Exhibit 10.1


 





SECOND AMENDMENT TO ACQUISITION
AGREEMENT


 


 


THIS SECOND
AMENDMENT TO ACQUISITION AGREEMENT (this “Amendment”), dated March 16, 2017, but made effective as of February
13, 2017 (the “Effective Date”), is by and among Maglenta Enterpises Inc., a company incorporated and existing
in the Republic of Seychelles (“Maglenta”), Champfremont Holding Ltd., a company incorporated and existing
in the Republic of Seychelles (“CHL”) (each of the foregoing individually, a “Seller” and,
collectively, “Sellers”); Polimore Capital Limited, a company incorporated and existing under the laws of Cyprus,
Brosword Holding Limited, a company incorporated and existing under the laws of Cyprus, and other companies listed under the caption
“Target Company” in Exhibit B to the Acquisition Agreement (as defined below) (each of the foregoing individually,
a "Target Company" and, collectively, the "Target Companies"); ТOT Group Russia LLC, a
limited liability company organized and existing under the laws of the Russian Federation, and/or its assignee, and TOT Group
Europe Ltd., a company organized and existing under the laws of England and Wales, and/or its assignee (each of the foregoing
individually, a “Purchaser” and, collectively, the "Purchasers"). Sellers, Purchasers and
Target Companies are referred to herein collectively as the “Parties.” 


 


RECITALS


 


 


WHEREAS,
on or about May 20, 2015, Sellers, Target Companies and Purchasers entered into that certain Acquisition Agreement (the “Acquisition
Agreement”) and Net Element, Inc., a Delaware corporation (the “Guarantor”), executed that certain
guaranty in connection with the Purchasers’ certain obligations under the Acquisition Agreement (the “Guaranty”).


 


WHEREAS,
on or about October 25, 2016 (but made effective as of October 21, 2016), the Sellers and the Guarantor entered into that certain
settlement agreement (the “Settlement Agreement”) in connection with Purchasers’ obligations under the
Acquisition Agreement.


 


WHEREAS,
on or about October 25, 2016, the Sellers, Target Companies and Purchasers entered into that certain amendment to Acquisition Agreement
(the “First Amendment”). The Acquisition Agreement, as amended by the First Amendment, shall be referred to
herein as the “Amended Acquisition Agreement.” Capitalized terms used but not defined herein shall have the
meanings ascribed to such terms in the Amended Acquisition Agreement.


 


WHEREAS
the Parties would like to reconcile certain obligations set forth in the Amended Acquisition Agreement and amend certain terms
of the Amended Acquisition Agreement, as more particularly set forth herein. 


 


NOW, THEREFORE,
in consideration of the mutual covenants contained herein, the Parties hereby agree that the Amended Acquisition Agreement shall
be further amended as follows: 


 


1.                 
Recitals. All of the recitals contained herein are true and correct and are incorporated
herein by this reference. 


 


2.                 
Amendment. Notwithstanding prior correspondence of the Parties and their respective
representatives, the Parties have reconciled the amounts, the calculations, the methodology, the procedures of review and approval,
the process and dates of payments in cash and issuances of Consideration Shares in respect to the Deferred Consideration (specifically,
the second, third, fourth, fifth Installments and Extra Payment) as set forth in Annex 1 to this Amendment. Accordingly,
the Parties hereby agree that the first paragraph of Section 2.7 and Sub-Sections 2.7.1 through and inclusive of 2.7.5 of the Amended
Acquisition Agreement are hereby modified and amended in their entirety to reflect the terms set forth in Annex 1 to this
Amendment. None of the procedures and/or remedies shall be applicable with respect to any Party or Guarantor in connection with
any performance or non- performance, delay or failure to reconcile the Deferred Consideration pursuant to the first paragraph of
Section 2.7 and Sub-Sections 2.7.1 through and inclusive of 2.7.5 of the Amended Acquisition Agreement prior to the Effective Date.
Notwithstanding anything to the contrary set forth in this Section 2, nothing herein shall modify the Parties’ obligations
under the Settlement Agreement and the First Amendment, including but not limited to, the Purchasers’ and Guarantor’s
payment obligations thereunder.


 



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3.                 
This Amendment (including Annex 1 hereto) is legally binding on each of the Parties.
In consideration of the mutual covenants and conditions contained herein this Amendment supersedes all previous correspondence
and negotiations between Parties regarding the Deferred Consideration. 


