EXHIBIT 10.1
CLOSING AGREEMENT
THIS CLOSING AGREEMENT ("Agreement") is dated as of June 16, 2003, by and
among LIFETIME HEALTHCARE SERVICES, INC., a Delaware corporation ("Lifetime"),
REDWOOD INVESTMENTS ASSOCIATES, L.P., a Delaware limited partnership
("Redwood"), the stockholders of Lifetime listed on Schedule A hereto (the
"Stockholders"), XX. XXXXXXXX XXXXXX, M.D., an individual with offices at Two
Jericho Plaza - Wing B, Jericho, New York 11753 ("Xx. Xxxxxx"), AMERICAN UNITED
GLOBAL, INC., a Delaware corporation ("AUGI"), XXXXX XXXXXX, an individual with
office at Two Jericho Plaza - Wing B, Jericho, New York 11753 ("X. Xxxxxx"), THE
XXXXX FAMILY IRREVOCABLE STOCK TRUST (the "Trust"), and XXXXXX X. XXXXX
("Xxxxx").
WHEREAS, as of the date hereof, Lifetime has acquired all of the shares of
capital stock of NEW YORK MEDICAL, INC., a Delaware corporation ("NYMI"), owned
by Redwood (the "Acquisition") pursuant to that certain Stock Purchase Agreement
by and among Lifetime, Redwood and NYMI, dated as of March 21, 2003, as amended
as of June 16, 2003 (the "Purchase Agreement");
WHEREAS, the Stockholders own that number of shares of common stock, no par
value per share, of Lifetime (the "Lifetime Common Stock"), as set forth on
Schedule A hereto;
WHEREAS, the Trust is currently the record and beneficial owner of
approximately 77.6% of the outstanding shares of the common stock of AUGI, $0.01
par value per share ("AUGI Common Stock"), and following consummation of a stock
dividend to current AUGI stockholders and the "AUGI Merger" (defined below),
will own of record and beneficially the approximate number and percentage of
outstanding AUGI Common Stock as set forth on Schedule B hereto;
WHEREAS, Xxxxx is the President and Chief Executive Officer of AUGI;
WHEREAS, X. Xxxxxx is the holder and payee under the Xxxxxx Note (as that
term is defined in the Purchase Agreement);
WHEREAS, immediately following the consummation of the transactions
contemplated by the Purchase Agreement, the Stockholders are causing Lifetime to
be merged with a wholly-owned acquisition subsidiary of AUGI (the "AUGI
Merger"); as a result of which AUGI Merger, (a) the Stockholders shall receive
shares of capital stock of AUGI entitling them to vote the equivalent of up to
an aggregate of 4,417,461 shares of AUGI Common Stock, and (b) Lifetime, as the
surviving corporation of the AUGI Merger, will become a wholly-owned subsidiary
of AUGI and AUGI shall be the indirect beneficial owner of 55% of the
outstanding capital stock of NYMI; and
WHEREAS, Lifetime, the Stockholders, AUGI, Redwood, the Trust, Xxxxx and
Xx. Xxxxxx xxxx it to be in their respective best interests to provide for
certain provisions governing the control and operation of AUGI, Lifetime and
NYMI for an interim period.
NOW, THEREFORE, in consideration of the foregoing and intending to be
legally bound hereby, the parties hereto agree as follows:
1. Defined Terms. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned thereto by the Purchase Agreement.
As used in this Agreement, the term "Settlement Date" shall mean the date
on which the last of the following events (collectively, the "Payment
Events") shall have taken place:
(a) the satisfaction of all obligations of NYMI under the Xxxxxx
Note; and
(b) the unpaid principal amount of the original $5,500,000 Note
issued pursuant to Section 1.2 of the Purchase Agreement (giving
effect to all conversions of principal thereunder) shall be $3,500,000
or less.
