SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 24, 2009
IVIVI TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in Charter)
New Jersey 001-33088 22-2956711
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(State Or Other Jurisdiction Of (Commission (IRS Employer
Incorporation) File Number) Identification No.)
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135 Chestnut Ridge Road, Montvale, NJ 07645
(Address of Principal Executive Offices)(Zip Code)
(201) 476-9600
Registrant's Telephone Number
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[X] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On September 24, 2009, Ivivi Technologies, Inc. (the "Company") entered into an
Asset Purchase Agreement (the "Asset Purchase Agreement") with Ivivi
Technologies, LLC (the "Buyer") and Ajax Capital, LLC ("Ajax"), entities
controlled by Steven M. Gluckstern, the Company's Chairman, President, Chief
Executive Officer and Chief Financial Officer. Pursuant to the terms of the
Asset Purchase Agreement, at the closing, the Company will sell substantially
all of the assets of the Company to the Buyer, other than cash and certain other
excluded assets set forth in the Asset Purchase Agreement, and the Buyer will
assume certain specified ordinary course liabilities of the Company as set forth
in the Asset Purchase Agreement. The aggregate purchase price to be paid to the
Company under the terms of the Asset Purchase Agreement will equal the sum of
(i) the amount necessary to pay in full the principal, and accrued interest, as
of closing, under the Company's loan with Emigrant Capital Corp. ("Emigrant"),
which was approximately $2,620,000 as of September 21, 2009 (the "Loan") and
(ii) $475,000; provided, however, that the sum of the amounts specified in
clauses (i) and (ii) would not be in excess of $3.15 million. The closing of the
transactions contemplated by the Asset Purchase Agreement is subject to certain
customary conditions, including the receipt of approval by the Company's
shareholders of the transactions contemplated by the Asset Purchase Agreement.
Under the terms of the Asset Purchase Agreement, the Company and Foundation
Ventures, LLC ("Foundation"), the Company's investment banker, will continue to
have the right to solicit other proposals regarding the sale of the Company's
assets and equity until receipt of the approval by the Company's shareholders of
the transactions contemplated by the Asset Purchase Agreement. Prior to the
receipt of approval by the Company's shareholders of the transactions
contemplated by the Asset Purchase Agreement, the Company may terminate the
Asset Purchase Agreement under specified circumstances in order to enter into a
definitive agreement implementing a Superior Proposal (as defined in the Asset
Purchase Agreement). If the Company terminates the Asset Purchase Agreement to
enter into a Superior Proposal, the Company is required to pay the Buyer a
termination fee equal to $90,000.
In connection with the signing of the Asset Purchase Agreement, the Buyer, the
Company and certain shareholders of the Company, who have the power to vote
approximately 39.5% (and together with the Company's common stock held by Steven
M. Gluckstern, approximately 51.3%) of the Company's common stock, entered into
a Voting Agreement (the "Voting Agreement"). Pursuant to the Voting Agreement,
the signatory shareholders agreed to vote their shares of the Company's common
stock in favor of the transactions contemplated by the Asset Purchase Agreement.
In the event that the Company terminates the Asset Purchase Agreement in
connection with a Superior Proposal, the Voting Agreement will also terminate.
The transaction was reviewed by a special committee of the board of directors of
the Company comprised of independent directors. The special committee engaged
Foundation to evaluate the transaction and to solicit other proposals and assist
the special committee in analyzing and evaluating other proposals, if any,
received by the Company. Although the Company and Foundation have received a few
inquiries and requests for due diligence materials from potentially interested
parties, the Company has not received any competing offers. The transaction was
unanimously approved by the special committee and recommended to the board of
directors of the Company by the special committee. The board of directors of the
Company also unanimously approved the transaction. In approving the transactions
contemplated by the Asset Purchase Agreement (including the consideration to be
paid by the Buyer for the Company's assets), the special committee and the board
of directors of the Company considered the lack of a current market for the
Company's assets, equity and debt, previous unsuccessful attempts over more than
12 months to obtain additional capital for the Company, the right to continue to
solicit other proposals for the Company, the Company's obligations to Emigrant,
a fairness opinion from Foundation and other considerations.
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In connection with the execution of the Asset Purchase Agreement, Emigrant and
the Company entered into an Amended and Restated Forbearance Agreement under
which Emigrant agreed to extend the forbearance period through the earlier of
(i) November 30, 2009 and (ii) the occurrence of a termination event under the
Amended and Restated Forbearance Agreement. The Amended and Restated Forbearance
Agreement also provides for an increase in the interest rate to be paid with
respect to the Loan to the lesser of (i) 18% or (ii) the maximum rate permitted
by law during the forbearance period. In addition, in the event the Company
completes a Superior Proposal under which the purchase price exceeds $3.15
million, Emigrant shall be entitled to receive an additional fee equal to the
lesser of (i) 20% of such excess amount or (ii) $175,000.
