-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EK/gZ5u3AZojP0r2z900hdKxyUsQsgkjkiNdw7SzdZPhfJkCm7n65clPDCEEXZuY CvWSoMa6/MC/s8+m+6k89g== 0001019687-08-000097.txt : 20080107 0001019687-08-000097.hdr.sgml : 20080107 20080107132936 ACCESSION NUMBER: 0001019687-08-000097 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20071231 ITEM INFORMATION: Departure of Directors or Principal Officers; Election of Directors; Appointment of Principal Officers ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20080107 DATE AS OF CHANGE: 20080107 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Integrated Healthcare Holdings Inc CENTRAL INDEX KEY: 0001051488 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-HOSPITALS [8060] IRS NUMBER: 870412182 STATE OF INCORPORATION: NV FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-23511 FILM NUMBER: 08514431 BUSINESS ADDRESS: STREET 1: 1301 N. TUSTIN AVENUE CITY: SANTA ANA STATE: CA ZIP: 92705 BUSINESS PHONE: 714-434-9191 MAIL ADDRESS: STREET 1: 1301 N. TUSTIN AVENUE CITY: SANTA ANA STATE: CA ZIP: 92705 FORMER COMPANY: FORMER CONFORMED NAME: Integrated Healthcare Holdings DATE OF NAME CHANGE: 20040816 FORMER COMPANY: FORMER CONFORMED NAME: FIRST DELTAVISION INC DATE OF NAME CHANGE: 19971216 8-K 1 ihh_8k-010308.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K -------------------------- CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (date of earliest event reported): December 31, 2007 -------------------------- INTEGRATED HEALTHCARE HOLDINGS, INC. (Exact Name of Registrant as Specified in its Charter) -------------------------- NEVADA 0-23511 87-0573331 (State or Other Jurisdiction of (Commission (I.R.S. Employer Incorporation or Organization) File Number) Identification No.) 1301 NORTH TUSTIN AVENUE SANTA ANA, CALIFORNIA 92705 (Address of Principal Executive Offices) (Zip Code) (714) 953-3503 (Registrant's telephone number, including area code) (Former Name or Former Address, if Changed Since Last Report) -------------------------- Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) -1- ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS. (b) and (e) On December 31, 2007, Integrated Healthcare Holdings, Inc. (the Company) entered into a Severance Agreement With Mutual Releases ("Severance Agreement") and a Consulting Agreement with Larry B. Anderson, President of the Company. Under the Severance Agreement, Mr. Anderson terminated his employment as President of the Company by mutual agreement, effective December 31, 2007. Under the Severance Agreement, Mr. Anderson will receive consideration currently valued at approximately $465,000. The Company will pay Mr. Anderson compensation equivalent to fourteen (14) equal monthly installments. The amount of each monthly installment shall be the sum of Mr. Anderson's base monthly salary, net of required deductions, plus the monthly value of his health and dental insurance, plus the monthly value of his automobile allowance. The schedule of payments is as follows: (i) one (1) lump sum payment equivalent to eight (8) monthly installments within one (1) business day after Mr. Anderson's 7-day right to revoke the Severance Agreement has expired, and (ii) the remaining six (6) equal installments shall be paid to him on or before the first business day of each month, commencing on September 1, 2008. In addition, the Company will pay a year end (December 31, 2007) bonus of $30,000 to Mr. Anderson, which is payable within one (1) business day after the 7-day right to revoke expires. The Severance Agreement also includes mutual releases, specific waivers and releases, nondisclosure of confidential information, return of property, future cooperation, non-disparagement, and general provisions customary in such agreements. Under the terms of the Consulting Agreement, which is effective from January 1, 2008 through June 30, 2008, the Company will pay Mr. Anderson $180,000 consisting of one (1) payment of $60,000 payable within one (1) business day after the 7-day right to revoke the aforementioned Severance Agreement has expired and four (4) equal monthly installments of $30,000 each, commencing April 1, 2008, with the last payment due on July 1, 2008. As additional compensation for special projects, such as his services relating to the proposed acquisition of Anaheim Memorial Medical Center (AMMC) by the Company, Mr. Anderson is entitled to receive 0.5% of the total value of the purchase, minus $30,000, or an estimated $310,000 if the acquisition of AMMC is consummated at the currently proposed price. The Consulting Agreement will terminate if Mr. Anderson exercises his 7-day right to revoke the aforementioned Severance Agreement. The Consulting Agreement contains other provisions customary to such agreements. Mr. Anderson's agreements are furnished as exhibits to this Report. The preceding description of the agreements should be read in conjunction with the exhibits filed herewith. (c) The Company's Board of Directors appointed Bruce Mogel, the Company's current Chief Executive Officer (principal executive officer), to also serve as the Company's President, commencing on the effective date of the Severance Agreement with Larry B. Anderson, or December 31, 2007. No additional consideration to Mr. Mogel was approved by the Board at this time. ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS. (d) Exhibits EXHIBIT NUMBER DESCRIPTION 99.1 Severance Agreement with Mutual Releases of Larry B. Anderson, as of December 31, 2007. 99.2 Consulting Agreement of Larry B. Anderson, as of December 31, 2007. -2- SIGNATURES ---------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: January 7, 2008 INTEGRATED HEALTHCARE HOLDINGS, INC. By: /s/ Steven R. Blake ----------------------------------- Steven R. Blake Chief Financial Officer -3- EX-99.1 2 ihh_8k-ex9901.txt EXHIBIT 99.1 SEVERANCE AGREEMENT WITH MUTUAL RELEASES This SEVERANCE AGREEMENT WITH MUTUAL RELEASES ("Severance Agreement") is between Integrated Healthcare Holdings, Inc. ("Employer") and Larry B. Anderson ("Employee"), collectively "Parties." This Severance Agreement shall be enforceable only when and if (i) a certain "Consulting Agreement", and (ii) this Severance Agreement are both fully executed ("Effective Date"). RECITALS -------- A. Employee entered into an Employment Agreement with the Company, on or about February 22, 2005 to serve as the Company's President ("Employment"), commencing February 22, 2005. On or about June 9, 2005, an Amendment to the Employment Agreement was executed by Employee and the then Chairman of the Board of the Company. B. Employee and Company mutually agree that it is in both Parties' best interest to mutually terminate the Employment Agreement, as Amended (collectively, "Amended Employment Agreement"), and to terminate Employee's Employment and in order to facilitate Employee's transition from an employee of, to a consultant for, the Company. C. NOW, THEREFORE, for good and valuable consideration and the mutual covenants contained herein, including the execution of this Agreement, the Parties agree as follows: SEVERANCE AGREEMENT ------------------- ARTICLE 1. TERMINATION OF EMPLOYMENT AND OF EMPLOYMENT AGREEMENT ---------------------------------------------------------------- 1.01. TERMINATION OF EMPLOYMENT AND OF EMPLOYMENT AGREEMENT. Employee's Employment and the Amended Employment Agreement both shall be terminated at midnight, December 31, 2007, automatically and without further notice, by mutual agreement ("the Termination"). Thereafter, Employee shall not render and shall not be obligated to render any services, legal or otherwise, as President, as an officer, as an employee or in any other capacity, except as a Consultant as provided in that certain concurrently executed Consulting Services Agreement. ARTICLE 2. PAYMENT OF COMPENSATION ---------------------------------- 2.01. PAYMENT OF SEVERANCE PACKAGE COMPENSATION. In consideration for Employee's releases and conditioned upon Employee's execution and delivery of this Severance Agreement to Company within the time required, below, Employer shall pay and provide the below described compensation and benefits ("Severance Package"). 