ADDENDUM TO AGREEMENT
ADDENDUM
TO AGREEMENT
This
Addendum is made and entered into this 1st
day of
August, 2006, by and between Pantel Systems Inc., a.k.a friendlyway Inc., a
Nevada based publicly traded company with offices at 0000 Xxxxxxxx Xxxxxx Xxxxx,
Xxxxx 000, Xxxxxxxx Xxxxxxx, XX 00000, hereinafter referred to as (“PSI”), and
Ignition Media Group., Inc., a Nevada based wholly owned subsidiary of PSI
,
with offices at 0000 Xxxxxxxx Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxxx Xxxxxxx, XX
00000, hereinafter referred to as (“IMG”) and collectively with PSI referred to
as (“Buyer”) and Captive Audience LLC, a limited liability company, with offices
at 0 Xxxxxx Xxxxx, Xxxxxx, XX 0000, hereinafter referred to as (“Seller”). The
parties having executed an Asset Purchase Agreement on May 18, 2006, hereinafter
referred to as (“APA”) having verbally agreed to amend, extend, and supplement
the APA on July 28, 2006 enter into this written Addendum to amend, extend,
and
supplement the APA which, in the event of inconsistency with the APA this
Addendum will control, as follows:
l.
References:
Buyer
and Seller incorporate any and all references to the APA as if stated herein
at
length.
2.
Pursuant
to Section 6. of the APA, Closing:
The
closing of the transactions contemplated hereby (the “Closing”) shall occur on
August 15, 2006. The fifty thousand dollar ($50,000) payment shall be paid
to
Seller by Buyer on or before August 3, 2006 and shall be credited to the
Purchase Price as defined in Section 3.
3.
Pursuant
to and in Addition to Section 1. of the APA, Purchase and
Sale:
(a)
In
consideration of Buyer’s payment of two million four hundred thousand dollars
(US $2,400,000) (the “Purchase Price”), Seller hereby sells, assigns, transfers
and delivers the Assets to Buyer. The Purchase Price shall be paid as follows:
(i) cash in the amount of one million one hundred thousand dollars (US
$1,100,000) which shall be paid by Buyer to Seller, which shall be documented
in
the form of a Promissory Note which Buyer and Seller shall execute at Closing
consistent with the following structure:
Buyer
shall make the following payments on the following dates to Seller, timeliness
of the essence:
|
Payment
Due Date from Seller to Buyer
|
Installment
Payment
of Purchase Price (USD) |
|
August
15, 2006
|
$
22,400.83
|
|
September
15, 2006
|
$
72,400.83
|
|
October
15, 2006
|
$
72,400.83
|
|
November
15, 2006
|
$
89,400.83
|
|
December
15, 2006
|
$
89,400.83
|
|
January
15, 2007
|
$
89,400.83
|
|
February
15, 2007
|
$
89,400.83
|
|
March
15, 2007
|
$
89,400.83
|
|
April
15, 2007
|
$
89,400.83
|
|
May
15, 2007
|
$
89,400.83
|
|
June
15, 2007
|
$
39,900.83
|
|
July
15, 2007
|
$
39,900.83
|
and
(ii)
shares of PSI’s common stock having an agreed aggregate value of one million
three hundred thousand dollars (US $1,300,000) hereinafter referred to as
(“Common Stock”). The number of shares to be issued shall be equal to dividing
one million three hundred thousand dollars (US $1,300,000) by the average
closing bid price of the Buyer’s public stock during the ten days preceding
Closing.
(g)
At
Closing Seller shall assign four separate Equipment Leases to Buyer has with
four separate leasing companies, hereinafter referred to as (“Leasing
Obligations”). Seller shall assign to Buyer the Leasing Obligations at the
Closing and Buyer shall accept such assignment alleviating Seller and any
personal guarantors of any responsibility related to the Leasing Obligations.
The Leasing Obligations consist of the following:
|
Leases
to be Assigned to Buyer from Seller at Closing
|
||||
|
Leasing
Company
|
Address
|
Number
of Payments to be made
|
Payment
Amount
|
Net
Amount owed
|
|
Mainfest
Funding Services
|
0000
Xxxxxxx Xxxxxxx, Xxxxxxxx, Xxxxxxxxx 5628
|
17
|
$
2,025.98
|
$
30,389.70
|
|
First
Niagara Leasing
|
XX
Xxx 000, Xxxxxxxx, XX 00000
|
18
|
$
2,203.89
|
$
35,262.24
|
|
American
Equipment Finance
|
000
Xxxx Xxxxxx Xxxx, Xxxxxx, XX 00000
|
21
|
$
1,695.00
|
$
32,205.00
|
|
American
Bank Leasing Corp
|
000
Xxx Xxxxxx Xxxxx Xxxxx X0, Xxxxxxx, Xxxxxxx 00000
|
29
|
$
1,011.49
|
$
29,333.21
|
|
|
|
|
|
$
127,190.15
|
4.