2. Boards of Directors. Commencing on the Closing Date and ending on the
Settlement Date:
(a) Redwood shall have the right to nominate and have elected to
the board of directors of each of Lifetime and NYMI (the "Subsidiary
Boards"), a total of two (2) directors (the "Redwood Directors");
(b) The entire Subsidiary Boards shall consist of no more than
three (3) directors, of which one (1) director (the "Minority
Director") shall be Xxxxx or such other person as shall be designated
by a majority of the entire board of directors of AUGI (the "AUGI
Board");
(c) The AUGI Board shall consist of a total of five (5) persons,
of which two (2) directors shall be the Redwood Directors (or such
other persons acceptable to Redwood), two (2) directors shall be Xxxxx
and one other person acceptable to Xxxxx, and the remaining one (1)
member of the AUGI Board shall consist of an independent director
(within the meaning of the Xxxxxxxx-Xxxxx Act of 2002 (the "SOX") as
applicable to the member of AUGI's audit committee pursuant to Section
301 thereunder) who shall be a person mutually acceptable to Xxxxx and
Redwood (the "Independent Director"); and
(d) At any time at which (i) the Stockholders and the Trust shall
have the right to vote in the election of members of the AUGI Board,
and (ii) AUGI shall have the right to vote in the election of members
of the Subsidiary Boards, respectively, each of AUGI, the Trust and
the Stockholders agree to vote all of the capital stock of AUGI and/or
Lifetime it or they own in favor of the election of the Redwood
Directors to the Subsidiary Boards and the AUGI Board, and the
election of the Independent Director to the AUGI Board, as
contemplated hereby.
3. Actions by the Subsidiary Boards and the AUGI Board.
(a) The Subsidiary Boards. Redwood agrees to, and to cause its
affiliates and the Redwood Directors to, only take those actions as
members of the Subsidiary Boards in conducting the business and
operations of Lifetime and its subsidiaries (including NYMI) as are
provided for in this Agreement or in accordance with their fiduciary
duties as directors, except that:
(i) payments to Redwood, Xx. Xxxxxx, Xxxxx Xxxxxx or their
respective affiliates, associates or related parties shall only
be made in accordance with this Agreement and the respective
terms of the Purchase Agreement, the Note, the Xxxxxx Note and
the Employment Agreement (collectively, the "Transaction
Documents"), as such terms may be expressly modified by the terms
of this Agreement, and any amendments to any of the Transaction
Documents shall require the approval of the Minority Director of
the Subsidiary Boards, and any such amendment not so approved
shall be null and void ab initio;
(ii) except as otherwise prohibited by applicable law, the
Minority Director shall have the right to review and approve any
amendments or modifications to the terms of the existing
management agreements among NYMI and any or all of the
professional corporations being managed by NYMI (the
"Professional Corporations"), and any such amendment or
modification not so approved shall be null and void ab initio;
(iii) neither Lifetime nor NYMI shall make payments on the
Xxxxxx Note or any other notes or other debt instruments of
Lifetime, NYMI or any of their subsidiaries that are held by
Redwood, Xx. Xxxxxx, Xxxxx Xxxxxx or any of their respective
affiliates, associates or related parties, unless such payments
(A) are made in accordance with the terms of such notes or debt
instruments and this Agreement, and (B) would not violate the
terms and conditions (with or without notice or the passage of
time) of any other debt obligations of Lifetime, NYMI, the
Professional Corporations or any of their respective
subsidiaries, including Senior Indebtedness (as defined in the
Note); and
(iv) the Subsidiary Boards shall not, without the consent of
the Minority Director, cause or permit NYMI to engage in any of
the activities or consummate any of the transactions which would
otherwise be prohibited under Section 3(b)(ii) of this Agreement.
(b) The AUGI Board.
