Item 1.01 Entry into a Material Definitive Agreement.
The Registrant is party to an acquisition and option agreement with Behavioral
Centers of South Florida LLC, a Florida limited liability company ("BCSF"), as
reported in a report of current event on Commission Form 8-K dated August 27,
2021, which is expected to close on or before December 31, 2021. However, BCSF
has not been able to meet the Registrant's requests for due diligence
information on a timely basis. In light of the foregoing, while the Registrant
intends to assist BCSF in this process, the required documentation being
essential to successfully close on such acquisition, it has decided to
accelerate other proposed acquisitions and, on October 28, entered into a merger
agreement and plan of reorganization with a joint venture formed by Primary
Medical Physicians, LLC, a Florida limited liability ("PMP"), Personal Care
Medical Group, LLC, a Florida limited liability company ("PCMG"), and, Glades
Medical Centers LLC, a Florida limited liability company using Glades Medical
Centers of Florida, LLC, a Florida Limited Liability company ("GMCF") as the
joint venture vehicle all four entities being collectively referred to in this
current report as Glades. The individual principals involved are Messrs. Carlos
H. Arce, Esquire, Robbie Chamoun and Daniel Sierra, and, Ramon A. Berenguer, MD,
all Florida residents.
Glades is focused on primary care diagnosis and treatments for illnesses such as
colds, flu, stomach aches or ear infections; minor injury care such as less
severe bumps, cuts, abrasions or sprains; pediatrics from common childhood
illnesses like influenza, bronchitis, rashes or infections, to minor injury care
for cuts, lacerations, sprains or breaks; x-rays and in-house lab testing, and
occupational medicine. Pursuant to the terms of the merger agreement and plan of
reorganization all of the entities comprising Glades will be merged into the
Registrant's consolidated subsidiary, Now Health Corp., a recently organized
Florida corporation ("NHC") with all securities in such entities converted into
200,000 shares of the Registrant's Class B Convertible Preferred Stock with up
to an additional 40,000 shares issuable based on performance over a three year
period. In addition, the Registrant will make available a $1,000,000 three year
line of credit for development of the acquired businesses. It is anticipated
that the acquisition will be closed upon following closing on Registrant's
current limited offering of $20,000,000 in shares of its Class B Convertible
Preferred Stock in reliance on Rule 506(b) of Commission Regulation D (the
"Limited Offering") but in no event later than December 31, 2021. A copy of the
Glades merger and reorganization agreement is filed as exhibit 10.01 to this
report of current event and the foregoing disclosure is qualified in its
entirety by the information contained therein.
Carlos H. Arce, Esquire, the Registrant's recently appointed vice president,
secretary and general counsel is an "affiliate" of Glades (as that term is
defined under Rule 405 of Commission Regulation C) and was introduced to Puget
during negotiations for the acquisition of Glades.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
At the 2021 annual meeting of the Registrant's shareholders held on June 7,
2021, the shareholders ratified the recommendation that the Registrant's board
of directors be expanded to nine or more members, at least three of whom should
be independent so that audit, nominating and compensation committees could be
implemented as envisioned by the Registrant's articles of incorporation and
bylaws. The Registrant's board of directors is currently evaluating a number of
candidates for designation to its board of directors, as authorized by its
shareholders, and upon their election and assumption of office, Messrs. Hermann
Burckhardt and Thomas Jaspers, the current members of the Registrant's board of
directors have indicated they will resign and dedicate themselves to their role
in Qest Consulting Group, Inc., the Registrant's "parent" as that term is
defined in Rule 504 of Commission Regulation C, as well as its strategic
consultant ("Qest"), from which they will continue to assist the Registrant.
Karen Lynn Fordham, the Registrant's president and chief executive officer will
succeed Mr. Burckhardt as a member of the board of directors and as its chair
when Mr. Burckhardt resigns following closing on the Limited Offering described
in Item 1.01 above.
Puget Technologies, Inc., current report on Commission Form 8-K, Page 2 of 5
(excluding exhibits).
In addition to the foregoing, several persons have agreed to serve as members of
the board of directors at such time as the Registrant has obtained officers and
directors' liability insurance (a cost anticipated in the allocation of proceeds
from Limited Offering described in Item 1.01 above. They will be identified in
future current reports on Form 8-K filed with the Commission at such time as
they enter into agreements agreeing to serve as members of the board of
directors subject to the condition that officers and directors' liability
insurance has been obtained and is in place. As of the date of this report, one
person, Major General (ret, US Air Force Minnesota and Indiana Air National
Guard) Worthe S. Holt Jr., MD, MMM, has signed such agreement. Pursuant to the
terms of the directors' agreement signed by Dr. Holt with the Registrant on
October 28, 2021, he will be compensated for his services as a member of the
Registrant's board of directors and committees thereof as follows:
(A) In the event that Dr. Holt arranges or provides funding for the Registrant on
terms more beneficial than those reflected in the Registrant's then current
principal financing agreements, copies of which are included among the
Registrant's records available through the Commission's EDGAR web site,
subject to applicable licensing requirements, Dr. Holt shall be entitled, at
his or her election, to either:
(1) A fee equal to 5% of such savings, on a continuing basis; or
(2) If equity funding is provided through Dr. Holt or any affiliates thereof, a
discount of 5% from the bid price for the subject equity securities, if they
are issuable as free trading securities, or, a discount of 25% from the bid
price for the subject equity securities, if they are issuable as restricted
securities (as the term restricted is used for purposes of Commission Rule
144); and
(3) If equity funding is arranged for the Registrant by Dr. Holt and the
Registrant is not obligated to pay any other source compensation in
conjunction therewith, other than the normal commissions charged by broker
dealers in securities in compliance with the compensation guidelines of the
FINRA, Dr. Holt shall be entitled to a bonus in a sum equal to 5% of the net
proceeds of such funding.
