plan (other than ordinary course
Claims for benefits) and, to the best knowledge of Parent and Seller Companies,
none are threatened.  The Benefit Plans do not discriminate in
operating in favor of employees who are officers or highly
compensated.  The Benefit Plans have not been audited or investigated
by either the Internal Revenue Service, the Department of Labor or the Pension
Benefit Guaranty Corporation within the last five (5) years, and there are no
outstanding issues with reference to the Benefit Plans pending before said
governmental agencies.

      

      2.22.7   No
written or oral representations have been made to any Employee promising or
guaranteeing any employer payment or funding, and no Benefit Plans provide, for
the continuation of medical, dental, life or disability insurance coverage for
any former Employee or such former Employee’s beneficiaries for any period of
time beyond the end of the Employee’s termination date (except to the extent of
coverage required under Title I, Part 6, of ERISA (“COBRA”) and solely at the cost
of the former Employee).  The consummation of the transactions
contemplated pursuant to this Agreement and the agreements, documents and
transactions contemplated hereby and thereby will not accelerate the time of
vesting or payment, or increase the amount, of compensation to any Employee,
except to the extent required by the Code.  No Benefit Plans or other
contracts or arrangements provide for payments to any Employee that would be
triggered by the consummation of the transactions contemplated pursuant to this
Agreement and the agreements, documents and transactions contemplated hereby and
thereby would subject any person to excise tax under Section 4999 of the Code
(i.e., “golden parachute” taxes).  With respect to the Employees, no
Seller Company nor Parent has made any payments, is not obligated to make any
payments, and is not a party to any agreement that under certain circumstances
could obligate it to make any payments that will not be deductible under Section
280G of the Code.

      

      2.22.8   Parent,
Seller Companies and each of their ERISA Affiliates have substantially complied
with the continuation coverage provisions of COBRA with respect to all
Employees.  Purchaser shall not assume responsibility for any current
COBRA beneficiary of Seller Companies or Parent.

      

      2.22.9   Neither
Parent, nor any Seller Company or any ERISA Affiliate nor any other employer who
has participated or is participating in any Benefit Plan (a “Sponsor”) has incurred any
liability to the DOL or the Internal Revenue Service in connection with any of
the Benefit Plans, and no condition exists that presents a risk to Parent,
Seller Companies or any Sponsor of incurring any material liability to the DOL
or the Internal Revenue Service in connection with any of the Benefit
Plans.

       

      
        
           

        

        
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      2.22.10   Parent
and Seller Companies have paid in full or properly accrued on the appropriate
balance sheet all amounts that are required under the terms of each Benefit Plan
or funding arrangement to have been paid as of the date of this Agreement with
respect to periods prior to the Closing Date.  Further, on or prior to
the due date under applicable law, Seller Companies shall pay in full all
liabilities accrued as of the Closing Date with respect to each Employee in each
Benefit Plan.

      

      2.22.11   All
amounts required under any Benefit Plan or arrangement that provides for
severance payments to Employees will be paid on or prior to the completion of
the transactions contemplated herein.

      

      2.22.12   No
lien, security interests, encumbrances or other Liens exist with respect to the
Acquired Assets that were imposed pursuant to the terms of the Code or ERISA,
and no condition exists or could occur that would result in the imposition of
such liens, security interests, encumbrances or Liens with respect to the
Acquired Assets, Seller Companies, or the Business, arising from or relating to
the Benefit Plans.

      

      2.22.13   For
the purpose of this Section 2.22, the
term “ERISA Affiliate”
shall mean (i) any related company or trade or business that is required to be
aggregated with Seller Companies or Parent under Code Sections 414(b), (c), (m)
or (o); (ii) any other company, entity or trade or business that has adopted or
has ever participated in any Benefit Plan; and (iii) any predecessor or
successor company or trade or business of Parent, Seller Companies or any entity
described in Section 2.22.13(i)
and (ii)
immediately above.

      

      2.23   Employees.  Schedule 2.23
attached hereto sets forth a list of all officers, directors, managers, and
employees of the Business (collectively, the “Employees”), together with
such Employees’ positions, a description of the rate and basis for their total
compensation and leave status (if applicable).  Except for those
Employees who are subject to Contracts described in Schedule 2.10.1(l)
attached hereto, all of the Employees are terminable at will.  To the
knowledge of Seller Companies and Parent, no executive, key employee, or group
of employees has given notice that they intend to terminate employment with the
Business prior to the Closing.  Under no circumstances will any
physician or other duly licensed health care provider that is not otherwise
permitted by applicable New Jersey laws to be an employee of
Purchaser.  Each Seller Company has conducted its business in
compliance with all Regulations and Orders affecting employment and employment
practices applicable to Seller Companies, including the payment of wages and
hours.  No Seller Company has ever been party to or bound by any
collective bargaining agreement, and none of the Employees are represented by
any labor organization.  To the knowledge of Seller Companies and
Parent, there is no organizational effort presently being made or threatened
(and none has been made or, to the knowledge of Parent and Seller Companies,
threatened within the last three (3) years) by or on behalf of any labor union
with respect to any Employee.  There have been no strikes, slowdowns,
work stoppages, other job actions, lockouts, material labor disputes, nor any
demands for collective bargaining by any union, labor organization or other
Person during the last three (3) years (nor, to the knowledge of Parent and
Seller Companies, has any such event been threatened).  There is no
dispute or controversy with any union or other organization of the Employees,
and no arbitration proceedings are pending or, to the best knowledge of Seller
Companies and Parent, threatened involving a dispute or controversy affecting
Seller Companies or the Business.  There are no complaints, charges,
or Claims against any Seller Company pending or, to the knowledge of Seller
Companies or Parent, threatened before any Authority based on, arising out of,
or in connection with, or otherwise relating to the employment or termination of
employment of any Employee.  At the Closing, Seller Companies will not
have any liability or obligation to any of their Employees or former employees,
officers or managers (including unaccrued year end bonuses) other than for the
payment of salaries to be paid in the ordinary course of
business.  Neither Parent nor any Seller Companies have taken any
action, or failed to take any action, that has resulted, or would reasonably be
likely to result in, any Claim by an Employee that the Employee has been
constructively terminated or due severance payments.  Upon the
consummation of the transactions contemplated pursuant to this Agreement and the
agreements, documents and transactions contemplated hereby and thereby, Seller
Companies will not have any “change in control,” bonus or other obligations to
any Employees, consultants or other Persons performing services for Seller
Companies or the Business.

       

      
        
           

        

        
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      2.24   Insurance
Coverage.  Each Seller Company and, to the knowledge of Seller
Companies and Parent, the PA has maintained in full force and effect, with no
premium arrearages as of the Closing Date, insurance policies bearing the
numbers, for the terms, with the insurance companies or other insurance
providers, in the amounts and providing the coverage set forth on Schedule 2.24
attached hereto.  True and correct copies of all such policies and all
endorsements thereto have been delivered to Purchaser.  Parent and
Seller Companies do not know of any state of facts, or of the occurrence of any
event which might reasonably (a) form the basis for any claim against the PA,
Parent or Seller Companies not fully covered by insurance for liability on
account of any express or implied warranty or tortious omission or commission,
or (b) result in material increase in insurance premiums of Seller Companies
with respect to the Acquired Assets, or the Business as it operates prior to the
Closing Date or as it is contemplated to operate after Closing, pursuant to the
transactions contemplated pursuant to this Agreement and the agreements,
documents and transactions contemplated hereby and thereby.  Schedule 2.24
attached hereto contains a description of all current malpractice liability
insurance policies of Seller Companies.  Except as set forth on Schedule 2.24
attached hereto, to Parent’s and Seller Companies’ knowledge: (i) neither
Parent, any Seller Company nor the PA has during the three (3) years immediately
preceding the Closing Date, filed any written application for any insurance
coverage relating to the PA’s or Seller Companies’ business or property that has
been denied by an insurance agency or carrier; and (ii) Seller Companies and the
PA have been continuously insured for professional malpractice claims during the
same period.  Schedule 2.24
attached hereto also sets forth a list of all claims for any insured loss in
excess of $5,000 per occurrence filed by Parent, Seller Companies or to the
knowledge of Seller Companies and Parent, the PA during the three (3) years
immediately preceding the Closing Date, including workers compensation, general
liability, environmental liability and professional malpractice liability
claims. With respect to each insurance policy listed in Schedule 2.24
attached hereto:  (i) each such policy is legal, valid, binding,
enforceable, and in full force and effect; (ii) each such 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
pursuant to this Agreement and the agreements, documents and transactions
contemplated hereby and thereby; (iii) no Seller Company nor Parent nor, to the
knowledge of Seller Companies and Parent, the PA 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; (iv) no party to such policy has repudiated any
provision thereof; (v) there is no claim pending under any such policy as to
which coverage has been questioned, denied or disputed by the underwriters of
such policies or any notice that a defense will be afforded with reservation of
rights; (vi) neither any Seller Company, Parent nor, to the knowledge of Seller
Companies and Parent, the PA has received: (A) any notice that any issuer of any
such policy has filed for protection under applicable bankruptcy laws or is
otherwise in the process of liquidating or has been liquidated, or (B) any other
indication that such policies are no longer in full force and effect or that the
issuer of any such policy is not longer willing or able to perform its
obligations thereunder; and (vii) neither any Seller Company nor Parent has
received any written notice from or on behalf of any insurance carrier issuing
such policies, that there will hereafter be a cancellation, or a material
increase in the premium or deductible or non-renewal of existing policies.
Seller Companies and, to the knowledge of Seller Companies and Parent, the PA
have been covered during the past three (3) years by insurance in scope and
amount customary and reasonable for the business in which it has engaged during
the aforementioned period.

      

      2.25   Appraisal
Reports and Surveys.  To the knowledge of Parent and Seller
Companies, within the three (3) year period prior to the Closing Date, there
have been no appraisal reports, surveys or other documents that evaluate or
describe Seller Companies, the Business, the Locations or any of the Acquired
Assets or Acquired Assets that have not been delivered to
Purchaser.

      

      2.26   Consents.  Schedule 2.26
attached hereto sets forth a complete list of consents of governmental and other
regulatory agencies or authorities, foreign or domestic, and non-governmental
Persons required to be received by or on the part of Parent or Seller Companies
to enable them to enter into and carry out this Agreement in all material
respects.  All such requisite consents have been, or prior to the
Closing Date will have been, obtained.

      

      2.27   Environmental
Matters.  Parent or Seller Companies have provided Purchaser
with, or access to, true and complete copies of all environmental reports
documenting the results of inspections, investigations, studies, or tests
conducted in relation to the Locations, Seller Companies or the Business,
including final Phase I and Phase II environmental site assessments,
if any, prepared by or on behalf of Seller Companies, Parent, any lender or
financing source of Parent or Seller Companies or otherwise in the possession or
control of Parent or Seller Companies, relating to Seller Companies, the
Locations or the operation of the Business. Except as disclosed in Schedule 2.27
attached hereto:

      

      2.27.1   Seller
Companies (i) hold and are in compliance with all Environmental Permits, and all
such Environmental Permits are in full force and effect; and (ii) currently
operate and have operated the Business, the Locations, and any other property
owned, leased or operated by Seller Companies or in connection with the Business
in compliance with applicable Environmental Laws and Environmental
Permits.

      

      2.27.2   Neither
Parent nor any Seller Company has received or has knowledge of any written
notice, citation, summons, order, request for information, notice of claim,
demand, complaint, penalty or notification that it is or may be potentially, and
no investigation or review currently is pending or, to Parent’s or Seller
Companies’ knowledge, threatened, by or from any Authority or other Person: (A)
with respect to any alleged violation of any Environmental Law or Environmental
Permits; (B) with respect to any failure to have any Environmental Permit;
(C) with respect to any possession, generation, treatment, storage,
recycling, transportation or Release of any Hazardous Substance, or (D) with
respect to any Remedial Action of any threatened or actual Release of any
Hazardous Substance generated by or on behalf of Seller Companies or their
predecessors at the Locations or in connection with Seller Companies’ past
operation of the Business.

      
        
           

        

        
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      2.27.3   To
the knowledge of Seller Companies, no expenditure(s) in excess of $50,000 in the
aggregate with respect to Seller Companies, the Business or the Locations will
be necessary to achieve compliance with any Environmental Law.

      

      2.27.4   There
exists no Environmental Condition at, under or about any Location or any other
property now or formerly operated or used by Seller Companies and/or in
connection with the Business.

      

      2.27.5   There
are not now and there have not been Hazardous Substances used, generated or
stored by Seller Companies in the conduct of the Business or at the Locations;
(b) there are no and there have not been any Underground Storage Tanks or above
ground storage tanks at any Location; (c) there is no asbestos located at or on
any Location;  and (d) no Environmental Lien has attached to any
Location or any other property now or formerly operated or used by any Seller
Company or in connection with the Business.

      

      2.27.6   No
Location nor any other property now or formerly operated or used by Seller
Companies or in connection with the Business is listed or proposed for listing
on the National Priorities List pursuant to CERCLA, or set forth on the
Comprehensive Environmental Response Compensation Liability Information System
List, or any similar state list of sites and, to the knowledge of Parent and
Seller Companies, no condition at such properties exists that, if known to an
Authority, would qualify such property for inclusion on any such
list.

      

      2.27.7   Seller
Companies have no liability for costs associated with Remedial Action or natural
resource damages arising from an arrangement by Seller Companies for the
disposal of Hazardous Substances.

      

      2.27.8   The
transactions contemplated pursuant to this Agreement and the agreements,
documents and transactions contemplated hereby and thereby will not result in
any obligations for site investigation or cleanup, or consent of government
agencies or third parties, pursuant to any of the so called “transaction
triggered” or “responsible property transfer” Environmental Laws or any other
Environmental Law.

      

      2.28   Medical
Waste.  With respect to the generation, transportation,
treatment, storage, and disposal, or other handling of Medical Waste, Seller
Companies have complied with all Medical Waste Laws.

      

      2.29   Federal
Health Care Programs.

      

      2.29.1   No
Seller Company participates in the Medicare program.  To the knowledge
of Seller Companies and Parent, the PA is qualified for participation in the
Medicare program and each Imaging Center is duly enrolled in the Medicare
program as an independent diagnostic testing facility.

      

      2.29.2   No
Seller Company participates in the Medicaid program.  To the knowledge
of Seller Companies and Parent, the PA is qualified for participation in the
Medicaid program.

