Exhibit 10.1
AMENDMENT NO. 1
TO
ASSET PURCHASE AGREEMENT
This Amendment No. 1 (this "Amendment") to the Asset Purchase Agreement
(as defined below), dated November 17, 2009, is entered into by and among Ivivi
Technologies, Inc., (the "Company"), Ivivi Technologies, LLC (the "Buyer") and
Ajax Capital LLC ("Ajax"). Capitalized terms used and not defined herein shall
have the meanings assigned to them in the Asset Purchase Agreement.
WHEREAS, the Company, the Buyer and Ajax have entered into that certain
Asset Purchase Agreement, dated September 24, 2009 (the "Asset Purchase
Agreement"), pursuant to which, at the Closing, and subject to the terms and
conditions of the Asset Purchase Agreement, the Company agreed to sell to the
Buyer the Acquired Assets and the Buyer agreed to purchase from the Company the
Acquired Assets for an amount equal to the Purchase Price and the assumption of
the Assumed Liabilities;
WHEREAS, in light of the current financial condition of the Company, prior
to the Closing, the Company is seeking to borrow from the Buyer from time to
time certain advances, which shall be deemed advanced payments of the Purchase
Price payable to the Company at the Closing pursuant to the Asset Purchase
Agreement;
WHEREAS, the Company and the Buyer wish and agree to amend the Asset
Purchase Agreement as contemplated by the terms and subject to the conditions of
this Amendment.
NOW, THEREFORE, in consideration of the terms and conditions herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
1. Amendment to Section 2.1 (Payment of Purchase Price) of the Asset
Purchase Agreement. Each of the Company, the Buyer and Ajax hereby agrees to
amend and supplement Section 2.1 of the Asset Purchase Agreement by deleting it
in its entirety and adding the following instead:
"SECTION 2.1. PAYMENT OF PURCHASE PRICE.
(A) SUBJECT TO THAT CERTAIN CLOSING AGREEMENT, OF EVEN DATE HEREWITH, BY
AND AMONG THE COMPANY, THE BUYER, XXXXXX X. XXXXXXXXXX ("SMG"),
XXXXXXX XXXXX ("XXXXX"), EMIGRANT AND EMIGRANT MORTGAGE COMPANY,
INC. ("EMC") (THE "CLOSING AGREEMENT"), AT THE CLOSING, UPON THE
TERMS AND SUBJECT TO THE CONDITIONS OF THIS AGREEMENT, THE BUYER
SHALL PAY THE COMPANY, BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE
FUNDS, AN AGGREGATE AMOUNT EQUAL TO THE SUM OF (I) THE AMOUNT
NECESSARY TO PAY IN FULL THE PRINCIPAL OF, AND ACCRUED INTEREST ON,
THE COMPANY'S INDEBTEDNESS OWED TO EMIGRANT PLUS (II) $475,000 MINUS
(III) THE AGGREGATE AMOUNT OF ALL ADVANCED PAYMENTS (AS DEFINED
BELOW), IF ANY; PROVIDED, HOWEVER, THAT THE SUM OF THE AMOUNTS
SPECIFIED IN CLAUSES (I) AND (II) SHALL IN NO EVENT EXCEED THREE
MILLION ONE HUNDRED AND FIFTY THOUSAND DOLLARS ($3,150,000) (THE
"PURCHASE PRICE").
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(B) THE BUYER AGREES TO MAKE AVAILABLE TO THE COMPANY, FROM TIME TO TIME
DURING THE PERIOD BEGINNING ON NOVEMBER 17, 2009 AND ENDING ON THE
EARLIER OF (I) THE TERMINATION OF THIS AGREEMENT (A "PRE-CLOSING
TERMINATION") AND (II) THE CLOSING, AT THE COMPANY'S REQUEST, CASH
ADVANCES IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED THREE
HUNDRED THOUSAND DOLLARS ($300,000) (EACH AN "ADVANCED PAYMENT"). IN
THE EVENT A PRE-CLOSING TERMINATION OCCURS, ANY AND ALL OF THE
OUTSTANDING ADVANCED PAYMENTS (TOGETHER WITH ACCRUED INTEREST
THEREON) SHALL BECOME DUE IMMEDIATELY, AND, SUBJECT TO THE
SUBORDINATION AGREEMENT (AS DEFINED BELOW) SHALL BE REPAID BY THE
COMPANY AS SOON AS PRACTICABLE FOLLOWING THE OCCURRENCE OF SUCH
PRE-CLOSING TERMINATION. EACH ADVANCED PAYMENT SHALL ACCRUE INTEREST
