Amendment No. 1 to Asset Purchase Agreement
EXHIBIT 2.1
This Amendment No. 1, effective as of September 26, 2006 (this “Amendment”), is to that
certain Asset Purchase Agreement (the “Agreement”), dated as of August 4, 2005, by and among
NuVasive, Inc., a Delaware corporation (“Buyer”); Pearsalls Limited, a private limited company
incorporated in England and Wales under registration number 03851227 (“Seller”); and American
Medical Instruments Holdings, Inc., a Delaware corporation (“Seller Parent”). All capitalized
terms set forth in this Agreement not defined herein shall have the meaning set forth in the
Agreement.
WHEREAS, Buyer, Seller and Seller Parent desire to amend the Agreement as set forth below.
NOW THEREFORE, in consideration of the representations, warranties, covenants and agreements
contained herein, and for other valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties mutually agree as follows:
1. Milestone Payment. Within 15 calendar days following the date of this Amendment, Buyer
shall make a payment to Seller in respect of having completed the First Milestone consisting of (i)
$2,500,000 in cash and (ii) that number of shares of Common Stock (the “Shares”) equal to the
quotient obtained by dividing (x) $8,000,000 by (y) the Reference Market Value on the date of
payment, with any fraction of a share of Common Stock being treated as set forth in Section 2.8 of
the Agreement (collectively, the “Milestone Payment”).
2. Final Payment. Within 15 calendar days following the date of this Amendment, Buyer
shall make a payment to Seller in respect of Seller entering into this Amendment and having agreed
to forego all future payments contemplated by the Agreement consisting of $9,500,000 in cash (the
“Final Payment”).
3. Deleted Sections. Section 2.5 (Additional Consideration), Section 2.6 (Right of
Reversion), Section 2.7 (Form of Consideration Payable by Buyer) and Section 2.9 (Earnout Payments)
of the Agreement shall be deleted in their entirety and of no further force or effect.
4. Registration of the Shares.
(a) Registration. Buyer shall file as promptly as practicable (but in any event
within 30 days after the date of the payment required by Section 1 hereof) and use its reasonable
efforts to have declared effective as promptly as practicable (but in any event, within 120 days
after the date of this Amendment) a registration statement on Form S-3 (or any successor form to
Form S-3) promulgated under the Securities Act of 1933, as amended, covering the resale of the
Shares (the “Registration Statement”). Buyer shall use its reasonable efforts to cause the
Registration Statement to become and remain
effective until the earlier of (i) the date on which all of the Shares have be sold or (ii)
the date that is one hundred twenty (120) days after the Registration Statement is first declared
effective.
(b) Limitations. The registration rights granted to Seller above are subject to the
following limitations:
(i) Buyer shall be entitled to postpone for a reasonable time, not exceeding ten (10) days,
the filing of the Registration Statement or its efforts to cause the Registration Statement to
become effective if at the time the right to delay is exercised Buyer shall determine in good faith
that such offering would interfere with any acquisition, financing or other transaction which Buyer
is actively pursuing and is material to Buyer or would involve initial or continuing disclosure
obligations that would not be in the best interests of Buyer; and
(ii) Notwithstanding the foregoing, Buyer by notice to Seller Parent may postpone all sales
under the Registration Statement for a reasonable time, not exceeding thirty (30) days, if Buyer
shall determine in good faith that permitting such sales would interfere in any material respect
with any material acquisition, financing or other transaction which Buyer is actively pursuing or
require premature disclosure (if Buyer is so advised by its legal counsel) of any other material
corporate development or event, which disclosure Buyer believes would adversely affect the
interests of Buyer; provided that Buyer may not implement more than one such postponement.
(c) Facilitation of Sale of the Shares. Buyer shall use its reasonable efforts to
facilitate (as explained below) upon the written request of Seller the private sale by the Seller
of the Shares to a third party in the event that the Registration Statement has not been declared
effective within 120 days after the date of this Agreement, except as set forth in Section 4(b)
above; provided that Buyer shall be entitled to suspend such efforts if and when the Registration
Statement is thereafter declared effective. Seller acknowledges and agrees that the reasonable
efforts to facilitate obligations of Buyer under this Section will be satisfied by the chief
executive officer or the president of Buyer giving a “road show” type presentation about Buyer to
prospective buyers identified by Seller, that Buyer shall not be required by this Section to
disclose any material inside information in any such presentation and that the obligations of Buyer
under this Section do not require among other things Buyer to make representations and warranties
to any buyer of the Shares. Buyer and Seller shall cooperate in good faith to schedule the time
and place for any above described and requested “road show” presentation.