      

      2.29.3   No
Seller Company participates in the CHAMPUS program. To the knowledge of Seller
Companies and Parent, the PA is qualified for participation in the Champus
program.

      

      2.30   Capital
Expenditures and Investments.  Seller Companies
have outstanding Contracts and a budget for capital expenditures and Investments
that are Assumed Obligations as set forth in Schedule 2.30
attached hereto which includes a schedule of all monies disbursed on account of
capital expenditures and investments made by Seller Companies since the
Financial Statement Date.

      

      2.31   Dealings
with Affiliates.  Schedule 2.31
attached hereto sets forth a complete and accurate list and description of the
economic terms, including the parties, of all Contracts to which any Seller
Company is, will be or has been a party, at any time from the Financial
Statement Date to the Closing Date, and to which any one or more of (a) Seller
Companies, (b) Parent, (c) a Seller Company’s Affiliate, (d) a Parent’s
Affiliate, or (e) any Person in which a Seller Company or Parent or any of their
respective Affiliates has, directly or indirectly, made an Investment, is also a
party.  Since the Financial Statement Date, no Seller Company has made
any payments, loaned or borrowed any funds or property or made any credit
arrangement or accommodation with Parent or an Affiliate or employee of any
Seller Company, except for the payment of employee salaries and manager
compensation in the ordinary course of business.

      
        
           

        

        
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      2.32   Confidential
Information.  No Seller Company nor Parent has disclosed to any
Person, other than Purchaser, authorized representatives of Purchaser and
employees of Seller Companies, any proprietary confidential information related
to the Business.

      

      2.33   Brokerage.  There
are no Claims for brokerage commissions, investment banking or finders’ fees or
expenses or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or Contract binding upon
Seller Companies or Parent.

      

      2.34   Solvency.  Immediately
prior to, and immediately subsequent to, the consummation of the sale of the
Acquired Assets pursuant to the provisions of this Agreement, each Seller
Company will be a solvent entity with the ability to pay its debts as they
become due.  For purposes of this Agreement, solvent shall mean, with
respect to each Seller Company, that the present fair saleable value of such
Seller Company’s assets is greater than the amount that will be required to pay
its liability on its existing debts as they become absolute and
matured.

      

      2.35   Power of
Attorney.  There are no outstanding powers of attorney executed
on behalf of any Seller Company.

      

      
        2.36   RadNet
Shares.

      

      

      2.36.1.   Seller
Companies and Parent retained their own professional advisors to review and
evaluate the economic, tax and other consequences of an investment in RadNet,
Inc.

      

      2.36.2.   Seller
Companies and Parent acknowledge that the RadNet Shares being acquired hereunder
will not be registered under the Securities Act of 1933, as amended (the “Act”),
or the securities laws of any state or other jurisdiction, that absent an
exemption from registration contained in those laws, the issuance and sale of
the RadNet Shares would require registration, and that the Purchaser’s reliance
upon such exemption is based upon the Seller Companies’ and Parent’s
representations, warranties and agreements as follows:

      

      2.36.3.   Seller
Companies and Parent have reviewed RadNet Inc.’s most recent annual report on
Form 10-K for the year ended December 31, 2008 and quarterly and other reports
for 2009, each of which is available on RadNet, Inc.’s website, www.radnet.com.  Seller
Companies and Parent have been given the opportunity to ask questions of, and
receive answers from RadNet, Inc. and to obtain such additional written
information, to the extent RadNet, Inc. possesses such information or can
acquire it without unreasonable effort or expense, necessary to verify the
accuracy of same as the undersigned desires in order to evaluate the
investment.  Seller Companies and Parent further acknowledge that each
has had the opportunity to discuss any questions regarding RadNet, Inc. with its
counsel or other advisor.   Notwithstanding the foregoing, the
only information upon which Seller Companies and Parent have relied is that set
forth in RadNet, Inc.’s public filings and Seller Companies’ and Parent’s own
independent investigation.  Seller Companies and Parent acknowledge
that each has received no representations or warranties from RadNet, Inc. or its
officers, directors, stockholders, employees or agents in making this investment
decision other than as set forth in RadNet, Inc.’s public filings.

      

      2.36.4.     Seller
Companies and Parent are aware that the acquisition of the RadNet Shares is a
speculative investment and that there is no guarantee that Seller Companies or
Parent will realize any gain from this investment, that Seller Companies and
Parent could lose the total amount of Seller Companies’ and Parent’s
investment.

      

      2.36.5.     Seller
Companies and Parent understand that no federal or state agency or authority has
reviewed this transaction, made any finding or determination regarding its
fairness, of this offering of the RadNet Shares for investment, or any
recommendation or endorsement of this transaction.

      

      2.36.6.     Seller
Companies and Parent are acquiring the RadNet Shares for each of their own
accounts, with the intention of holding the RadNet Shares, with no present
intention of dividing or allowing others to participate in this investment or of
reselling or otherwise participating, directly or indirectly, in a distribution
of the RadNet Shares, and shall not make any sale, transfer or pledge thereof
without registration under the Act and any applicable securities laws of any
state or other jurisdiction or unless an exemption from obtaining registration
is available under those laws to the satisfaction of RadNet, Inc. and its
counsel.

       

      
        
          
             

          

          
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      2.36.7.   Seller
Companies and Parent have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of an
investment in the RadNet Shares.

      

      2.36.8.   Seller
Companies and Parent acknowledge that the certificate for the RadNet Shares
which it will receive will contain a legend substantially as
follows:

      

      THE
SECURITIES REPRESENTED BY THIS STOCK CERTIFICATE HAVE BEEN ACQUIRED PURSUANT TO
AN INVESTMENT REPRESENTATION ON THE PART OF THE PURCHASER THEREOF AND SHALL NOT
BE SOLD, PLEDGED, HYPOTHECATED, DONATED OR OTHERWISE TRANSFERRED WHETHER OR NOT
FOR CONSIDERATION BY THE PURCHASER EXCEPT UPON THE ISSUANCE BY THE COMPANY OF A
FAVORABLE OPINION OF ITS COUNSEL AND/OR THE SUBMISSION TO THE COMPANY OF SUCH
OTHER EVIDENCE AS MAY BE SATISFACTORY TO COUNSEL TO THE COMPANY, IN EITHER CASE,
TO THE EFFECT THAT ANY SUCH TRANSER SHALL NOT BE IN VIOLATION OF THE SECURITIES
ACT OF 1933, AS AMENDED, AND APPLICABLE STATE SECURITIES LAWS.

      

      2.37   Disclosures.  Neither this
Agreement nor any of the Contracts, exhibits, attachments, written statements,
documents, certificates or other items prepared for or supplied to Purchaser by
or on behalf of any Seller Company or Parent with respect to the transactions
contemplated hereby contains any untrue statement of a material fact or omits a
material fact necessary to make each statement contained herein or therein not
misleading.  There is no fact that any Seller Company or Parent has
not disclosed to Purchaser herein and of which any Seller Company or Parent, or
any of their respective officers, directors, managers or executive employees is
aware that could reasonably be anticipated to have a Material Adverse Effect on
Seller Companies, the Business, the Acquired Assets or the ability of Purchaser
to continue the businesses Seller Companies in the same manner as Seller
Companies conducted the Business prior to the Closing Date after consummation of
the transactions contemplated pursuant to this Agreement and the agreements,
documents and transactions contemplated hereby and thereby.  Seller
Companies have disclosed to Purchaser all material information relating to the
Business, the Acquired Assets and the transactions contemplated pursuant to this
Agreement and the agreements, documents and transactions contemplated hereby and
thereby.

      

      3.   Representations
And Warranties Of Purchaser

      

      Purchaser
represents and warrants to Seller Companies and Parent as of the date hereof and
as of the Closing Date as set forth below in this Section
3.  Each of the representations and warranties shall be deemed
material, and Seller Companies and Parent, in executing, delivering and
consummating the transactions under this Agreement, have relied and will rely
upon the correctness and completeness of each of representation and warranty
notwithstanding any independent investigation and all representations and
warranties are provided by Purchaser to induce Seller Companies and Parent to
enter into this Agreement and to consummate the transactions contemplated
hereby.

      

      3.1   Corporate
Organization, Etc.  Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of New Jersey
with full corporate power and authority to carry on its business as it is now
being conducted and to own, operate and lease its properties and
assets.  Purchaser is duly qualified or licensed to do business and is
in corporate and Tax good standing in every jurisdiction in which the conduct of
its business, the ownership or lease of its properties, require it to be so
qualified or licensed.

       

      
        
           

        

        
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      3.2   Authorization,
Etc.

      

      3.2.1   Purchaser
has full power and authority to enter into this Agreement and the agreements
contemplated hereby to which Purchaser is a party and to consummate the
transactions contemplated hereby and thereby.  The execution, delivery
and performance of this Agreement and all other agreements and transactions
contemplated hereby have been duly authorized by Purchaser, and no other
corporate proceedings on their part are necessary to authorize this Agreement
and the agreements contemplated hereby and the transactions contemplated hereby
and thereby.  This Agreement and all other agreements contemplated
hereby to be entered into by Purchaser each constitutes a legal, valid and
binding obligation of Purchaser enforceable against Purchaser in accordance with
its terms, except as the same may be limited by applicable bankruptcy,
insolvency, rehabilitation, moratorium or similar laws, now or hereafter in
effect, of general application relating to or affecting creditors’ rights,
including, without limitation, the effect of statutory or other laws regarding
fraudulent conveyances and preferential transfers, and for the limitations
imposed by general principles of equity.

      

      3.2.2   Except
as set forth in Schedule 3.2.2
attached hereto, the execution, delivery and performance by Purchaser of this
Agreement, and all other agreements contemplated hereby, and the fulfillment of
and compliance with the respective terms hereof and thereof by Purchaser, do not
and will not (a) conflict with or result in a breach of the terms, conditions or
provisions of, (b) constitute a default or event of default under (whether with
or without due notice, the passage of time or both), (c) result in a violation
of, or (d) require any authorization, consent, approval, exemption or other
action by, notice to, or filing with any third party or Authority pursuant to,
the organizational documents or operating agreement of Purchaser or any
applicable Regulation, Order or Contract to which Purchaser or its properties
are subject.  Purchaser has complied in all material respects with all
applicable Regulations and Orders in connection with the execution, delivery and
performance of this Agreement, the agreements contemplated hereby and the
transactions contemplated hereby and thereby.

      

      3.3   Brokerage.  There
are no Claims for brokerage commissions, investment banking or finders’ fees or
expenses or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or Contract binding upon
Purchaser.

      

      3.4.   RadNet
Shares.  At the Closing the RadNet Shares will (a) have been
duly authorized and validly issued, fully paid and nonassessable and (b) be
issued in compliance with all applicable state and federal securities
laws.

      

      3.5.   SEC Reports and
Filings.  RadNet, Inc.’s (i) Annual Report on Form 10-K for the
year ended December 31, 2008, (ii)  Quarterly Reports on Form 10-Q for
its fiscal quarters ended March 31, June 30 and September 30, 2009, (iii)
definitive proxy statement on Schedule 14A, for its 2009 Annual Meeting, and
(iv) Current Reports on Form 8-K , filed with the SEC during calendar year 2009
(all of the foregoing documents, collectively, the “SEC Documents”), including
the financial statements contained therein, (i) complied with the applicable
requirements of the Exchange Act, at and as of the times they were filed in all
material respects, and (ii) did not at and as of the time they were filed
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.

      

      4.   Covenants
of Seller Companies and Parent.

      

      Until the
Closing Date, except as otherwise consented to or approved by Purchaser in
writing, each of Seller Companies and Parent agree that they shall act, or
refrain from acting where required hereinafter, to comply (and in the case of
Parent, to cause Seller Companies to comply) with the following:

      

      4.1   Regular
Course of Business.  Each Seller
Company shall (a) operate its business diligently and in good faith, consistent
with past management practices; (b) maintain all of its properties in customary
repair, order and condition, reasonable wear and tear excepted;
(c) maintain (except for expiration due to lapse of time) all leases and
Contracts in effect without change except as expressly provided herein; (d)
comply with the provisions of all Regulations and Orders applicable to such
Seller Company and the conduct of the Business; (e) not cancel, release, waive
or compromise any debt, Claim or right in its favor having a value in excess of
$5,000 other than in connection with returns of inventory for credit or
replacement in the ordinary course of business; (f) not alter the rate or basis
of compensation of any of its officers, directors, managers or employees other
than in the ordinary course of business consistent with past practice and
immaterial in amount or otherwise adopt or modify any Benefit Plan; (g) maintain
insurance coverage up to the Closing Date with the coverage and in the amounts
set forth in Schedule
2.24 attached hereto; (h) maintain inventory, supplies and spare parts at
customary operating levels consistent with current practices, and replace in
accordance with past practice any inoperable, worn out or obsolete assets with
modern assets of comparable quality; (i) maintain  each Seller
Company’s books, accounts and records in accordance with past custom and
practice as used in the preparation of the Financial Statements; (j) maintain in
full force and effect the existence of all Business Intellectual Property
rights; (k) use its reasonable best efforts to preserve the goodwill and
organization of the Business and its relationships with its customers,
suppliers, employees and other Persons having business relations with it; (l)
not take or omit to take any action that would require disclosure under Section 2, or that
would otherwise result in a breach of any of the representations, warranties or
covenants made by Parent or Seller Companies in this Agreement or in any of the
agreements contemplated hereby; (m) not sell any of such Seller Company’s assets
other than in the ordinary course of business; and (n) not take any action or
omit to take any action which act or omission would reasonably be anticipated to
have a Material Adverse Effect.

      
        
           

        

        
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      4.2   Ownership
Changes.  Seller Companies
shall not issue or sell any Equity Interests or securities convertible or
exchangeable into, or Options to subscribe for, any Equity Interests, and Seller
Companies shall not pledge or otherwise encumber any Equity
Interests.  Seller Companies shall not redeem, retire, purchase or
otherwise acquire directly or indirectly any Equity Interests.  Seller
Companies shall not declare, pay or set aside for payment any dividend or other
distribution in respect of its Equity Interests.  Seller Companies
shall not issue any additional Options or enter into any Contracts containing
any profit participation features, equity appreciation rights or phantom equity
option plans, or similar Contracts that allow any Person to participate in the
equity of any Seller Company.  No Seller Company shall amend its
organizational documents or operating agreement or merge into or consolidate
with any other Person or change the character of its business.  Parent
shall not sell, pledge or otherwise encumber its Equity Interests.  In
addition, Seller Companies shall not allow the transfer of any of their Equity
Interests on the ownership ledger or other books and records.