AT THE RATE OF 8% PER ANNUM FROM, AND INCLUDING, THE DATE MADE TO,
BUT EXCLUDING, THE DATE ON WHICH SUCH PRE-CLOSING TERMINATION OCCURS
(SUCH INTEREST TO BE PAID ON THE DATE OF REPAYMENT OF THE ADVANCED
PAYMENTS). ANY ADVANCED PAYMENT NOT REPAID WHEN DUE SHALL ACCRUE
INTEREST AT THE RATE OF 12% PER ANNUM FOR EACH DAY FROM THE DATE ON
WHICH A PRE-CLOSING TERMINATION OCCURS UNTIL REPAID (SUCH INTEREST
TO BE PAID ON THE DATE OF REPAYMENT OF THE ADVANCED PAYMENTS). IN
THE EVENT THE CLOSING OCCURS, ALL OF THE ADVANCED PAYMENTS
(EXCLUDING ACCRUED INTEREST) SHALL BE CREDITED, UPON CONSUMMATION OF
THE CLOSING, TOWARDS THE PURCHASE PRICE AS SET FORTH ABOVE AND THE
ADVANCED PAYMENTS SHALL BE DEEMED FULLY PAID AND NO INTEREST SHALL
BE DUE AND PAYABLE BY THE COMPANY. ALL INDEBTEDNESS OF THE COMPANY
PURSUANT TO THE ADVANCED PAYMENTS SHALL BE UNSECURED AND SHALL BE
SUBORDINATED IN RIGHT OF PAYMENT TO ALL INDEBTEDNESS FOR BORROWED
MONEY OF THE COMPANY TO EMIGRANT AS CONTEMPLATED BY THAT CERTAIN
SUBORDINATION AGREEMENT OF EVEN DATE HEREWITH AMONG THE COMPANY,
EMIGRANT AND THE BUYER (THE "SUBORDINATION AGREEMENT").
(C) EACH REQUEST BY THE COMPANY FOR AN ADVANCED PAYMENT SHALL BE IN
INCREMENTS OF TWENTY FIVE THOUSAND DOLLARS ($25,000) AND SHALL BE
MADE BY DELIVERY OF A WRITTEN NOTICE TO THE BUYER (A "PAYMENT
REQUEST") NOT LATER THAN 11:00 A.M., NEW YORK CITY TIME, TWO (2)
BUSINESS DAYS PRIOR THE DATE OF THE PROPOSED ADVANCED PAYMENT. EACH
PAYMENT REQUEST SHALL BE IRREVOCABLE AND SHALL CONTAIN THE
FOLLOWING:
I. THE AMOUNT OF SUCH ADVANCED PAYMENT;
II. THE DATE OF THE PROPOSED ADVANCED PAYMENT (WHICH SHALL BE A BUSINESS
DAY NO LESS THAN TWO (2) BUSINESS DAYS AFTER THE DATE THE PAYMENT
REQUEST IS RECEIVED BY THE BUYER; AND
III. THE COMPANY'S WIRE INSTRUCTIONS."
2. Amendment to Article IV (Covenants and Agreements) of the Asset
Purchase Agreement. Each of the Company and the Buyer agrees to amend and
supplement Article VI of the Asset Purchase Agreement by adding the following at
the end of Article VI:
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"SECTION 6.16. USE OF PROCEED OF ADVANCED PAYMENTS. THE COMPANY AGREES TO
USE THE PROCEEDS OF ANY ADVANCED PAYMENT RECEIVED FROM THE BUYER SOLELY
FOR THE PURPOSE OF CONDUCTING ITS BUSINESS IN THE ORDINARY COURSE (AFTER
TAKING INTO CONSIDERATION THE CURRENT FINANCIAL CONDITION OF THE COMPANY)
IN ACCORDANCE WITH THE TERMS AND CONDITIONS OF THIS AGREEMENT.
SECTION 6.17. PAYMENT OF PATENT APPLICATION FEES AND EXPENSES.
NOTWITHSTANDING ANYTHING CONTAINED IN THIS AGREEMENT TO THE CONTRARY:
(A) THE COMPANY COVENANTS AND AGREES TO PAY, NO LATER THAN NOVEMBER 24,
2009, ANY AND ALL FEES AND EXPENSES, DUE AS OF SUCH DATE, ASSOCIATED
WITH THOSE CERTAIN PATENT APPLICATIONS RELATED TO CAPSULAR
CONTRACTION, RESPIRATORY, INTEGRATED COIL AND INDUCTION COIL (THE
"PENDING PATENTS") (INCLUDING, WITHOUT LIMITATION, FEES AND EXPENSES
FOR SERVICES RENDERED TO THE COMPANY BY XXXXXXX & CO. IN CONNECTION
WITH THE PENDING PATENTS); PROVIDED, HOWEVER, THAT THE COMPANY'S
LIABILITY UNDER THIS SECTION 6.17(A) SHALL NOT EXCEED AN AGGREGATE
AMOUNT OF TWELVE THOUSAND TWO HUNDRED FIFTY DOLLARS ($12,250); AND
(B) FOLLOWING SATISFACTION OF THE COMPANY'S PAYMENT OBLIGATIONS UNDER
SECTION 6.17(A) ABOVE, THE BUYER COVENANTS AND AGREES TO PAY, WHEN
DUE, ANY AND ALL OTHER FEES AND EXPENSES RELATED TO THE PENDING
PATENT; PROVIDED, HOWEVER, THAT THE BUYER'S LIABILITY UNDER THIS
SECTION 6.17(A) SHALL NOT EXCEED AN AGGREGATE AMOUNT OF TWELVE
THOUSAND TWO HUNDRED FIFTY DOLLARS ($12,250)."
