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Exhibit 10.1

 

 

 

BILL OF SALE

 

This BILL OF SALE is made and entered into as of September 19, 2011 (this “ Bill of Sale ”) by and between Entelos, Inc. (“ Entelos ”, and together with its successors and assigns, the “ Seller ”) and Simulations Plus, Inc. or its assignee or designee (together with its and their successors and assigns, the “ Purchaser ”).

 

WHEREAS , Imperium Master Fund, Ltd. (“ Imperium ”) and Seller entered into financing arrangements pursuant to which, among other things, Imperium provided loans and other financial accommodations to Seller as set forth in (a) that certain Exchange Agreement, dated March 25, 2010, by and between Entelos and Imperium, (b) that certain Senior Term Note, dated April 15, 2010, by Entelos in favor of Imperium, in the original principal amount of $6,000,000, (c) that certain Supplemental Senior Term Note, dated June 2, 2011, by Entelos in favor of Imperium, in the original principal amount of $500,000, (d) that certain Second Supplemental Senior Note, dated June 24, 2011, by Entelos in favor of Imperium, in the original principal amount of $850,000, (e) that certain Secured Term Promissory Note, dated July 22, 2011, in the original principal amount of $300,000, and (f) that certain Amended and Restated Security Agreement, dated April 15, 2010, by and among Entelos, Entelos (UK) Ltd. (“ Entelos UK ”), Eratosethes, Inc. (“ Eratosethes ”), Digitalself, Inc. (“ Digitalself ”, and together with Entelos, Entelos UK and Eratosethes, collectively, the “ Entelos Entities ”), Imperium and Imperium Advisers, LLC (“ Collateral Agent ”), and (f) all other agreements, documents and instruments executed and/or delivered in connection with the foregoing, in each case, as amended, modified, or supplemented from time to time (all of the foregoing, collectively, the “ Pre-Petition Financing Agreements ”);

 

WHEREAS , as of July 22, 2011, the aggregate principal amount of all obligations, liabilities and other indebtedness owing by Seller to Imperium and Collateral Agent under and in connection with the Pre-Petition Financing Agreements was not less than $8,442,000 (inclusive of interest accrued though July 22, 2011), plus interest thereafter and all costs, fees, expenses (including reasonable attorneys’ fees and legal expenses) and other charges accrued, accruing or chargeable with respect thereto (collectively, and as such term is more fully defined in the DIP Facility Agreement (defined below), the “ Pre-Petition Obligations ”).

 

WHEREAS , pursuant to the Pre-Petition Financing Agreements, Seller granted to Collateral Agent, for the benefit of Imperium, a continuing priority security interest in and general lien upon substantially all assets and properties of the Seller (collectively, the “ Collateral ”) to secure the prompt payment and performance of all Pre-Petition Obligations;

 

WHEREAS , the Seller has filed a voluntary petition for relief under chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the District of Delaware (the “ Bankruptcy Court ”), case number 11-12329 (“ Bankruptcy Case );

 

WHEREAS , the Bankruptcy Court has approved the Seller entering into further financial arrangements with Imperium pursuant to which, among other things, Imperium has provided an additional post-petition loan to Seller in the amount determined pursuant to that certain Ratification and Supplemental Credit Agreement dated on or about the date thereof, by and among the Entelos Entities, Imperium, and Collateral Agent (the “ DIP Facility Agreement ”);

 

 

 

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NOW, THEREFORE , for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Seller and Buyer hereby agree as follows:

 

1.            Purchase .  Subject  to (a) a finding by the Bankruptcy Court that the Purchaser is deemed to have purchased the Acquired Assets in good faith pursuant to section 363(m); (b) execution and delivery of the Assignment Agreements, 1   and (c) effective upon the entry by the Bankruptcy Court of the Sale Order approving the transactions contemplated herein (the “ Closing Date ”), and in consideration of Purchase Price (as defined below), the Seller shall sell, contribute, convey, assign, transfer and deliver to Purchaser, free and clear of all Liens, Claims, and other interests and encumbrances (whether arising prior to or subsequent to the Petition Date, including, but not limited to the Liens, Claims  and security interest of Imperium and Collateral Agent securing the Pre-Petition Obligations and the DIP Facility Agreement) (except for the Assumed Liabilities ) to the fullest extent allowed by Law, and Purchaser shall purchase, acquire and take assignment and delivery of the Acquired Assets, which shall include, but are not limited to, all properties, assets, rights, titles and interests of every kind and nature, owned, licensed or leased by Seller (including indirect and other forms of beneficial ownership) as of the Closing Date, whether tangible or intangible, real or personal and wherever located and by whomever possessed, including, but not limited to all of the Collateral, Intellectual Property, Inventory and all other assets required to operate the Seller’s Business as of the Closing Date, other than the Excluded Assets and the Excluded Agreements (as defined below).

 

2.            Purchase Price .  The aggregate consideration for the Acquired Assets (the “ Purchase Price ”) shall equal the following, as calculated on the Closing Date: an amount equal to the sum of (i) $1,700,000, plus (ii) $50,0000, plus   (iii) all Cure Amounts (as defined below) paid or to be paid by the Purchaser; plus (iv) the assumption of the Assumed Liabilities (as defined below).

 

3.            Acquired Contracts .  As of the Closing Date, the Seller shall assume pursuant to section 365(a) of the Bankruptcy Code and sell and assign to the Purchaser pursuant to sections 363(b), (f), and (m) and 365(f) of the Bankruptcy Code each of the executory contracts and unexpired leases listed on Schedule B hereto (the “ Acquired Contracts ”).  Purchaser shall only assume from Seller and thereafter be responsible for the payment, performance or discharge of the Liabilities and obligations of Seller under the Acquired Contracts arising after the Closing Date (the “ Assumed Liabilities ”).  The Purchaser shall be responsible for and shall pay on the Closing Date (or as soon as practicable thereafter) the cure amounts directly to the counter-party of the Acquired Contract necessary to assume such executory contracts and/or unexpired leases pursuant to section 365 of the Bankruptcy Code as of the date of the Assumption and Cure Notice (the “ Cure Amount ”). Purchaser shall have the right, at its option and in its sole discretion, to amend Schedule B hereto to remove or add any executory contracts or unexpired leases of the Seller prior to the Closing Date (to the extent such executory contracts or unexpired leases already have not been rejected by the Debtor).  To the extent that the Purchaser concludes that there are other executory contracts or unexpired leases that it desires the Seller to assume and assign to it, the Seller shall promptly seek Bankruptcy Court approval of  said request (to the extent such executory contracts or unexpired leases already have not been rejected by the Debtor).

 

 


  1 All Capitalized terms not defined herein shall have the meanings ascribed to them in Schedule A to this Bill of Sale.

 

 

 

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4.            Excluded Assets .  The Acquired Assets shall not include (a) the executory contracts and unexpired leases of the Seller that are not Acquired Contracts (collectively, “ Excluded Agreements ”), (b) claims under chapter 5 of the Bankruptcy Code, (c) all rights to proceeds under any director and officer liability insurance policies of Seller for claims arising prior to the Closing; (d) all of the Seller’s ownership interests in and to Entelos UK, Eratosethes and Digitalself; and (e) all assets maintained pursuant to or in connection with any employee benefit plan  (the “ Excluded Assets ”).

 

6.            Excluded Liabilities .  Seller acknowledges and agrees that pursuant to the terms and provisions o


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