(d) Indemnification.
(i) Indemnification by Buyer. In connection with registration of the Shares pursuant
to this Agreement, to the extent permitted by law, Buyer shall indemnify and hold harmless Seller
and each officer, director and agent of Seller and each person, if any, who controls Seller (within
the meaning of the Securities Act of 1993, as amended (the “Securities Act”), or the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) (such holder and any such other person being
hereinafter an “Seller Indemnitee”) (A) against any and all losses, claims, damages and expenses
whatsoever to
which such Seller Indemnitee may become subject, to the extent such losses, claims, damages or
expenses (or actions in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Registration Statement, the
prospectus included in the Registration Statement or any amendment or supplement to any of the
foregoing, or arise out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading; (B) against any and all
losses, claims, damages and expenses whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding by any governmental agency or
body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, if such settlement is effected with the
written consent of Buyer; and (C) against any and all expense whatsoever (including reasonable fees
and disbursements of counsel), as reasonably incurred in investigating, preparing for or defending
against any litigation, or investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission,
or any such alleged untrue statement or omission, to the extent that any such expense is not paid
under subparagraph (A) or (B) above; provided, however, that Buyer shall not be required to
indemnify and hold harmless or reimburse a Seller Indemnitee to the extent that any such loss,
claim, damage or expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission in any document made in reliance upon and in conformity
with written information furnished to Buyer by or on behalf of such Seller Indemnitee expressly for
use in the preparation of such documents; provided further that Buyer shall not be required to
indemnify any Seller Indemnitees, to the extent that the loss, claim, damage, liability (or actions
in respect thereof) or expense for which indemnification is claimed results from the failure by
such Seller Indemnitee to send or give a copy of the then current prospectus (if theretofore made
available to Seller) or a prospectus supplement to the person asserting an untrue statement or
alleged untrue statement or omission or alleged omission if such statement or omission was
corrected in the then current prospectus or in the prospectus supplement; provided further that
Buyer shall not be required to indemnify any Seller Indemnitees to the extent that the loss, claim,
damage, liability (or actions in respect thereof) or expense for which indemnification is claimed
arises with respect to a sale or transfer of common stock of Buyer made during a period during
which the sale or transfer thereof is not permitted under this Amendment.
(ii) Indemnification by Seller. In connection with the Registration Statement, Seller
will furnish to Buyer in writing such information as shall be reasonably requested by Buyer for use
in the Registration Statement or prospectus and shall, to the extent permitted by law, indemnify
and hold harmless Buyer, its directors, officers and agents and each person, if any, who controls
Buyer (within the meaning of the Securities Act or the Exchange Act) (Buyer and any such other
person being hereinafter a “Buyer Indemnitee”) against all losses, claims, damages or liabilities
to which any such Buyer Indemnitee may become subject, under the Securities Act or the Exchange Act
or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue or alleged untrue statement of any material fact
contained in the Registration Statement, prospectus or any preliminary
prospectus or any amendment or supplement to any of the foregoing, or arise out of or are
based upon the omission to state therein a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they were made, not
misleading, in each case, to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to Buyer by or on behalf of Seller expressly for use
in the preparation of such documents; and, subject to Section 4(d)(iii) below, Seller shall
reimburse Buyer Indemnitee for any and all expenses whatsoever (including reasonable fees and
disbursements of counsel chosen by Buyer), reasonably incurred by Buyer Indemnitee in connection
with investigating, preparing for or defending against any such loss, claim, damage, liability or
action; provided, however, that the maximum amount of liability of Seller under this Section shall
be limited to an amount equal to the net proceeds actually received by Seller from the sale of
securities effected pursuant to such registration.
