Exhibit 10.18
SHARE PURCHASE RIGHT AGREEMENT
This SHARE PURCHASE RIGHT AGREEMENT, is effective as of the 8th day of
November, 2005 (the "Effective Date"), among Xxxxxx Xxxxxxxxxx ("Xx.
Xxxxxxxxxx") and the shareholders (collectively, the "Shareholders") of Ivivi
Technologies, Inc., a New Jersey corporation (the "Company"), set forth on
Exhibit A hereto.
WITNESSETH:
WHEREAS, the Shareholders are the record owners of shares of common stock,
no par value, of the Company (the "Common Stock"); and
WHEREAS, the Shareholders believe it to be in the best interests of the
Company and the Shareholders that Xx. Xxxxxxxxxx have the right to purchase the
number of shares of Common Stock owned of record by the Shareholders set forth
under the heading "Purchasable Shares" on Exhibit A hereto (collectively, the
"Purchasable Shares") pursuant to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
and intending to be legally bound, the parties hereto agree as follows:
ARTICLE I
GRANT OF RIGHT; EXERCISE OF RIGHT
Section 1.1. Grant of Right. Subject to the terms and conditions of this
Agreement, each Shareholder hereby grants Xx. Xxxxxxxxxx the right (each, a
"Right") to purchase up to the number of Purchasable Shares of such Shareholder
set forth on Exhibit A hereto at any time and from time to time during the
period commencing on the Effective Date and terminating at 5:00 P.M. on November
7, 2010 (the "Expiration Date"),.
Section 1.2. Exercise Price. The exercise price (the "Exercise Price") of
each Purchasable Share shall be equal to the lesser of (i) initial public
offering price (the "IPO Price") of the Common Stock in the initial public
offering (an "IPO") and (ii) $8.30 (subject to adjustment for any
recapitalization, stock-split or other similar event); provided, however, that
if an IPO is not consummated on or before the six-month anniversary of the
Effective Date, the Exercise Price of each Purchasable Share shall be $7.00 and
shall be decreased by $.50 each month after the six-month anniversary of the
Effective Date until the earlier to occur of (i) the twelve-month anniversary of
the Effective Date and (ii) the date a registration statement with respect to an
IPO is declared effective by the Securities and Exchange Commission.
Notwithstanding the foregoing, in no event shall the Exercise Price be less than
$1.00 per share.
Section 1.3. Method of Exercise.
(a) In the event Xx. Xxxxxxxxxx desires to exercise all or any portion of
the Rights, Xx. Xxxxxxxxxx shall deliver an exercise notice (the "Exercise
Notice") to each Shareholder in the manner provided by Section 5.6. The Exercise
Notice, which shall be signed by Xx. Xxxxxxxxxx, shall state Xx. Xxxxxxxxxx'x
election to exercise all or any portion of the Rights and the number of
Purchasable Shares in respect of which the Rights are being exercised. The
number of Purchasable Shares to be purchased by Xx. Xxxxxxxxxx upon exercise of
all or any portion of the Rights of the Shareholders shall be allocated among
such Shareholders pro rata in accordance
with such Shareholders' respective Proportionate Share or in such other
proportions as are mutually agreed to in writing by such Shareholders. For
purposes of this Agreement, the term "Proportionate Share" means, with respect
to a Shareholder, a fraction, the numerator of which is the total number of
Purchasable Shares of such Shareholder (excluding any and all Purchasable Shares
previously sold upon the exercise of any Right in accordance with this
Agreement), and the denominator of which is the total number of Purchasable
Shares of all of the Shareholders (excluding any and all Purchasable Shares
previously sold upon the exercise of any Right in accordance with this
Agreement).