      

      4.3   Capital
and Other Expenditures.  No Seller Company
shall make any Investments or capital expenditures, or commitments with respect
thereto, except as provided in its budget, and shall not make any Material
Adverse Change in business practices, such as reductions in capital
expenditures, advertising, etc., contemplated by the budget of Seller
Companies.  Seller Companies shall not make any loan or advance to any
Person (other than accounts receivable made in the ordinary course of business)
and shall collect in full any amounts outstanding now due from any
Affiliate.  Seller Companies shall not make any charitable or other
contributions to any Person, nor shall it make any commitments
therefore.

      

      4.4   Borrowing.  Seller Companies
shall not incur, assume or Guarantee any Indebtedness not reflected on the
Financial Statements except in the ordinary course of business under existing
credit facilities as such credit facilities exist on the date
hereof.

      

      4.5   Other
Commitments.  Except as set
forth in this Agreement, incurred or transacted in the ordinary course of
business, or permitted in writing by Purchaser, Seller Companies shall not enter
into any material Contract or transaction or make any commitment or incur any
material obligation or liability (including entering into any real property
leases).

      

      4.6   Interim
Financial Information and Audit.  Seller Companies
shall supply Purchaser with unaudited monthly operating statements within thirty
(30) days after the end of each month ending between the date hereof and the
Closing Date, certified by each Seller Company’s chief executive officer and
chief financial officer as having been prepared in accordance with procedures
employed by Seller Companies in preparing prior monthly operating statements and
certifying that such financial statements were prepared in accordance with GAAP
applied on a basis consistent with the Financial Statements and include all
adjustments (all of which were normal recurring adjustments) necessary to fairly
present Seller Companies’ financial position, results of operations and changes
in financial position at and for such periods.

      

      4.7   Full
Access and Disclosure.  Each Seller
Company shall afford to Purchaser and its counsel, accountants, agents and other
authorized representatives and to financial institutions specified by Purchaser
reasonable access during business hours to Seller
Companies’  facilities, books and records in order that Purchaser may
have full opportunity to make such reasonable investigations as it shall desire
to make of the affairs of Seller Companies; provided that in each
case any visits by such Person to Seller Companies’ facilities shall be approved
by the applicable Seller Company or Parent and accompanied by a representative
of Seller Companies.  Seller Companies shall cause their officers,
employees, counsel and auditors to furnish such additional financial, operating
data and other information as Purchaser shall from time to time reasonably
request including, without limitation, any internal control recommendations made
by its independent auditors in connection with any audit of Seller
Companies.  From time to time prior to the Closing Date, Seller
Companies shall promptly supplement or amend information previously delivered to
Purchaser with respect to any matter hereafter arising which, if existing or
occurring at the date of this Agreement, would have been required to be set
forth or disclosed herein; provided, however, that such
supplemental information shall not be deemed to be an amendment to any schedule
hereto and shall not change the risk allocation of this Agreement as between
Purchaser, Parent and Seller Companies.

      

      4.8   Fulfillment
of Conditions Precedent.  Parent and Seller
Companies shall use their best efforts to obtain at their expense all such
waivers, Permits, consents, approvals or other authorizations from third Persons
and Authorities, and to do all things as may be necessary or desirable in
connection with transactions contemplated by this Agreement.

      
        
           

        

        
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    4.9   Intentionally
Omitted.

    

    4.10   SEC
Matters.  Within five (5) business days following the execution
of this Agreement, Parent shall file with the Securities Exchange Commission
(the “SEC) a preliminary
Schedule 14C information statement pursuant to Section 14C of the Securities
Exchange Act of 1934, as amended (the “Preliminary Information
Statement”) (and shall provide Purchaser with a copy thereof) describing
the transactions contemplated by this Agreement and notifying Parent's
stockholders that the holders of at least a majority of the issued and
outstanding shares of Parent's common stock have consented in writing to such
transactions. Parent shall provide Purchaser with a copy of such executed
written stockholder consent prior to filing the Preliminary Information
Statement with the SEC. In the event that the SEC provides Parent any comments
to the Preliminary Information Statement, Parent shall provide Purchaser with
all documents and communications related thereto (the “SEC Communications”) until
such time that the SEC has approved a definitive information statement for
filing with the SEC and mailing to Parent’s stockholders (the “Definitive Information Statement”, and
together with the Preliminary Information Statement and the SEC Communications,
the “SEC Documents”).
Parent shall file the Definitive Information Statement with the SEC, mail the
same to its stockholders and provide Purchaser with a copy thereof as soon as
practicable following the approval of the Definitive Information Statement by
the SEC as set forth above.

    

    5.   Closing
Conditions

    

    5.1   Conditions
to the Obligations of Purchaser.  Each and every obligation of
Purchaser under this Agreement shall be subject to the satisfaction at or prior
to the Closing Date of each of the following conditions, any of which may be
waived, in writing, exclusively by Purchaser:

    

    5.1.1   Representations
and Warranties; Performance.  The representations and
warranties of Seller Companies and Parent contained in this Agreement, and all
information contained in any exhibit or schedule hereto delivered by or on
behalf of Seller Companies or Parent to Purchaser, shall be true and correct
when made and on the Closing Date with the same force and effect as though the
same had been made on and as of the Closing Date, except for those
representations and warranties given as of a particular date, which shall be
true and correct on and as of such date.  Seller Companies and Parent
shall have performed and complied with all agreements, covenants, conditions and
obligations under this Agreement required to be performed and complied with by
such parties as of the Closing Date.

    

    5.1.2   No
Material Adverse Change.  There shall have been no Material
Adverse Change since the Financial Statement Date.

    

    5.1.3   No
Litigation.  No action or proceeding shall have been instituted
against any Seller Company or Parent before any court or other governmental body
seeking to restrain or prohibit the consummation of the transactions
contemplated hereby or to make the consummation of the transactions contemplated
hereby illegal.

    

    5.1.4   No
Third-Party Claims.  No third party shall have made a Claim in
any forum for beneficial ownership of any of the Acquired Assets or the Equity
Interests.

    

    5.1.5   Intentionally
Omitted.

    

    5.1.6   Intentionally
Omitted.

    

    5.1.7   Management
Agreement.  Purchaser and the PA shall have entered into a
Management Services Agreement reasonably satisfactory to Purchaser (the “MSA”).

    

    5.1.8   Approvals
and Consents.  The Purchaser shall have approved the
transactions contemplated pursuant to this Agreement and the agreements,
documents and transactions contemplated hereby and thereby. Purchaser, each Seller
Company and Parent shall have obtained all
third-party consents, approvals, Order, Permits or other authorization required
by all applicable Regulations, Order and Contracts involving Seller Companies or
binding on their properties and assets to effectuate the transactions
contemplated pursuant to this Agreement and the agreements, documents and
transactions contemplated hereby and thereby, including, but not limited to, any
required consents to assignment from each Location’s landlord.

    
      
         

      

      
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    5.1.9   Regulatory
Approvals.  Parent and Seller Companies shall have obtained any
Regulatory approvals required as a result of the transactions contemplated
pursuant to this Agreement and the agreements, documents and transactions
contemplated hereby and thereby.

    

    5.1.10   Conditions
of Assets.  Seller Companies’ assets and properties shall not
have been damaged or destroyed, prior to the Closing Date, by fire or other
casualty, whether or not fully covered by insurance, in an aggregate amount
exceeding $25,000.

    

    5.1.11   Termination
of Affiliate Contracts.  Seller Companies and Parent shall have
caused all Contracts between any Seller Company, on the one hand, and Parent or
Affiliate of Parent, on the other hand, to terminate at Closing without any
further liability or obligation to any Seller Company.

    

    5.1.12   Closing
Deliveries.  Seller Companies and Parent shall have delivered
to Purchaser each of the items set forth under Section
6.2.

    

    5.1.13   The
Existing Services Agreement.  The Existing
Services Agreement shall have been terminated and no longer be of any force or
effect, and Seller Companies shall have delivered evidence of the same to
Purchaser.

    

    5.1.14   Intentionally
omitted.

    

    5.1.15   License
Transfer.  The New Jersey Department of Health and Senior
Services shall have consented to the transfer to Purchaser of the Acute Care
Facility License with respect to each of the Imaging Centers.

    

    5.1.16   Other
Matters.  All corporate and other proceedings in connection
with the transactions contemplated pursuant to this Agreement and the
agreements, documents and transactions contemplated hereby and thereby at the
Closing Date shall be reasonably satisfactory in substance and form to Purchaser
and its counsel, and Purchaser and its counsel shall have received all such
counterpart originals or certified or other copies of such documents as they may
reasonably request.

    

    5.2   Conditions
to Obligations of Seller Companies and Parent.  Each and every
obligation of Seller Companies and Parent under this Agreement shall be subject
to the satisfaction at or prior to the Closing Date of each of the following
conditions, any of which may be waived, in writing, exclusively by Seller
Company:

    

    5.2.1   Representations
and Warranties; Performance .  The representations and
warranties of Purchaser contained in this Agreement and all information
contained in any exhibit or schedule hereto delivered by, or on behalf of
Purchaser, shall be true and correct when made and on the Closing Date with the
same force and effect as though the same had been made on and as of the Closing
Date, except for those representations and warranties given as of a particular
date, which shall be true and correct on and as of such
date.  Purchaser shall have performed and complied with all
agreements, covenants, conditions and obligations under this Agreement required
to be performed and complied with by Purchaser as of the Closing
Date.

    

    5.2.2   No Litigation.  No
action or proceeding shall have been instituted against Purchaser before any
court or other governmental body, seeking to restrain or prohibit the
consummation of the transactions contemplated hereby or to make the consummation
of the transactions contemplated hereby illegal.

    

    5.2.3   Closing
Deliveries.  Purchaser shall have delivered to Seller Companies
each of the items set forth under Section
6.3.

    

    6.   Closing

    

    6.1   Closing.  Unless
this Agreement shall have been terminated or abandoned pursuant to the
provisions of Section
9 hereof, the sale, purchase and other transactions provided for herein
(the “Closing”) shall be
consummated as soon as reasonably possible after satisfaction of the Closing
conditions and deliveries on such date and time as may be mutually agreed upon
by the Parties hereto (the “Closing Date”); provided that
the Closing shall not occur, in any event, after January 29,
2010.  The Closing shall take place at the office of Purchaser located
at1510 Cotner Ave., Los Angeles, CA 90025-3303, or via remote location as
coordinated by the Parties’ respective counsel.

    
      
         

      

      
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    6.2   Deliveries
by Seller Companies and Parent.  At the Closing, Seller
Companies and Parent shall deliver or cause to be delivered, to Purchaser the
following, as applicable:

    

    6.2.1   Bill
of Sale duly executed by Seller Companies, as applicable;

    

    6.2.2   Assumption
Agreement duly executed by Seller Companies, as applicable;

    

    6.2.3   An
Assignment of Lease for each Location, duly executed by the applicable Seller
Company;

    

    6.2.4   The
MSA duly executed by the PA;

    

    6.2.5   Intentionally
omitted.

    

    6.2.6   A
payoff letter (reasonably satisfactory to Purchaser) from each and every holder
of Seller Companies’ Indebtedness other than the Assumed Obligations and as set
forth on Schedule 6.2.6, in each case dated within three (3) days prior to the
Closing Date and stating the amounts owed in order for such creditors to have
been paid in full and to release all Liens in favor of such creditors on the
Closing Date.  Seller Companies shall at Closing file such UCC
termination statements, releases of mortgages and other releases of Liens as
shall be required by Purchaser and its lenders to release all Liens in favor of
such creditors on the Closing Date;

    

    6.2.7   Resolutions
adopted by (i) the stockholders and (ii) the Board of Directors or the Board of
Managers, as applicable, of Parent and each Seller Company authorizing the
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated pursuant to this Agreement and the agreements,
documents and transactions contemplated hereby and thereby;

    

    6.2.8   All
third party or governmental consents and approvals required to consummate the
transaction contemplated hereby;

    

    6.2.9   A
certificate, executed by the secretary of Parent and each Seller Company,
certifying (i) as to the charter, articles of organization, bylaws and operating
agreement (or other similar constating documents), as applicable, of parent and
each Seller Company, (ii) that the resolutions delivered in connection with this
Agreement and to Purchaser pursuant to Section 6.2.7 are
true, correct and complete, and that such resolutions were duly adopted and have
not been amended or rescinded, (iii) as to the incumbency of certain officers of
Parent and Seller Companies, and (iv) as to the jurisdictions in which Parent
and Seller Companies are qualified to conduct business, in the form of Exhibit 6.2.9
attached hereto;

    

    6.2.10   Certified
documentation from the appropriate governmental Authority evidencing the good
standing with respect to the conduct of business of each Seller Company as of a
date not more than ten (10) days prior to the Closing Date as an entity
organized under the laws of the state and as a foreign entity authorized to do
business under the laws of the jurisdictions listed in the schedules
hereto;

    

    6.2.11   A
certificate, dated the Closing Date, executed by the Chief Executive Officer and
the Chief Financial Officer of Parent and each Seller Company certifying as to
(i) the satisfaction of the conditions set forth in Sections 5.1.1,
5.1.2 and 5.1.3, and (ii) as to
the accuracy of all of the Financial Statements, in the forms designated as
Exhibit
6.2.11(i) attached hereto and Exhibit 6.2.11(ii)
attached hereto, respectively;

    

    6.2.12   An
opinion of Seller Companies’ and Parent’s counsel (which will be addressed to
Purchaser and its lenders), dated the Closing Date, in the form of Exhibit 6.2.12
attached hereto;

    

    6.2.13   A
funds flow statement, satisfactory to Purchaser, executed by Seller Companies,
which shall include, without limitation, instructions for payment of the Payment
Obligations at the Closing (the “Funds Flow Statement”);
and

    

    6.2.14   Such
other certificates, documents and instruments as Purchaser reasonably requests
related to the transactions contemplated hereby.