(i) Affirmative Covenants. Until such time as all of the
Payment Events shall have occurred, AUGI hereby agrees, the
Stockholders and the Trust severally agree, in their capacities
as stockholders of AUGI, and Xxxxx agrees, in his capacity as
Chief Executive Officer and a director of AUGI:
(A) to cause the AUGI Board not to take any actions
which, in any way, would contravene, amend, modify or
overrule any of the actions taken by the Subsidiary Boards
in accordance with this Agreement, or otherwise contravene
or violate any of the provisions of this Agreement or any of
the Transaction Documents; and
(B) to cause the AUGI Board to concentrate its primary
efforts toward securing, on or before the dates set forth in
clauses (x) and (y) of Section 4(a) of this Agreement,
additional debt and/or equity financing for AUGI, and upon
securing such financing to (A) first, make payments under
the Xxxxxx Note and then under the Note to satisfy the
Payment Events on a timely basis, as provided in clauses (x)
and (y) of Section 4(a) of this Agreement , (B) second, if
and to the extent required, to refinance Senior Indebtedness
(as defined in the Note), and (C) third, to consummate
additional acquisitions acceptable to the Redwood Directors
on the AUGI Board; provided, that no additional acquisitions
shall be consummated unless and until either prior thereto
or simultaneous therewith, all of the Payments Events shall
have occurred.
(ii) Negative Covenants. Until such time as the Payment
Events shall have occurred, AUGI hereby agrees, and the
Stockholders and the Trust severally agree, in their capacities
as stockholders of AUGI, that without the prior written consent
of Xx. Xxxxxx, AUGI shall not, nor shall it permit or otherwise
cause Lifetime or NYMI to, engage in or otherwise consummate any
of the following:
(A) the incurrence of any indebtedness for money
borrowed or mortgages, liens or security interests on the
assets and properties of NYMI or any of its subsidiaries in
excess of the maximum amounts of indebtedness which may be
borrowed under any existing credit or similar agreements
evidencing Senior Indebtedness of NYMI or any of its
subsidiaries, and secured by mortgages, liens and security
interests currently securing Senior Indebtedness of NYMI or
any of its subsidiaries; provided, however, that prior to
the full satisfaction of the Payment Events, NYMI may
refinance its outstanding Senior Indebtedness to DVI
Business Credit Corp. on terms and conditions acceptable to
both the AUGI Board and the Subsidiary Boards;
(B) except as otherwise provided in Section 4 of this
Agreement, a sale of any assets or properties of NYMI or any
of its subsidiaries (other than the sale of inventories in
the ordinary course of their businesses), or the sale of any
of the outstanding shares of capital stock of NYMI or any of
its subsidiaries, to any person, firm or corporation;
(C) the issuance of any additional shares of capital
stock of NYMI or any of its subsidiaries, or any options or
warrants to purchase shares of capital stock of NYMI or any
of its subsidiaries;
(D) except for its acquisition of the remaining 45% of
the NYMI capital stock owned by The New York Medical, Inc.
Employee Stock Ownership Plan and Trust (the "ESOP"), the
acquisition by AUGI, Lifetime, NYMI or any of their
subsidiaries, whether by stock purchase, asset purchase,
merger, joint venture, consolidation or like combination of
the securities, assets or businesses of any person, firm or
corporation (an "Acquisition");
(E) except for (x) the Senior Indebtedness outstanding
as at the date of this Agreement (or the refinancing of any
such Senior Indebtedness), or (y) up to $250,000 of
indebtedness in the aggregate for the purchase or lease of
office or medical equipment, causing NYMI or any of its
subsidiaries to incur any indebtedness for borrowed money or
capitalized lease transactions;
(F) altering or terminating in any material respect the
basic business of NYMI, Lifetime, AUGI or any of its
subsidiaries;
(G) except for (x) the payment of compensation to Xx.
