Item
2.01 Completion of Acquisition or Disposition of Assets.
Asset
Purchase Agreement with Accountable Healthcare America, Inc.
On
May 27, 2020, Clinigence Holdings Inc. entered into an Intellectual Property Asset Purchase Agreement (the “IP APA Agreement”)
by and among Clinigence Health, Inc., a Delaware corporation (“Clinigence Health” or “Seller”), Clinigence
Holdings, Inc., a Delaware corporation (“CLNH” or “Shareholder”), AHA Analytics, Inc., a Delaware corporation
(“Purchaser”) and Accountable Healthcare America Inc., a Delaware corporation (“AHA”). The transactions
contemplated by the IP APA Agreement were consummated on May 29, 2020 (the “Closing”).
The
IP APA Agreement provided for the sale of certain intellectual property and rights, including but not limited to copyrights, patents,
pending patents, and continuation in part, (the “Transferred Assets”) to Purchaser from the Seller, , hereafter
referred to as the “Asset Sale.”
Subject
to the provisions of the IP APA Agreement, the Asset Sale provided for an aggregate purchase price (“Purchase Price”)
to Seller and Shareholder equal to the sum of the amounts set forth in (i) and (ii), below.
(i)
The Series _E Preferred Stock. The Series E Preferred Stock, (the “Preferred
Stock”) as more fully described and stated
in the Series E Preferred Stock Certificate of Designation (the “Certificate of Designation”), shall
have an initial stated value of $15,000,000 in the aggregate, unless adjusted as set forth in (iii) below (the "Stated Value").
The Stated Value, however, shall be reduced by the Assumed Liabilities as set forth herein which includes the Hold Back amount
as set forth in Article 9 of the IP APA Agreement, and shall automatically convert upon either of the following events:
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(1)
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Immediately
before (A) the Purchaser’s consummation of a merger with or an acquisition by a
Publicly Traded Company listed on NASDAQ all of the Preferred Shares shall be automatically
converted into shares of Common Stock of Purchaser or (B) upon Purchaser’s consummation
of the Merger into Common Shares of the Publicly Traded Company (“Pubco Shares”)
equal to the Stated Value (as may be adjusted in accordance with the terms of the Certificate
of Designation), which Pubco Shares shall be valued at the Fair Market Value of those
shares;
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(2)
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After
two hundred and forty (240) days from the date of Closing, if the event described in
(i)(1) above has not occurred, the Preferred Stock shall automatically convert into 3,750,000
of Common Shares of Stock of the Purchaser, based upon a $4 per share valuation on the
date of Conversion,
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(ii)
The Assumed Liabilities. The Assumed Liabilities consisting of (1) the November 2019 Clinigence Convertible Notes, in the
aggregate principal amount of $2,442,875 (2) the Lighter Capital Loan in the amount of$539,770.47, and approximately an additional
$487,000 in accounts payable, notes payable and loans payable.
(iii) Adjustment
to Stated Value. The initial Stated Value shall be $15,000,000 (less the Assumed Liabilities)
in the aggregate upon the Purchaser’s consummation of a merger with or an acquisition by a Publicly Traded Company listed
on NASDAQ (the “Merger”) based upon a minimum valuation of Purchaser equal to twelve (12) times
the Audited EBITDA of Purchaser upon the closing of the Merger (the “Valuation”). Should the Purchaser’s
Valuation in a Merger be adjusted downward due to market conditions, as reflected in and governed by the terms of, the definitive
agreements relating to such Merger between Purchaser and the Publicly Traded Company, the Stated Value shall be adjusted downward
proportionally.
The
foregoing description of the IP APA Agreement is a summary only and is qualified in its entirety by reference to the IP APA Agreement,
a copy of which is attached hereto as Exhibit 2.1 and is incorporated herein by reference.
License
Agreement
In
connection with the Asset Purchase, the Company’s subsidiary Clinigence Health, Inc. (“Clinigence Health”) entered
into an Intellectual Property License Agreement (the “License Agreement”) with AHA Analytics Inc. (“Licensor”),
a Delaware corporation.
Pursuant
to the License Agreement Licensor granted Clinigence Health a worldwide, irrevocable, royalty-free, non-transferable (other than
as set forth herein), non-exclusive license to use, solely for Clinigence Health’s ongoing Analytics Business Customers,
the Licensor Intellectual Property to make, have made, use, offer to sell, sell and import, copy, reproduce, modify, publish,
display, publicly perform and make derivative works on the Licensed Products and to incorporate the Licensor Intellectual Property
and Licensed Products, in whole or in part, into the Analytics Business platform maintained by Licensee, within the Territory,
and subject to the License Agreement, to develop improvements based on the Licensor Intellectual Property.
Licensor
also granted Clinigence Health the right to grant limited sub-licenses to customers as a non-exclusive license to use the Licensed
Material, for the Term of the License Agreement. It is understood that the use of the licensed material will be offered to Clinigence
Health ‘s customers as part of its ongoing Analytics Business.
The
foregoing description of the License Agreement is a summary only and is qualified in its entirety by reference to the IP APA Agreement,
a copy of which is attached hereto as Exhibit 2.2 and is incorporated herein by reference.
Managed
Services Agreement
In
connection with the Asset Purchase, Clinigence Health entered into a Managed Services Agreement (the “Managed Services Agreement”)
by and between AHA Analytics, Inc. (“AHA Analytics”), a Delaware corporation and Clinigence Health, Inc., a Delaware
corporation.
Pursuant
to the Managed Services Agreement Clinigence Health provide, supply and render management and operational support services as
are necessary to continue to maintain and keep the AHA Analytics technology up to date, in keeping with the ordinary course of
business as it has customarily been used in the Clinigence Health Analytics Business.
The
foregoing description of the Managed Services Agreement is a summary only and is qualified in its entirety by reference to the
Managed Services Agreement, a copy of which is attached hereto as Exhibit 2.3 and is incorporated herein by reference.