    
      
         

      

      
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    6.3   Deliveries
by Purchaser.  At the Closing, Purchaser shall deliver to
Seller Companies the following:

    

    6.3.1   The
Purchase Price;

    

    6.3.2   Resolutions
adopted by Purchaser authorizing the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated pursuant to this
Agreement and the agreements, documents and transactions contemplated hereby and
thereby;

    

    6.3.3   A
certificate by the secretary of Purchaser certifying (i) as to the certificate
of formation of Purchaser, (ii) that the resolutions delivered to Seller
Companies and Parent pursuant to Section 6.3.2 are
true, correct and complete, and that such resolutions were duly adopted and have
not been amended or rescinded, (iii) as to the incumbency of certain officers of
Purchaser, and (iv) as to the jurisdictions in which Purchaser is qualified to
conduct business, in the form of Exhibit 6.3.3
attached hereto;

    

    6.3.4   Certified
documentation from the appropriate governmental Authority evidencing the good
standing, with respect to both the conduct of business and the payment of all
Taxes, of Purchaser as of a date not more than seven (7) days prior to the
Closing Date as an entity organized under the laws of the state and as a foreign
entity authorized to do business under the laws of the jurisdictions listed in
the schedules hereto;

    

    6.3.5   The
MSA duly executed by Purchaser;

    

    6.3.6   A
certificate, dated the Closing Date, executed by Purchaser certifying as to the
satisfaction of the conditions set forth in Sections 5.2.1,
and 5.2.2;

    

    6.3.7   Funds
Flow Statement duly executed by Purchaser; and

    

    6.3.8   Such
other certificates, documents and instruments as Seller Companies reasonably
request in connection with the transactions contemplated pursuant to this
Agreement and the agreements, documents and transactions contemplated hereby and
thereby.

    

    7.   Covenants.

    

    7.1   No
Solicitation or Negotiation.  Seller Companies and Parent shall
not, and any of Parent’s and Seller Companies’ Affiliates, representatives,
officers, employees, directors, managers or agents shall not, directly or
indirectly (a) submit, solicit, initiate, encourage or discuss any proposal or
offer from any Person or enter into any Contract or accept any offer relating to
or to consummate any (i) reorganization, liquidation, dissolution or
recapitalization of any Seller Company; (ii) merger or consolidation involving
any Seller Company; (iii) purchase or sale of any of the assets or Equity
Interests, Options, stock appreciation rights, phantom stock options or other
similar equity based participations (or any rights to acquire, or securities
convertible into or exchangeable for, any such capital stock, Options, stock
appreciation rights, phantom stock options or other such securities) of any
Seller Company (other than a purchase or sale of inventory and worn-out or
obsolete assets in the ordinary course of business consistent with past custom
and practice and in accordance with the terms of this Agreement); (iv) similar
transaction or business combination involving any Seller Company or its assets;
or (v) acquisition by any Seller Company of other businesses, whether by the
purchase of assets or capital stock of another Person; or (b) 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 to do any of the
foregoing; provided, however, that nothing
herein shall limit or restrict in any way Seller Companies or Parent from
communicating with their legal, accounting and other professional advisors or
lenders for the purpose of facilitating the transactions contemplated pursuant
to this Agreement and the agreements, documents and transactions contemplated
hereby and thereby. Seller Companies and Parent shall notify Purchaser
immediately if any Person makes any proposal, offer, inquiry or contact to any
Seller Company or Parent or, to Seller Companies’ or Parent’s knowledge, any
other Person, for the purpose of effectuating one or more of the foregoing
transactions.

    

    7.2   Transfer
Tax.  Seller Companies and Parent shall pay on a timely basis
all applicable transfer, sales, use, recording, registration and other taxes
associated with the transactions contemplated pursuant to this Agreement and the
agreements, documents and transactions contemplated hereby and thereby,
including, but not limited to, the transfer of the Acquired Assets to
Purchaser.

    
      
         

      

      
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    7.3   Agreement
to Defend.  In the event any action, suit, proceeding or
investigation of the nature specified in Section 5.1.3 or
Section 5.2.2
is commenced, whether before or after the Closing Date, all the parties hereto
agree to cooperate and use their best efforts to defend against and respond
thereto.

    

    7.4   Further
Acts and Assurances.  Seller Companies and Parent shall, at any
time and from time to time at and after the Closing, upon request of Purchaser,
take any and all actions necessary to place Purchaser in possession and
operating control of the Acquired Assets to be transferred hereunder, and will
do, execute, acknowledge and deliver, or will cause to be done, executed,
acknowledged and delivered, all such further acts, deeds, assignments,
transfers, conveyances, powers of attorney and assurances as may be reasonably
required for the transferring and confirming to Purchaser or to its successors
or permitted assigns, or for reducing to possession, the Acquired
Assets.  Subject to the terms and conditions of this Agreement, the
parties hereto and thereto shall use their best efforts to take, or cause to be
taken, all action, and to do, or cause to be done, all things necessary, proper
or advisable under applicable Regulations and Orders to consummate and make
effective as promptly as possible the transactions contemplated pursuant to this
Agreement and the agreements, documents and transactions contemplated hereby and
thereby, and to cooperate with each other in connection with the foregoing,
including without limitation using their best efforts (a) to obtain all
necessary waivers, consents, and approvals from other parties to loan
agreements, leases, mortgages and other Contracts; (b) to obtain all necessary
Permits, consents, approvals and authorizations as are required to be obtained
under any Regulation or Order; (c) to lift or rescind any injunction or
restraining order or other Order adversely affecting the ability of the parties
to consummate the transactions contemplated pursuant to this Agreement and the
agreements, documents and transactions contemplated hereby and thereby; (d) to
effect all necessary registrations and filings and submissions of information
requested by Authorities; and (e) to fulfill all conditions to the obligations
of the parties under this Agreement. Furthermore, Purchaser, Seller Companies
and Parent shall use their respective best efforts to prevent, with respect to a
threatened or pending preliminary or permanent injunction or other Regulation or
Order, the entry, enactment or promulgation thereof, as the case may
be.

    

    7.5   Deliveries
After Closing..  From time to time after the Closing, at
Purchaser’s request and without further consideration from Purchaser, Seller
Companies and Parent shall execute and deliver such other instruments of
conveyance and transfer and take such other action as Purchaser reasonably may
require to convey, transfer to and vest in Purchaser and to put Purchaser in
possession of any rights or property to be sold, conveyed, transferred and
delivered hereunder.

    

    7.6   No
Termination of Seller Companies’ and Parent’s Obligations by Dissolution,
Etc..  Each Seller Company and Parent each specifically agrees
that the obligations of Seller Companies and Parent hereunder, including,
without limitation, obligations pursuant to Section 8 below,
shall not be terminated by the dissolution of Parent or any Seller Company or by
operation of law.

    

    7.7   Confidentiality.

    

    7.7.1   The
information, documents and instruments delivered to Purchaser by Seller
Companies, Parent or their respective agents and the information, documents and
instruments delivered to Seller Companies or Parent by Purchaser or its
respective agents are of a confidential and proprietary nature.  Each
of the Parties hereto agrees that both prior and subsequent to the Closing it
will maintain the confidentiality of all such confidential information,
documents or instruments delivered to it by each of the other Parties hereto or
their agents in connection with the negotiation of this Agreement or in
compliance with the terms, conditions and covenants hereof and will only
disclose such information, documents and instruments to its duly authorized
officers, directors, managers, representatives and agents.  Each of
the Parties hereto recognizes that any breach of this Section 7.7 would
result in irreparable harm to the other Parties to this Agreement and their
Affiliates and that, therefore each Party shall be entitled to an injunction to
prohibit any such breach or anticipated breach, without the necessity of posting
a bond, cash or otherwise, in addition to all other legal and equitable
remedies.  Nothing in this Section 7.7, however,
shall prohibit the use of such confidential information, documents or
information (a) that was, is now, or becomes generally available to the public
(but not as a result of a breach of any duty of confidentiality by which a Party
and its representatives and advisors are bound); (b) that was known to a Party
prior to its disclosure to such Party as demonstrated by such Party’s written
records; (c) that is disclosed to a Party by a third party not subject to any
duty of confidentiality prior to its disclosure to such Party; or (d) that, in
the reasonable opinion of Seller Companies’ counsel, Parent’s counsel or
Purchaser’s counsel, for governmental filings are (i) required by law or
governmental regulations or (ii) otherwise appropriate.

    
      
         

      

      
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    7.7.2   The
Parties hereto agree that the terms and conditions of the transactions
contemplated pursuant to this Agreement and the agreements, documents and
transactions contemplated hereby and thereby shall remain
confidential.  Neither Purchaser, Seller Companies nor Parent or any
of their respective agents and representatives shall distribute any of the
documents in connection with the transactions contemplated pursuant to this
Agreement and the agreements, documents and transactions contemplated hereby and
thereby or any drafts thereof, nor any part thereof, to any third party unless
required by law to do so.

    

    7.8   Public
Announcements.  Each of the Parties agree that no Party hereto
shall release, publish or otherwise make available to the public in any manner
whatsoever any information or announcement regarding the transactions herein
contemplated without the prior written consent of Seller Companies and
Purchaser, except for information and filings reasonably necessary to be
directed to governmental agencies to fully and lawfully effect the transactions
herein contemplated or required in connection with applicable
laws.  Nothing herein shall allow any Party to respond to questions
presented by the press or media without first obtaining prior consent of Seller
Companies and Purchaser.

    

    7.9   Non-Competition.

    

    7.9.1   For
a period commencing on the Closing Date and ending on the third (3rd)
anniversary of the Closing Date, no Seller Company nor Parent shall, without the
prior written consent of Purchaser, (a) directly or indirectly, own, manage,
operate, control or participate in any manner in the ownership, management,
operation or control of, or serve as a partner, director, employee, manager,
principal, agent, consultant or otherwise contract with, or have any financial
interest in or with, or aid or assist any other person or entity that operates
imaging equipment or an imaging facility or competes with an Imaging Center or
the Business within a twenty five (25) mile radius of any Imaging Center or any
other imaging centers managed by Purchaser, and (b) in any capacity, either
separately, jointly or in association with others, directly or indirectly do any
of the following:  (i) employ or seek to employ any Person or agent
who is then employed or retained by the Business, Purchaser or its Affiliates
(or who was so employed or retained at any time within the two (2) years prior
to the date a Seller Company or Parent employs or seeks to employ such Person);
(ii) solicit, induce, or influence any proprietor, partner, stockholder, lender,
director, officer, manager, employee, joint venturer, investor, consultant,
agent, lessor, supplier, customer or any other Person that has a business
relationship with the Business, Purchaser or its Affiliates, to discontinue or
reduce or modify the extent of such relationship with the Business, Purchaser or
its Affiliates; or (iii) submit, solicit, encourage or discuss any proposal,
plan or offer to acquire an interest in any of the Business’, Purchaser’s or its
Affiliates’ identified potential acquisition candidates.

    

    7.9.2   Each
Party understands and acknowledges that the provisions of this Section 7.9 are
designed to preserve the legitimate business interests and goodwill of the
Parties.  Accordingly, each Party hereby acknowledges that any breach
or threatened breach of the provisions of this Section 7.9 will
result in irreparable harm and injury to each of the other Parties and that
monetary damages will not provide an adequate remedy to a
Party.  Accordingly, each Party hereby agrees that in the event of a
breach or threatened breach of the provisions of this Section 7.9, the
non-breaching Party shall be entitled to (1) a temporary restraining order,
preliminary injunction and permanent injunction to enjoin such breach or
threatened breach; (b) any and all damages incurred or to be incurred by the
non-breaching Party; and (c) recover from the breaching Party the reasonable
attorneys’ fees and costs incurred by the non-breaching Party in enforcing the
provisions of this Section
7.9.

    

    7.9.3   The
provisions of this Section 7.9 shall
apply for the applicable periods as set forth above.  If any Seller
Company or Parent violates the restrictive covenant provisions set forth in this
Section 7.9,
and Purchaser, any of Purchaser’s successors and assigns or any of Purchaser’
Affiliates brings legal action for injunctive or other relief, such party
bringing the action shall not, as a result of the time involved in obtaining the
relief, be deprived of the benefit of the full period of the restrictive
covenant, unless a court of competent jurisdiction holds that the restrictive
covenant is not enforceable in whole or in part.  Accordingly, for any
time period that any Seller Company or Parent is in violation of the restrictive
covenant, such time period shall not be included in calculating the duration of
the restrictive covenant indicated above.

    

    7.9.4   Each
Party hereby acknowledges that the restrictions set forth in this Section 7.9 are
minimal, reasonable in scope and duration and are necessary to protect the
legitimate business interests of the Parties and that any breach or threatened
breach of these restrictions will result in irreparable harm to the
non-breaching Party.  In the event any of the restrictions are found
by a court of competent jurisdiction to be too broad to permit enforcement to
its full extent, then such restriction shall be enforced to the maximum extent
allowable by law and the Parties hereby consent to and authorize the court to
modify these restrictions in a manner to permit their enforcement to the fullest
extent of the law.

    
      
         

      

      
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    7.9.5   The
Parties also agree that the existence of any Claim by Parent or any Seller
Company against Purchaser, whether predicated upon this Agreement or otherwise,
shall not constitute a defense to the enforcement of the restrictive covenants
set forth herein, but shall be litigated separately.

    

    7.10   Employees.  Seller
Companies shall terminate the employment of all employees as of the Closing
Date.  Purchaser shall provide employment to each of the Employees
that meets Purchaser’s needs, hiring standards and criteria.  Nothing
contained herein shall restrict Purchaser or its subsidiaries in the exercise of
their independent business judgment as to the terms and conditions under which
the employment of Employees shall be offered after the Closing, or shall
continue, the duration of such employment, the basis on which such employment is
terminated, or the benefits provided to Employees.  If the execution
and delivery of this Agreement or the consummation of the transactions
contemplated hereby and the decisions of Purchaser (a) results in any payment
becoming due to any current or former Employee, (b) increases any benefits under
any Benefit Plan, or (c) results in the acceleration of the time of payment,
vesting or other rights with respect to any such benefits, then Seller Companies
and Parent shall be solely liable for such payment, increase, or obligation, and
such amounts will not be Assumed Obligations. As of the Closing Date, Seller
Companies and Parent shall fully vest (100%) each Employee’s interest in any
pension plan sponsored by Seller Companies that is qualified under Section
401(a) of the Code. The cost to fully vest each Employee’s interests in any
pension plan sponsored by Seller Companies that is qualified under Section
401(a) of the Code shall be borne by Seller Companies and
Parent.  Within ten (10) days of the Closing Date, each Seller Company
and Parent shall payout any accrued but unused vacation or paid time off to all
Employees.  Seller Companies and Parent shall be responsible for
complying with all obligations under COBRA, with respect to Employees and other
“qualified beneficiaries” who incur a “qualifying event” on or prior to the
Closing Date (i.e., including a termination of employment).  Seller
Companies and Parent shall be responsible for all notifications and liability
associated with any terminations of employment on or prior to the Closing Date
under the worker Adjustment and Retraining Notification Act and any similar
state or local “mass layoff” or “plant closing” law.  Nothing
contained in this Agreement shall be deemed to abrogate or impair the right of
Purchaser to determine which employees, if any, will be employed from and after
the Closing, and/or the compensation and benefits to be paid to those employees
employed by Purchaser from and after the Closing; provided, however, that,
Purchaser will cause all employees employed from and after the Closing to be
offered the opportunity to participate in the group health programs generally
offered to employees of Purchaser and its Affiliates as of the
Closing.  Purchaser acknowledges that Seller Companies and Parent
shall have no role in deciding which of Sellers Companies’ employees are hired
by Purchaser, if any.