The Company cannot assure you that the transactions contemplated by the Asset
Purchase Agreement will be completed. In the event the transaction with the
Buyer is completed, following the closing, it is likely that the Company's
liabilities will exceed its available cash and the Company's board of directors
may elect to liquidate the Company and utilize its available cash and assets to
repay our outstanding creditors to the extent of its remaining assets. Following
such repayment, the Company does not believe that there will be any assets
remaining to distribute to the Company's shareholders. In addition, following
the closing, the Company will remain liable under its lease for its Montvale,
New Jersey office. The lease, which has a monthly rent of $15,613, will
terminate in October 2014. Payments on the lease are current as of the date of
this filing. In the event the Company does not successfully complete the
transactions contemplated by the Asset Purchase Agreement or complete a Superior
Proposal, the Company will not be able to meet its obligations under the Loan
and Emigrant will have the right to foreclose under the Loan, which is secured
by all of the Company's assets. In such an event, the Company would have to
cease its operations or file for bankruptcy protection.
The foregoing description of the Asset Purchase Agreement, the Voting Agreement
and the Amended and Restated Forbearance Agreement is qualified in its entirety
by reference to the full text of the Asset Purchase Agreement, the Voting
Agreement and the Amended and Restated Forbearance Agreement, which are attached
as Exhibit 2.1, Exhibit 10.1 and Exhibit 10.2, respectively, to this Current
Report on Form 8-K and are incorporated herein by reference. The Asset Purchase
Agreement has been attached to provide investors with information regarding its
terms. It is not intended to provide any other factual information about the
Company. In particular, the assertions embodied in the representations and
warranties contained in the Asset Purchase Agreement are qualified by
information in confidential disclosure schedules provided by the Company to the
Buyer in connection with the signing of the Asset Purchase Agreement. These
disclosure schedules contain information that modifies, qualifies and creates
exceptions to the representations and warranties set forth in the Asset Purchase
Agreement. Moreover, certain representations and warranties in the Asset
Purchase Agreement were used for the purpose of allocating risk between the
Company and the Buyer, rather than establishing matters as facts. Accordingly,
you should not rely on the representations and warranties in the Asset Purchase
Agreement as characterizations of the actual state of facts about the Company.
ITEM 8.01. OTHER EVENTS.
On September 24, 2009, the Company issued a press release with regard to the
Asset Purchase Agreement. A copy of the press release is attached as Exhibit
99.1 to this Current Report on Form 8-K and is incorporated by reference herein.
Although the Company has obtained the necessary votes pursuant to the Voting
Agreement to complete the transaction, the Company intends to hold a special
meeting of its shareholders to approve the transaction. In connection with
seeking shareholder approval, the Company intends to file proxy materials and
other relevant documents with the Securities and Exchange Commission (the
"SEC"). The Company's shareholders are urged to read the proxy statement (and
any other relevant documents filed) with the SEC when they become available,
because they will contain important information about the transaction. The
Company will mail the definitive proxy statement to the Company's shareholders.
In addition, the Company's shareholders may obtain free copies of the final
proxy statement, as well as the Company's other filings, without charge, at the
SEC's Web site (www.sec.gov) when they become available. Copies of the filings
may also be obtained without charge from the Company by directing a request to:
Ivivi Technologies, Inc., 135 Chestnut Ridge Road, Montvale, NJ 07645.
3
The Company's directors, executive officers and other members of management and
employees may be deemed to be participants in the solicitation of proxies from
shareholders in respect of the transaction. Information regarding the Company's
directors and executive officers is available in the Company's Annual Report on
Form 10-K, filed with the SEC on July 14, 2009, as amended by the Company's
Annual Report on Form 10-K/A as filed with the SEC on July 29, 2009. Additional
information regarding the interests of such potential participants will be
included in the proxy statement and the other relevant documents filed with the
SEC when they become available.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits.
Exhibit Number Description
2.1 Asset Purchase Agreement, dated September 24, 2009, by
and among Ivivi Technologies, Inc., Ivivi Technologies, LLC
and Ajax Capital LLC.
10.1 Voting Agreement, dated as of September 24, 2009, by and among
Ivivi Technologies, Inc., Ivivi Technologies, LLC and the
shareholders named therein.
10.2 Amended and Restated Forbearance Agreement, dated as of
September 24, 2009, by and between Ivivi Technologies, Inc.
and Emigrant Capital Corp.
99.1 Press Release, dated September 24, 2009, issued by Ivivi
Technologies, Inc.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
IVIVI TECHNOLOGIES, INC.
By: /s/ Andre' DiMino
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Name: Andre' DiMino
Title: Executive VP-Manufacturing and
Technology and Chief Technical Officer
Date: September 24, 2009
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Ivivi Technologies (CE) (USOTC:IVVI)
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