(b) Each closing (the "Closing") of the purchase of the Purchasable Shares
upon exercise of Rights by Xx. Xxxxxxxxxx in accordance with this Section 1.3
shall take place on such date, not later than ten (10) business days following
the delivery of the Exercise Notice to all of the Shareholders or as otherwise
may be agreed to by Xx. Xxxxxxxxxx and the Shareholders. The Closing shall be
held at the principal office of the Company, or at such location as may
otherwise be agreed to by Xx. Xxxxxxxxxx and the Shareholders. At the Closing:
(i) the Shareholders shall deliver to Xx. Xxxxxxxxxx certificates representing
the Purchasable Shares then being sold, together with fully executed stock
powers; (ii) Xx. Xxxxxxxxxx shall pay in full to each Shareholder, the Exercise
Price (as of the date of the Exercise Notice) for each Purchasable Share being
sold by such Shareholder in accordance with the provisions of this Article III
in immediately available funds by check or wire transfer of funds to an account
designated by such Shareholder at or prior to the Closing; and (iii) each of Xx.
Xxxxxxxxxx and the Shareholders shall execute such other documents and take such
other action as reasonably shall be necessary for the purpose of carrying out
the terms and conditions and reflecting the intention of and transactions
contemplated by this Agreement.
(c) Xx. Xxxxxxxxxx hereby acknowledges that the Purchasable Shares of each
Shareholder are subject to a lock-up agreement between Maxim Group, LLC.
("Maxim") and that such Purchasable Shares shall remain subject to such lock-up
agreement following the purchase by Xx. Xxxxxxxxxx; provided, that the lock-up
period provided under such lock-up agreement shall be no longer than the
shortest period for which any officer or director of the Company is prohibited
from selling, contracting to sell or otherwise disposing of any his or her
shares of Common Stock or other securities of the Company pursuant to a Maxim
lock-up agreement immediately following the consummation of the initial public
offering of shares of Common Stock.
Section 1.4. Transfer of Rights. Xx. Xxxxxxxxxx may not transfer, sell,
assign, pledge, hypothecate give, create a security interest in or lien on,
place in trust (voting or otherwise), transfer by operation of law, grant a
proxy with respect to or in any other way encumber or dispose of, directly or
indirectly, whether or not voluntarily (each, a "Transfer") any of the Rights
other than to a trust or other entity designed as an element of Xx. Xxxxxxxxxx'x
estate planning objectives; provided, that in the event of any such Transfer,
the Rights so Transferred shall remain subject to this Agreement and prior to
any such Transfer, the transferee (each, a "Transferee") of such Rights shall
execute an instrument agreeing to be bound by all of the terms and provisions of
this Agreement. In furtherance of the foregoing, and not in limitation thereof,
by taking and holding any such Rights, the Transferee thereof shall be deemed to
have agreed to be bound by and to comply with all of the terms and provisions of
this Agreement. The terms of this Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of Xx. Xxxxxxxxxx.
ARTICLE II
TRANSFER RESTRICTIONS
During the term of this Agreement, no Shareholder shall Transfer any of the
Purchasable Shares other than to a trust or other entity designed as an element
of such Shareholder's estate planning objectives; provided, that in the event of
any such Transfer, the Purchasable Shares so Transferred shall remain subject to
this Agreement and prior to any such Transfer, the Transferee shall execute an
instrument agreeing to be bound by all of the terms and provisions of this
Agreement. In furtherance of the foregoing, and not in limitation thereof, by
taking and holding any such Purchasable Shares, the Transferee thereof shall be
deemed to have agreed to be bound by and to comply with all of the terms and
provisions of this Agreement. The terms of this Agreement shall be binding upon
the executors, administrators, heirs, successors and assigns of each of the
Shareholders.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
The Shareholders, severally but not jointly, hereby make the following
representations and warranties to Xx. Xxxxxxxxxx, Xx. Xxxxxxxxxx'x successors
and assigns, and acknowledges and confirms that Xx. Xxxxxxxxxx is relying upon
such representations and warranties in connection with the execution, delivery
and performance of this Agreement and the transactions contemplated hereby,
notwithstanding any investigation made by Xx. Xxxxxxxxxx or on Xx. Xxxxxxxxxx'x
behalf:
Section 3.1. Authorized and Issued Shares. Each of the Shareholders is the
sole and exclusive owner of the Purchasable Shares held by such Shareholder. All
Purchasable Shares of the Shareholders have been properly issued by the Company
and are fully paid and non-assessable. Except for the Voting Agreement dated as
of January 5, 2004 among the Company, the Shareholders and Fifth Avenue Capital
Partners (the "Voting Agreement"), there are no outstanding subscriptions,
warrants, options, agreements or other commitments or contractual rights
pursuant to which any of the Purchasable Shares are subject. Each of the
Shareholders hereby acknowledges and agrees that none of the Purchasable Shares
shall be subject to the Voting Agreement upon any Transfer thereof in accordance
with the terms and conditions of this Agreement.
