1
EXHIBIT 10.6
SECOND AMENDMENT TO
ASSET PURCHASE AGREEMENT
THIS SECOND AMENDMENT TO ASSET PURCHASE AGREEMENT ("SECOND AMENDMENT")
is made as of February 19, 1997 by and among ROCKWELL MEDICAL SUPPLIES, LLC, a
Michigan limited liability company d/b/a Rockwell Medical Supply (the "SUPPLY
COMPANY"), ROCKWELL TRANSPORTATION, LLC, a Michigan limited liability company
(the "TRANSPORTATION COMPANY" and, together with the Supply Company, the
"SELLERS"), T.K. INVESTMENT COMPANY, a Michigan partnership, which is owned
equally by the family partnerships, CHILAKAPTI FAMILY LIMITED PARTNERSHIP,
XXXXXXXXXX FAMILY LIMITED PARTNERSHIP (the "FAMILY PARTNERSHIPS"), the
respective general partners of which are XXXXX XXXXX CHILAKAPTI, M.D. and
XXXXXXXXXXXXX XXXXXXXXXX, M.D. and XXXXXX X. XXXXXXX, (T.K. INVESTMENT COMPANY,
THE FAMILY PARTNERSHIPS, XXXXX XXXXX CHILAKAPTI, M.D., XXXXXXXXXXXXX XXXXXXXXXX,
M.D. and XXXXXX X. XXXXXXX are hereinafter referred to individually as a
"MEMBER" and jointly and severally as the "MEMBERS"), and ACQUISITION PARTNERS,
INC., a Michigan corporation ("BUYER").
RECITALS
A. On November 1, 1996, the Sellers, the Members and Buyer entered
into an Asset Purchase Agreement, which the parties thereto amended on January
31, 1997 pursuant to the First Amendment to Asset Purchase Agreement (as
amended, the "PURCHASE AGREEMENT"), pursuant to which Buyer agreed to purchase
and the Sellers agreed to sell substantially all of the Sellers' assets upon the
terms and conditions set forth in the Purchase Agreement.
B. The parties to the Purchase Agreement believe it is in their
respective best interests and desire to further amend the terms and conditions
of the Purchase Agreement as set forth in this First Amendment.
THEREFORE, the parties agree as follows:
1. Amendment to Section 1.2.2(c).
(a) Section 1.2.2(c) of the Purchase Agreement is hereby amended by
the deletion of Section 1.2.2(c) in its entirety and by the replacement of
Section 1.2.2(c) with the following:
"(c) Buyer will pay the remainder of the Purchase Price by
delivery to the Supply Company of a 8.5% promissory note (the "NOTE")
having a principal face amount equal to the Remaining Balance (as
defined below) and providing for repayment of $500,000 on or before
May 19, 1997 which payment will include all accrued interest to the
payment date with any excess charged to principal and the remaining
principal balance plus all accrued interest on January 31, 1998 (the
"MATURITY DATE"), in the form
2
attached as Exhibit 1.2.2(c)I; provided, however, that the Note
shall be subject to prepayment in accordance with Section 6..2
below. The obligations of Buyer under the Note shall be secured
by a pledge of all of the shares of capital stock of Buyer (the
"PLEDGED STOCK") owned by Xxxx X. Xxxxx ("XX. XXXXX"), Xxxxxxx X.
Xxxxxxxxx ("XX. XXXXXXXXX") and Xxxxxx X. Xxxxxxx ("XX.
XXXXXXX"), pursuant to a share pledge and escrow agreement in the
form attached as Exhibit 1.2.2(c)II to this Agreement (the
"PLEDGE AGREEMENT"). For purposes of this Agreement, the
"REMAINING BALANCE" shall mean an amount calculated as follows:
the Payment Amount, less the Cash Amount and less the NBD
Amount."
(b) Exhibit 1.2.2(c)I of the Purchase Agreement is hereby
replaced with the Exhibit 1.2.2(c)I attached to this Second Amendment.
2. Amendment to Section 1.4. Section 1.4 of the Agreement is hereby
amended by the deletion of "February 4, 1997" in the third line of such Section
and the replacement of such deleted language with "February 19, 1997".