(B) In the event that Dr. Holt generates business for the Registrant, then, on
any sales resulting therefrom, Dr. Holt shall be entitled to a commission
equal to 5% of the Net Profits derived by the Registrant therefrom for a
period of two years.
(C) During the term of this Agreement Dr. Holt will be entitled to 4.9% of the
purchase price of any business which he brings to the Registrant and the
Registrant acquires, subject to any post-closing adjustments.
(D) Dr. Holt will be entitled to participate in any the Registrant qualified
incentive stock option plans on terms at least as favorable as those enjoyed
by any other non-officer member of the Registrant's board of directors.
A copy of the directors' agreement signed by Dr. Holt is filed as exhibit 10.02
to this this report of current event and the foregoing disclosure is qualified
in its entirety by the information contained therein
Dr. Holt, age 64, has over 40 years of healthcare delivery and administrative
experience. Most recently, Dr. Holt has served as the chief executive officer
and chief medical officer for Wellvana Health, focusing upon the latter role
during the past 18 months. Wellvana is a leader in building and operating
physician-led, high-performing, clinically integrated networks across the United
States. Prior to Wellvana, Dr. Holt served as vice president and deputy chief
medical officer of Humana, Inc. Dr Holt's experience has also included roles as
executive vice president and chief operating officer at multiple hospitals and
health systems in Indiana. Holt completed his undergraduate studies, medical
degree, and residency in family medicine at Indiana University, and his Masters
in Medical Management at Tulane University. Dr. Holt also completed a faculty
development fellowship at the University of North Carolina at Chapel Hill.
Additionally, he has served as president of the Indiana Medical Licensing Board,
president of the Indiana Academy of Family Physicians, a member of the Board of
Trustees of Franklin College and continues to staff the St. Francis Family
Practice Residency Program in Indianapolis. Dr. Holt provides leadership,
strategic and operational expertise, working nationally to support business
development, independent physician integration, clinical care delivery, and
value-based methodologies consistent with healthcare's quadruple aim, and, has
provided clinical operations insight into several merger and acquisition
opportunities.
Puget Technologies, Inc., current report on Commission Form 8-K, Page 3 of 5
(excluding exhibits).
In addition to his medical accomplishments, Dr. Holt served in the United States
Air Force and National Guard rising to the rank of Major General (ret). As
Special Assistant to the Commander and Deputy Chief of Staff, United States
Africa Command, General Holt provided policy representation on behalf of the
Joint Chiefs of Staff. This included direct contribution to the development of
U. S. National Security policies and their execution as well as negotiations
with U.S. Ambassadors and host nation political and military leadership.
Previously, he served as a fighter pilot/physician (F-16, F-4) with the Indiana
National Guard and as the Adjutant General - Air, for the Minnesota National
Guard. He holds an Air Medal for combat operations and the Legion of Merit.
Section 5.06 Change in Shell Company Status.
It is anticipated that the closing on the transaction with Glades disclosed in
response to Item 1.01 will result in the termination of the Registrant's status
as a "shell company" and require the filing of significant additional
information with the Commission as well as a detailed description of the subject
transaction. Such information will include most of the information required
under Commission Form 10 in compliance with Commission Regulation S-K and
Article 8 of Commission Regulation S-X, in each case as applicable to smaller
reporting companies.
Section 9 - Financial Statements and Exhibits Item 9.01 Financial Statements and
Exhibits.
Exhibit Index
Exhibit Description
Number
10.01 Merger agreement and plan of reorganization with joint venture formed
by Primary Medical Physicians, LLC, a Florida limited liability,
Personal Care Medical Group, LLC, a Florida limited liability company
and, Glades Medical Centers LLC, a Florida limited liability company
using Glades Medical Centers of Florida, LLC, a Florida Limited
Liability company as the joint venture vehicle.
10.02 Agreement to serve as a member of the Registrant's board of directors
entered into by Worthe S. Holt Jr., MD, MMM.
Puget Technologies, Inc., current report on Commission Form 8-K, Page 4 of 5
(excluding exhibits).
© Edgar Online, source Glimpses