2.01.01. Company shall pay Employee compensation, equivalent to fourteen (14) equal monthly installments (the monthly amount of which is more particularly described in Page 1 of 10 subsection 2.01.03, below), according to the schedule describe in subsection 2.01.02, below. Payment is subject to and conditioned on Employee not having exercised his right to revoke his acceptance of, and terminate, this Severance Agreement (see below). 2.01.02. The schedule of payments is as follows: (i) one (1) lump sum payment, equivalent to eight (8) monthly installments, payable within one (1) business day after Employee's right to revoke his acceptance of, and terminate, this Severance Agreement has expired (REF. Section 3.01 ET SEQ, below); and (ii) The remaining six (6) equal installments shall be paid to Employee on or before the first business day of each month, commencing September 1, 2008 month. 2.01.03 The amount of each equal monthly installments shall be the sum of Employee's customary monthly compensation, as paid to Employee for the month of December 2007 ("Installment"), as determined by the sum of (i) Employee's base monthly salary, net of required deductions; PLUS (ii) the monthly value of Employee's health and dental insurance; PLUS (iii) the monthly value of Employee's automobile allowance. Other compensation (E.G. bonuses, accrued vacation, ETC.), which may have been paid in any month, including December, but which is not described in this sub section 2.01.03, shall not be included as part of any monthly Installment. 2.01.04. Employee shall not accrue or be entitled to additional "Paid Time Off," vacation pay, sick pay benefits, non-accrued bonuses, non-accrued or non vested stock options, or any other compensation or benefits (employment related or otherwise), after the effective date of termination, except (i) as specifically described in this Section 2.01 and the sub parts thereof; and (ii) when and if enforceable, pursuant to the concurrently executed Consulting Services Agreement. 2.01.05. Company shall pay Employee a year end bonus of $30,000 payable within one (1) business day after Employee's right to revoke his acceptance of, and terminate, this Severance Agreement has expired (REF. Section 3.01 ET SEQ, below). 2.01.06. Company's obligations (including all obligations to pay) under this Severance Agreement are conditioned on, and shall not commence until (i) the concurrent execution and delivery of this Severance Agreement and that certain Consulting Services Agreement, to Company, and (ii) the expiration of seven (7) days, after Employee's delivery of the executed Severance Agreement, without Employee having revoked his acceptance of the Severance Agreement. In no event, however, shall Company have any obligation to provide compensation and benefits under the Severance Agreement (i) while Company is still paying compensation and providing benefits under the terms of the Amended Employment Agreement, or (ii) until after the effective date of Employee's termination. 2.01.06. Any extension of the time for Employee's execution and delivery of this Severance Agreement must be in writing and executed by Employer, otherwise, no extension shall be permitted or shall be enforceable. Section. 2.02. PAYMENT OF PRE-TERMINATION COMPENSATION. On or before January 3, 2008, Company shall pay and deliver to Employee all the following unpaid items (if any) which Page 2 of 10 will have been accrued, through midnight, December 31, 2007, and which remain unpaid: (i) salary (after deduction of required withholdings), through ; (ii) the full value of all accrued and unpaid vacation pay; (iii) bonuses or other accrued pay (if any); and (iv) all properly submitted expense invoices, as reimbursement, IRRESPECTIVE OF WHETHER THIS SEVERANCE AGREEMENT IS EXECUTED. ARTICLE 3. MUTUAL RELEASES -------------------------- Section 3.01. MUTUAL RELEASES. Employee releases Employer and Employer releases Employee from any and all known and unknown claims of any nature, including (without limitation) any claims arising from or otherwise related to Employee's employment by Company, including (without limitation) the Amended Employment Agreement and any other employment agreement of any kind whatsoever, as more particularly provided herein. 3.01.01. Employee's release of "Employer" means Employee waives, releases and forever discharges Company and each of its current and former affiliates, subsidiaries, parents, divisions, successors, predecessors and assigns, as well as each of their respective past and present agents, directors, officers, shareholders, partners, insurers, representatives, consultants, attorneys and employees (collectively referred to as "Employer Releasees"), and each of them, from any and all claims of any kind or nature, whether known or unknown or suspected or unsuspected, which Employee now owns or holds, or has at any time before the date he signs this Severance Agreement, owned or held against Employer and the Employer Releasees, and each of them. 3.01.02. The phrase "any and all known and unknown claims" as used in this Severance Agreement includes, but is not limited to, all claims, demands, causes of action, complaints, or actions of any kind, whether known or unknown, anticipated or unanticipated, suspected or unsuspected, past or present, contingent or fixed including which either Employee or Employer may have. "[Any and all known and unknown claims", includes (but is not limited to): (i) any and all claims based on tort or contract; (ii) any and all claims arising under federal, state or local law or statute, including, but not limited to any and all claims arising under Title VII of the Civil Rights Act of 1975, as amended, 42 U.S.C. ss.2000e, et seq., the Americans with Disabilities Act, 42 U.S.C. ss.12101, et seq., the Family and Medical Leave Act of 1993, 29 U.S.C., ss. 2601, et seq., the California Family Rights Act, Cal. Gov't Code ss. 12945.2, the California Fair Employment and Housing Act, Cal. Govt Code ss.12900, et seq., and any other federal, state or local fair employment practice or civil rights law, ordinance or Employee order; and, (iii) any and all claims arising out of, related to or connected with the employment of Employee by Company, the terms and conditions and/or separation of that employment, and any employment practice, policy or decision of, or omission or action taken by, the Employee or Employer, and each of them, including, but not limited to, any claims for wrongful discharge, misrepresentation, defamation, fraud, fraudulent inducement or emotional distress. 