FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT
EXHIBIT 10.1
FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT
This
First Amendment to Stock Purchase Agreement
(“Amendment”) is effective as of November 15, 2017 and
amends that certain Stock Purchase Agreement, dated as of October
5, 2017 (“SPA”), by and between SpendSmart Networks,
Inc., a Delaware corporation (“Seller”), and Eclipse
Marketing LLC, a Delaware limited liability company
(“Buyer”). In consideration of the mutual benefits to
be derived herefrom, Seller and Buyer amend the SPA as
follows:
1. The
definition of “Ancillary Documents” in Article I is
hereby deleted in its entirety and replaced with the following:
“Ancillary Documents” means a transition services
agreement in form and substance reasonably satisfactory to Buyer,
the Note, a security agreement securing the payment obligations
under the aforementioned promissory note with the assets of the
Company in form and substance reasonably satisfactory to Buyer and
Seller, and other documents, certificates and agreements to be
delivered in connection with this Agreement or otherwise requested
by Buyer, in form and substance satisfactory to Buyer.
2. The
following defined term and associated definition is hereby added to
Article I: “Note” means a promissory note with a
principal amount of $750,000, subject to increase in accordance
with Section 2.02, requiring $20,000 per month payments and having
a fifteen-month term, in form and substance reasonably satisfactory
to Buyer and Seller.
3. Section
2.02 is hereby deleted in its entirety and replaced with the
following: The aggregate purchase price for the Shares shall be
$2,150,000 (the “Purchase Price”) and payable as
follows: at Closing, (a) the Buyer shall pay $1,400,000 less
outstanding balances of Company credit cards as reasonably
determined by Buyer as of Closing and those amounts that are
described in Exhibit D attached hereto (the “Closing Date
Payment”) by wire transfer of immediately available funds to
an account designated by Seller to Buyer in writing and (b) the
Buyer shall deliver the Note. In the event a 338(h)(10) or 336(e)
election is made, the parties agree to allocate the Purchase Price
for tax purposes as provided in Section 6.05. Notwithstanding the
foregoing or any provision in this Agreement to the contrary, the
parties acknowledge and agree that the principal amount due under
the Note from Buyer to Seller shall increase by $5,000 for each
business day between January 31, 2018 and the Closing Date, if any,
unless the failure to close the transactions contemplated hereby by
January 31, 2018 is due to the failure of Seller to perform or
comply with any of the covenants, agreements or conditions hereof
to be performed or complied with by it prior to the Closing or is
otherwise at Seller’s election.
4. The
following is added as a new Section 5.14: Within five (5) business
days of Closing, Seller shall pay all Transaction Expenses and
Indebtedness that are described in Exhibit E and shall, promptly
thereafter, provide Buyer with evidence of same.
5. The
following is added as a new Section 7.02(v): Seller shall have
established admin user accounts (e.g., user ID and password) and
user accounts (e.g., user ID and password) in, and otherwise
provide access to, all Company systems and technology, vendor,
payroll, banking and credit card accounts, including, without
limitation, password management systems, software accounts and bank
accounts. In addition, Seller shall have established Xxxxxxx
Xxxxxxxxx as a signer on all Company bank accounts and authorized
contract on all major vendor accounts.
6. The
first sentence of Section 8.04(a) is hereby deleted in its entirety
and replaced with the following: Seller shall not be liable to the
Buyer Indemnitees under Section 8.02(a) until the aggregate amount
of all Losses in respect of indemnification under Section 8.02(a)
exceeds $250,000 (the “Basket”), in which event Seller
shall be required to pay or be liable for all such Losses in excess
of the Basket.
7. Section
8.04(e) is hereby deleted in its entirety and replaced with the
following: Any indemnification obligation of the Seller pursuant to
Section 8.02 shall be effected by wire transfer of immediately
available funds from the Seller to an account designated in writing
by the applicable Buyer Indemnitee within fifteen (15) days after
the determination thereof. Notwithstanding the foregoing, in lieu
of receiving such payment from the Seller, the Buyer may, in its
sole discretion, offset the amounts due from the Buyer to the
Seller under the Note by the amount of such payment.
8. Section
9.01(b)(ii) is hereby deleted in its entirety and replaced with the
following: (ii) any of the conditions set forth in Section 7.01 or
Section 7.02 shall not have been, or if it becomes apparent that
any of such conditions will not be, fulfilled by January 31, 2018,
unless such failure shall be due to the failure of Buyer to perform
or comply with any of the covenants, agreements or conditions
hereof to be performed or complied with by it prior to the
Closing;
9. Section
9.01(c)(ii) is hereby deleted in its entirety and replaced with the
following: (ii) any of the conditions set forth in Section 7.01 or
Section 7.03 shall not have been, or if it becomes apparent that
any of such conditions will not be, fulfilled by January 31, 2018,
unless such failure shall be due to the failure of Seller to
perform or comply with any of the covenants, agreements or
conditions hereof to be performed or complied with by it prior to
the Closing; or
10. As
amended hereby, the SPA remains valid and in full force and
effect.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF , the parties hereto have caused this Amendment to
be executed as of the date first written above by their respective
officers thereunto duly authorized.
| SpendSmart
Networks, Inc. |
|
|
Eclipse Marketing LLC |
|
| Signature: |
|
|
Signature: |
|
|
|
|
|
|
|
|
Name: Xxxx
Xxxxxxx
|
|
|
Name: Xxxxxxx X.
