Stock Purchase Agreement Dated as of December 12, 2009 By and Among Walter Kostiuk and Mark and Bernard Gruberg and Bellmore Corporation
Exhibit
10.1
Dated as
of December 12, 2009
By and
Among
▇▇▇▇▇▇
▇▇▇▇▇▇▇
and
▇▇▇▇
and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
and
▇▇▇▇▇▇▇▇
Corporation
table
of Contents
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Section 1. Construction and
Interpretation
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3
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1.1. Principles
of Construction.
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3
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Section 2. The
Transaction
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4
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2.1. Purchase
Price:
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4
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2.2. Transfer
of Shares and Terms of Payment:
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4
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2.3.
Closing.
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4
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2.4.
Escrow Shares
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4
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2.5
Additional Consideration
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5
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Section
3. Representations and Warranties
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5
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3.1.
Representations and Warranties of the Sellers and the
Company.
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5
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3.2. Covenants
of the Sellers and the Company.
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7
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3.3.
Representations and Warranties of the Purchaser
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8
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Section
4. Miscellaneous
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9
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4.1.
Expenses.
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9
|
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4.2. Governing
Law.
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9
|
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4.3.
Resignation of Old and Appointment of New Board of
Directors.
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9
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4.4.
Indemnification.
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9
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4.5.
Disclosure.
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10
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4.6.
Notices.
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10
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4.7. Parties in
Interest.
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11
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4.8. Entire
Agreement.
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11
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4.9.
Amendments.
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11
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4.10.
Severability.
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11
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4.11.
Counterparts
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12
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PAGE 2 OF
13
This
stock purchase agreement (the “Agreement”), dated as
of December 12, 2009, is entered into by and among Bellmore Corporation, a
Nevada corporation (“Bellmore” or the
“Company”),
▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (the “Sellers”), and ▇▇▇▇▇▇
▇▇▇▇▇▇▇ (the “Purchaser”) and
together with the Company and the Sellers, the “Parties”, and each
individually, a “Party”).
W i t n e s s e t
h:
Whereas,
the Sellers are shareholders of Bellmore and own and/or control the shares
listed on Schedule
A, attached hereto, which represents approximately 84.39% of the issued
and outstanding common stock of the Company, (the “Stock”);
and
Whereas,
the Purchaser desires to acquire the Stock from Sellers.
Now,
Therefore, in consideration of the foregoing recitals and the mutual
promises, representations and covenants hereinafter set forth and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
Section
1. Construction and Interpretation
1.1. Principles of
Construction.
(a) All references to Articles,
Sections, subsections and Appendixes are to Articles, Sections, subsections and
Appendixes in or to this Agreement unless otherwise specified. The
words “hereof,” “herein” and “hereunder” and words of similar import when used
in this Agreement shall refer to this Agreement as a whole and not to any
particular provision of this Agreement. The term “including” is not
limiting and means “including without limitations.”
(b) In the computation of periods of
time from a specified date to a later specified date, the word “from” means
“from and including”; the words “to” and “until” each mean “to but excluding”;
and the word “through” means “to and including.”
(c) The Table of Contents hereto and
the Section headings herein are for convenience only and shall not affect the
construction hereof.
(d) Both the Sellers and the Purchaser
acknowledge and understand that ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP (the “Counsel”)
represents the Company, and does not represent or act as legal counsel for the
Purchaser or the Sellers in their individual capacities.
(e) This Agreement is the result of
negotiations among the Parties and has been reviewed by the
Counsel. Accordingly, this Agreement shall not be construed against
any Party merely because of such Party’s involvement in its
preparation.
(f) Wherever in this Agreement the
intent so requires, reference to the neuter, masculine or feminine shall be
deemed to include each of the other, and reference to either the singular or the
plural shall be deemed to include the other.
PAGE 3 OF
13
Section
2. The Transaction
2.1.
Purchase Price:
Sellers
hereby agree to sell to the Purchaser, and the Purchaser, in reliance on the
representations and warranties contained herein, and subject to the terms and
conditions of this Agreement, agrees to purchase from Sellers the Stock for a
total purchase price of two hundred and seventy five thousand dollars ($275,000)
(the “Purchase
Price”). The Purchase Price is payable in the following
manner:
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1.
|
The
Purchaser shall pay a thirty thousand dollar ($30,000) non-refundable
deposit (the “Deposit”),
payable to the Sellers by wire transfer to the Escrow Account (as defined
herein), to be released to the Sellers immediately upon the execution of
this Agreement; and
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|
2.