3.01.03. The Parties understand that each of their releases includes all claims of every nature and kind whatsoever, known or unknown, suspected or unsuspected, including, without limitation, any and all claims or obligations arising from or related in any way to the Page 3 of 10 Action. All rights under Section 1542 of the Civil Code of California, or under any other state statute or case law which is substantially similar to Section 1542 in language or effect, are hereby expressly waived. Section 1542 provides as follows: "A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor." 3.01.04. The Parties understand that facts different from, or in addition to, those which now known or believed to be true with respect presently asserted or any other possible claims may be discovered at a later date, but agrees that the releases contained herein shall be and remain effective in all respects notwithstanding such different or additional facts or the discovery thereof. Section 3.02. SPECIFIC WAIVERS AND RELEASES. Employee specifically, voluntarily, and knowingly waives any claims or causes of action he may have under the Age Discrimination in Employment Act ("ADEA") and pursuant to the Older Workers Benefit Protection Act ("OWBPA"). In this regard, Employee specifically acknowledges the following: 3.02.01. Employee is aware of his right to consult with, and specifically has been given the opportunity to and has been advised to consult with Employee's own independent counsel regarding his rights under both of these Acts, as well as this entire Severance Agreement, prior to signing this Severance Agreement. 3.02.02. Employee has the right to, and was given, twenty-one (21) days within which to consider the provisions of this Severance Agreement if ADEA and OWBPA are applicable, although Employee may sign and return it sooner. Employee has decided to voluntarily execute the Severance Agreement now and, therefore, waives this right. 3.02.03. Employee understands he has the right to revoke this Severance Agreement for a period of seven (7) days after its execution. Accordingly, this Severance Agreement shall not become effective or enforceable until the eighth day following Employee's execution of this Severance Agreement. 3.02.04. Employee represents he has been given the opportunity to and has, in fact, read this entire Severance Agreement, that it is in plain language, and that Employee has had all questions (if any) regarding its meaning answered to Employee's satisfaction. 3.02.05. Employee fully understands the terms, contents and effects of this Severance Agreement and understands that it is a FULL RELEASE OF ALL KNOWN AND UNKNOWN CLAIMS (if any) against Company and any and all Company Agents, including all rights under the ADEA and OWPA. The releases contained herein are not a waiver of claims that may arise after the date of this Severance Agreement; Page 4 of 10 3.02.06. Employee represents he has enters into this Severance Agreement knowingly and voluntarily in exchange for the promises contained herein and, except as stated herein, no other representations have been made to Employee to induce or influence Employee's execution of this Severance Agreement. Section 3.03. That certain concurrently executed Consulting Services Agreement shall survive the releases contained herein, provided Employee does not timely exercise his right to revoke his acceptance of, and terminate, this Service Agreement. ARTICLE 4. CONFIDENTIAL INFORMATION; RETURN OF PROPERTY. -------------------------------------------------------- Section 4.01. NONDISCLOSURE OF CONFIDENTIAL INFORMATION. Except as may be required by that certain concurrently executed Consulting Agreement, Employee shall not (i) voluntarily, directly or indirectly communicate, in any manner to any legal or natural person (except as required by applicable law or in connection with the performance of his duties and responsibilities as a former employee of Company); (ii) use or otherwise appropriate for Employee's own or any third party's benefit any Confidential Information. Confidential Information shall include (without limitation) information made available to, obtained by or developed by Employee during the course of his employment relating or pertaining to the Company's trade secrets, financial information, technical information and /or business plans and strategies. Employee shall use his best efforts, and cooperate with the Company, to maintain the secrecy of and limit the use of such Confidential Information. Section 4.02. RETURN OF PROPERTY. Except as may be required by that certain concurrently executed Consulting Agreement, all documents, memoranda, reports, notebooks, correspondence, files, lists and other records, and the like, designs, drawings, specifications, computer software and computer equipment, computer printouts, computer disks, and all photocopies or other reproductions thereof, affecting or relating to the Business of the Company, which Employee shall prepare, use, construct, observe, possess or control ("Company Materials"), shall be and remain the sole property of the Company. Employee shall deliver promptly to the Company all such Company Materials and other Company Property (E.G. tangible property, credit cards, entry cards, pagers, identification badges, cellular phones, and keys) upon termination of his employment. ARTICLE 5. FUTURE COOPERATION. ------------------------------ Section 5.01. Subsequent to his termination, Employee agrees to cooperate with the Company and use his best efforts to respond to all reasonable requests by the Company for assistance and advice relating to matters and procedures in which Employee was involved or which Employee managed or was responsible for while employed by the Company, as its President. Section 5.02. Employee also represents and agrees to cooperate in the Company's defense or prosecution of any claim or other action which arises, whether civil, criminal, administrative or investigative, in which Employee's participation is required in the best judgment of the Company by reason of his former employment with the Company. Upon the Company's request, Employee Page 5 of 10 will use his best efforts to attend hearings and trials, to assist in effectuating settlements, and to assist in the procuring of witnesses, producing evidence, and in the defense or prosecution of said claims or other actions. ARTICLE 6. NON-DISPARAGEMENT. ----------------------------- Section 6.01. NON-DISPARAGEMENT. Employee agrees that he will not make derogatory nor disparaging statements about Company or any of its other affiliate companies and their employees, officers and directors (collectively, "Company"). Employee also shall not induce or incite claims of discrimination, wrongful discharge, sexual or other forms of harassment, breach of contract, tortious acts, or any other claims of any type whatsoever against Company by any other person or employee, relating to such individual's employment or business dealings with Company. ARTICLE 7. GENERAL PROVISIONS Section 7.01. NOTICES. Any notices required or permitted to be sent under this Severance Agreement may be personally delivered, sent by overnight mail or overnight delivery service (E.G. Federal Express) or mailed by registered or certified mail, return receipt requested. Receipt of any notice shall be conclusively be deemed complete, according to the following: (i) personal delivery shall be deemed received the same day; (ii) overnight mail or overnight delivery service shall be deemed complete the next day, Sundays and holidays excepted; (iii) certified or registered mail shall be deemed complete upon recipient's execution of the receipt. Notices shall be sent to the following addresses until and unless changed by a Parties written notice to the other Party: IF TO CLIENT: Scott Schoeffel, General Counsel Integrated Healthcare Holdings, Inc 1301 North Tustin Ave. Santa Ana, CA 92705 IF TO CONSULTANT: Larry Anderson 28 Pegasus Dr. Coto De Caza, CA. 92679 Section 7.02. ENTIRE AGREEMENT OF THE PARTIES. This Severance Agreement is the full and complete agreement and, with the concurrently executed Consulting Agreement, contain the entire and complete understanding of all agreements between Company and Employee. There are no other agreements of any kind. This Severance Agreement supersedes all prior agreements, including the prior EMPLOYMENT AGREEMENT between the Parties, dated February 22, 2005 and all amendments (if any) thereto. This Severance Agreement can only be modified by a writing signed by both Parties. Section 7.03. ATTORNEYS' FEES. In the event of a dispute arising from or relating to this Severance Agreement, each party shall pay their own legal fees and costs. Page 6 of 10 Section 7.04. SEVERABLE PROVISIONS. The provisions of this Severance Agreement are severable. If any provision shall be determined to be unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable. Section 7.05 ARBITRATION. 