Item 1.01.
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Entry into a Material Definitive Agreement.
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On March 30, 2016, AAC Holdings, Inc., a
Nevada corporation (the Company), entered into an Amendment to the Asset Purchase Agreement (the Amendment) by and among the Company, American Addiction Centers, Inc., a Nevada corporation and wholly owned subsidiary of the
Company (AAC), Townsend Treatment Center, LLC, a Delaware limited liability company and indirect wholly owned subsidiary of the Company (Buyer), Sagenex Diagnostics Laboratory, LLC, a Delaware limited liability company
(Sagenex), Rush Medical Lafayette, LLC, a Delaware limited liability company (Rush), Houma Treatment Center, L.L.C., a Louisiana limited liability company (Houma) and the Sellers Representative party
thereto, to the Asset Purchase Agreement, dated December 10, 2015, among the Company, AAC, Buyer, Sellers, the members of the Sellers party thereto and the Sellers Representative party thereto, which was previously announced and disclosed in
the Companys Annual Report on Form 10-K that was filed with the Securities and Exchange Commission (the SEC) on March 9, 2016 (the Asset Purchase Agreement). The Amendment added Sagenex, Rush and Houma as
additional parties to the Asset Purchase Agreement, increased the Cash Consideration by $750,000, modified the definitions of Share Price, Excluded Assets and Excluded Liabilities and updated Annex B to reflect
the addition of Houma as a Seller.
The foregoing description of the Amendment does not purport to be complete and is qualified in its
entirety by reference to the full text of the Amendment. A copy of the Asset Purchase Agreement is incorporated herein by reference as
Exhibit 2.1
, and a copy of the Amendment is filed herewith as
Exhibit 2.2
and is incorporated herein
by reference.
The cash portion of the Townsend acquisition was funded from borrowings pursuant to the Companys subordinated debt
facility with Deerfield Management Company, L.P. (Deerfield Management), previously disclosed in the Companys Current Report on Form 8-K that was filed with the SEC on October 7, 2015 (the Facility Agreement). On
April 1, 2016, the Company issued to Deerfield International Master Fund, L.P., Deerfield Private Design Fund III, L.P., and Deerfield Partners, L.P., affiliates of Deerfield Management, Senior Subordinated Notes in the principal amounts of
$3,780,000, $6,750,000 and $2,970,000, respectively (the Senior Subordinated Notes). Pursuant to the terms and conditions of the Facility Agreement, the Senior Subordinated Notes bear interest at an annual rate of 12.0% and
mature on September 30, 2020. Additionally, all of the Companys operating subsidiaries (collectively, the Guarantors) previously entered into a Guaranty, dated as of October 2, 2015, whereby the Guarantors agreed to guarantee
the obligations and liabilities of the Company under the Facility Agreement and the Senior Subordinated Notes.
The foregoing description
of the Senior Subordinated Notes does not purport to be complete and is qualified in its entirety by reference to the full text of the Senior Subordinated Notes. Copies of the Senior Subordinated Notes are filed herewith as
Exhibits 10.1
,
10.2
and
10.3
and are incorporated herein by reference.