Xxxxx
|
|
|
Title: Chief
Executive Officer
|
|
|
Title: Authorized
Person
|
|
2
EXHIBIT D
|
Reconciliation
of cash purchase price for the SSPC CA corporation vs. amount to be
funded at closing:
|
|
|
|
|
|
Amount of cash
purchase price:
|
$1,400,000.00
|
|
|
|
|
Less:
|
|
|
Assumption of
AMEX card
|
56,075.94
|
|
Assumption of
CB&T credit card
|
69,901.24
|
|
Amount of
payroll, taxes and benefits - 1/25 - 1/31
|
39,929.00
|
|
Total
cash purchase price reductions
|
$165,906.18
|
|
|
|
|
Amount to be
wired to SSPC at closing
|
$1,234,093.82
|
3
EXHIBIT E
|
Vendor
|
Pay at
close
|
|
27 Holdings
LLC
|
$5,576.00
|
|
Xxxxxx
Xxxxxxx
|
$581.00
|
|
BizQuest
|
$1,330.00
|
|
Xxxxx
Xxxxxxxxx
|
$2,500.00
|
|
City of San Xxxx
Obispo
|
$2.55
|
|
Corporation Service
Company
|
$477.52
|
|
Crushed Grape
|
$553.00
|
|
Crystal
Springs
|
$830.00
|
|
Xxx Xxxxxx
|
$24,500.00
|
|
Xxxxxx Xxxxx
|
$2,500.00
|
|
Xxxxx Xxxxxx
V
|
$2,500.00
|
|
Digital West
|
$550.00
|
|
Digital West Account
#992
|
$730.30
|
|
Executive
Janitorial
|
$1,655.00
|
|
Experian
Membership
|
$527.55
|
|
Fitch Even
|
$587.50
|
|
Franchise
Direct
|
$420.00
|
|
Franchise for
Professionals
|
$1,960.00
|
|
Franchise
Opportunities
|
$3,275.00
|
|
Xxxxxx Xxxxxx
|
$2,500.00
|
|
Gusto
|
$15,000.00
|
|
Imurgent
|
$15,271.76
|
|
Inferior
Elements
|
$3,160.00
|
|
ITransition,
Inc.
|
$4,556.25
|
|
X. Xxxxxxx
|
$0.06
|
|
Xxxx Xxxxxxxx
|
$78.40
|
|
Xxxxx
Xxxxxxxxx
|
$2,500.00
|
|
Xxxx X. Xxx
|
$14,108.26
|
|
Xxxx Xxxxx
|
$9.80
|
|
Xxxx Xxxxx
|
$171.03
|
|
Xxx Xxxxxxx
|
$259.80
|
|
Xxxx Xxxx
|
$2,500.00
|
|
MFV Exposition & Franchise
Expo
|
$2,250.00
|
|
Xxxx Xxxxxxxx
|
$78.40
|
|
More Office
Solutions
|
$41.75
|
|
Xxxxxxxx
Xxxxxxx
|
$5,000.00
|
|
Plum Grove
Printers
|
$301.36
|
|
Proven
Franchises
|
$1,500.00
|
|
Xxxxxxxx
Xxxxxxxxxx
|
$900.00
|
|
Sales Gravy
|
$250.00
|
|
Xxxxxxxxxx.xxx
|
$4,076.70
|
|
Samsung SDS
America
|
$325.00
|
|
Xxxxx
X’Xxxxx
|
$53.83
|
|
Security Servvices, LLC, A
Neustar Company
|
$750.00
|
|
Xxxxxxxxx
Xxxxxx
|
$2,500.00
|
|
Smart and
Bigger
|
$655.00
|
|
Sprint
|
$1,037.09
|
|
Xxxx Xxxxxx
|
$4,509.80
|
|
Trademark DB
Corp
|
$996.00
|
|
TroyGould PC
|
$25,813.00
|
|
Ubiquity
|
$750.00
|
|
Valley VIP
Deals
|
$6,000.00
|
|
Verizon
|
$406.32
|
|
Vivint
|
$597.70
|
|
YV Analytics
|
$950.00
|
|
Total -
Vendor
|
$170,912.72
|
|
Held
Payroll
|
|
|
11/15
|
$3,506.00
|
|
11/30
|
$7,569.00
|
|
12/15
|
$13,863.00
|
|
12/31
|
$16,984.00
|
|
1/15
|
$12,545.00
|
|
Total - Held
Payroll
|
$54,467.00
|
|
PTO for Former
Employees
|
|
|
Xxxx
Xxxxxxxxx
|
$28,000.00
|
|
Xxx Xxxxx
|
$9,421.72
|
|
Total - Former
Employee PTO
|
$37,421.72
|
|
Total of items
to be paid by SpendSmart DE
|
$262,801.44
|
4