7.05.01. Any controversy between Company and Employee involving the construction or application of any of the terms, provisions or conditions of this Severance Agreement shall be submitted to binding arbitration if one Party sends a written demand for binding arbitration to the other Party . Company and Employee shall both be deemed to have waived the right to litigate the claim in any federal or state court if either party tenders a written request for arbitration of any such claim(s). 7.05.02. Prior to commencement of, and as a condition of, any arbitration, however, the Parties agree to first attempt to resolve any dispute before a neutral mediator in a non-binding mediation. The mediation shall take place within thirty (30) days of written notice by either party of any such dispute. The mediator shall be a California licensed attorney with at least fifteen years experience in and an emphasis in California and Federal Employment Law, or a retired or former judge of the Superior Court of the State of California or of the Court of Appeals of the State of California ("Mediator"). The Mediator shall be selected by the same process used for the selection of an Arbitrator, as described in subsection 11.4, below. The parties agree that mediation shall not exceed one (1) day in duration. 7.05.03. Arbitration shall comply with and be governed by the provisions of the California Arbitration Act, unless otherwise precluded by California or Federal law. The Federal Arbitration Act shall apply only if enforcement of a particular provision of the California Arbitration Act would undermine the goals and policies of the Federal Arbitration Act. 7.05.04. Any demand to arbitrate shall be deemed to have been made on the date actually received by the party upon whom it is served and, for purposes of the statute of limitations, shall have the same effect as if suit had been filed on the date the demand is made. Any demand to arbitrate any claim arising from or in connection with this Severance Agreement must be received within six (6) months after the claim first arose, notwithstanding any other statute of limitations providing for a longer period of time, unless otherwise forbidden in law. 7.05.02. The arbitration shall occur in Orange County, California, before a neutral, single retired or former judge of the Superior Court of the State of California or of the Court of Appeals of the State of California ("Arbitrator"). The parties shall agree upon an Arbitrator within ten (10) days after the demand is made. If the parties cannot agree on an arbitrator, then any of them may apply to the Orange County Superior Court for an Order appointing an Arbitrator who meets the requirements of this subsection 13.3. 7.05.02. The Arbitrator shall have exclusive jurisdiction over all legal and equitable claims, issues and remedies, so all types of relief available in a judicial proceeding shall be available to the Parties in the Arbitration. The Parties may use the Orange County Superior Court or, only if required, the Federal Court in Orange County to enforce the Arbitrators rulings Page 7 of 10 and awards. Discovery, including depositions for the purpose of discovery, shall be broadly permitted, and the provisions of the California Code of Civil Procedure ss.1283.05 shall apply. 7.06. CAPTIONS. The captions of the paragraphs of this Severance Agreement are solely for the convenience of the undersigned, are not a part of this Severance Agreement, and shall not be used for the interpretation of any provision of this Severance Agreement. 7.07. CONTINUING OBLIGATIONS. The rights and obligations of Employee and Company set forth in this Severance Agreement shall survive the releases contained herein. 7.08. NON-WAIVER. The failure of either party to insist on strict compliance with any of the terms and conditions of this Severance Agreement by the other party shall not be deemed a waiver of that term or condition. The waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. 7.09. APPLICABLE LAW; VENUE. This Severance Agreement is entered into and is to be performed in Orange County, California. The Severance Agreement shall be governed by the laws of the State of California. The Parties agree venue shall conclusively be deemed to lie in Orange County, California in the event of any arbitration or litigation. This is a material provision without which Company would not have executed this Severance Agreement. 7.10. PHOTOCOPIES AND COUNTERPARTS. This Severance Agreement may be executed in counterparts, each of which shall be deemed an original and together shall constitute one complete instrument. Photocopies and facsimiles of such signed counterparts may be used in lieu of the originals for any purpose. 7.11. AUTHORITY. Any person or entity purporting to have the authority to enter into this Severance Agreement on behalf of or for the benefit of any other person or entity hereby warrants that it has such authority. 7.12. INTERPRETATION OF SEVERANCE AGREEMENT. In determining the meaning of, or resolving any ambiguity with respect to, any word, phrase or provision of this Severance Agreement, this Severance Agreement shall be construed with the understanding both Parties were responsible for, and participated in, its preparation. Section 1654 of the Civil Code shall not apply. 7.13. DISCLAIMER. Employee understands the Law Firm of James W. Lundquist, Inc., is the attorney for Company ONLY. Employee represents he has not executed this Severance Agreement in reliance on or with the belief that any employee or person associated or believed to be associated with the Law Firm of James W. Lundquist, Inc., is acting (whether as an attorney or otherwise) on Employee's behalf in executing this document. 