    

    7.11   Intentionally
Omitted.

    

    7.12   Intentionally
Omitted.

    

    7.13   Professional
Liability Insurance.  To the extent that any of the
professional liability insurance currently maintained by or for the benefit of
the Seller Companies shall be on a "claims made" basis, Seller Companies shall
obtain professional liability tail coverage insurance covering claims made
against the Seller Companies prior to the Closing in respect of events or
occurrences which took place on or prior to the Closing Date or for the five (5)
years prior thereto, and Seller Companies will provide Purchaser with a copy of
the certificate evidencing such coverage.

    

    8.   Indemnification.

    

    8.1  
 Survival.  All of the terms,
conditions and covenants of this Agreement, together with the representations
and warranties contained herein or in any instrument or document delivered or to
be delivered pursuant to this Agreement, shall survive the execution of this
Agreement and the Closing Date until all obligations set forth therein shall
have been performed and satisfied notwithstanding any investigation heretofore
or hereafter made by or on behalf of any party hereto as follows:  (a)
the representations and warranties in Section 2.13 (Taxes),
Section 2.22
(Employee “Benefit Plans), and Section 2.23
(Employees) and their related schedules and the covenants contained in this
Agreement shall survive until sixty (60) days after the date as of which the
applicable statutes of limitations with respect to such matters expire (after
giving effect to any extensions or waivers thereof); (b) the representations and
warranties in Section
2.27 (Environmental Matters), Section 2.28 (Medical
Waste) and their related schedules shall terminate on the sixth (6th)
anniversary of the Closing Date; (c) the representations and warranties in Section 2.1
(Corporate Organization, Etc.), Section 3.2
(Authorization, Etc.), Section 3.3
(Brokerage) and their related schedules (collectively, items (a), (b) and (c)
shall be referred to as the “Fundamental Representations and
Warranties”) shall survive indefinitely and not terminate; and (d) all
other representations and warranties in this Agreement and their related
schedules or in any of the written statements, certificates or other items
prepared and delivered hereunder or to induce the consummation of any of the
transactions contemplated hereby, shall terminate upon the thirty sixth (36th) month
anniversary of the Closing Date; provided that the
representations, warranties and indemnities for which an indemnification Claim
shall be pending as of the end of the applicable period referred to herein shall
survive with respect to such Claim until the final disposition
thereof.  The representations and warranties in this Agreement and the
schedules attached hereto or in any writing delivered in connection herewith
shall in no event be affected by any investigation, inquiry or examination made
for or on behalf of any party or be affected by the knowledge of any officer,
director, manager, stockholder, employee, partner or agent of any party seeking
indemnification hereunder or by the acceptance of any certificate or opinion
from any third party.  In addition, in no event will any disclosure of
any event or circumstance made after the date hereof and prior to the Closing
serve to amend any representation or warranty for any purpose of this Agreement.
The foregoing shall not apply to any sections herein which contain their own
specific limitation period.

    
      
         

      

      
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    8.2   Limitations.

    

    8.2.1   No
Party shall be required to indemnify another Party under Sections 8.3.1 or
8.4.1 until the
indemnifiable damages, individually or in the aggregate, exceed $50,000 (the
“Hurdle Rate”), at which
point such indemnifying party shall be responsible for all indemnifiable damages
that may arise, irrespective of the Hurdle Rate; and provided that indemnifiable
damages shall accumulate until such time as they exceed the Hurdle Rate,
whereupon the party to be indemnified shall be entitled to seek indemnification
for the full amount of such damages from the first dollar.

    

    8.2.2   Absent
fraud, after the Closing, the aggregate amount of indemnifiable damages for
which Seller Companies and Parent shall be jointly and severally liable with
respect to breaches of the representations and warranties made by Seller
Companies and Parent in Section 2 (other than
the Fundamental Representations and Warranties or for knowing or intentional
misrepresentations or breaches of covenants and agreements) shall not exceed the
Purchase Price.

    

    8.2.3   In
the event the transactions contemplated pursuant to this Agreement and the
agreements, documents and transactions contemplated hereby and thereby are not
consummated as a result of a breach hereunder by Purchaser, the maximum
aggregate amount of indemnifiable damages for which Purchaser shall be liable
for hereunder shall equal the Purchase Price.  The Parties agree that
such amount is a fair estimate of the maximum amount of Seller Companies’ and
Parent’s potential damages and hereby agree not to assert any Claim in excess of
such amount.

    

    8.2.4   After
the Closing, the sole remedy of any party hereto with respect to indemnification
Claims pursuant to this Section 8 of this
Agreement shall be monetary damages determined pursuant to this Section 8; provided that nothing
herein shall prevent Purchaser from seeking equitable remedies for, among other
things, specific performance for breaches of Section 7.7
(Confidentiality), Section 7.8 (Public
Announcements), and Section 7.9
(Non-Competition).

    

    8.3   Indemnification
by Seller Companies and Parent.  Subject to Sections 8.1 and
8.2, each
Seller Company and Parent agree, jointly and severally, to indemnify Purchaser,
its subsidiaries and Affiliates and its officers, managers, employees, equity
holders, representatives, successors, assigns, and agents and hold each of them
harmless against and in respect of any and all damage, loss, deficiency,
liability, obligation, commitment, cost or expense (including the fees and
expenses of counsel) resulting from, or in respect of, any of the
following:

    

    8.3.1   Any
misrepresentation or breach of any representation or warranty on the part of
Seller Companies or Parent under this Agreement, any document relating hereto or
thereto or contained in any schedule to this Agreement or from any
misrepresentation in or omission from any certificate, schedule, other Contract
or instrument delivered by Seller Companies or Parent hereunder.

    

    8.3.2   Any
breach of any covenant, agreement or non-fulfillment of any obligation on the
part of the applicable Seller Company or Parent under this Agreement, any
document relating hereto or thereto or contained in any schedule to this
Agreement or any certificate, schedule, other Contract or instrument delivered
by Seller Companies or Parent hereunder.

    

    8.3.3   Any
and all Excluded Liabilities.

    
      
         

      

      
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    8.3.4   Any
and all Excluded Assets.

    

    8.3.5   (i)
All Taxes, losses, Claims and expenses resulting from, arising out of, or
incurred with respect to, any Claims that may be asserted by any party based on,
attributable to, or resulting from the failure of any representation or warranty
made pursuant to Section 2.13 to be
true and correct in all respects as of the date of this Agreement and as of the
Closing Date; and (ii) all Taxes (A) attributable to the Acquired Assets or the
Business with respect to any taxable period or portion thereof that ends on or
prior to the Closing Date or (B) imposed on Seller Companies or
Parent.

    

    8.3.6   Any
and all Claims with respect to Seller Companies, the Business or the Acquired
Assets arising out of or relating to any event, matter or circumstance occurring
prior to the Closing Date.

    

    8.3.7   All
environmental liability of Seller Companies, including federal, state and local
environmental liability, together with any interest or penalties thereon or
related thereto, that arises or accrues on or prior to the Closing
Date.

    

    8.3.8   Any
failure (i) of Seller Companies to have good, valid and marketable title to the
Acquired Assets, free and clear of all Liens, Claims and Orders other than
Permitted Liens and (ii) to obtain the signature of Seller Companies and Parent
in connection with the transactions contemplated pursuant to this Agreement and
the agreements, documents and transactions contemplated hereby and thereby, and
Seller Companies and Parent shall be responsible for all liability, fees and
expenses that may arise because such Person fails or refuses to agree to the
terms hereof.

    

    8.3.9   Any
Claim for transaction costs or expenses not paid through a reduction in the
Purchase Price on the Closing Date.

    

    8.3.10   Intentionally
Omitted.

    

    8.3.11   All
demands, assessments, judgments, costs and reasonable legal and other expenses
arising from, or in connection with, any action, suit, proceeding or Claim
incident to any of the foregoing.

    

    8.4   Indemnification
by Purchaser.  Subject to Sections 8.1 and
8.2, Purchaser
agrees to, and shall, indemnify Seller Companies and Parent and hold each of
them harmless, against and in respect of any and all damage, loss, deficiency,
liability, obligation, commitment, cost or expense (including the fees and
expenses of counsel) resulting from, or in respect of, any of the
following:

    

    8.4.1   Any
misrepresentation or breach of any representation or warranty on the part of
Purchaser under this Agreement, any document relating hereto or thereto or
contained in any schedule to this Agreement or from any misrepresentation in or
omission from any certificate, schedule, other Contract or instrument delivered
by Purchaser hereunder.

    

    8.4.2   Any
breach of any covenant, agreement or non-fulfillment of any obligation on the
part of Purchaser under this Agreement, any document relating hereto or thereto
or contained in any schedule to this Agreement or any certificate, schedule,
other Contract or instrument by Purchaser hereunder.

    

    8.4.3   Any
and all Assumed Obligations (including, but not limited to, the capital and
operating leases set forth on Schedule 1.2(a)
attached hereto) after the Closing Date.

    

    8.4.4   Any
and all Acquired Assets after the Closing Date.

    

    8.4.5   All
demands, assessments, judgments, costs and reasonable legal and other expenses
arising from, or in connection with, any action, suit, proceeding or Claim
incident to any of the foregoing.

    
      
         

      

      
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    8.5   Third-Party
Claims.

    

    8.5.1   The
following procedures shall be applicable with respect to indemnification for
third-party Claims.  Promptly after receipt by the party seeking
indemnification hereunder (hereinafter referred to as the “Indemnitee”) of notice of the
commencement of any (i) Tax audit or proceeding for the assessment of Tax by any
Taxing Authority or any other proceeding likely to result in the imposition of a
Tax liability or obligation or (ii) any action or the assertion of any Claim,
liability or obligation by a third party (whether by legal process or
otherwise), against which Claim, liability or obligation the other party to this
Agreement (hereinafter the “Indemnitor”) is, or may be,
required under this Agreement to indemnify such Indemnitee, the Indemnitee
shall, if a Claim thereon is to be, or may be, made against the Indemnitor,
notify the Indemnitor in writing of the commencement or assertion thereof and
give the Indemnitor a copy of such Claim, process and all legal
pleadings.  The Indemnitor shall have the right to (i) participate in
the defense of such action with counsel of reputable standing and (ii) assume
the defense of such action by agreeing to assume such defense within ten (10)
days of transmittal in writing of the notice of the Claim by the Indemnitee,
unless such Claim (A) may result in criminal proceedings, injunctions or other
equitable remedies in respect of the Indemnitee or its business; (B) may result
in liabilities which, taken with other then existing Claims under this Section 8, would not
be fully indemnified hereunder; (C) may have a Material Adverse Effect on the
business or financial condition of the Indemnitee after the Closing Date
(including an effect on the Tax liabilities, earnings or ongoing business
relationships of the Indemnitee); (D) is for an alleged amount of less than
$25,000; (E) upon petition by the Indemnitee, if an appropriate court rules that
the Indemnitor failed or is failing to vigorously prosecute or defend such
Claim, in which events the Indemnitee shall assume the defense; or
(F)  is with respect to Taxes, in which case Seller Companies shall
have the right to assume the defense or settlement of such third-party Claim
only if it solely relates to (i) Taxes with respect to the income or operations
of the Business or the ownership of the Acquired Assets for a taxable year or
other taxable period ending on or before the Closing Date or (ii) Taxes imposed
upon Seller Companies and Parent. Notwithstanding the immediately preceding
sentence, with respect to a third-party Claim for Taxes, neither Seller
Companies nor Parent shall consent to entry of any judgment or enter into any
settlement (or otherwise compromise) of such Claim without the written consent
of Purchaser, which consent shall not be unreasonably withheld or
delayed.

    

    8.5.2   The
Indemnitor and the Indemnitee shall cooperate in the defense of any third party
Claims.  In the event that the Indemnitor assumes or participates in
the defense of such third party Claim as provided herein, the Indemnitee shall
make available to the Indemnitor all relevant records and take such other action
and sign such documents as are reasonably necessary to defend such third party
Claim in a timely manner.  If the Indemnitee shall be required by
judgment or a settlement agreement to pay any amount in respect of any
obligation or liability against which the Indemnitor has agreed to indemnify the
Indemnitee under this Agreement, the Indemnitor shall promptly reimburse the
Indemnitee in an amount equal to the amount of such payment plus all expenses
(including legal fees and expenses) incurred by such Indemnitee in connection
with such obligation or liability subject to this Section
8.  No Indemnitor, in the defense of any such Claim, shall,
except with the consent of the Indemnitee, consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to such Indemnitee of a release
from all liability with respect to such Claim.  In the event that the
Indemnitor does not accept the defense of any matter for which it is entitled to
assume as provided above, the Indemnitee shall have the full right to defend
such Claim.

    

    8.5.3   Prior
to paying or settling any Claim against which an Indemnitor is, or may be,
obligated under this Agreement to indemnify an Indemnitee, the Indemnitee must
first supply the Indemnitor with a copy of a final court judgment or decree
holding the Indemnitee liable on such Claim or failing such judgment or decree,
must first receive the written approval of the terms and conditions of such
settlement from the Indemnitor, which shall not be unreasonably withheld;
provided however, that no written approval is required from the Indemnitor as to
any third party Claim (i) that results solely in injunctions or other equitable
remedies in respect of the Indemnitee or its business; (ii) that settles
liabilities, or portions thereof, that are not subject to indemnification
hereunder; or (iii) is for an amount of less than $25,000.

    

    8.5.4   An
Indemnitee shall have the right to employ its own counsel in any case and the
fees and expenses of such counsel shall be at the expense of the Indemnitee
unless

    

    (a)   the
employment of such counsel shall have been authorized in writing by the
Indemnitor in connection with the defense of such Claim;

    

    (b)   the
Indemnitor shall not have employed counsel in the defense of such Claim after
ten (10) days notice; or

    

    (c)   such
Indemnitee shall have reasonably concluded that there may be defenses available
to it which are contrary to, or inconsistent with, those available to the
Indemnitor; in any of the foregoing events such fees and expenses shall be borne
by the Indemnitor.