Section 3.2. Authority to Sell. Each of the Shareholders has, and
throughout the term of this Agreement will have, the full right, power and
authority to sell, transfer, convey and deliver to Xx. Xxxxxxxxxx the
Purchasable Shares agreed to be sold, transferred, conveyed and delivered by the
Shareholders hereunder, free and clear of any statutory, contractual or other
limitation of any kind, type or nature whatsoever, and the Purchasable Shares
are not, nor will they be at any time during the term of this Agreement, subject
to any lien, pledge, hypothecation or any encumbrance or interest of any third
party whatsoever (each, an "Encumbrance"), except as may be expressly provided
herein. The sale provided for herein will vest in Xx. Xxxxxxxxxx all right,
title and interest in and to the Purchasable Shares, free and clear of any and
all Encumbrances, other than any Encumbrances resulting from actions taken or
failed to be taken by Xx. Xxxxxxxxxx. In addition, Xx. Xxxxxxxxxx acknowledges
that upon the sale of the Purchasable Shares to him, such Purchasable Shares
will be subject to restrictions under the Securities Act of 1933, as amended,
and state securities laws.
Section 3.3. Enforceability. Each of the Shareholders represents that (i)
this Agreement constitutes a legally valid and binding agreement, enforceable
against each Shareholder in accordance with its terms, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles; and (ii) the execution and delivery by each of the
Shareholders of this Agreement does not, and the performance by each of the
Shareholders of the transactions contemplated hereby will not, violate any of
the provisions of any contract or agreement to which any of the Shareholders is
a party or by which the Purchasable Shares are bound, or any order, writ,
injunction, or decree applicable to any of the Shareholders or the Purchasable
Shares.
Section 3.4. No Violation. Neither the execution and delivery of this
Agreement by the Shareholders nor the consummation by the Shareholders of the
transactions contemplated hereby will result in the creation or imposition of
any Encumbrance upon any of the Purchasable Shares under, any agreement or
commitment to which any of the Shareholders is a party or by which any of the
Purchasable Shares are subject, or violate any statute or law or any judgment,
decree, order, writ, injunction, regulation or rule of any domestic or foreign
court or government authority applicable to any of the Shareholders or the
Purchasable Shares.
Section 3.5. Litigation, Judgments and Decrees. There currently is no
action, suit or proceeding or any claim or investigation of any nature
whatsoever, at law or in equity or both, by or before any domestic or foreign
court or government or other regulatory or administrative agency, arbitration
tribunal, board, bureau, authority or commission pending or threatened against
or involving any of the Shareholders or any of the Purchasable Shares, or which
would question or challenge the validity of this Agreement or any action taken
or to be taken by any of the Shareholders pursuant to this Agreement or in
connection with the transactions contemplated hereby.
Section 3.6. Requirements for Notification or Approval. The execution and
delivery of this Agreement by the Shareholders, the consummation of the
transaction contemplated hereby and the performance of any obligations hereunder
does not require notice, registration, report or other filing or qualification
with, or consent, waiver, approval, license or authority of any third party or
public authority except for such as have been duly and validly obtained prior to
the date hereof.
Section 3.7. Accuracy of Representations and Warranties. No representation
or warranty of the Shareholders specifically contained herein or information
with respect to the Purchasable Shares specifically contained herein contains or
will contain any untrue statement of fact.