9.14. SEPARATE COUNSEL ENCOURAGED. Employee represents he is an experienced attorney and active member of the California State Bar. Employee also acknowledges he has been advised to review this Severance Agreement with his own attorney before executing this Severance Agreement. Page 8 of 10 SIGNATURES FOLLOW ON PAGE 10 Page 9 of 10 EACH OF THE UNDERSIGNED PARTIES HAS CAREFULLY READ, UNDERSTANDS AND AGREES TO EVERY PROVISION CONTAINED IN THIS SEVERANCE AGREEMENT. Integrated Healthcare Holdings, Inc., A Nevada Corporation, as "Company" By: /s/ Bruce Mogel Executed on December 31, 2007 ---------------------------------------- Bruce Mogel, CEO By: /s/ Larry B. Anderson Executed on December 31, 2007 ---------------------------------------- Larry B. Anderson, "Employee" Page 10 of 10 EX-99.2 3 ihh_8k-ex9902.txt EXHIBIT 99.2 CONSULTING AGREEMENT -------------------- This Consulting Agreement, between Larry B. Anderson ("Consultant") and Integrated Healthcare Holdings, Inc. ("Client"), collectively, "Parties," shall be enforceable only when and if (i) the Consulting Agreement, and (ii) a certain "SEVERANCE AGREEMENT WITH MUTUAL RELEASES" both are fully executed ("Effective Date"). ARTICLE 1. TERM OF CONTRACT --------------------------- Section 1.01. TERM. Consultant shall provide consulting services to and for the benefit of Client ("Consulting Services"), as more particularly described below and subject to the terms of this Consulting Agreement, starting on January 1, 2008 ("Commencement Date") and ending at midnight, June 30, 2008 ("Consulting Termination Date") ("the Term"). Section 1.02. TERMINATION OF EMPLOYMENT; COMMENCEMENT DATE. 1.02.01. Consultant presently is employed, pursuant to a certain "EMPLOYMENT AGREEMENT," dated February 22, 2005 (and all enforceable amendments, if any, thereto) ("collectively, Employment Agreement") as Client's President ("Present Employment"). Consultant's Present Employment shall terminate ("Termination") at midnight, December 31, 2007 ("Employee Termination Date"). The Term shall commence immediately after the Employee Termination Date, so there shall be no interruption in Consultant's service to Client. 1.02.02 The Employment Agreement and all other agreements (excluding the concurrently executed "Severance Agreement," referenced in Section 2.01, below), if any, shall automatically terminate, without further notice or agreement, concurrently with the Termination and, further, shall be superseded by this Consulting Agreement. ARTICLE 2. EFFECT OF SEVERANCE AGREEMENT ---------------------------------------- Section 2.01. SEVERANCE AGREEMENT, EXECUTION. Consultant has been presented with a certain "SEVERANCE AGREEMENT WITH MUTUAL RELEASES" ("Severance Agreement") which relates to the termination of Consultant's Present Employment as Client's President. Execution and enforceability of the Severance Agreement is a condition precedent to the validity and enforcement of this Consulting Agreement. Therefore, this Consulting Agreement shall not become effective or enforceable until and unless the Severance Agreement is concurrently executed with the execution of this Consulting Agreement. Section 2.02. SEVERANCE AGREEMENT, CANCELLATION RIGHT. Consultant has the right to cancel the Severance Agreement with the mutual releases contained -1- therein ("Cancellation Right"), within a seven (7) day period following its execution, as more particularly provided therein. This Consulting Agreement shall be enforceable during this seven (7) day period. However, this Consulting Agreement shall terminate, automatically and without necessity of notice, if Consultant timely exercises his Cancellation Right under the Severance Agreement. As a result of any such termination of the Consulting Agreement, Consultant's obligation to provide services to, and Client's obligation to compensate Consultant under any provision of this Consulting Agreement, shall immediately terminate. ARTICLE 3. CONSULTING SERVICES ------------------------------ Section 3.01. CONSULTING SERVICES, DESCRIBED. 3.01.01. Consultant shall transition all work previously performed as President, in the manner and at the time designated by Client's "CEO." Consultant shall give his "best effort" to transition all such work, as smoothly as possible and minimize any disruption to the operation of the Client and to perform whatever services are required of him by the CEO during the term of this Consulting Agreement. 3.01.02. Consultant shall provide ongoing services in the merger and acquisition, public and government relations areas for the Client, as assigned by the CEO of Client. Consultant specifically shall search out new opportunities for growth of Client and shall present such opportunities to Client, as they appear, and, thereafter, shall work diligently to close any such transaction approved by Client. 3.01.03. Consultant shall not represent Client, as an agent, to negotiate directly with third parties on behalf of Client without Client's prior written approval. 3.01.04. Consultant's services shall not include supervising, overseeing, or being reported to by Client's employees in the normal course of business. Consultant's services are limited to those services specifically enumerated herein. 3.01.05. Consultant shall not provide services, consulting or otherwise, to any healthcare or healthcare related operation, business or entity ("Healthcare Operations"), located in or doing business in Orange County, during the Term of this Consulting Agreement without the Company's prior written consent. "[Healthcare Operations" means any hospital, medical office building, ambulatory surgery center, medical professional or similar medical or healthcare related natural or legal person. 3.01.06. Client understands Consultant may provide services and opportunities to other natural and legal persons ("Third Parties"), during the Term of this Consulting Agreement, except as otherwise precluded by this Consulting Agreement, including (without limitation) subsection 3.01.05, above, without Company's prior written consent. Consultant shall not allow any such services to any Third Parties to interfere with his obligations to provide Consulting Services Client, to Client, especially -2- as such services relate to pending Special Projects (including, most particularly, the acquisition of Anaheim Memorial Medical Center). 3.01.07. Consultant does not guarantee his Consulting Services will provide any certain or favorable outcome to Client. Section 3.02. CONSULTING SERVICES, CONTROL OVER. Consultant shall provide required Consulting Services at such time and place as Consultant shall determine. Consultant shall report and provide the services directly to Client's CEO or another Executive Officer, as designated by the CEO. Consultant shall determine the method, details, and means of performing the Consulting Services. Client shall not control the manner in, or determine the method by, which Consultant shall render Consulting Services except and unless otherwise provided herein. Section 3.03. CLIENT SUPPORT; ACCESS. Client shall provide reasonable office and office support services to Consultant on an as-needed basis, incidental to the provision of services under this Consulting Agreement. Consultant shall have access to Client's files and business records, during customary business hours in its corporate and regional offices, as is necessary or incidental to the provision of his Consulting Services. Section 3.04. SPECIAL PROJECTS, SCOPE OF SERVICES. 3.04.01. Consultant understands that purchase/merger/ acquisition projects ("Special Projects"), such as the acquisition of Anaheim Memorial Medical Center ("AMMC"), are time sensitive and time intensive. Therefore, Consultant shall be available to Client as reasonably required to complete such Special Projects, during the Term of this Consulting Agreement. 3.04.02. Notwithstanding Consultant's relationships with Third Parties and during the Term of this Consulting Agreement, Consultant first shall give written notice to Client , to the exclusion of all Third Parties, of any opportunity to purchase or otherwise acquire any healthcare, or healthcare related, asset ("Opportunity") identified by or known to Consultant. "[Healthcare or healthcare related asset" ("Healthcare Asset") means a hospital, medical office building, ambulatory surgery center, or any other similar asset. Section 3.05. CONSENT TO PARTICIPATE IN BID FOR AND ACQUISITION OF BROTHMAN HOSPITAL. 