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The
balance of the Purchase Price of two hundred and forty five thousand
dollars ($245,000) (the “Balance”) shall
be due and payable on or before January 14, 2010 (the “Termination
Date”). If the Balance is not delivered to the Escrow
Account by the Purchaser by 5:00pm ET on the Termination Date, any portion
of the Balance previously paid to the Escrow Account shall be returned to
the Purchaser.
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3.
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If,
after the Termination Date, the Purchaser still desires to purchase the
Stock from the Sellers, he retains the right to do so by paying to the
Sellers (i) the Balance and (ii) an additional two thousand dollar
($2,000) penalty for every seven (7) day period that the Balance is not
paid in full (the “Penalty
Payment”), not to exceed twelve thousand dollars ($12,000) or forty
two (42) days (the “Option
Period”). If, at the end of the Option Period the
Balance and any applicable Penalty payment are not paid in full (a “Non-Payment”),
the Escrow Agent shall return any portion of the Balance held in the
Escrow Account to the Purchaser and Purchaser shall have no further
obligation under this Agreement, including, but not limited to any
obligation to purchase the Stock. Failure by Purchaser to
purchase the Stock under this Agreement shall not constitute a breach or a
default under this Agreement.
|
2.2. Transfer of Shares and Terms of
Payment:
In
consideration for the transfer of the Stock by the Sellers to the Purchaser, the
Purchaser shall pay the Purchase Price in accordance with the terms of this
Agreement. The transfer of the shares and payment thereof shall be in
the following manner:
|
i)
|
The
Purchaser will place the Deposit into an escrow account (the “Escrow
Account”) with ▇▇▇▇▇▇ & Jaclin LLP (the “Escrow Agent”)
on behalf of the Sellers to be released to the Sellers immediately upon
the execution of this Agreement.
|
|
ii)
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Simultaneously
with the delivery of the Deposit, the Sellers shall deliver to the Escrow
Agent, the certificates for the Stock duly endorsed for transfer to be
held in escrow in accordance with the terms of this
Agreement.
|
PAGE 4 OF
13
2.3.
Closing Date.
Subject to the terms and conditions of
this Agreement, the closing shall take place by wire transfer and overnight mail
on or before 5:00 P.M. EST on January 14, 2010, or at such later date as
provided for in Section 2.1(3) of this Agreement, provided that the terms of
such section have been met in full (the “Closing
Date”).
2.4. Escrow of Shares.
The Purchaser acknowledges that the
Stock with a medallion guaranteed stock power shall be held in the Escrow
Account (the “Escrow
Shares”) by the Escrow Agent until such time as the Purchase Price has
been paid in full. In the event of Non-Payment by the Purchaser, the
Escrow Shares shall be immediately returned to the Sellers. At such
time as the Purchase Price and applicable Penalty Payment, if any, is paid in
full, the Escrow Shares shall be released to the Purchaser.
Section
3. Representations and Warranties
3.1.
Representations and Warranties of the Sellers and the Company.
3.1.1 The
Company is a corporation duly organized and validly existing under the laws of
the State of Nevada and has all corporate power necessary to engage in all
transactions in which it has been involved in as well as any general business
transactions in the future that may be desired by its directors.
3.1.2 The
Company is in good standing with the Secretary of State of Nevada.
3.1.3 The
Company has, and will have on the Closing Date, no outstanding debt or
obligations whatsoever. Should the Purchaser discover any obligation
of the Company that was not paid prior to the Closing Date, the Sellers
undertake to indemnify the Purchaser for a period of two (2) years from the
Closing Date, for any and all such liabilities, whether outstanding or
contingent or otherwise.
3.1.4 The
Company will have no assets or liabilities on the Closing Date.
3.1.5 The
Company is not subject to any pending or threatened litigation, claims or
lawsuits from any party, and there are no pending or threatened proceedings
against the Company by any federal, state or local government, or any
department, board, agency or other body thereof.
3.1.6 The
Company is not a party to any contract, lease or agreement which would subject
it to any performance or business obligations in the future after the Closing
Date.
3.1.7 The
Company does not own any real estate or any interests in real
estate.
3.1.8 The
Company is not liable for any income, real or personal property taxes to any
governmental or state agencies whatsoever.
3.1.9 The
Company is not in violation of any provision of laws or regulations of federal,
state or local government authorities and agencies.
PAGE 5 OF
13
3.1.10 The
Sellers, either directly or by representation, are the lawful owners of record
of the Stock, and the Sellers presently have, and will have at the Closing Date,
the power to transfer and deliver the Stock to the Purchaser in accordance with
the terms of this Agreement. The delivery to the Purchaser of
certificates evidencing the transfer of the Stock pursuant to the provisions of
this Agreement will transfer to the Purchaser good and marketable title thereto,
free and clear of all liens, encumbrances, restrictions and claims of any
kind.