3. Amendment to Section 10.2 (Expenses) of the Asset Purchase
Agreement. Each of the Company and the Buyer agrees to amend and supplement
Section 10.2 of the Asset Purchase Agreement by deleting it in its entirety and
adding the following instead:
"SECTION 10.2. EXPENSES. WHETHER OR NOT THE TRANSACTION IS CONSUMMATED,
ALL COSTS AND EXPENSES INCURRED IN CONNECTION WITH THE TRANSACTION, THIS
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE PAID BY THE
PARTY INCURRING OR REQUIRED TO INCUR SUCH EXPENSES, EXCEPT EXPENSES
INCURRED IN CONNECTION WITH THE PRINTING, FILING AND MAILING OF THE PROXY
STATEMENT (INCLUDING APPLICABLE SEC FILING FEES) SHALL BE BORNE ONE-HALF
BY THE COMPANY AND ONE-HALF BY THE BUYER; PROVIDED, HOWEVER, THAT THE
COMPANY AGREES TO REIMBURSE THE BUYER AND AJAX FOR ALL COSTS AND EXPENSES
(INCLUDING LEGAL FEES AND EXPENSES) INCURRED OR REQUIRED TO BE INCURRED BY
THE BUYER AND AJAX AS CONTEMPLATED BY THIS SECTION 10.2, BUT IN NO EVENT
SHALL THE COMPANY BE OBLIGATED TO PAY THE BUYER AND AJAX MORE THAN AN
AGGREGATE AMOUNT EQUAL TO 50% OF THE AGGREGATE ADVANCED PAYMENTS RECEIVED
BY THE COMPANY PURSUANT TO SECTION 2.1 OF THIS AGREEMENT, LESS ANY
INTEREST PAYMENT PAID TO THE BUYER AND/OR AJAX, IF ANY; FURTHER, PROVIDED,
THAT ALL COSTS AND EXPENSES (INCLUDING LEGAL FEES AND EXPENSES) INCURRED
BY THE BUYER AND AJAX IN CONNECTION WITH AMENDMENT NO. 1 TO THIS AGREEMENT
UP TO $20,000 SHALL BE PAID OR REIMBURSED BY THE COMPANY. NOTWITHSTANDING
THE FOREGOING, THE BUYER AND AJAX UNDERSTAND AND AGREE THAT ANY AMOUNTS
DUE FROM THE COMPANY PURSUANT TO THIS SECTION 10.2 SHALL RANK PARI-PASSU
WITH OTHER TRADE PAYABLES OF THE COMPANY AND SHALL BE PAID AT SUCH TIME AS
OTHER CREDITORS OF THE COMPANY ARE PAID IN THE ORDINARY COURSE. "
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4. Effect on the Asset Purchase Agreement. Except as explicitly set
forth in this Amendment, all the terms and conditions of the Asset Purchase
Agreement shall continue to be in full force and effect thereafter as if this
Amendment had never been entered into.
5. Governing Law. This Amendment shall be governed by the laws of the
state of New York without giving effect to the principles of conflicts of laws
thereof.
6. Counterparts. This Amendment may be executed in one or more
counterparts (including by facsimile or electronic mail), all of which shall be
considered one and the same agreement and shall become effective when one or
more counterparts have been signed by each of the parties and delivered to the
other parties.
7. WAIVER OF JURY TRAIL; SUBMISSION TO JURISDICTION. EACH OF THE
PARTIES HERETO AGREES, AFTER CONSULTATION WITH COUNSEL, TO WAIVE ANY RIGHTS TO A
JURY TRIAL TO RESOLVE ANY DISPUTES OR CLAIMS RELATING TO THIS AMENDMENT. EACH
PARTY HERETO HEREBY IRREVOCABLY CONSENTS TO THE JURISDICTION OF THE COURTS OF
THE STATE OF NEW YORK LOCATED IN THE COUNTY OR NEW YORK AND OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK LOCATED IN THE BOROUGH OF
MANHATTAN IN ANY ACTION TO ENFORCE, INTERPRET OR CONSTRUE ANY PROVISION OF THIS
AMENDMENT.
[SIGNATURES FOLLOW]
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IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as of the
date first above written.
IVIVI TECHNOLOGIES, INC.
By: /s/ Andre' XxXxxx
-------------------------------
Name: Andre' XxXxxx
Title: Executive Vice President
IVIVI TECHNOLOGIES, LLC
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: Managing Member
AJAX CAPITAL LLC
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: Managing Member
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