    
      
         

      

      
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    8.6   Payment
of Indemnification Amounts.  Each Indemnitor
shall pay the indemnification amount claimed by the Indemnitee in immediately
available funds promptly within ten (10) days after the Indemnitee provides the
Indemnitor with written notice of a Claim hereunder unless the Indemnitor in
good faith disputes such Claim.  If the Indemnitor disputes such Claim
in good faith, then promptly after the resolution of such dispute, the amount
finally determined to be due shall be paid by the Indemnitor to the Indemnitee
in immediately available funds within ten (10) days of such dispute
resolution.  In the event the Indemnitor fails to pay the Indemnitee
the amount of such indemnification Claim within such ten (10) day period, the
Indemnitor shall pay the Indemnitee interest on the amount of such
indemnification Claim at a rate of ten percent (10%) per annum, compounded
monthly from the date of the original written notice of such indemnification
Claim until the indemnification Claim is paid in full.  If any
Indemnitor fails to comply with its obligations to make cash payments to an
Indemnitee in an aggregate amount sufficient to reimburse the Indemnitee for all
losses resulting from an indemnified Claim, the Indemnitee may pursue any and
all rights and remedies against the Indemnitor available in law or in equity,
subject only to the limitations set forth in Section 8.2
above.

    

    8.7   Security
for the Indemnification Obligation; Right of Set-Off.  Each
Indemnitee shall have the right, with notice to each Indemnitor, to offset
amounts owed to it by such Indemnitor (including any indemnification payment
owed by such Indemnitor) against amounts owed by such Indemnitee or its
Affiliates to such Indemnitor pursuant to any other obligations, including,
without limitation, any indemnification payment owed by such Indemnitee to such
Indemnitor, but not prior to the time when it is finally determined that such
Indemnitee owes such Indemnitor the amount being offset by such Indemnitee
pursuant hereto.  Neither the exercise of, nor the failure to exercise
such right of set-off shall constitute an election of remedies or limit an
Indemnitee in any manner in the enforcement of other remedies that may be
available to such Indemnitee hereunder.

    

    8.8   Adjustment
to Purchase Price.  Any indemnification payable pursuant to
this Section 8
shall be, to the extent permitted by law, an adjustment to the Purchase
Price.

    

    8.9   Breach.  Notwithstanding
any other provision in this Agreement to the contrary, the Parties acknowledge
and agree that a breach by one Party of any representation, warranty, covenant,
agreement or obligation set forth in this Agreement or the documents entered
into or delivered in connection with this Agreement does not release the
non-breaching Party of its obligations hereunder, pursuant to the ancillary
documents hereto or in connection with the transactions contemplated pursuant to
this Agreement and the agreements, documents and transactions contemplated
hereby and thereby.

    

    9.   Termination,
Amendment and Waiver

    

    9.1   Termination.  Except
as provided in Section
9.2 hereof, this Agreement may be terminated and the transactions
contemplated herein abandoned at any time prior to the Closing:

    

    9.1.1   by
mutual written agreement of Seller Companies, Parent and Purchaser;

    

    9.1.2   by
Purchaser or Seller Companies if this Agreement is not consummated on or before
January 31, 2010; provided that if any Party has
breached or defaulted with respect to its obligations under this Agreement on or
before such date, such Party may not terminate this Agreement pursuant to this
Section 9.1.2,
and each other Party to this Agreement may at its option enforce its rights
against such breaching or defaulting Party and seek any remedies against such
party, in either case as provided hereunder and by applicable
Regulation;

    

    9.1.3   by
Purchaser if as of the Closing Date any of the conditions specified in Section 5.1 hereof
have not been satisfied or if Seller Companies or Parent are otherwise in
default under this Agreement or breach of any of their respective
representations, warranties or covenants or other agreements herein;
or

    

    9.1.4   by
Seller Companies if as of the Closing Date any of the conditions specified in
Section 5.2
hereof have not been satisfied or if Purchaser is otherwise in default under
this Agreement or breach of any of its respective representations, warranties or
covenants or other agreements herein.

    

    9.1.5   by
Purchaser if it rejects in writing Seller Companies’ schedules pursuant to
Section 7.11.

    

    9.1.6   by
Parent, Seller Companies or Purchaser if they reject in writing any of the
Exhibits pursuant to Section 7.12.

    
      
         

      

      
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    9.2   Effect of
Termination.  In the event of termination of this Agreement as
provided in this Section 9, this
Agreement shall forthwith become void and there shall be no liability or
obligation on the part of any party; provided, however, that each
Party hereto shall remain liable for any material breaches of this Agreement
prior to its termination; and provided, further, however, that, the
provisions of Sections
7.7 and 7.8 and the
Confidentiality Agreement shall remain in full force and effect and survive any
termination of this Agreement.

    

    9.3   Extension;
Waiver.  Purchaser, on the one hand, and Seller Companies and
Parent, on the other hand, may, to the extent legally allowed, (i) extend
the time for the performance of any of the obligations of the other Party(ies)
hereto, (ii) waive any inaccuracies in the representations and warranties
made to such other Party(ies) contained herein or in any document delivered
pursuant hereto, and (iii) waive compliance with any of the agreements or
conditions for the benefit of such other Party(ies) contained
herein.  Any agreement on the part of a Party hereto to grant any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such Party.

    

    10.   Definitions.  As
used herein, the following terms have the respective meanings set forth below or
set forth in the referenced Section of this Agreement:

    

    “24/7” shall have the meaning
referenced in Section 2.21.9.

    

    “Acquired Assets” shall have
the meaning referenced in Section 1.1.

    

    “Affiliate” means, with regard
to any Person, (a) any Person, directly or indirectly, controlled by, under
common control of, or controlling such Person; (b) any Person, directly or
indirectly, in which such Person holds, of record or beneficially, five percent
(5%) or more of the equity or voting securities; (c) any Person that holds, of
record or beneficially, five percent (5%) or more of the equity or voting
securities of such Person; (d) any Person that, through Contract, relationship
or otherwise, exerts a substantial influence on the management of such Person’s
affairs; (e) any Person that, through Contract, relationship or otherwise, is
influenced substantially in the management of its affairs by such Person; (f)
any director, officer, manager, partner or individual holding a similar position
in respect of such Person; or (g) as to any natural Person, any Person related
by blood, marriage or adoption and any Person owned by such Persons, including
without limitation, any spouse, parent, grandparent, aunt, uncle, child,
grandchild, sibling, cousin or in-law of such Person.

    

    “Agreement” shall have the
meaning referenced in the preamble of this Agreement.

    

    “Assignment of Lease” shall
have the meaning referenced in Section 1.3(b).

    

    “Assumed Obligations” shall
have the meaning referenced in Section 1.2.

    

    “Assumption Agreement” shall
have the meaning referenced in Section 1.2.

    

    “Authority” means any
governmental, regulatory or administrative body, agency, commission, board,
arbitrator or authority, any court or judicial authority, any public, private or
industry regulatory authority, whether international, national, federal, state
or local.

    

    “Benefit Plans” shall have the
meaning referenced in Section 2.22.1.

    

    “Bill of Sale” shall have the
meaning referenced in Section 1.3.

    

    “Business” shall have the
meaning referenced in the recitals to this Agreement.

    

    “Business Intellectual
Property” shall mean all Intellectual Property owned by Parent or any
Seller Company that is used or held for use in connection with the
Business.  Business Intellectual Property does not include any
Intellectual Property used, owned or licensed by HealthIXS Corporation, a
wholly-owned subsidiary of Parent.

    

    “CERCLA” means Comprehensive
Environmental Response Compensation and Liability Act of 1980, as amended, and
the Regulations thereunder.

    
      
         

      

      
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    “Claim” means any action, suit,
claim, lawsuit, demand, suit, inquiry, hearing, investigation, notice of a
violation or noncompliance, litigation, proceeding, arbitration, appeals or
other dispute, whether civil, criminal, administrative or
otherwise.

    

    “Closing” shall have the
meaning referenced in Section 6.1.

    

    “Closing Date” shall have the
meaning referenced in Section 6.1.

    

    “CMS” means Center for Medicaid
and Medicare Services.

    

    “COBRA” shall have the meaning
referenced in Section 2.22.7.

    

    “Code” shall have the meaning
referenced in Section 2.22.1.

    

    “Confidentiality Agreement”
means that certain Confidentiality Agreement, datedOctober ___, 2009, by and
between Seller Companies, Parent and Purchaser.

    

    “Contract” means any agreement,
contract, commitment, instrument, document, certificate or other binding
arrangement or understanding, whether written or oral.

    

    “Definitive Information Statement” shall
have the meaning referenced in Section 4.10.

    

    “DOL” shall have the meaning
referenced in Section 2.22.5.

    

    “Employees” shall have the
meaning referenced in Section 2.23.

    

    “Environmental Condition” means
a condition of the soil, surface waters, groundwater, stream sediments, air
and/or similar environmental media including any Release or threatened Release
of Hazardous Substances, either on or off a property resulting from any
activity, inactivity or operations occurring on such property that, by virtue of
Environmental Laws (i) requires notification, investigatory, corrective or
remedial measures, and/or (ii) comprises a basis for Claims against, demands of
and/or Liabilities of Seller Companies, Parent or Purchaser or in respect of the
Business or the Locations.

    

                “Environmental Law” shall mean
any Regulation, Order, settlement agreement or Authority requirement, which
relates to or otherwise imposes liability or standards of conduct concerning the
environment, health, safety or Hazardous Substances, including without
limitation, discharges, emissions, releases or threatened releases of noises,
odors or any Hazardous Substances, whether as matter or energy, into ambient
air, water, or land, or otherwise relating to the manufacture, processing,
generation, distribution, use, treatment, storage, disposal, cleanup, transport
or handling of Hazardous Substances, including but not limited to CERCLA, the
Superfund Amendments and Reauthorization Act of 1986, the Hazardous Material
Transportation Act, the Resource Conservation and Recovery Act of 1976, the
Toxic Substances Control Act, the Federal Water Pollution Control Act, the Clean
Water Act, the Clean Air Act, the Occupational Safety and Health Act, any
so-called “Superlien” law, all as now or hereafter amended or supplemented, and
the Regulations promulgated thereunder, and any other similar Federal, state or
local Regulations.

    

    “Environmental Permit” shall
mean Permits, certificates, approvals, licenses, decrees, consents, Orders and
other authorizations relating to or required by Environmental Law and necessary
or desirable for Seller Companies’ business.

    

    “Equity Interests” shall have
the meaning referenced in Section 2.2.

    

    “ERISA” shall have the meaning
referenced in Section 2.22.1.

    

    “ERISA Affiliate” shall have
the meaning referenced in Section 2.22.13.

    

    “Escrow Agent” means American
Stock Transfer & Trust Company, LLC, located at 59 Maiden Lane, Plaza Level,
New York, New York 10038.

    
      
         

      

      
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    “Escrow Agreement” shall have the meaning
referenced in Section 1.7.1.

    

    “Escrow Amount” shall have the
meaning referenced in Section 1.7.1.

    

    “Excluded Assets” shall have
the meaning referenced in Section 1.1.

    

    “Excluded Liabilities” shall
have the meaning referenced in Section 1.2.

    

    “Existing Services Agreement”
shall have the meaning referenced in the recitals to this
Agreement.

    

    “Financial Statement Date”
shall have the meaning referenced in Section 2.7.1.

    

    “Financial Statements” shall
have the meaning referenced in Section 2.7.1.

    

    “Fundamental Representations and
Warranties” shall have the meaning set forth in Section 8.1.

    

    “Funds Flow Statement” shall
have the meaning set forth in Section 6.2.13.

    

     “GAAP” means United States
generally accepted accounting principles applied on a consistent
basis.

    

    “Guarantee” means any guarantee
or other contingent liability (other than any endorsement for collection or
deposit in the ordinary course of business), direct or indirect with respect to
any obligations of another Person, through a Contract or otherwise, including,
without limitation, (a) any endorsement or discount with recourse or undertaking
substantially equivalent to or having economic effect similar to a guarantee in
respect of any such obligations and (b) any Contract (i) to purchase, or to
advance or supply funds for the payment or purchase of, any such obligations,
(ii) to purchase, sell or lease property, products, materials or supplies, or
transportation or services, in respect of enabling such other Person to pay any
such obligation or to assure the owner thereof against loss regardless of the
delivery or nondelivery of the property, products, materials or supplies or
transportation or services or (iii) to make any loan, advance or capital
contribution to or other Investment in, or to otherwise provide funds to or for,
such other Person in respect of enabling such Person to satisfy an obligation
(including any liability for a dividend, liquidation payment or expense) or to
assure a minimum equity, working capital or other balance sheet condition in
respect of any such obligation.

    

    “Hazardous Substances” shall be
construed broadly to include any toxic or hazardous substance, material, or
waste, any petroleum or petroleum products, radioactive or nuclear materials,
asbestos in any form that has become friable, urea formaldehyde foam insulation,
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas,
any chemicals, materials or substances defined or included in the definition of
“hazardous substances,” “hazardous wastes,” “restricted wastes,”, “medical
wastes,” “toxic substances,” “toxic pollutants,” or words of similar import,
under any applicable Environmental Law, any other chemical, material or
substance, exposure to which is prohibited, limited, or regulated by any
governmental Authority and any other contaminant, pollutant or constituent
thereof, whether liquid, solid, semi-solid, sludge and/or gaseous, including
without limitation, chemicals, compounds, by-products, pesticides, asbestos
containing materials, petroleum or petroleum products or by-products, and
polychlorinated biphenyls, the presence of which requires investigation or
remediation under any Environmental Law or which are or could reasonably be
expected to become regulated, listed or controlled by, under or pursuant to any
Environmental Law, or which has been or shall be determined or interpreted at
any time by any Authority to be a hazardous or toxic substance regulated under
any other Regulation or Order.

    

    “HIPAA” shall have the meaning
referenced in Section 2.17.1.

    

    “HIPAA Regulations” shall have
the meaning referenced in Section 2.17.2.

    

    “Hurdle Rate” shall have the
meaning set forth in Section 8.2.1.

    

    “Imaging Centers” shall have
the meaning referenced in the recitals to this Agreement.

    

    “Improvements” shall have the
meaning set forth in Section 2.6.4.

