Item 1.01. Entry into a Material Definitive Agreement
On
The Assets were acquired at Closing for a purchase price of 1,500,000 shares of
common stock of the Company (the "Shares"). The acquisition of the Assets closed
on
During the one hundred and twenty (120) day period following the Closing, Sellers have the sole right to continue to collect all outstanding accounts receivable of the Business as of the Closing other than the Acquired AR. On or before the end of the one hundred and twenty (120) days following the Closing, Sellers will have the option, at their sole discretion, to transfer any remaining outstanding accounts receivable of the Business as of the Closing other than the Acquired AR to the Company and, in such event, the Company will have the sole right to collect such outstanding accounts receivable (any such transferred accounts receivable, the "Bonus AR"); provided, however, that in its sole discretion, the Company may reject assignment of any accounts receivable that constitute the Bonus AR.
The Company shall pay to Sellers during the 24-month period from the transfer date of the Bonus AR (the "Receivable Bonus Period") an amount equal to the product of: (i) 45% multiplied by (ii) the gross amount of the Bonus AR collected by the Company during such calendar month during the Receivable Bonus Period (the "Receivable Bonus").
Any Receivable Bonus will be paid to each Seller in the following percentages (the "Pro Rata Share"): NervePro: 16%; Neuroprotect: 34%; Neurotech: 34%, and Nervefocus 16%. The parties agree that no costs or expenses of the Company arising from or related to the Bonus AR will be applied to offset or reduce the Receivable Bonus. For clarity, no Receivable Bonus will be owed or paid with respect to any Acquired AR.
The Company has sole and absolute discretion with regard to all matters relating to the Company's operations, including the operation of the Business and whether or not to collect (and what if efforts, if any, are used to collect) Bonus AR. Purchaser has no obligation to operate the Business in order to achieve any Receivable Bonus payment or to maximize the amount of any Receivable Bonus payment.
The Purchase Agreement contains customary representations, warranties and covenants from each of the parties. Under the Purchase Agreement, the Sellers have agreed to indemnify us for (a) any misrepresentation, omission, or breach by Sellers of any representation or warranty contained in the Purchase Agreement; (b) any nonperformance, failure to comply, or breach of or default by Sellers of any covenant, promise, or agreement of Sellers contained in this Agreement; (c) any retained liabilities of the Sellers; and (d) any excluded assets of the Sellers. Under the Purchase Agreement, the Company has agreed to indemnify the Sellers for (a) any misrepresentation, omission, or breach by the Company of any representation or warranty contained in the Purchase Agreement; (b) any
nonperformance, failure to comply, or breach of or default by the Company of any covenant, promise, or agreement of the Company contained in this Agreement; and (c) any assumed liabilities of the Sellers. Neither Seller nor the Company have any obligation to indemnify the other until the aggregate amount of loss exceeds 5% of the value of the closing consideration value and subject to a maximum indemnification amount of 15% of the closing consideration value.
In connection with the Closing under the Purchase Agreement, the Company also entered into a bill of sale, related to the Assets, and assignment and assumption agreement related to the assignment and assumption of contracts and assumed liabilities, and medical records custody agreement to arrange for the transfer and safekeeping and access to certain medical records of the Sellers transferred to the Company.
In relation to the issuance of the Shares, the Company and the Sellers entered
into a registration rights agreement dated
The above is a description of the material terms of the Purchase Agreement and the Registration Rights Agreement and is qualified in its entirety by the more complete terms and conditions set forth in the Purchase Agreement and the Registration Rights Agreement which are filed with this Current Report on Form 8-K as exhibits 10.1 and 10.2, respectively, and are incorporated herein by reference.
Item 3.02 Unregistered Sales of
The information set forth above under Item 1.01 is hereby incorporated by reference into this Item 3.02.
In connection with the acquisition of Seller's Assets, the Company issued to Sellers 1,500,000 Shares. The Shares were issued pursuant to Rule 506(b) of Regulation D and Section 4(a)(2) of the Securities Act, and applicable state securities law exemptions based on the representations of the Sellers in the Purchase Agreement. The Shares are "restricted securities" as defined in Rule 144 of the Securities Act.
On
Item 7.01 Regulation FD
On
Item 9.01 Exhibits
Exhibit No.Name
10.1 Purchase Agreement datedDecember 30, 2022 10.2 Registration Rights Agreement datedDecember 30, 2022 99.1 Press Release datedJanuary 6, 2023
104Cover Page Interactive Data File (formatted in Inline XBRL and included as Exhibit 101).
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