3. Amendment to Section 6.2. Section 6.2 of the Agreement is hereby
amended by the deletion of Section 6.2 in its entirety and by the replacement of
Section 6.2 with the following:
"6.2 Prepayment of the Note. Buyer will pay 50% of the net cash
proceeds (after deducting all fees and expenses incurred in
generating such cash proceeds) of all issuances of capital stock
of Buyer received by Buyer (the "SUBSCRIPTION PAYMENTS") during
the period from the Closing Date through the Maturity Date (the
"PREPAYMENT PERIOD"), to the extent that Buyer receives in excess
of $1,750,000 of Subscription Payments during the Prepayment
Period."
4. Amendment to Section 6.4. Section 6.4 of the Agreement is hereby
amended by the deletion of Section 6.4 in its entirety and by the replacement of
Section 6.4 with the following:
"6.4 Access to Books and Records. Beginning January 1, 1998 and
continuing through the Election Period (as defined in the Pledge
Agreement), the Supply Company and its representatives and
agents, at reasonable times and upon reasonable notice to Buyer
and at no cost to Buyer, shall have access to the books and
records of Buyer for the purpose of ascertaining Buyer's
financial condition."
-2-
3
5. The Purchase Agreement. The term "Agreement" as used in the Purchase
Agreement (as defined in Recital A above) shall hereafter mean the Purchase
Agreement as amended by this Second Amendment and shall continue in full force
and effect in accordance with the terms thereof and hereof. In the event of
any inconsistency or conflict between this Second Amendment and the Purchase
Agreement, the terms and provisions of this Second Amendment shall govern.
6. Governing Law and Forum. This Second Amendment shall be governed by the
laws of the State of Michigan (regardless of the laws that might otherwise
govern under applicable Michigan principles of conflicts of law) as to all
matters, including, but not limited to, matters of validity, construction,
effect, performance and remedies. Each of the parties consents to be subject
to personal jurisdiction of the courts of Michigan, including the federal
courts of Michigan, which shall be the sole and exclusive forum for the
resolution of all disputes under this Second Amendment.
7. Counterparts. This Second Amendment may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Second Amendment
may be executed by facsimile signatures.
-3-
4
IN WITNESS WHEREOF, the parties have executed this Second Amendment as of the
date set forth in the introductory paragraph of this Second Amendment.
BUYER: ROCKWELL MEDICAL TECHNOLOGIES, INC.
(f/k/a Acquisition Partners, Inc.)
By: /s/ Xxxx X. Xxxxx
------------------------------
Its: Chairman of the Board
-------------------------
THE SELLERS: ROCKWELL MEDICAL SUPPLIES, LLC
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
XXXXXX X. XXXXXXX, Member
By: T. K. INVESTMENT COMPANY, Member
By: CHILAKAPTI FAMILY LIMITED
PARTNERSHIP
By: /s/ Xxxxx Xxxxx Xxxxxxxxxxx
----------------------------
Its: General Partner
-----------------
By: XXXXXXXXXX FAMILY LIMITED
PARTNERSHIP
By: /s/ Xxxxxxxxxxxxx Xxxxxxxxxx
-----------------------------
Its: General Partner
--------------------
(Signatures continued on next page.)
-4-
5
(Signatures continued from previous page.)
ROCKWELL TRANSPORTATION, LLC
By: CHILAKAPTI FAMILY LIMITED
PARTNERSHIP, Member
By: /s/ Xxxxx Xxxxx Xxxxxxxxxxx
------------------------------
Its: General Partner
------------------------
By: XXXXXXXXXX FAMILY LIMITED
PARTNERSHIP, Member
By: /s/ Xxxxxxxxxxxxx Xxxxxxxxxx
------------------------------
Its: General Partner
------------------------
THE MEMBERS: /s/ Xxxxx Xxxxx Xxxxxxxxxxx
----------------------------------
XXXXX XXXXX CHILAKAPTI, M.D.
/s/ Xxxxxxxxxxxxx Xxxxxxxxxx
----------------------------------
XXXXXXXXXXXXX XXXXXXXXXX, M.D.
/s/ Xxxxxx X. Xxxxxxx
----------------------------------
XXXXXX X. XXXXXXX
T. K. INVESTMENT COMPANY
By: CHILAKAPTI FAMILY LIMITED
PARTNERSHIP, Member
By: /s/ Xxxxx Xxxxx Xxxxxxxxxxx
----------------------------
Its: General Partner
-----------------------
By: XXXXXXXXXX FAMILY LIMITED
PARTNERSHIP, Member
By: /s/ Xxxxxxxxxxxxx Xxxxxxxxxx
----------------------------
Its: General Partner
-----------------------
-5-