ARTICLE IV
SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION
Section 4.1. Survival of Representations. All representations, warranties
and covenants contained in this Agreement shall survive.
Section 4.2. Indemnification by the Shareholders. The Shareholders,
severally but not jointly, agree to indemnify, defend and hold Xx. Xxxxxxxxxx
harmless, at any time after the date hereof, from and against all losses, costs,
damages, liabilities, interest, penalties, settlements, judgments or expenses,
including, but not limited to, reasonable attorneys' fees and expenses, asserted
against, resulting from, imposed upon or incurred by Xx. Xxxxxxxxxx directly or
indirectly,
arising out of or in connection with (i) the breach or inaccuracy of any of the
representations or warranties of the Shareholders made in or pursuant to this
Agreement and; (ii) any breach or non-fulfillment of any covenant or agreement
of the Shareholders contained in this Agreement.
Section 4.3. Remedies Cumulative. The remedies provided for herein shall be
cumulative and shall not preclude assertion by any party of any other rights or
the seeking of any other remedies against any other party. Nothing contained in
this Section 4.3 shall be construed in any way to limit, impair or modify the
provisions of this Agreement or otherwise impose any liability or obligation on
any party at any time for any liability, obligation, debt or commitment of the
other party.
ARTICLE V
MISCELLANEOUS
Section 5.1. Recapitalization, Exchanges, etc. Affecting the Common Stock.
The provisions of this Agreement shall apply to the full extent set forth herein
with respect to (a) the Purchasable Shares and (b) any and all shares of capital
stock of the Company or any successor or assign of the Company (whether by
merger, consolidation, sale of assets or otherwise) which may be issued in
respect of, in exchange for, or in substitution for the Purchasable Shares, by
reason of any stock dividend, split, reverse split, combination,
recapitalization, reclassification, merger, consolidation or otherwise. In the
event of any change in the capitalization of the Company, as a result of any
stock split, stock dividend or stock combination, the provisions of this
Agreement shall be appropriately adjusted.
Section 5.2. No Joint Venture or Partnership. No party hereto shall have
any authority to bind or commit any other party hereto and no such authority
shall be implied by the provisions hereof. Nothing herein shall be deemed or
construed to create a joint venture, partnership or agency relationship between
any of the parties hereto for any purpose.
Section 5.3. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors,
assigns and legal representatives. This Agreement shall be for the sole benefit
of the parties to this Agreement and their respective successors, permitted
assigns and legal representatives and is not intended, nor shall be construed,
to give any person or entity, other than the parties hereto and their respective
successors, permitted assigns and legal representatives, any legal or equitable
right, remedy or claim hereunder. This Agreement may not be assigned by
operation of law or otherwise, and any attempted assignment shall be null and
void, except that Xx. Xxxxxxxxxx and any Shareholder may assign his or her
rights hereunder, in whole but not in part, in connection with a Transfer of
Purchasable Shares made in strict compliance with all of the provisions of this
Agreement, including, without limitation Article II of this Agreement.
Section 5.4. Expenses. Each of the parties hereto shall pay its own
expenses incident to this Agreement and the transactions contemplated hereby.
Section 5.5. Amendment; Waiver.
(a) This Agreement may be amended only by a written instrument duly
executed by all of the parties hereto.
(b) No failure by any party to insist upon the strict performance of any
covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy consequent upon breach thereof shall constitute a waiver of any
such breach or of any other covenant, duty, agreement or condition, any such
waiver being effective only if contained in a writing executed by the waiving
party.
Section 5.6. Notices. Except as otherwise provided in this Agreement, all
notices, requests, claims, demands, waivers and other communications hereunder
shall be in writing and shall be deemed to have been duly given to any party
hereto when delivered by hand, when delivered personally or by courier, three
days after being deposited in the mail (registered or certified mail, postage
prepaid, return receipt requested), or when received by facsimile transmission
if promptly confirmed by one of the foregoing means, to such party at the
address or facsimile transmission number specified below his or her name on the
signature pages hereto or to such other address or facsimile transmission number
specified in a notice given in accordance with this Section 5.6.