(iii) Indemnification Procedures. Promptly after receipt by an indemnified party
under Section 4(b)(i) or Section 4(b)(ii) of notice of the commencement of any action, suit,
proceeding or investigation or threat thereof made in writing for which such person will claim
indemnification or contribution pursuant to this Amendment, the indemnified party shall notify the
indemnifying party thereof in writing and, unless in such indemnified party’s reasonable judgment a
conflict of interest may exist between such indemnified and indemnifying parties with respect to
such claim, shall permit such indemnifying party to assume and control the defense of such claim at
its expense with counsel reasonably satisfactory to such indemnified party. The failure to so
notify the indemnifying party shall relieve the indemnifying party from any liability hereunder
with respect to the action if such failure prevents the indemnifying party from contesting such
action; provided, however that any such failure shall not relieve the indemnifying party from any
other liability which it may have to any other party. If the indemnifying party gives notice to
such indemnified party of its election to assume and control the defense of such claim, the
indemnifying party will not be liable to such indemnified party for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense or investigation of
the action unless the indemnified party shall have given the indemnifying party notice of a
conflict of interest with respect to such claim. The failure of an indemnifying party to give
notice to the indemnified party of its election to assume and control the defense of any action for
which notice has been received by the indemnifying party in accordance with this Section within 45
days after the receipt of such notice shall constitute an election by the indemnifying party not to
assume and control the defense of such action. An indemnifying party who is not entitled to, or
elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of
more than one counsel for all parties indemnified by such indemnifying party with respect to such
claim, unless in the reasonable judgment of any indemnified party a conflict of interest may exist
between such indemnified party and any other indemnified party with respect to such claim, in which
event the indemnifying party shall be obligated to pay the fees and expenses of separate counsel
for such indemnified parties. No indemnified party shall consent to entry of any judgment or enter
into any settlement with respect to a claim without the consent of the indemnifying party.
(iv) Rights of Contribution. In order to provide for just and equitable contribution
in circumstances under which the indemnity contemplated by Section 4(b)(i) and Section 4(b)(ii) is
for any reason not available, other than by reason of the exceptions provided therein, the parties
required to indemnify by the terms thereof shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity agreement incurred by
Buyer and Seller, except to the extent that contribution is not permitted under Section 11(f) of
the Securities Act. In determining the amounts which the respective parties shall contribute,
there shall be considered the relative benefits received by each party from the offering of the
Shares (taking into account the portion of the proceeds of the offering realized by each), the
relative knowledge of the parties and access to information concerning the matter with respect to
which the claim was asserted, the opportunity to correct and prevent any statement or omission and
any other equitable considerations appropriate under the circumstances. Buyer and Seller agree
with each other that Seller shall not be required to contribute any amount in excess of the amount
Seller would have been required to pay to an indemnified party if the indemnity under Section
4(b)(ii) were available. For purposes of this Section, each director and each officer of Buyer who
signed the Registration Statement, and each person, if any, who controls Buyer or Seller within the
meaning of Section 15 of the Securities Act shall have the same rights to contribution as Buyer or
Seller, as the case may be.
5. No Additional Payments. The parties hereto agree, that at such time as Buyer has made
both the Final Payment and the Milestone Payment to Seller, no further amounts will be owed by
Buyer to Seller or Seller Parent in respect of the assets acquired pursuant to the Agreement.
6. Manufacturing Facility. In the event that Seller determines to sell or otherwise
transfer its manufacturing facility located in Taunton, United Kingdom (the “Manufacturing
Facility”), to any bona fide purchaser other than Seller’s current management team, including its
managing director, or an entity controlled by Seller’s current management team, including its
managing director, Seller shall provide the proposed terms of sale (the “Terms of Sale”) to Buyer
on a confidential basis. Buyer shall have the right (exercisable only within twenty (20) days of
receipt of the Terms of Sale), to notify Seller in writing of its election to acquire the
Manufacturing Facility on terms substantially similar to the Terms of Sale (the “Election Notice”).
In the event that Buyer delivers the Election Notice to Seller, the parties shall work together in
good faith for a period of not to exceed sixty (60) days to complete the sale of the Manufacturing
Facility to Buyer. In the event the parties do not complete the sale of the Manufacturing Facility
to Buyer as provided for herein, Seller shall be permitted to sell the Manufacturing Facility to
the bona fide purchaser on terms substantially similar to the Terms of Sale; provided, however,
that Seller shall not sell the Manufacturing Facility to any such purchaser during an additional,
successive sixty (60) day period if Buyer and Seller are making a good faith effort to complete the
sale of the Manufacturing Facility to Buyer.