 


4.                 
Except as expressly amended and modified by this Amendment, the Amended Acquisition Agreement
shall continue in full forth and effect. 


 


5.                 
This Amendment shall be governed by and construed in accordance with the laws of the State
of New York, without regard to principles of conflicts of law thereof. Each Party hereby irrevocably submits to the jurisdiction
of the courts of the State of New York, sitting in New York County, and the courts of the United States for the Southern District
of New York. Each Party irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of the venue of any such suit, action or proceeding brought in any such court, any claim that any such suit,
action or proceeding brought in such a court has been brought in an inconvenient forum and the right to object, with respect to
any such suit, action or proceeding brought in any such court, that such court does not have jurisdiction over such Party. In
any such suit, action or proceeding, each Party waives, to the fullest extent it may effectively do so, personal service of any
summons, complaint or other process and agrees that the service thereof may be made by certified or registered mail, addressed
to such Party at its address as set forth in the Amended Acquisition Agreement. 


 


6.                 
This Amendment may be executed in counterparts, each of which shall be an original, but all
of which together shall constitute one and the same agreement. The exchange of copies of this Amendment and of signature pages
by facsimile transmission, pdf or other electronic means shall constitute effective execution and delivery of this Amendment as
to the parties and may be used in lieu of the original Amendment for all purposes (and such signatures of the parties transmitted
by facsimile, pdf or other electronic means shall be deemed to be their original signatures for all purposes).


 


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IN WITNESS
WHEREOF, each of the Parties has duly executed this Amendment as of the Effective Date.


 


 


SELLERS:


  


 


MAGLENTA ENTERPRISES INC.


 


By:  /s/ Evaline Sophie Joubert                                        


Name: Evaline Sophie Joubert


Title: Director


 


 


CHAMPFREMONT HOLDING LTD


 


By:  /s/ Nicos Hadjinicolaou                                             


Name: Nicos Hadjinicolaou


Title: Director


  


  


TARGET COMPANIES:


 


 


POLIMORE CAPITAL LIMITED


 


By:  /s/ Avraam Marangos                                                


Name: Avraam Marangos


Title: Director


 


 


BROSWORD HOLDING LIMITED


 


By: /s/ Avraam Marangos                                                


Name: Avraam Marangos


Title: Director


 


 


INNOVATIVE PAYMENT TECHNOLOGIES LLC


 


By: /s/ Madina Khandzharova                                        


Name: Madina Khandzharova


Title: General Director


 


 


 


 


 


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PAYONLINE SYSTEM LLC


 


By: /s/ Marat Abasaliev                                 


Name: Marat Abasaliev


Title: General Director





 


 


PURCHASERS:


 


 


TOT GROUP RUSSIA, LLC


 


By:_/s/ Konstantin Zaripov                          


Name: Konstantin Zaripov


Title: General Director


 


TOT GROUP EUROPE LTD






By:_/s/ Konstantin Zaripov                          


Name: Konstantin Zaripov


Title: Managing Director





 


 


ACKNOWLEDGED AND AGREED TO BY THE
GUARANTOR FOR PURPOSES OF THE GUARANTY:


 


  


NET ELEMENT, INC.


 


  


By:  /s/ Oleg Firer                                        


Name:  Oleg Firer                                        


Title:  CEO                                                    


 


 


 


 




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ANNEX 1


 


 


1.                     
The amount of the second Installment is calculated and reconciled by the Parties, and accordingly
is defined for all purposes of the Amended Acquisition Agreement as One Hundred Fifteen Thousand One Hundred Ninety Six and 20/100
US dollars (US $115,196.20). Purchasers previously paid and Sellers previously received US $72,360.40 in cash and US $72,360.40
in Consideration Shares as payment for the second Installment, resulting in US $29,524.60 overpayment to the Purchasers for the
second Installment. 


 


2.                     
The amount of the third Installment is calculated and reconciled by the Parties, and accordingly
is defined for all purposes of the Amended Acquisition Agreement as Ninety-Three Thousand Seven Hundred Thirty-One and 32/100
US dollars (US $93,731.32). Purchasers previously paid and Sellers previously received US $61,735.57 in cash and US $61,735.57
in Consideration Shares as payment for the third Installment, resulting in US $29,739.82 overpayment to the Purchasers for the
third Installment. 