In
Addition to the APA, Remedies:
(a)
In
the event Buyer defaults in making any Installment Payments of the Purchase
Price to Seller on the due date as outlined in the APA and this Addendum Buyer
shall be in default of the APA. Upon receipt of written notice from Seller,
Buyer shall have ten days (10) to remedy the default by providing Seller with
that installment payment that is past due. In the event Buyer does not remedy
such default within the ten day (10) period, Seller at Seller’s sole discretion
may provide written notification, hereinafter referred to as (“Re-Assignment
Notification”) to Buyer requiring Buyer to assign ownership of the Agreements
Buyer has with Big Y Foods Inc., Foodtown Inc., and Wakefern Food Corporation
hereinafter collectively referred to as (“Retail Agreements”), in addition to
any digital signage equipment owned by Buyer that is installed in any retail
locations which are owned, operated, or managed by Big Y Foods Inc., Foodtown
Inc., and Wakefern Food Corporation hereinafter collectively referred to as
(“Retail Partners”). Upon receipt of Re-Assignment Notification Buyer shall
immediately thereupon assign clear title to the Retail Agreements, additionally
Seller shall be responsible for any outstanding lease payments held by Buyer
related to any digital signage equipment installed in retail locations owned,
operated, or managed by the Retail Partners. In the event Buyer has executed
lease payments for digital signage equipment installed in retail locations
owned, operated, or managed by the Retail Partners, wherein the value of the
lease payments that Buyer has made plus the amount of the Promissory Note which
Buyer has paid to Seller exceeds the total value of the Promissory Note
hereinafter referred to as (“Excess Lease Value”), Seller shall be obligated to
repay Buyer the Excess Lease Value. In the event Buyer has purchased digital
signage equipment installed in retail locations owned, operated, or managed
by
the Retail Partners, wherein the purchase price of the digital signage equipment
plus the amount of the Promissory Note which Buyer has paid to Seller exceeds
the total value of the Promissory Note, hereinafter referred to as (“Excess
Purchase Value”), Seller shall be obligated to repay Buyer the Excess Purchase
Value. The rate at which Seller shall pay Buyer both Excess Purchase Value
and
Excess Lease Value shall be calculated by adding the Excess Lease Value and
the
Excess Purchase Value, dividing it by the number of locations owned, operated,
or managed by the Retail Partners wherein digital signage Equipment is installed
and dividing it by twenty-four equal payments (24) to be paid by Seller to
Buyer
on the first of each month commencing thirty days (30) after the date of
default. In exercising the aforementioned remedies, the Seller in no way becomes
obligated to refund any part of the Purchase Price which has been previously
paid.
5.
In addition to the APA, Deployment:
Consistent
with the Sellers representations made to the Retail Partners at the request
of
Buyer, Buyer agrees to procure the necessary Equipment to deploy the following
locations in the time period specified below:
|
Deployment,
Number of locations, by Retail Partner
|
|||
|
|
Big
Y Foods Inc.
|
Foodtown
Inc.
|
Wakefern
Food Corporation
|
|
September
1, 2006
|
25
|
|
|
|
October
1, 2006
|
25
|
|
|
|
November
1, 2006
|
3
|
|
|
|
December
1, 2006
|
|
60
|
|
|
January
1, 2007
|
|
|
|
|
February
1, 2007
|
|
|
30
|
|
March
1, 2007
|
|
|
30
|
|
April
1, 2007
|
|
|
15
|
IN
WITNESS WHEREOF,
the
parties hereto have caused this Addendum to be executed by their respective
duly
authorized officers or representatives as of the last date set forth
below.
| Captive Audience, LLC | Pantel Systems, Inc | |
| By: /s/ Xxxx Xxxxxx | By: /s/ Xxx Xxxxxxx | |
| Name: Xxxx Xxxxxx | Name: Xxx Xxxxxxx | |
| Title: Chairman | Title: Chief Executive Officer | |
| Ignition Media Group, Inc | ||
| By: /s/ Xxxxxxxx Xxxxxxxxxx | ||
| Name: Xxxxxxxx Xxxxxxxxxx | ||
| Title: President |