7. Mutual Representations and Warranties. Each party hereby represents and warrants to the
other parties that: (i) such party has the authority and right to enter into and perform this
Amendment, (ii) this Amendment is a legal and valid obligation binding
upon such party and is enforceable in accordance with its terms, subject to applicable limitations
on such enforcement based on bankruptcy laws and other debtors’ rights, and (iii) such party’s
execution, delivery and performance of this Amendment will not conflict in any material fashion
with the terms of any other agreement or instrument to which it is or becomes a party or by which
it is or becomes bound, nor violate any law or regulation of any court, governmental body or
administrative or other agency having authority over it. Each party acknowledges and hereby
verifies that the other party has not made any representations or warranties in connection with
this Amendment, whether express or implied, of any kind or character, except as expressly set forth
herein.
8. Seller’s Investment Representations.
(a) The issuance of the Shares by Buyer is made in reliance upon Seller’s representation to
Buyer, which by Seller’s execution of this Amendment Seller hereby confirms, that the Shares to be
received by Seller will be acquired for investment for Seller’s own account, not as a nominee or
agent, and not with a view to the sale or distribution of any part thereof and that Seller has no
present intention of selling, granting any participation in, or otherwise distributing any of the
Shares; provided, however, that the foregoing shall not be deemed to limit Seller’s
registration rights under Section 4 of this Amendment. By executing this Amendment, Seller further
represents that it has no present contract, undertaking, agreement or arrangement with any person
to sell, transfer or grant participation to such person or to any third person, with respect to any
of the Shares.
(b) Seller understands and acknowledges that the issuance and sale of the Shares pursuant to
this Amendment will not be registered under the Securities Act on the grounds that the offering and
sale of the Shares are exempt from registration pursuant to Section 4(2) of the Securities Act and
that the Shares may not be resold except upon their subsequent registration or pursuant to an
exemption from the registration requirements, and that Buyer’s reliance upon such exemption is
predicated upon Seller’s representations as set forth in this Agreement.
(c) Seller represents that: (i) it has such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of its prospective investment in the
Shares; (ii) it believes it has received all the information it has requested from Buyer and
considers necessary or appropriate for deciding whether to obtain the Shares; (iii) it has had the
opportunity to discuss Buyer’s business, management, and financial affairs with Buyer’s management;
(iv) it has the ability to bear the economic risks of its prospective investment; and (v) it is
able, without materially impairing its financial condition, to hold the Shares for an indefinite
period of time and to suffer a complete loss on its investment; provided, however,
that the foregoing shall not be deemed to limit Seller’s registration rights under Section 4 of
this Amendment.
(d) Seller qualifies as an “accredited investor” within the meaning of Regulation D of the
rules and regulations promulgated under the Securities Act.
9. General Provisions.
(a) Except as amended hereby, the Agreement shall remain unchanged and in full force and
effect.
(b) The Agreement, as amended by this Amendment, constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof, and supersedes any and all prior
agreements and undertakings, oral or written, concerning the subject matter hereof. This Amendment
may not be changed or terminated orally, and may only be changed or terminated by a writing signed
by the party against whom such change or termination is sought.
(c) This Amendment shall be governed by and construed in accordance with the laws of the State
of Delaware without regard to principles of conflicts of law.
(d) This Amendment may be executed in counterparts, each of which shall be deemed to be an
original and both of which together shall be deemed to be one and the same instrument. Delivery of
signed counterparts by facsimile shall be fully as effective as if original counterparts were
executed and delivered.
[Signature page follows]
IN WITNESS WHEREOF, this Amendment has been duly executed by the parties as of the date first
set forth above.
| NUVASIVE, INC. | ||||||
| a Delaware corporation | ||||||
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ | |||||
| Name: | ||||||
| Its: | Chairman and CEO | |||||
| PEARSALLS LIMITED | ||||||
| By: | /s/ K. ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||||
| Name: | K. ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||||
| Its: | President | |||||
| AMERICAN MEDICAL INSTRUMENTS HOLDINGS, INC. | ||||||
| By: | /s/ K. ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||||
| Name: | K. ▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||||
| Its: | President | |||||
[SIGNATURE PAGE TO AMENDMENT NO. 1 TO ASSET PURCHASE AGREEMENT]