Xxxxxx in accordance with the terms of his Employment
Agreement, and (y) the payment of compensation to (1) Xxxxxx
X. Xxxxx under the terms of the existing Xxxxx employment
agreement with AUGI, (2) Xxxxxxx Xxx (or his affiliate)
under the terms of the amended and restated consulting
agreement, dated of even date herewith between AUGI and such
affiliate of Xxxxxxx Xxx, and (3) Xxxxxx XxXxxx (or his
affiliate) under the terms of the amended and restated
finders agreement, dated of even date herewith between AUGI
and such affiliate of Xxxxxx XxXxxx (all of which agreements
have been fully disclosed to and approved by Xx. Xxxxxx and
the AUGI Board of Directors), paying any compensation,
bonuses or other remuneration or benefits from AUGI,
Lifetime, NYMI or any of their respective subsidiaries to
any officer, director or stockholder of AUGI, including the
Stockholders, Xxxxx and the Trust, or any of their
affiliates;
(H) paying or issuing any finders fees' brokerage
commissions, placement fees, stock bonuses or stock options
(collectively, "Placement Compensation"), whether in AUGI or
any subsidiary of AUGI, directly or indirectly (to the
extent known by AUGI after reasonable inquiry) to any
officer, director or stockholder of AUGI, including Xxxxx,
the Stockholders and the Trust, or any of their affiliates,
in connection with any debt and/or equity financing(s)
obtained by AUGI; except that Placement Compensation may be
paid to the Stockholders or affiliates of the Stockholders
(including Xxxxxx XxXxxx) to the extent (x) permitted by
applicable securities laws, (y) related directly to the
raising of additional capital for AUGI and its subsidiaries
for the purposes contemplated by Section 3(b)(i)(B) of this
Agreement, and (z) consistent with traditional levels of
"underwriters' or placement agent compensation" or as
otherwise permitted by the NASD for similar debt and/or
equity financings;
(I) entering into any related party transactions with
any of the officers, directors or stockholders of AUGI,
Lifetime or NYMI, including Xxxxx, the Stockholders and the
Trust, or any of their affiliates, which would require
disclosure in a prospectus filed under Form S-1 under the
Securities Act of 1933, as amended, other than transactions
pursuant to existing management agreements with the
Professional Corporations or amounts incurred in the
ordinary course of business except where prohibited by SOX;
(J) except for the purchase of and declaration and
payment of dividends on the capital stock of NYMI owned by
the ESOP, declaring, setting aside, making or paying any
dividend or other distribution in respect of the capital
stock of NYMI, or consummating the repurchase, redemption or
other acquisition of any outstanding shares of capital stock
of NYMI or any of its subsidiaries;
(K) making any inter-company loan or other advance from
NYMI to Lifetime, AUGI or any of their subsidiaries or
affiliates, other than transactions pursuant to existing
management agreements with the Professional Corporations;
(L) effecting any recapitalization, reclassification,
equity split or like change in the current capitalization of
NYMI or any of its subsidiaries;
(M) amending the certificate of incorporation or
organizational documents of NYMI, AUGI or any of its
subsidiaries; or
(N) taking any other actions which, in any way, would
contravene, amend, modify or overrule any of the actions
taken by the AUGI Board and/or Subsidiary Boards in
accordance with the terms of this Agreement.
4. Right to Sale of NYMI.
(a) If (x) by October 17, 2003, the unpaid principal amount of
the Xxxxxx Note is in excess of $1,000,000 (plus any amount deferred
in accordance with Section 8 hereof), or (y) by March 22, 2004, all of
the Payment Events shall not have occurred, then a "Default Event"
under this Agreement shall be deemed to have occurred. Subject to the
conditions set forth below, if either Default Event shall have
occurred and is continuing, upon the written request of Xx. Xxxxxx
given at any time within thirty (30) days after the first occurrence
of such Default Event, the AUGI Board and the Subsidiary Boards shall
engage the services of an investment banker acceptable to Xx. Xxxxxx
to sell either (i) all of the securities of NYMI then owned by
Lifetime or AUGI, or (ii) all or a portion of the assets and
liabilities of NYMI (either, a "Sale of NYMI"), at the highest price
then available and on such other terms and conditions as shall be
acceptable to Xx. Xxxxxx, and shall take all steps reasonably
necessary to consummate the Sale of NYMI.
