EXHIBIT 10.1
AMENDMENT NO. 1 TO TRANSACTION DOCUMENTS
FTS Group, Inc., a Nevada corporation (hereinafter called the "Buyer"), and
Metro One Development, Inc., formerly On The Go Healthcare, Inc.,
(hereinafter called the "Seller") or their registered assigns or successors
in interest agree to amend the following documents, dated as of
March 18, 2008, between FTS Group, Inc. and OTG Technologies Group, Inc.,
a wholly-owned subsidiary of FTS Group, Inc., on the one side, and On The
Go HealthCare, Inc., DBA On The Go Technologies Group on the other side:
* Binding Agreement (the "Agreement");
* Exhibit A of the Agreement, comprising the list of acquired assets
(the "Assets");
* Exhibit B of the Agreement, comprising the list of vendor and other debt
acquired by the Buyer (the "Debt List");
* Exhibit C of the Agreement, comprising the list of the acquired contracts
(the "Contracts");
* Exhibit D of the Agreement, comprising the Confidentiality and Non-Compete
Agreement (the "Non-Compete"); and
* Exhibit E of the Agreement, comprising the Promissory Note (the "Promissory
Note");
(each a "Transaction Document" and together the "Transaction Documents"),
dated as of June 6, 2008 (this "Amendment");
WHEREAS, in connection with the Agreement, the Buyer issued to the Seller a
Promissory Note in the principal amount of $1,100,000; and
WHEREAS, in connection with the Agreement, the Buyer acquired from the Seller
debt in the amount of $2,861,863.71; and
WHEREAS, in connection with the Agreement, the Buyer entered into agreements
with the Seller known as Exhibits A, C and D that remain unchanged and are
hereby incorporated into this Amendment; and
WHEREAS, the parties desire to amend the terms of the Agreement, Exhibit B and
the Promissory Note as set forth in this Amendment, effective May 22, 2008.
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Amendment, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the parties agree as follows:
ARTICLE I
AMENDMENT OF TRANSACTION DOCUMENTS
1.1 The terms of the Promissory Note shall be amended and restated as follows:
the principal value of the Promissory Note is reduced from $1,100,000
to $650,000. Any payments due to Seller on the Promissory Note between
March 18, 2008 and May 22, 2008 are no longer due to Seller and are
hereby cancelled. No breach of the Note shall have occurred as a result
of failure to make payments between March 18, 2008 and May 22, 2008.
Any and all payments due under the Note will be directed to Laurus Master
Fund ("Laurus") or such other entity as directed by Xxxxxx so long as
payments are credited against amounts owed by Seller to Laurus relating
to the Seller's accounts receivable line (the "Laurus Line"). The Seller
agrees to assign outstanding receivables related to the Laurus Line in the
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amount of approximately $119,000 to the Buyer for purposes of paying the
Laurus Line. Once the amount of $650,000 has been paid by the Buyer to
Laurus and up to $119,000 has been directed by the Seller to Laurus, if
there are excess funds not necessary to pay the Laurus Line and Xxxxxx
has signed an acknowledgement of payment and release of all liens, excess
funds will be directed back to Seller. The Laurus Line shall be repaid
in full by July 14, 2008 and both Buyer and Seller agree to use
commercially reasonable best efforts to repay the Laurus Line before
such date. If the Laurus Line is not repaid up to $650,000 by the Buyer
by July 14, 2008 , unless extended by Laurus (or its designee), then the
default provisions in the Note shall apply. However, in no event shall
such extension be longer than ninety days. Additionally, Seller will not
be able to pursue any default by Buyer pursuant to the Note if Seller
has not paid up to $119,000 but in no event less than the amount necessary
to repay the Laurus Line after deducting the Buyer's payments to Xxxxxx
as described in this Section 1.1.
1.2 The Seller agrees take reasonable steps to cause Xxxxxx to add Xxxxx
Xxxxxxxxx to the "Lock Box" bank account associated with the Laurus Line
and to remove all other parties except Laurus representatives from the
account.
1.3 Both parties agree that all funds generated by the Buyer that have been
deposited into Seller's accounts through the date of this Amendment
Number 1 will be applied to the Assumed Debt further described in
Schedule B..