    
      
         

      

      
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    “Indebtedness” with respect to
any Person means (a) any obligation of such Person for borrowed money, but in
any event shall include:  (i) any obligation or liabilities incurred
for all or any part of the purchase price of property or other assets or for the
cost of property or other assets constructed or of improvements thereto, other
than accounts payable included in current liabilities and incurred in respect of
property purchased in the ordinary course of business, (whether or not such
Person has assumed or become liable for the payment of such obligation) (whether
accrued, absolute, contingent, unliquidated or otherwise, known or unknown,
whether due or to become due); (ii) the face amount of all letters of credit
issued for the account of such Person and all drafts drawn thereunder;
(iii) obligations incurred for all or any part of the purchase price of
property or other assets or for the cost of property or other assets constructed
or of improvements thereto, other than accounts payable included in current
liabilities and incurred in respect of property purchased in the ordinary course
of business (whether or not such Person has assumed or become liable for the
payment of such obligation) secured by Liens; (iv) capitalized lease
obligations; (v) all Guarantees of such Person; and (vi) any outstanding
obligations or liabilities in connection with loans from Parent;
(b) equipment lease obligations; (c) accounts payable and accrued expenses
of such Person; (d) annual employee bonus obligations that are not accrued on
the Financial Statements; and (e) retroactive insurance premium
obligations.

    

    “Indemnification Escrow Amount”
shall have the meaning referenced in Section 1.7.1.

    

    “Indemnitee” shall have the
meaning set forth in Section 8.5.1.

    

    “Indemnitor” shall have the
meaning set forth in Section 8.5.1.

    

    “Intellectual Property” means
all domestic and foreign patents, patent applications, trademarks, service marks
and other indicia of origin, trademark and service mark registrations and
applications for registrations thereof, copyrights, copyright registrations and
applications for registration thereof, Internet domain names and universal
resource locators (“URLs”), trade secrets,
inventions (whether or not patentable), invention disclosures, moral and
economic rights of authors and inventors (however denominated), technical data,
customer lists, corporate and business names, trade names, trade dress, brand
names, know-how, show-how, maskworks, formulae, methods (whether or not
patentable), designs, processes, procedures, technology, source codes, object
codes, computer software programs, databases, data collectors and other
proprietary information or material of any type, whether written or unwritten
(and all good will associated with, and all derivatives, improvements and
refinements of, any of the foregoing).

    

    “Investment” shall mean (a) any
direct or indirect ownership, purchase or other acquisition by a Person of any
notes, obligations, instruments, capital stock, Options, securities or ownership
interests (including partnership interests and joint venture interests) of any
other Person; and (b) any capital contribution or similar obligation by a Person
to any other Person.

    

    “IRS” means the United States
Internal Revenue Service or any successor agency, and, to the extent relevant,
the United States Department of the Treasury.

    

    “JV” means the joint venture
partnership between Parent and UIA commonly known as “Union Imaging Associates,
JV”.

    

    “Licenses” shall have the
meaning referenced in Section 2.16.

    

    “Lien” means any (a) security
interest, lien, mortgage, pledge, hypothecation, encumbrance, rights of first
refusal, Options, warrants, charges, pledges, voting agreements, trusts,
restrictions of any nature, Claim, easement, charge, restriction on transfer or
otherwise, or interest of another Person of any kind or nature, including any
conditional sale or other title retention Contract or lease in the nature
thereof; (b) any filing or agreement to file a financing statement as debtor
under the Uniform Commercial Code or any similar statute; (c) any subordination
arrangement in favor of another Person; and (d) any other encumbrances of any
nature whatsoever.

    

    “Locations” shall have the
meaning referenced in the recitals to this Agreement.

    

    “Material Adverse Change” means
any developments or changes that would have a Material Adverse
Effect.

    
      
         

      

      
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    “Material Adverse Effect” means
any circumstances, state of facts or matters which might reasonably be expected
to have a material adverse effect in respect of any Location, the Business or
its operations, properties, assets, condition (financial or otherwise), results,
plans, strategies or prospects.

    

    “Medical Waste” includes, but
is not limited to, (a) pathological waste, (b) blood, (c) sharps, (d)
wastes from surgery or autopsy, (e) dialysis waste, including contaminated
disposable equipment and supplies, (f) cultures and stocks of infectious agents
and associated biological agents, (g) contaminated animals, (h) isolation
wastes, (i) contaminated equipment, (j) laboratory waste, and (k) various other
biological waste and discarded materials contaminated with or exposed to blood,
excretion, or secretions from human beings or animals.  “Medical
Waste” also includes any substance, pollutant, material, or contaminant listed
or regulated under MWTA.

    

    “Medical Waste Laws” means the
following, including regulations promulgated and orders issued thereunder, all
as may be amended from time to time: MWTA; the U.S. Public Vessel Medical Waste
Anti-Dumping Act of 1988, 33 USCA §§2501 et seq.; the Marine Protection,
Research, and Sanctuaries Act of 1972, 33 USCA §§1401 et seq.; the Occupational
Safety and Health Act, 29 USCA §§651 et seq.; the United States Department of
Health and Human Services, National Institute for Occupational Self-Safety and
Health Infectious Waste Disposal Guidelines, Publication No. 88-119 et seq. and
any other federal, state, regional, county, municipal, or other local laws,
regulations, and ordinances insofar as they purport to regulate Medical Waste,
or impose requirements relating to Medical Waste.

    

    “MSA” shall have the meaning
referenced in Section 5.1.7.

    

    “MWTA” means the Medical Waste
Tracking Act of 1988, 42 U.S.C. §§6992, et seq.

    

    “Option” means any
subscription, option, warrant, right, security, Contract, commitment,
understanding, equity appreciation right, phantom equity option, profit
participation or arrangement by which (a) with respect to any Seller Company,
such Seller Company is bound to issue any additional interest in the equity or
equity appreciation of such Seller Company or rights pursuant to which any
Person has a right to purchase an interest in the equity or equity appreciation
of Seller Company or (b) with respect to any Seller Company, such Seller Company
is bound to sell or allow another Person to vote, encumber or control the
disposition of any equity or rights pursuant to which any Person has a right to
purchase, vote, encumber or control the disposition of equity from such Seller
Company.

    

    “Order” means any writ, decree,
order, judgment, injunction, rule, ruling, Lien, voting right, consent of or by
an Authority.

    

    “PA” shall have the meaning
referenced in the recitals to this Agreement.

    

    “Parent” shall have the meaning
referenced in the preamble of this Agreement.

    

    “Parties” means, collectively,
Purchaser, Seller Companies, Parent, and their respective successors and
permitted assigns.

    

    “Party” means, individually,
Purchaser, each Seller Company and Parent and their respective successors and
permitted assigns.

    

    “Payment Obligations” shall
have the meaning referenced in Section 1.4.

    

    “Permits” means all permits,
licenses, registrations, certificates, Orders, qualifications or approvals
required by any Authority or other Person.

    

    “Permitted Liens” means (a)
statutory Liens not yet delinquent and immaterial in amount; (b) such
imperfections or irregularities of title or Liens as do not materially detract
from or interfere with the present use of the properties or assets subject
thereto or affected thereby, otherwise impair present business operations at
such properties, or do not detract from the value of such properties and assets;
(c) Liens reflected in the Financial Statements or the notes thereto; (d) the
rights of customers of a Seller Company with respect to inventory or work in
progress under purchase orders or Contracts entered into by a Seller Company in
the ordinary course of business; (e) mechanics’, carriers’, workers’,
repairmen’s, warehousemen’s, or other similar Liens arising in the ordinary
course of business in respect of obligations not overdue and immaterial in
amount or that are being contested in good faith and covered by a bond in an
amount at least equal to the amount of the Lien; and (f) deposits or pledges to
secure workmen’s compensation, unemployment insurance, old age benefits or other
social security obligations in connection with, or to secure the performance of,
bids, tenders, trade Contracts not for the payment of money or leases, or to
secure statutory obligations or surety or appeal bonds or other pledges or
deposits for purposes of like nature in the ordinary course of business and
immaterial in amount.

    
      
         

      

      
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    “Person” means any corporation,
partnership, joint venture, limited liability company, organization, entity,
Authority or natural person.

    

    “PET” shall have the meaning
referenced in the preamble of this Agreement.

    

    “PET Center” shall have the meaning
referenced in the recitals to this Agreement.

    

    “PET Location” shall have the
meaning referenced in the recitals to this Agreement.

    

    “Physicians” shall have the
meaning referenced in Section 2.19.

    

    “Preliminary Information
Statement” shall have the meaning referenced in Section
4.10.

    

    “Purchase Price” shall have the
meaning referenced in Section 1.4.

    

    “Purchaser” shall have the
meaning referenced in the preamble of this Agreement.

    

    “Reading Physicians” shall have
the meaning referenced in Section 2.19.

    

    “Regulation” means any rule,
law, code, statute, regulation, ordinance, requirement, announcement, policy,
guideline, rule of common law or other binding action of or by an Authority and
any judicial interpretation thereof.

    

    “Release” means any manner of
spilling, leaking, dumping, discharging, releasing, migrating or emitting, as
any of such terms may further be defined in any Environmental Law, into or
through any medium including, without limitation, ground water, surface water,
land, soil or air.

    

    “Remedial Action” shall mean
actions to clean up the environment, including soil, surface water or
groundwater, in response to a Release, spill or discharge of Hazardous
Substances, including the following activities: (a) monitoring, investigation,
assessment, treatment, cleanup, containment, removal, mitigation, response or
restoration work; (b) obtaining any permits, consents, approvals or
authorizations of any Governmental Authority necessary to conduct any such
activity; (c) preparing and implementing any plans or studies for any such
activity; (d) the use, implementation, application, installation, operation or
maintenance of remedial technologies applied to the surface or subsurface soils,
excavation and treatment or disposal of soils, systems for long-term treatment
of surface water or groundwater, engineering controls or institutional controls;
and (e) any other activities reasonably determined to be necessary or
appropriate or required under Environmental Laws to address a release of
Hazardous Substances.

    

    “Scheduled Physicians” shall
have the meaning referenced in Section 2.19.

    

    “SEC” shall have the meaning
referenced in Section 4.10.

    

    “SEC Communications” shall have
the meaning referenced in Section 4.10.

    

    “SEC Documents” shall have the
meaning referenced in Section 4.10.

    

    “Seller Companies” shall have
the meaning referenced in the preamble to this Agreement.

    

    “Seller Companies’ knowledge”,
“knowledge of Seller
Companies” “Parent’s
knowledge”, “knowledge
of Parent” or correlative terms shall be deemed to mean the knowledge of
Parent, Seller Companies or any of Seller Companies’ officers, directors,
managers or owners, after due and diligent inquiry (which shall include
conversations with such managers, officers and employees of Seller Companies
having responsibility for, and review of the files of Seller Companies relating
to, the subject matter to which the representation and warranty relates) of
their respective direct reports and management of Seller
Companies.

    
      
         

      

      
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    “Server” shall have the meaning
referenced in Section 2.21.9.

    

    “Settlement Amount Certificate”
shall have the meaning referenced in Section 1.8.2.

    

    “Settlement Date” shall have
the meaning referenced in Section 1.8.3.

    

    “Sites” shall have the meaning
referenced in Section 2.21.9.

    

    “Sponsor” shall have the
meaning referenced in Section 2.22.9.

    

    “Storage Location” shall have the
meaning referenced in the recitals to this Agreement.

    

    “Supervising Physicians” shall
have the meaning referenced in Section 2.19.

    

    “Tax Returns” shall have the
meaning referenced in Section 2.13.1.

    

    “Taxes” shall mean all taxes,
assessments, charges, duties, fees, levies or other governmental charges,
including, without limitation, all Federal, state, local, foreign and other
income, franchise, profits, gross receipts, capital gains, capital stock,
transfer, net proceeds, alternative or add-on minimum, ad valorem, turnover,
personal property (tangible and intangible), leasing, lease, user, employment,
fuel, excess profits, interest equalization, property, sales, use, value-added,
occupation, property, excise, severance, windfall profits, stamp, license,
payroll, social security, withholding and other taxes, assessments, charges,
duties, fees, levies or other governmental charges of any kind whatsoever
(whether payable directly or by withholding and whether or not requiring the
filing of a Tax return), all estimated taxes, deficiency assessments, additions
to tax, penalties and interest and shall include any liability for such amounts
as a result either of being a member of a combined, consolidated, unitary or
Affiliated group or of a contractual obligation to indemnify any person or other
entity.

    

    “Taxing Authorities” means
Internal Revenue Service and any other Federal, state, or local Authority which
has the right to impose Taxes on Seller Companies or Parent.

    

    “UIA” shall have the meaning
referenced in the preamble of this Agreement.

    

    “UIC” shall have the meaning
referenced in the preamble of this Agreement.

    

    “UIC Center” shall have the meaning
referenced in the recitals to this Agreement.

    

    “UIC Location” shall have the
meaning referenced in the recitals to this Agreement.

    

    “Underground Storage Tank”
shall have the meaning ascribed to such term in Section 6901 et seq., as
amended, of RCRA, or any applicable Regulation, Order governing underground
storage tanks.

    

    11.   Miscellaneous.

    

    11.1   Schedules
and Other Instruments.  Each Schedule and Exhibit to this
Agreement shall be considered a part hereof as if set forth herein in
full.

    

    11.2   Additional
Assurances.  The provisions of this Agreement shall be
self-operative and shall not require further agreement by the Parties except as
may be herein specifically provided to the contrary; provided, however, at the
reasonable request of a Party, the other Party or Parties shall execute such
additional instruments and take such additional actions as the requesting Party
may deem necessary to effectuate this Agreement.  In addition and from
time to time after Closing, Parent and the applicable Seller Companies shall
execute and deliver such other instruments of conveyance and transfer, and take
such other actions as Purchaser reasonably may request, to effectively convey
and transfer full right, title and interest to, vest in, and place Purchaser in
legal, equitable and actual possession of the Business and the Acquired
Assets.  Seller Companies and Parent shall also furnish Purchaser with
such information and documents in that Party’s possession or under that Party’s
control, or which Seller Companies and Parent can execute or cause to be
executed, as will enable Purchaser to prosecute any and all petitions,
applications, Claims and demands relating to or constituting a part of the
Acquired Assets. Additionally, Seller Companies, Parent and Purchaser shall
cooperate and use their respective reasonable efforts to have their respective
present managers, directors, officers and employees cooperate with each other on
and after Closing in furnishing information, evidence, testimony and other
assistance in connection with any action, proceeding, arrangement or dispute of
any nature with respect to matters pertaining to all periods prior to Closing in
respect of the items subject to this Agreement.