(b) Notwithstanding the foregoing, a Sale of NYMI shall not be
consummated unless all of the following conditions shall have been
satisfied:
(i) such Sale of NYMI is approved by the Subsidiary Boards;
(ii) the Subsidiary Boards and the AUGI Board shall have
received a "fairness opinion" from an independent financial
advisor with respect to the Sale of NYMI, to the effect that,
based upon the then business, financial condition and prospects
of NYMI and the Transaction Documents, the price and payment
terms of the Sale of NYMI is fair to Lifetime, AUGI and the AUGI
stockholders from a financial point of view; and
(iii) the Sale of NYMI does not require AUGI, Lifetime, or
any of their Subsidiaries or their respective affiliates or
successors to incur any contingent liability following the
Closing in connection with the Sale of NYMI; provided, however,
if required by any prospective purchaser as a condition to the
Sale of NYMI, AUGI and Lifetime shall make representations,
warranties, covenants or agreements for the benefit of any
prospective purchaser in connection with the Sale of NYMI that
are standard and customary for such a transaction if and only if
AUGI and Lifetime each receive an indemnity from Redwood or
another entity deemed creditworthy by the AUGI Board and the
Subsidiary Boards in the exercise of their good faith judgment.
(c) The proceeds from any Sale of NYMI shall be applied in the
following order of priority:
(i) first to pay all out-of-pocket costs (other than the
fairness opinion described in Section 4(b)(i) above) associated
with the Sale of NYMI, including professional fees, commissions
and related expenses;
(ii) second, to pay all accrued and unpaid indebtedness of
NYMI other than $1,500,000 of existing indebtedness to AUGI not
assumed by the purchaser, if any;
(iii) third, to pay all then outstanding indebtedness owed
to the holders of the Xxxxxx Note and the Note;
(iv) fourth, to pay the costs of the fairness opinion
described in Section 4(b)(i) above; and
(v) to the extent of any remaining net proceeds, the same
shall be remitted to AUGI.
In the event that the net proceeds from the Sale of NYMI based upon the
above applications, shall be insufficient to satisfy in full all of the Payment
Events, any unpaid amounts then due to the holders of the Xxxxxx Note and the
Note shall remain obligations of Lifetime and AUGI and shall be payable to the
holders of the Xxxxxx Note and the Note on a date which shall be the earlier to
occur of (i) six months from the date of consummation of the Sale of NYMI, or
(ii) immediately upon consummation of any debt or equity financing(s) for AUGI
subsequent to the date of consummation of the Sale of NYMI.
5. Use of Proceeds. All net proceeds which shall be obtained in connection
with any contemplated debt and/or equity financings for AUGI and its
subsidiaries shall be used and applied in the following order of priority: (i)
first, to make payments under the Xxxxxx Note and then under the Note to satisfy
the Payment Events, (ii) second, if and to the extent required, to refinance
Senior Indebtedness (as defined in the Note), and (iii) third, to consummate
additional acquisitions acceptable to the Redwood Directors on the AUGI Board;
provided, that no additional acquisitions shall be consummated unless and until
either prior thereto or simultaneous therewith, all of the Payments Events shall
have occurred.
6. Lock-Up. In addition to and not in lieu of any other lock-up or related
agreements contained in the Merger Agreement, each of the Stockholders and the
Trust agree not to sell, transfer, hypothecate or assign any shares of Lifetime
Common Stock or AUGI capital stock (including any shares of AUGI Common Stock
into which such shares of AUGI capital stock may be converted) issued to them in
connection with the AUGI Merger or otherwise, until the earlier until the
earlier to occur of (a) May 21, 2004 and (b) date on which the last of the
Payment Events occurs.
7. Termination. This Agreement shall terminate and be of no further force
or effect upon the last of the Payment Events to occur.