Section 5.7. Applicable Law. This Agreement shall be governed, and
construed in accordance with, the internal laws of the State of New York,
without reference to the choice of law principles thereof.
Section 5.8. Headings. The descriptive headings of the several sections in
this Agreement are for convenience only and do not constitute part of this
Agreement and shall not affect in any way the meaning or interpretation of this
Agreement.
Section 5.9. Integration. This Agreement and the other writings referred to
herein or delivered pursuant hereto which form a part hereof contain the entire
understanding of the parties with respect to its subject matter. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to its subject matter. There are no restrictions, agreements, promises,
representations, warranties, covenants or undertakings with respect to its
subject matter other than those expressly set forth or referred to herein.
Section 5.10. Severability. If any term or provision of this Agreement or
any application thereof shall be declared or held invalid, illegal or
unenforceable, in whole or in part, whether generally or in any particular
jurisdiction, such provision shall be deemed amended to the extent, but only to
the extent, necessary to cure such invalidity, illegality or unenforceability,
and the validity, legality and enforceability of the remaining provisions, both
generally and in every other jurisdiction, shall not in any way be affected or
impaired thereby.
Section 5.11. Consent to Jurisdiction. Each of the parties hereto hereby
(i) irrevocably consents and submits to the sole exclusive jurisdiction of the
United States District Court for the District of New York or the Supreme Court
of New York (and of the appropriate appellate courts therefrom) in connection
with any suit, action or other proceeding arising out of or relating to this
Agreement, (ii) irrevocably waives, to the fullest extent permitted by law, any
objection that it may now or hereafter have to the laying of the venue of any
such suit, action or proceeding in any such court or that any such suit, action
or proceeding which is brought in any such court has been brought in an
inconvenient forum, and (iii) agrees that service of any summons, complaint,
notice or other process relating to such suit, action or other proceeding may be
effected in the manner provided by Section 5.6 of this Agreement.
Section 5.12. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which shall together
constitute one and the same instrument.
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SHARE PURCHASE RIGHT AGREEMENT
SIGNATURE PAGE
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
/s/ Xxxxxx Xxxxxxxxxx
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Xxxxxx Xxxxxxxxxx
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Street Address
----------------- ----------- --------
City State Zip
WITNESS:
/s/ Xxxxx Xxxx
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SHARE PURCHASE RIGHT AGREEMENT
SIGNATURE PAGE
/s/ Andre' Xxxxxx
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Street Address
----------------- ----------- --------
City State Zip
WITNESS:
/s/ Xx Xxxxxx
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SHARE PURCHASE RIGHT AGREEMENT
SIGNATURE PAGE
/s/ X. Xxxxxxx
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Street Address
----------------- ----------- --------
City State Zip
WITNESS:
/s/ Xx Xxxxxx
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SHARE PURCHASE RIGHT AGREEMENT
SIGNATURE PAGE
/s/ Xx Xxxxxx
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Street Address
----------------- ----------- --------
City State Zip
WITNESS:
/s/ Xxxxx Xxxxxx
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SHARE PURCHASE RIGHT AGREEMENT
SIGNATURE PAGE
/s/ Xxxxxx Xxxxx
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----------------------------------------
Street Address
----------------- ----------- --------
City State Zip
WITNESS:
/s/ Xx Xxxxxx
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SHARE PURCHASE RIGHT AGREEMENT
SIGNATURE PAGE
/s/ Xxxxx Xxxxxx
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Street Address
----------------- ----------- --------
City State Zip
WITNESS:
/s/ Xx Xxxxxx
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EXHIBIT A
SHAREHOLDERS
NAME PURCHASABLE SHARES
------------- ------------------
Andre' XxXxxx 10,000
Xxxx Xxxxxxx 5,000
Xx Xxxxxx 5,000
Xxxxxx Xxxxx 11,000
Xxxxx Xxxxxx 19,000
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TOTAL: 50,000
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