    
      
         

      

      
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    11.3   Consented
Assignment.  Anything contained herein to the contrary
notwithstanding, this Agreement shall not constitute an agreement to assign any
Claim, right, Contract, license, lease, commitment, sales order or purchase
order if an attempted assignment thereof without the consent of the other Party
thereto would constitute a breach thereof or in any material way affect the
rights of Seller Companies and Parent, as appropriate, thereunder, unless such
consent is obtained.  If such consent is not obtained, or if an
attempted assignment would be ineffective or would materially affect the rights
thereunder of any Seller Company or Parent so that Purchaser would not in fact
receive all such rights, then the Parties shall cooperate in any reasonable
arrangement designed to provide for the Parties the benefits under any such
Claim, right, Contract, license, lease, commitment, sales order or purchase
order, including, without limitation, enforcement of any and all rights of
Seller Companies and Parent, against the other party or parties thereto arising
out of the breach or cancellation by such other party or otherwise.

    

    11.4   Legal
Fees and Costs.  In the event a Party elects to incur legal
expenses to enforce or interpret any provision of this Agreement, the agreements
contemplated hereby, or the transactions contemplated hereby or thereby by
judicial proceedings or otherwise, the prevailing Party in whose favor a final
non-appealable judgment is rendered will be entitled to recover such legal
expenses, including, without limitation, reasonable attorney’s fees, costs and
necessary disbursements at all court levels, in addition to any other relief to
which such Party shall be entitled.

    

    11.5   Benefit;
Assignment.  Subject to provisions herein to the contrary, this
Agreement shall inure to the benefit of and be binding upon the Parties hereto
and their respective legal representatives, successors and assigns; provided,
however, that no Party may assign this Agreement without the prior written
consent of the other Party, which consent shall not be unreasonably withheld;
provided, further, however, that Purchaser may, without the prior written
consent of the other Party, assign its rights and delegate its duties hereunder
to one or more entities that are under common ownership or control of Purchaser.
This Agreement is intended solely for the benefit of the Parties hereto and is
not intended to, and shall not, create any enforceable third party beneficiary
rights.

    

    11.6   Cost of
Transactions.  Except as otherwise provided herein, whether or
not the transactions contemplated hereby shall be consummated, the Parties agree
as follows:  (i) each Seller Company and Parent shall bear its own
fees, expenses and disbarments, including without limitation, those related to
its respective agents, representatives, accountants, and counsel incurred in
connection with the subject matter hereof and any amendments hereto on or prior
to the Closing Date; and (ii) Purchaser shall bear its own fees, expenses and
disbursements, including, without limitation, those related to its agents,
representatives, accountants and counsel incurred in connection with the subject
matter hereof and any amendments hereto.

    

    11.7   Waiver of
Breach.  The waiver by any Party of a breach or violation of
any provision of this Agreement shall not operate as, or be construed to
constitute, a waiver of any subsequent breach of the same or any other provision
hereof.

    

    11.8   Notice.  All
notices, requests, demands and other communications under this Agreement shall
be in writing and shall be deemed to have been duly given or made as follows:
(a) if sent designated for overnight delivery by nationally recognized
overnight air courier (such as Federal Express or UPS), one (1) business day
after mailing; (b) if sent by facsimile transmission before 5:00 p.m. on a
business day (sender’s time), when transmitted and receipt is confirmed through
a delivery report; (c) if sent by facsimile transmission after 5:00 p.m. or on a
day that is not a business day (sender’s time) and receipt is confirmed through
a delivery report, on the following business day; (d) the date such notice,
request, demand or other communication is rejected; or (e) upon actual receipt
by the party to whom such notice, request, demand or other communication is
required to be given; provided that such notices, requests, demands and other
communications are delivered to the address or facsimile number set forth below,
or to such other address or facsimile number as any party shall provide by like
notice to the other parties:

    
      
         

      

      
        43

        
          

        

      

      
         

      

    

    

    
      
        
          	
                  Parent
      or any Seller Company:

                
	 
      
	
                  c/o
      Modern Medical Modalities Corporation

                
	
                  439
      Chestnut Street

                
	
                  Union,
      New Jersey 07083

                
	
                  Attention:
      Barry Hayut, Chairman and Chief Executive Officer

                
	
                  Facsimile:  908-845-0385

                
	 
      
	
                  With
      a simultaneous copy to:

                
	 
      
	
                  Richardson
      & Patel LLP

                
	
                  10900
      Wilshire Blvd.

                
	
                  Suite
      500

                
	
                  Los
      Angeles, CA 90024

                
	
                  Facsimile:
      310-208-1154

                
	
                  Attention:
      Kevin Friedmann, Esq.

                
	
                     Jody
      Samuels, Esq.

                
	 
      
	
                  Purchaser:

                
	 
      
	
                  New
      Jersey Imaging Partners, Inc.

                
	
                  1510
      Cotner Ave.

                
	
                  Los
      Angeles, CA 90025-3303

                
	
                  Attention:  Howard
      G. Berger, M.D.,
President

                

        

      

    

    

    11.9   Performance.  If
the due date for any notice, request, demand or other communication under this
Agreement occurs on a Saturday, Sunday or United States federal holiday, then
the due date for such notice, request, demand or communication shall be the next
business day following such Saturday, Sunday or federal holiday.

    

    11.10   Severability.  In
the event any provision of this Agreement is held to be invalid, illegal or
unenforceable for any reason and in any respect, such invalidity, illegality, or
unenforceability shall in no event affect, prejudice or disturb the validity of
the remainder of such provision or the remaining provision of this Agreement,
which shall be and remain in full force and effect, enforceable in accordance
with its terms.

    

    11.11   Gender
and Number.  Whenever the context of this Agreement requires,
the gender of all words herein shall include the masculine, feminine and neuter,
and the number of all words herein shall include the singular and
plural.

    

    11.12   Divisions
and Headings.  The divisions of this Agreement into sections
and subsections and the use of captions and headings in connection therewith are
solely for convenience and shall have no legal effect in construing the
provisions of this Agreement.

    

    11.13   Entire
Agreement; Amendment.  This Agreement, including the schedules
and exhibits hereto and the Contracts, documents, certificates and instruments
referred to herein, embodies the entire agreement and understanding of the
parties hereto in respect of the transactions contemplated by this Agreement and
supersedes all previous Contracts, representations, warranties, promises,
covenants, arrangements, communications and understandings, oral or written,
express or implied, between the parties with respect to such transactions and
constitutes the entire agreement of whatsoever kind or nature existing between
or among the Parties respecting the within subject matter and no Party shall be
entitled to benefits other than those specified herein.  There are no
Contracts, representations, warranties, promises, covenants, arrangements or
understandings between the parties with respect to the transactions contemplated
hereby, other than those expressly set forth or referred to
herein.  As between or among the Parties, no oral statements or prior
written material not specifically incorporated herein shall be of any force and
effect.  All prior representations or agreements, whether written or
verbal, not expressly incorporated herein are superseded and no changes in or
additions to this Agreement shall be recognized unless and until made in writing
and signed by all Parties hereto.

    

    11.14   Counterpart.  This
Agreement may be executed in two or more counterparts (including by means of
telecopied or PDF signature pages), each and all of which shall be deemed an
original and all of which together shall constitute but one and the same
instrument.  Counterpart signatures need not be on the same page and
shall be deemed effective upon receipt.

    
      
         

      

      
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    11.15   No Third
Party Beneficiaries.  This Agreement is for the sole benefit of
the Parties and their permitted successors and assigns and nothing herein
express or implied shall be construed to give any Person, other than the Parties
of such permitted successors and assigns, any legal or equitable rights
hereunder.

    

    11.16   Schedules.  No
exceptions to any representations or warranties disclosed on one schedule shall
constitute an exception to any other representation or warranties made in this
Agreement unless the substance of such exception is disclosed as provided herein
on each such applicable schedule or a specific cross reference to a disclosure
on another schedule is made.  All schedules and exhibits attached
hereto or referred to herein are hereby incorporated in and made a part of this
Agreement as if set forth in full herein.

    

    11.17   Injunctive
Relief.  The Parties hereto agree that in the event of a breach
of any provision of this Agreement or a failure by a party to perform in
accordance with the specific terms herein, the aggrieved party or parties may be
damaged irreparably and without an adequate remedy at law. The Parties therefore
agree that in the event of a breach of any provision of this Agreement, the
aggrieved Party or Parties may elect to institute and prosecute proceedings in
any court of competent jurisdiction to enforce specific performance or to enjoin
the continuing breach of such provision without the requirement of a posting of
a bond, as well as to obtain damages for breach of this Agreement.  By
seeking or obtaining any such relief, the aggrieved Party shall not be precluded
from seeking or obtaining any other relief to which it may be
entitled.

    

    11.18   Delays or
Omissions.  No delay or omission to exercise any right, power
or remedy accruing to any Party hereto, upon any breach or default of any other
Party under this Agreement, shall impair any such right, power or remedy of such
party nor shall it be construed to be a waiver of any such breach or default, or
an acquiescence therein, or of any similar breach or default thereafter
occurring; nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter
occurring.  Any waiver, permit, consent or approval of any kind or
character on the part of any Party hereto of any breach or default under this
Agreement, or any waiver on the part of any Party of any provisions or
conditions of this Agreement must be made in writing and shall be effective only
to the extent specifically set forth in such writing.  All remedies,
either under this Agreement or by law or otherwise afforded to any Party, shall
be cumulative and not alternative.

    

    11.19   Waiver of
Jury Trial.  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHTS IT MAY HAVE TO DEMAND THAT ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR IN ANY WAY RELATED TO THIS AGREEMENT OR ANY SCHEDULES OR
EXHIBIT HERETO OR THE RELATIONSHIPS OF THE PARTIES HERETO OR ANY COURSE OF
DEALING OR COURSE OF CONDUCT OR STATEMENTS (WHETHER VERBAL OR WRITTEN) BE TRIED
BY JURY.  THIS WAIVER EXTENDS TO ANY AND ALL RIGHTS TO DEMAND A TRIAL
BY JURY ARISING FROM ANY SOURCE INCLUDING, BUT NOT LIMITED TO, THE CONSTITUTION
OF THE UNITED STATES OR ANY STATE THEREIN, COMMON LAW OR ANY APPLICABLE STATUTE
OR REGULATIONS.  EACH PARTY HERETO ACKNOWLEDGES THAT IS KNOWINGLY,
INTENTIONALLY AND VOLUNTARILY WAIVING ITS RIGHTS TO DEMAND TRIAL BY
JURY.

    

    11.20   Choice of
Law; Venue.  THE PARTIES AGREE THAT THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
JERSEY.  THE PARTIES DESIGNATE ALL FEDERAL AND STATE COURTS OF RECORD
SITTING IN THE STATE OF NEW JERSEY AS FORUMS WHERE ANY CLAIMS IN RESPECT OF OR
ARISING OUT OF THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT SHALL BE PROSECUTED AS TO ALL PARTIES, THEIR SUCCESSORS, ASSIGNS, AND
BY THE FOREGOING DESIGNATIONS THE PARTIES CONSENT TO THE JURISDICTION AND VENUE
OF SUCH COURTS.

    

    11.21   Tax
Advice and Reliance.  Except as expressly provided in this
Agreement, none of the Parties (nor any of the Parties’ respective counsel,
accountants or other representatives) has made or is making any representations
to any other Party (or to any other Party’s counsel, accountants or other
representatives) concerning the consequences of the transactions contemplated
hereby under applicable tax laws.  Each Party has relied solely upon
the tax advice of its own employees or of representatives engaged by such Party
and not on any such advice provided by any other Party hereto.

    
      
         

      

      
        45

        
          

        

      

      
         

      

    

    

    11.22   No Strict
Construction.  The Parties have participated jointly in the
negotiation and drafting of this Agreement.  In the event an ambiguity
or question of intent or interpretation arises, this Agreement shall be
construed as if drafted jointly by the parties, and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any of the provisions of this Agreement.

    

    11.23   Interpretation.  In
this Agreement, unless the context otherwise requires references to (a) a
judgment shall include references to any order, writ, injunction, decree,
determination or award of any court or tribunal or (b) time are references to
Eastern Standard Time.

    

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    IN WITNESS WHEREOF, the
Parties hereto have duly executed this Asset Purchase Agreement as of the date
first above written.

     

    
      
        
          
            	 
      	
                    PURCHASER:

                  
	 
      	 
      
	 
      	
                    NEW
      JERSEY IMAGING PARTNERS, INC.

                  
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                      /s/ Howard G.
      Berger

                  
	 
      	
                    By:

                  	
                       

                  
	 
      	 
      	
                    Howard
      G. Berger, M.D., President

                  
	 
      	 
      	 
      	 
      
	 
      	
                    PARENT:

                  
	 
      	 
      
	 
      	
                    MODERN
      MEDICAL MODALITIES CORPORATION

                  
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                     
      /s/ Baruh Hayut

                  
	 
      	
                    By:

                  	
                       

                  
	 
      	 
      	
                    Baruh
      Hayut, Chief Executive Officer

                  
	 
      	 
      	 
      	 
      
	 
      	
                    SELLER
      COMPANIES:

                  
	 
      	 
      
	 
      	
                    UNION
      IMAGING ASSOCIATES, INC.

                  
	 
      	 
      
	 
      	
                     /s/
      Baruh Hayut

                  
	 
      	
                    By:

                  	
                       

                  
	 
      	 
      	
                    Baruh
      Hayut, Chief Executive Officer

                  
	 
      	 
      
	 
      	
                    UNION
      IMAGING CENTER, LLC

                  
	 
      	 
      
	 
      	
                    By:

                  	
                    Modern
      Medical Modalities Corporation, its sole member

                  
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                     /s/
      Baruh Hayut

                  
	 
      	 
      	
                    By:

                  	
                       

                  
	 
      	 
      	 
      	
                    Baruh
      Hayut, Chief Executive
Officer

                  

          

        

      

    

    

    
      
        	 
      	
                PET
      SCAN AT UNION IMAGING, LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                Modern
      Medical Modalities Corporation, its sole member

              
	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                 /s/
      Baruh Hayut

              
	 
      	 
      	
                By:

              	
                 
      

              
	 
      	 
      	 
      	
                Baruh
      Hayut, Chief Executive
Officer

              

      

    

    
      
         

      

      
        47

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