 


3.                     
The amount of the fourth Installment is calculated and reconciled by the Parties, and accordingly
is defined for all purposes of the Amended Acquisition Agreement as One Hundred Sixty Thousand Nine Hundred Eighty- Seven and
94/100 US dollars (US $160,987.94). 


 


4.                     
The amount of the fifth Installment is calculated and reconciled by the Parties, and accordingly
is defined for all purposes of the Amended Acquisition Agreement as One Hundred Fourteen Thousand Five Hundred Ninety-Two and
72/100 US dollars (US $114,592.72). 


 


5.                     
The amount of the Extra Payment is calculated and reconciled by the Parties, and accordingly
is defined for all purposes of the Amended Acquisition Agreement as Eight Hundred Forty-Eight and 43/100 US dollars (US $848.43). 


 


6.                     
The aggregate amount for the Deferred Consideration (specifically, the second, third, fourth,
fifth Installments and Extra Payment combined) is calculated and reconciled by the Parties, and accordingly is defined for all
purposes of the Amended Acquisition Agreement as Four Hundred Eighty-Five Thousand Three Hundred Fifty-Six and 61/100 US dollars
(US $485,356.61). 


 


7.                     
As set in paragraphs 1 and 2 this Annex 1, the Purchasers previously paid the Sellers Two
Hundred Sixty-Eight Thousand One Hundred Ninety-One and 94/100 US dollars (US $268,191.94). 


 


8.                     
Accordingly, the remaining aggregate amount to be payable by the Purchaser to the Sellers
pursuant to the Amended Acquisition Agreement (as amended by this Amendment, including this Annex 1) for the Deferred Consideration
(specifically, the second, third, fourth, fifth Installments and Extra Payment combined) is calculated and reconciled by the Parties,
and accordingly is defined for all purposes of the Amended Acquisition Agreement as Two Hundred Seventeen Thousand One Hundred
Sixty-Six US dollars (US $217,166) (the “Final Amount”). 


 


9.                      The Final Amount shall be comprised of two (2) components: (i) cash in the amount of 50% of
Final Amount and (ii) Consideration Shares with a value equal to 50% of the Final amount (the number of such Consideration Shares
shall be determined based on the closing price per one (1) share of NETE Stock reported on The NASDAQ Capital Market on the Effective
Date (specifically, February 13, 2017). For avoidance of doubt, this Amendment shall be executed and delivered by the Parties and
dated only on the date when The NASDAQ Capital Market is open for trading.


 






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10.                  
The Final Amount shall be paid (in cash and in Consideration Shares as determined and provided
in paragraph 9 of this Annex 1) by the Purchasers to the Sellers, and the Sellers will accept such Final Amount as full and complete
satisfaction and settlement of the Deferred Consideration (specifically, the second, third, fourth, fifth Installments and Extra
Payment), in accordance with the following schedule:


 


The cash in the amount of 50%
of Final Amount shall be paid within five (5) Business Days after Purchasers receive signed by Sellers counterpart of this Amendment
according to Section 6 of this Amendment. The Consideration Shares, specifically 130,823 shares based on the closing price per
(1) share of NETE Stock reported on The NASDAQ Capital Market on the Effective Date, shall be issued within forty-five (45) calendar
days after Purchasers receive signed by Sellers counterpart of this Amendment according to Section 6 of this Amendment, however,
that the Consideration Shares in the amount as determined and provided in paragraph 9 of this Annex 1 shall be delivered to the
Sellers after the applicable securities laws and the Nasdaq formalities and the transfer agent formalities are complied with and
the securities law opinion with respect to the issuance of the shares is obtained by the Guarantor.


 


11.                  
Upon payment of the Final Amount to the Sellers (specifically, by a wire transfer US $108,583
to the bank account designated in writing by the Sellers and by the issuance of 130,823 Consideration Shares in the name of the
Sellers (divided between the Sellers as per such Sellers’ written instructions), (i) the entire Deferred Consideration (specifically,
the second, third, fourth, fifth Installments and Extra Payment) shall be paid in full and (ii) none of the Parties shall have,
and each Party hereby irrevocably releases, any and all rights, obligations, claims and/or liabilities related to the Deferred
Consideration (specifically, the second, third, fourth, fifth Installments and Extra Payment).


 


 











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