8. Deferral of Xxxxxx Note. Notwithstanding anything to the contrary
contained herein, in the event that either (a) DVI Business Credit Corp. ("DVI")
does not extend the due date of its existing lending facility (the "DVI
Facility") for at least six (6) months from September 24, 2003, or (b) NYMI
finds a replacement lender to replace DVI and there is a shortfall in the
borrowing base such that the refinancing is for less than the balance
outstanding at September 24, 2003, X. Xxxxxx hereby agrees to defer the
repayment of the amount of such shortfall up to $500,000 of the Xxxxxx Note owed
to X. Xxxxxx by AUGI for up to twelve (12) months from the date hereof.
There shall be no deferral if DVI extends the DVI Facility or another
asset-based lender refinances 100% of the debt due under the DVI Facility. In
the event of a deferral of a portion of the Xxxxxx Note, such deferred portion
shall accrue interest, from the date of such deferral, at an annualized rate of
twelve percent (12%) until satisfied in full.
In consideration of the above deferral by X. Xxxxxx, the principal stockholders
of AUGI shall pledge an amount of AUGI Common Stock equal in market value on the
date of such deferral determined by multiplying (x) the dollar amount of the
portion of the Xxxxxx Note that is deferred pursuant hereto by (y) two (2). Any
and all decisions as to the choice of a replacement lender and the terms of such
replacement loan shall be made by the AUGI Board.
9. Amendment. This Agreement may be amended, modified and supplemented in
any and all respects, but only by a written instrument signed by all of the
parties hereto expressly stating that such instrument is intended to amend,
modify or supplement this Agreement.
10. Assignment. This Agreement is not assignable by any party hereto and
any purported assignment of this Agreement shall be null and void and of no
effect. Notwithstanding the foregoing, AUGI and/or Lifetime may assign this
Agreement to any successor entity of which NYMI is a direct or indirect wholly
owned subsidiary; provided, that such assignment will not relieve AUGI or
Lifetime from any of its obligations under this Agreement, and any such assignee
shall execute a counterpart of this Agreement pursuant to which such assignee
shall guaranty the performance of all obligations of all of the parties to this
Agreement.
11. Governing Law. This Agreement and all rights and obligations hereunder
shall be governed by and construed in accordance with the laws of the State of
New York applicable to agreements made and to be performed wholly within such
State, without regard to such State's conflicts of laws principles.
12. Guaranty. Simultaneous with the AUGI Merger, AUGI and Lifetime shall
enter into a guaranty agreement, reasonably acceptable to Redwood and Xx.
Xxxxxx, dated as of the date hereof, with respect to the Transaction Documents
(the "Guaranty").
13. AUGI Capitalization. Upon consummation of the AUGI Merger and a
dividend of shares of convertible preferred stock to the stockholders of AUGI
immediately prior to consummation of such AUGI Merger, the issued and
outstanding AUGI capitalization shall be substantially in the form of Schedule B
annexed hereto.
14. Survival. The respective rights and obligations of each of the parties
to this Agreement, the Purchase Agreement, the Guaranty, and any other
Transaction Documents shall survive the AUGI Merger and any merger of AUGI with
any other entity.
15. Conflicts. In the event of any conflicts shall exist between the terms
and conditions contained in this Agreement or in any of the Transaction
Documents, the terms and conditions of this Agreement shall govern.
[The remainder of this page is left intentionally blank.]
IN WITNESS WHEREOF, the parties have executed this Agreement or caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first written above.
LIFETIME HEALTHCARE SERVICES, INC.
By: /s/Xxxxxx XxXxxx
------------------------------
Name: Xxxxxx Xx Xxxx
Title: President and Secretary
REDWOOD INVESTMENTS ASSOCIATES, L.P.
By:____________________________________
Name:
Title:
NEW YORK MEDICAL, INC.
By:____________________________________
Name:
Title:
XX. XXXXXXXX XXXXXX, M.D.
By: /s/ Xxxxxxxx Xxxxxx, M.D.