1.4 Buyer will rent space and equipment from the Seller for a period of 90 days
at an aggregate rate of $10,000 per month. Seller's employees and
representatives will not interfere with Xxxxx's acquired business and
Xxxxx's employees and representatives will not interfere with Seller's
business. If the Buyer takes longer to relocate the business it must give
the Seller 30 days notice in writing. The Seller agrees to provide up to
two extensions of one month each under essentially the same terms as
currently in place. Any additional delays will be worked out by the
parties.
1.5 Purchase Price. On the date hereof, the parties believe, based on
information available, the total deal value is described in detail
below in US dollars:
Deal Value $3,511,864
Assumed Debt as set forth on Exhibit B $2,861,864
Assumed Laurus Line $650,000
1.6 Once the entire debt is paid to Xxxxxx, the Buyer will concede to a
judgment against its parent company FTS Group, Inc. if any suit is brought
against the Seller for any of the debt included in Exhibit B hereto assumed
by the Buyer that has not been paid. Additionally, Xxxxx represents that
FTS Group will defend any action brought against the Seller for any of
those Accounts Payable.
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ARTICLE II
MISCELLANEOUS
2.1 Entire Agreement; Amendments. This Amendment contains the entire
understanding of the parties with respect to the
subject matter hereof and supersedes all prior
agreements and understandings, oral or written, with
respect to such matters, which the parties acknowledge
have been merged into such documents, exhibits and
schedules.
2.2 Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Amendment shall
be governed by and construed and enforced in
accordance with the internal laws of the State of
Florida, without regard to the principles of conflicts
of law thereof. Each party hereby irrevocably submits
to the exclusive jurisdiction of the state and federal
courts sitting in Orlando, Florida for the
adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby
or discussed herein, and hereby irrevocably waives,
and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally
subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper. Each
party hereby irrevocably waives personal service of
process and consents to process being served in any
such suit, action or proceeding by mailing a copy
thereof via registered or certified mail or overnight
delivery (with evidence of delivery). Nothing
contained herein shall be deemed to limit in any way
any right to serve process in any manner permitted by
law. Each party irrevocably waives, to the fullest
extent permitted by applicable law, any and all right
to trial by jury in any legal proceeding arising out
of or relating to this Amendment or the transactions
contemplated hereby. If either party shall commence
an action or proceeding to enforce any provisions of
the Transaction Documents contemplated herein, then
the prevailing party in such action or proceeding
shall be reimbursed by the other party for its
reasonable attorneys' fees and other costs and
expenses incurred with the investigation, preparation
and prosecution of such action or proceeding.
2.4 Survival. The representations, warranties, agreements and
covenants contained herein shall survive the Closing.
2.5 Execution. This Amendment may be executed in two or more
counterparts, all of which when taken together shall
be considered one and the same agreement and shall
become effective when counterparts have been signed
by each party and delivered to the other party, it
being understood that both parties need not sign the
same counterpart. In the event that any signature is
delivered by facsimile transmission, such signature
shall create a valid and binding obligation of the
party executing (or on whose behalf such signature is
executed) the same with the same force and effect as
if such facsimile signature page were an original
thereof.
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2.6 No Waiver. The waiver by any party of the breach of any of the
terms and conditions of, or any right under, this
Amendment shall not be deemed to constitute the
waiver of any other breach of the same or any other
term or condition or of any similar right. No such
waiver shall be binding or effective unless expressed
in writing and signed by the party giving such waiver.
2.7 Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an
original and all of which together shall constitute
one and the same instrument.
2.8 Construction. The article and section headings contained in this
Amendment are inserted for reference purposes only and
shall not affect the meaning or interpretation of this
Amendment.
2.10 Further Assurances. Each party will execute and deliver such further
agreements, documents and instruments and take such
further action as may be reasonably requested by the
other party to carry out the provisions and purposes
of this Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to
Transaction Documents to be duly executed by their respective authorized
signatories as of the date first indicated above.
Buyer: FTS Group, Inc.
/s/ Xxxxx Xxxxxxxxx
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By: Xxxxx Xxxxxxxxx
Its: President and Chief Executive Officer
Seller: Metro One Development, Inc,
/s/ Xxxxxx Xxxx
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By: Xxxxxx Xxxx
Its: President and Chief Executive Officer
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Exhibit B
Debt List
1. There is approximately $2,861,863.71 outstanding vendor debt as listed
on the accounts payable which include all invoices that are dated prior
to March 17, 2008. This amount shall be reduced by a payment in the
amount of $157,396.49. As of May 7, 2008, vendor debt is approximately
$2,704,467.
2. $650,000 outstanding debt on Laurus Line.
