EXHIBIT 10.1
AMENDMENT NO. 2 TO SECURITIES PURCHASE AGREEMENT
This Amendment No. 2 to Securities Purchase Agreement (this "SPA
AMENDMENT") is dated effective as of March 6, 2009, among Integrated Healthcare
Holdings, Inc., a Nevada corporation (the "COMPANY"), Xxxx X. Xxxxxxxxx, M.D.,
an individual ("INVESTOR"), and Xxxxxxx X. Xxxxxx, an individual ("XXXXXX").
Capitalized terms used herein and not otherwise defined herein have the meanings
set forth in the SPA (as defined below).
R E C I T A L S
WHEREAS, the parties entered into a Securities Purchase Agreement on
July 18, 2008 and then entered into Amendment No. 1 to Securities Purchase
Agreement on January 30, 2009 (the Securities Purchase Agreement, as amended by
Amendment No. 1 to Securities Purchase Agreement, the "SPA").
WHEREAS, Section 4.9 of the SPA describes certain pre-emptive rights
granted by the Company to Investor and Xxxxxx, which pre-emptive rights were
clarified in Amendment No. 1 to Securities Purchase Agreement and remain in full
force and effect.
WHEREAS, the parties desire to revise Section 4.9 to further clarify
their intentions with respect to those pre-emptive rights.
A G R E E M E N T
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this SPA Amendment and the SPA, and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. The defined term "Agreement" is hereby amended and restated in its
entirety as follows:
"AGREEMENT" means the SPA, as amended by the SPA
Amendment and Amendment No. 2 to Securities Agreement among
the parties hereto, and as further amended from time to time
in accordance with Section 6.4.
2. Section 4.9 is hereby amended and restated in its entirety as
follows:
4.9 PRE-EMPTIVE RIGHTS. Effective July 18, 2008, the
Company hereby grants to Investor and Xxxxxx pre-emptive
rights with respect to issuances, on or after July 18, 2008,
by the Company of its equity securities or securities or
rights convertible into or exercisable for equity securities
(other than issuances of Additional Shares, SPR Shares, or
shares of Common Stock issued on July 18, 2008 upon exercise
of the Exercised Warrants), where issuance of those securities
or rights would result in (a) dilution of Investor's or
Xxxxxx'x beneficial
ownership (as calculated by Investor or Xxxxxx for purposes of
Section 13(d) of the Exchange Act) of the Common Stock of the
Company on a fully-diluted basis taking into account all
Common Stock Equivalents (each a "POST-TRANSACTION
PERCENTAGE") to less than his respective beneficial ownership
of the Common Stock of the Company on a fully-diluted basis
taking into account all Common Stock Equivalents immediately
prior to the consummation of the proposed issuance (each a
"PRE-TRANSACTION PERCENTAGE") and/or (b) dilution of
Investor's or Xxxxxx'x ownership of outstanding voting shares
of the Company to less than the greater of (i) 51.0% and 5.0%,
respectively, of the outstanding voting shares of the Company
and (ii) his respective percentage ownership of the
outstanding voting shares of the Company prior to the issuance
(each of (i) and (ii), a "VOTING THRESHOLD"). Each time the
Company proposes to issue or offer any shares of, or
securities or rights convertible into or exercisable for any
shares of, any class of the Company's equity securities (the
"NEW SHARES") that would reduce Investor's or Xxxxxx'x
Post-Transaction Percentage to below his respective
Pre-Transaction Percentage and/or would reduce Investor's or
Xxxxxx'x percentage ownership of voting shares below one of
his respective Voting Thresholds, the Company shall first make
a written offer (the "OFFER NOTICE") to Investor and Xxxxxx of
such portion of the New Shares that would maintain Investor's
and Xxxxxx'x Post-Transaction Percentage at a minimum of their
respective Pre-Transaction Percentage and would maintain
Investor's and Xxxxxx'x ownership of voting shares at or above
their respective Voting Thresholds (the "PRO RATA SHARE"). The
Offer Notice would state the Company's (A) bona fide intention
to issue or offer the New Shares, (B) the identity of the
Person(s) to whom the New Shares are to be issued or offered,
(C) the number of New Shares to be issued or offered, and (D)
the price and terms upon which it proposes to issue or offer
the New Shares. Investor and/or Xxxxxx may, by written notice
to the Company delivered within thirty (30) days of their
respective receipt of the Offer Notice, elect to purchase, at
the price and on the terms specified in the Offer Notice, up
to the Pro Rata Share. The closing of the sale of such portion
of the Pro Rata Share as Investor and/or Xxxxxx elect to
purchase shall occur simultaneously with the issuance or sale
of the New Shares to other Person(s) identified in the Offer
Notice, no earlier than forty-five (45) days following
Investor's and Xxxxxx'x receipt of the Offer Notice (unless a
shorter period of time is agreed to by Investor and Xxxxxx in
their sole discretion), and the Pro Rata Share shall be priced
equal to the lowest price paid by any of the other Person(s)
identified in the Offer Notice, including any who may be
receiving or purchasing New Shares by virtue of similar
pre-emptive or other purchase rights. If the Company does not
consummate the issuance or sale of the New Shares within sixty
(60) days following Investor's and Xxxxxx'x receipt of the
Offer Notice, then the New Shares shall not be offered, issued
or sold unless again offered to Investor and Xxxxxx in
accordance with this Section 4.9. Effective July 18, 2008, the
pre-emptive rights contained in this Section 4.9 shall
supersede and replace the pre-
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emptive rights contained or incorporated by reference in the
Rescission Agreement. For the avoidance of doubt, the parties
acknowledge and agree that unless and until this Section 4.9
is specifically terminated in a writing signed by Investor and
Xxxxxx that explicitly refers to and provides for the
termination of this Section 4.9, this Section 4.9 shall
survive each Closing and the Outside Date, regardless of
whether any Additional Shares or SPR Shares are purchased by
Investor and notwithstanding any other termination, expiration
or lapse of this Agreement or the Purchase Right. The parties
further acknowledge and agree that neither Investor nor Xxxxxx
is obligated to exercise his respective pre-emptive rights in
full or in part as to any or all proposed issuances by the
Company, and that no failure on the part of Investor or Xxxxxx
to exercise his respective pre-emptive rights in full or in
part as to any proposed issuance by the Company shall be a
waiver of or preclude exercise of his respective pre-emptive
rights as to any other proposed issuances by the Company.
3. Section 6.17 is hereby deleted. In lieu of adopting a replacement to
Section 6.17, the parties hereby acknowledge that except as specifically amended
by Amendment No. 1 to Securities Purchase Agreement or by this SPA Amendment,
all terms, conditions, covenants, representations and warranties contained in
the Securities Purchase Agreement dated as of July 18, 2008 remain in full force
and effect.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed by their respective authorized signatories as of the date first
indicated above.
INTEGRATED HEALTHCARE HOLDINGS, INC.
By: /s/ Xxx Xxxxxxxxx
--------------------------------
Name: Xxx Xxxxxxxxx
Title: President and CEO
INVESTOR
/s/ Xxxx X. Xxxxxxxxx, M.D.
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Xxxx X. Xxxxxxxxx, M.D.
XXXXXX
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
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