-----------------------------
Xx. Xxxxxxxx Xxxxxx, M.D.
AMERICAN UNITED GLOBAL, INC.
By:/s/ Xxxxxx X. Xxxxx
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: CEO
XXXXX FAMILY IRREVOCABLE STOCK TRUST
By:/s/ Xxxxxx Xxxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Trustee
/s/ Xxxxx Xxxxxx /s/ Xxxxxx X. Xxxxx
---------------- -------------------
XXXXX XXXXXX XXXXXX X. XXXXX
SCHEDULE A
The Stockholders
CORICO INC.
By:____________________________________
Name:
Title:
Shares of Lifetime: 155
XX XXXXXX INC.
By:____________________________________
Name:
Title:
Shares of Lifetime: 00
XXX XXX FUND, INC.
By:____________________________________
Name:
Title:
Shares of Lifetime: 13
ALLIED INTERNATIONAL FUND INC.
By:____________________________________
Name:
Title:
Shares of Lifetime: 214
XXXXXX FAMILY IRREVOCABLE STOCK TRUST
By:____________________________________
Name:
Title:
Shares of Lifetime: 25
Schedule B
Lifetime Merger Dividend Common Percentage
Stockholder Shares Preferred Stock Preferred Stock Stock ownership (1)
----------- ------ --------------- --------------- ----- -------------
Xxxxxx Xxxxxxxxx 11 4,802 - - - 96,032 0.6 %
Xxxxxxxxx Xxxxxx 21 9,167 - - - 183,333 1.15 %
Xxx X. Xxxx 21 9,167 - - - 183,333 1.15 %
Xxxxx Xxxx Trust 64 27,937 - - - 558,730 3.49 %
Xxxxx Xxxx Irrevocable Trust 43 18,770 - - - 375,397 2.35 %
Xxxxx Xxxxx 54 23,571 - - - 471,429 2.95 %
Corico Inc 155 67,659 - - - 1,353,175 8.46 %
XX Xxxxxx Inc. 99 43,214 - - - 864,286 5.4 %
Saudry LLC 21 9,167 - - - 183,333 1.15 %
Old Oak Fund, Inc. 13 5,675 - - - 113,492 0.71 %
Allied International Fund, Inc. 214 93,413 - - - 1,868,254 11.68 %
XxXxxx Family Irrevocable Trust 25 10,913 - - - 218,254 1.36 %
Xxxxx Xxxxxx or designee (2) 321 140,119 - - - 2,802,381 17.52 %
Xxxxxx Xxxxxxx 3 1,310 - - - 26,190 0.16 %
K-Krew and Company 6 2,619 - - - 52,381 0.33 %
----- ----- ------- --------- -------
Lifetime stockholders 1,071 467,500 - - - 9,350,000 58.45 %
----- ------- ------- --------- -------
Xxxxx Trust - - - - - - 180,382 5,157,474 (3) 32.24 %
Public Stockholders - - - - - - 52,118 1,490,153 (4) 9.31 %
------ --------- -------
Augi stockholders - - - - - - 232,500 6,647,624 (5) 41.56 %
------- --------- -------
Post-Merger stockholders: 15,997,624 100%
========== =======
(1) Presumes issuance of common stock upon conversion of Series B-2
Convertible Preferred Stock (the "Merger Preferred Stock") and the Series B-3
Convertible Preferred Stock (the "Dividend Preferred Stock"). Calculations
assume all the preferred converts at once (not made in accordance with Rule
13d-3).
(2) Subject to redemption for $2,802 in the event certain financing events
do not occur.
(3) Of which 1,549,831 currently outstanding and 3,607,643 issuable upon
full conversion of Dividend Preferred Stock.
(4) Of which 447,793 currently outstanding and 1,042,357 issuable upon full
conversion of Dividend Preferred Stock
(5) Of which 1,997,624 currently outstanding and 4,650,000 issuable upon
full conversion of Dividend Preferred Stock