3.05.01 Notwithstanding Consultant's execution of this Consulting Agreement and the Severance Agreement, Consultant's has the ongoing duties and obligations as Client's President Client until midnight of December 31, 2007. Notwithstanding his ongoing employment, during such time, Client consents to, and waives all objections to, Consultant's participation in the negotiations for, bid for and acquisition of Brotman Hospital, in Culver City, California, subject to subsection -3- 3.05.02, below. 3.05.02. Client's consent is subject to, and shall immediately be effective upon, Consultant's execution of this Consulting Agreement and the Severance Agreement notwithstanding Consultant's ongoing duties and obligations as Client's President, provided Consultant's duties and obligations as President are not otherwise significantly and adversely affected. ARTICLE 4. COMPENSATION; PAYMENTS --------------------------------- Section 4.01. BASIC COMPENSATION. Client shall pay Consultant One Hundred Eighty Thousand Dollars ($180,000.00), as follows: 4.01.01. One (1) payment of $60,000, payable within one (1) business day after Employee's right to revoke his acceptance of, and terminate, the concurrently executed Severance Agreement has expired (REF Section 3.01 ET SEQ, of the Severance Agreement) and payable concurrently with the lump sum payment under subsection 2.01.02 of the Severance Agreement; and 4.01.02. Four (4) equal monthly payments of $30,000 each, commencing April 1, 2008. Each of the remaining four (4) payments shall be due on the first business day of each succeeding month, with the last payment being due on July 1, 2008. Section 4.02. ADDITIONAL COMPENSATION FOR CONSUMMATED SPECIAL PROJECTS. Client shall cause additional compensation to be paid to Consultant, as more particularly described below, if Consultant (irrespective of the capacity in which Consultant acts) provides an Opportunity and/or services, to and for the benefit of Client, in connection with (i) a purchase, merger or acquisition (collectively and separately referred to as "Acquisition") of a Healthcare Asset and, thereafter, (ii) Client completes Acquisition. 4.02.01. If Client completes the purchase of AMMC, Client shall cause Consultant to be paid one half of one percent (0.5%) of the total value of the purchase, minus $30,000. "[T]otal value" means the total gross purchase price, as agreed upon between the parties, without reduction for any offsets, such as accrued liabilities, prepaid expenses, inventory credits, etc. The decision to complete the purchase of AMMC shall be in the sole and absolute discretion of Client. Consultant have no right to a fee unless and until Client successfully closes the AMMC transaction. 4.02.02. Any compensation earned by Consultant, under this Section 4.02, shall be due and payable upon completion of the Acquisition, but no later than any "close of escrow." Section 4.03. EXPENSES, REIMBURSEMENT. Client shall reimburse Consultant, for costs incurred and paid by Consultant for customary and reasonable out-of-pocket -4- expenses, arising from or related to his Consulting Services (e.g., necessary travel and lodging, transportation, overnight/special delivery, special printing or handling of documents and other reasonable expenses), within 30 days after receipt of appropriate documentation. incidental to the performance of services for Client. Reimbursable expense shall not exceed a total of Five Thousand Dollars ($5,000) without Client's prior written consent. Section 4.04. INDEPENDENT CONTRACTOR; TAXES. 4.04.01. It is the express intention of the parties that Consultant is an independent contractor and not an employee, agent, joint venturer or partner of Client. Nothing in this Consulting Agreement shall be interpreted or construed as creating or establishing the relationship of employer and employee between Client and Consultant or any employee or agent of Consultant. Client is aware that Consultant shall retain the right to perform services for others during the term of this Consulting Agreement. 4.04.02. Both parties acknowledge that Consultant is not an employee for state or federal tax purposes. Consultant shall be responsible for all taxes, relating to or arising from Client's payment of compensation to Consultant. ARTICLE 5. OBLIGATIONS OF CONSULTANT ------------------------------------ Section 5.01. ASSIGNMENT, DELEGATION; RESTRICTIONS. 5.01.01. Neither this Consulting Agreement, nor any rights, duties or obligations under this Consulting Agreement, shall be delegated or assigned by either Client or Consultant to any third party without the prior written consent of both parties. Client's assignment of this Consulting Agreement to a legal person in which Client has a controlling interest shall not be deemed a prohibited assignment under this section 10. 5.01.02. Consultant shall have the right, in Consultant's sole discretion and except as provided in this subsection, to elect to treat a prohibited assignment by Client as a termination of his employment "without cause" by Client as provided for in Section 7.3. Consultant shall be deemed to have conclusively waived such right, however, if (i) Consultant does not give ten (10) days written notice to Client of his intent to declare a termination of his employment, and (ii) Consultant's ten (10) days notice to Client is not sent within thirty (30) days from Consultant's receipt of written notification by the Client that the Consulting Agreement has been assigned to a third party. Consultant shall not have the right to terminate his employment, under this subsection, if Client successfully revokes or is able to rescind the assignment within the ten (10) days following receipt of Consultant's written notice of his intent to terminate his employment. 5.01.03. Client shall have the right, in Client's sole discretion and except as provided in this subsection, to elect to treat a prohibited assignment by Consultant as a termination of Consultant's employment "without cause" by Consultant as provided for in -5- Section 7.4. Client shall be deemed to have conclusively waived such right, however, if (i) Client does not give ten (10) days written notice to Consultant of Client's intent to declare a termination of Consultant's employment, and (ii) Client's's ten (10) days notice to Consultant is not sent within thirty (30) days from Client's receipt of written notification by Consultant that the Consulting Agreement has been assigned to a third party. Client shall not have the right to terminate his employment, under this subsection, if Consultant successfully revokes or is able to rescind the assignment within the ten (10) days following receipt of Client's written notice of Client's intent to terminate Consultant's employment. 5.01.04. Consultant may use the services of qualified subcontractors to assist in his performance of his obligations under this Consulting Agreement, under Consultants' supervision, as necessary in the performance of duties under this Consulting Agreement, subject to Client's prior written approval and the terms of this Consulting Agreement. Client shall not be obligated to pay for any services rendered by any such subcontractors unless Client's CEO specifically has otherwise agreed, in writing. Section 5.02. NONDISCLOSURE OF CONFIDENTIAL INFORMATION. 5.02.01. During and after the Term of this Consulting Agreement, Consultant shall not (i) voluntarily, directly or indirectly communicate, in any manner to any legal or natural person (except as required by applicable law or in connection with the performance of his duties and responsibilities as a former employee of, and Consultant to, Client); (ii) use or otherwise appropriate for Consultant's own or any third party's benefit any Confidential Information. Confidential Information shall include (without limitation) information made available to, obtained by or developed by Consultant during the course of his employment relating or pertaining to the Client's trade secrets, financial information, technical information and /or business plans and strategies. Consultant shall use his best efforts, and cooperate with the Client, to maintain the secrecy of and limit the use of such Confidential Information. 5.02.02. All documents, memoranda, reports, notebooks, correspondence, files, lists and other records, and the like, designs, drawings, specifications, computer software and computer equipment, computer printouts, computer disks, and all photocopies or other reproductions thereof, affecting or relating to the Business of the Client, which Consultant shall prepare, use, construct, observe, possess or control ("Client Materials"), shall be and remain the sole property of the Client. Consultant shall deliver promptly to the Client all such Client Materials and other Client Property (e.g. tangible property, credit cards, entry cards, pagers, identification badges, cellular phones, and keys) upon termination of his employment. Section 5.03. FUTURE COOPERATION. 5.03.01 Consultant agrees to cooperate, during and after the Term of this Consulting Agreement, with the Client and use his best efforts to respond to all -6- reasonable requests by the Client for assistance and advice relating to matters and procedures in which Consultant was involved or which Consultant managed or was responsible for while employed by the Client, as its President, and while a Consultant under this Consulting Agreement. 5.03.02 Consultant also represents and agrees to cooperate in the Client's defense or prosecution of any claim or other action which arises, whether civil, criminal, administrative or investigative, in which Consultant's participation is required in the best judgment of the Client by reason of his former employment with the Client. Upon the Client's request, Consultant will use his best efforts to attend hearings and trials, to assist in effectuating settlements, and to assist in the procuring of witnesses, producing evidence, and in the defense or prosecution of said claims or other actions. ARTICLE 6. OBLIGATIONS OF CLIENT. --------------------------------- Section 6.01. COOPERATION OF CLIENT. Client shall comply with all reasonable requests of Consultant necessary to the performance of Consultant's duties under this Consulting Agreement. ARTICLE 7. TERMINATION. ----------------------- Section 7.01. TERMINATION BY CLIENT "FOR CAUSE". Client, at its option, may terminate Consultant's services "for cause" by giving written notification to Consultant. "[F]or cause" means For purposes of this Section 7.01, "for cause" shall mean (i) Consultant's commission of a felony; (ii) Consultant's commission of a crime or other illegal act involving moral turpitude; (iii) any willful and dishonest act committed by Consultant; (iv) Consultant's material breach of his duties or obligations under this Consulting Agreement; (v) Consultant's death or disability. A "material breach" of this Consulting Agreement includes, without limitation, an unreasonable refusal to perform properly requested services or failure to timely provide services. Client's sole obligation shall be to pay Consultant only for the services rendered up to the day of Consultant's termination, i.e., Consultant's receipt of notice of termination "for cause." Section 7.02. TERMINATION BY CONSULTANT "FOR CAUSE". 7.02.01. Consultant, at his option, may terminate his obligation to provide services under this Consulting Agreement, "for cause," by giving written notification to Client. For purposes of this Section 7.02, "for cause" shall mean any material breach of this Consulting Agreement. A "material breach" of this Consulting Agreement includes, without limitation, Client's failure to pay Consultant all or any part of the compensation, when due and payable under Article 4 of this Consulting Agreement if payment is not received by Consultant within thirty (30) days after Consultant gives Client written notice of the delinquency. 7.02.02. If Consultant justifiably terminates his obligation to provide services under this Consulting Agreement "for cause" under this Section 7.02, Client shall make a lump sum payment to Consultant in an amount equivalent to the total sum which -7- otherwise would have been for the remainder of the term of the Consulting Agreement ("Termination Payment"). "[R]emainder of the term" means the amount of time remaining from the date on which the payment is due (subsection 7.02.03, below) to the end of the Term. 7.02.03. Client's obligations under this Section 7.02 are conditioned on, and shall not commence until ten (10) business days after, Consultant's delivery of a written notice of termination "for cause" and the reason(s) therefore ("Payment Date"). Client also shall pay and deliver to Consultant all compensation, accrued up to the Payment Date. Section 7.03. TERMINATION BY CLIENT "WITHOUT CAUSE". 7.03.01. Notwithstanding any other provision in this Consulting Agreement, Client may terminate Consultant's services without cause by giving written notice to Consultant. 7.03.02. If Client terminates Consultant's obligation to provide services under this Consulting Agreement "without cause" under this Section 7.03, Client shall pay the Termination Payment, and all compensation accrued up to the Payment Date, to Consultant concurrently with Client's delivery of notice of termination "without cause." Section 7.05 NON-DISPARAGEMENT. Consultant agrees that he will not make derogatory nor disparaging statements about Client or any of its other affiliate companies and their employees, officers and directors (collectively, "Client"), during or after the Term of this Consulting Agreement. Consultant also shall not induce or incite claims of discrimination, wrongful discharge, sexual or other forms of harassment, breach of contract, tortious acts, or any other claims of any type whatsoever against Client by any other person or employee, relating to such individual's employment or business dealings with Client. during or after the Term of this Consulting Agreement. ARTICLE 9. GENERAL PROVISIONS ----------------------------- Section 9.01. NOTICES. Any notices required or permitted to be sent under this Consulting Agreement may be personally delivered, sent by overnight mail or overnight delivery service (e.g. Federal Express) or mailed by registered or certified mail, return receipt requested. Receipt of any notice shall be conclusively be deemed complete, according to the following: (i) personal delivery shall be deemed received the same day; (ii) overnight mail or overnight delivery service shall be deemed complete the next day, Sundays and holidays excepted; (iii) certified or registered mail shall be deemed complete upon recipient's execution of the receipt. Notices shall be sent to the following addresses until and unless changed by a Parties written notice to the other Party: IF TO CLIENT: Scott Schoeffel, General Counsel Integrated Healthcare Holdings, Inc 1301 North Tustin Ave. Santa Ana, CA 92705 -8- IF TO CONSULTANT: Larry Anderson 28 Pegasus Dr. Coto De Caza, CA. 92679 Section 9.02. ENTIRE AGREEMENT OF THE PARTIES. This Consulting Agreement is the full and complete agreement and, with the concurrently executed Severance Agreement, contain the entire and complete understanding of all agreements between Client and Consultant. There are no other agreements of any kind. This Consulting Agreement supersedes all prior agreements, including the prior EMPLOYMENT AGREEMENT between the Parties, dated February 22, 2005 and all amendments (if any) thereto. This Consulting Agreement can only be modified by a writing signed by both Parties. Section 9.03. ATTORNEYS' FEES. In the event of a dispute arising from or relating to this Consulting Agreement, each party shall pay their own legal fees and costs. Section 9.04. SEVERABLE PROVISIONS. The provisions of this Consulting Agreement are severable. If any provision shall be determined to be unenforceable, in whole or in part, the remaining provisions shall nevertheless be binding and enforceable. Section 9.05 ARBITRATION. 9.05.01. Any controversy between Client and Consultant involving the construction or application of any of the terms, provisions or conditions of this Consulting Agreement shall be submitted to binding arbitration if one Party sends a written demand for binding arbitration to the other Party . Client and Consultant shall both be deemed to have waived the right to litigate the claim in any federal or state court if either party tenders a written request for arbitration of any such claim(s). 9.05.02. Prior to commencement of, and as a condition of, any arbitration, however, the Parties agree to first attempt to resolve any dispute before a neutral mediator in a non-binding mediation. The mediation shall take place within thirty (30) days of written notice by either party of any such dispute. The mediator shall be a California licensed attorney with at least fifteen years experience in and an emphasis in California and Federal Employment Law, or a retired or former judge of the Superior Court of the State of California or of the Court of Appeals of the State of California ("Mediator"). The Mediator shall be selected by the same process used for the selection of an Arbitrator, as described in subsection 11.4, below. The parties agree that mediation shall not exceed one (1) day in duration. 9.05.03. Arbitration shall comply with and be governed by the provisions of the California Arbitration Act, unless otherwise precluded by California or Federal law. The Federal Arbitration Act shall apply only if enforcement of a particular provision of the California Arbitration Act would undermine the goals and policies of the Federal Arbitration Act. -9- 9.05.04. Any demand to arbitrate shall be deemed to have been made on the date actually received by the party upon whom it is served and, for purposes of the statute of limitations, shall have the same effect as if suit had been filed on the date the demand is made. Any demand to arbitrate any claim arising from or in connection with this Consulting Agreement must be received within six (6) months after the claim first arose, notwithstanding any other statute of limitations providing for a longer period of time, unless otherwise forbidden in law. 9.05.02. The arbitration shall occur in Orange County, California, before a neutral, single retired or former judge of the Superior Court of the State of California or of the Court of Appeals of the State of California ("Arbitrator"). The parties shall agree upon an Arbitrator within ten (10) days after the demand is made. If the parties cannot agree on an arbitrator, then any of them may apply to the Orange County Superior Court for an Order appointing an Arbitrator who meets the requirements of this subsection 13.3. 9.05.02. The Arbitrator shall have exclusive jurisdiction over all legal and equitable claims, issues and remedies, so all types of relief available in a judicial proceeding shall be available to the Parties in the Arbitration. The Parties may use the Orange County Superior Court or, only if required, the Federal Court in Orange County to enforce the Arbitrators rulings and awards. Discovery, including depositions for the purpose of discovery, shall be broadly permitted, and the provisions of the California Code of Civil Procedure ss. 1283.05 shall apply. 9.06. CAPTIONS. The captions of the paragraphs of this Consulting Agreement are solely for the convenience of the undersigned, are not a part of this Consulting Agreement, and shall not be used for the interpretation of any provision of this Consulting Agreement. 9.07. CONTINUING OBLIGATIONS. The rights and obligations of Consultant and Client set forth in this Section on Arbitration shall survive the expiration of the Term of this Consulting Agreement, except to the extent any the survival of certain terms would be inconsistent with the expiration of the Term. 9.08. NON-WAIVER. The failure of either party to insist on strict compliance with any of the terms and conditions of this Consulting Agreement by the other party shall not be deemed a waiver of that term or condition. The waiver or relinquishment of any right or power at any one time or times be deemed a waiver or relinquishment of that right or power for all or any other times. 9.09. APPLICABLE LAW; VENUE. This Consulting Agreement is entered into and is to be performed in Orange County, California. The Consulting Agreement shall be governed by the laws of the State of California. Notwithstanding Consultant's out of state residence, the Parties agree venue shall conclusively be deemed to lie in Orange County, California in the event of any arbitration or litigation. This is a material provision without which Client would not have executed this Consulting Agreement. -10- 9.10. PHOTOCOPIES AND COUNTERPARTS. This Consulting Agreement may be executed in counterparts, each of which shall be deemed an original and together shall constitute one complete instrument. Photocopies and facsimiles of such signed counterparts may be used in lieu of the originals for any purpose. 9.11. AUTHORITY. Any person or entity purporting to have the authority to enter into this Consulting Agreement on behalf of or for the benefit of any other person or entity hereby warrants that it has such authority. 9.12. INTERPRETATION OF CONSULTING AGREEMENT. In determining the meaning of, or resolving any ambiguity with respect to, any word, phrase or provision of this Consulting Agreement, this Consulting Agreement shall be construed with the understanding both Parties were responsible for, and participated in, its preparation. Section 1654 of the Civil Code shall not apply. 9.13. DISCLAIMER. Consultant understands the Law Firm of James W. Lundquist, Inc., is the attorney for Client ONLY. Consultant represents he has not executed this Consulting Agreement in reliance on or with the belief that any employee or person associated or believed to be associated with the Law Firm of James W. Lundquist, Inc., is acting (whether as an attorney or otherwise) on Consultant's behalf in executing this document. 9.14. SEPARATE COUNSEL ENCOURAGED. Consultant represents he is an experienced attorney and active member of the California State Bar. Consultant also acknowledges he has been advised to review this Consulting Agreement with his own attorney before executing this Consulting Agreement. EACH OF THE UNDERSIGNED PARTIES HAS CAREFULLY READ, UNDERSTANDS AND AGREES TO EVERY PROVISION CONTAINED IN THIS CONSULTING AGREEMENT. Integrated Healthcare Holdings, Inc., A Nevada Corporation, as "Client" By: /s/ Bruce Mogel Executed on December 31, 2007 ---------------------------------------- Bruce Mogel, CEO By: /s/ Larry B. Anderson Executed on December 31, 2007 ---------------------------------------- Larry B. Anderson, "Employee" -11- -----END PRIVACY-ENHANCED MESSAGE-----