3.1.11 All
issuances of the Company of the shares in their common stock in past
transactions have been legally and validly effected, and all of such shares in
the common stock are fully paid and non-assessable.
3.1.12 There
are no outstanding subscriptions, options, warrants, convertible securities or
rights or commitments of any nature in regard to the Company’s authorized but
unissued common stock.
3.1.13 There
are no outstanding judgments, liens or any other security interests filed
against the Company or any of its properties.
3.1.14 The
Company has no subsidiaries.
3.1.15 The
Company has no employment contracts or agreements with any of its officers,
directors, or with any consultants, employees or other such
parties.
3.1.16 The
Company has no insurance or employee benefit plans whatsoever.
3.1.17 The
Company is not in default under any contract, or any other
document.
3.1.18 The
Company has no outstanding powers of attorney and no obligations concerning the
performance of the Sellers concerning this Agreement.
3.1.19
The Company is not and has not ever been party to a non-compete agreement with
any person or entity.
3.1.20 The
execution and delivery of this Agreement, and the subsequent closing thereof,
will not result in the breach by the Company or the Sellers of any agreement or
other instrument to which they are or have been a party.
3.1.21 All
financial and other information which the Company and/or the Sellers furnished
or will furnish to the Purchaser, including information with regard to the
Company and/or the Sellers contained in the SEC filings filed by the Company
since its inception (i) is true, accurate and complete as of its date and in all
material respects except to the extent such information is superseded by
information marked as such, (ii) does not omit any material fact, not misleading
and (iii) presents fairly the financial condition of the organization as of the
date and for the period covered thereby.
3.1.22
The representations and warranties made herein by the Sellers and the Company
shall be true and correct in all material respects on and as of the Closing Date
hereof with the same force and effect as though said representations and
warranties had been made on and as of the Closing Date.
PAGE 6 OF
13
3.1.23
The representations and warranties made above shall survive the Closing Date and
shall expire for all purposes in the date numerically corresponding to the
Closing Date in the twenty-fourth (24th) month after the Closing
Date.
3.2.
Covenants of the Sellers and the Company.
From the
date of this Agreement and until the Closing Date, the Sellers and the Company
covenant the following:
3.2.1 The
Sellers will preserve intact the current status of the Company as an OTC
Bulletin Board quoted company.
3.2.2 The
Sellers will furnish the Purchaser with all corporate records and documents,
such as the Articles of Incorporation and Bylaws, or any other corporate
document or record requested by the Purchaser. The Company’s current
Articles of Incorporation and Bylaws are attached hereto and incorporated herein
as composite Schedule B.
3.2.3 The
Company will not enter into any contract or business transaction, merger or
business combination, or incur any further debts or obligations without the
express written consent of the Purchaser.
3.2.4 The
Company will not amend or change its Articles of Incorporation or Bylaws, or
issue any further shares or create any other class of shares in the Company
without the express written consent of the Purchaser.
3.2.5 The
Company will not issue any stock options, warrants or other rights or interests
in or to its shares without the express written consent of the
Purchaser.
3.2.6 The
Sellers will not encumber or mortgage any right or interest in their shares of
the common stock being sold to the Purchaser hereunder, and also they will not
transfer any rights to such shares of the common stock to any third party
whatsoever.
3.2.7 The
Company will not declare any dividend in cash or stock, or any other
benefit.
3.2.8 The
Company will not institute any bonus, benefit, profit sharing, stock option,
pension retirement plan or similar arrangement.
3.2.9 On
the Closing Date, the Company and the Sellers will obtain and submit to the
Purchaser resignations of current officers and directors.
3.3 Representations
and Warranties of the Purchaser.
3.3.1 The Purchaser has the requisite power and authority to
enter into and perform this Agreement and to purchase the shares being sold to
it hereunder. The execution, delivery and performance of this
Agreement by the Purchaser and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized, and no further
consent or authorization is required. This Agreement has been duly
authorized, executed and delivered by the Purchaser and constitutes, or shall
constitute when executed and delivered, a valid and binding obligation of the
Purchaser enforceable against the Purchaser in accordance with the terms
thereof.
PAGE 7 OF
13
3.3.2 The
Purchaser is, and will be at the time of the execution of this Agreement, an
“accredited investor,”
as such term is defined in Regulation D promulgated by the Commission under the
1933 Act, is experienced in investments and business matters, has made
investments of a speculative nature and has purchased securities of United
States publicly-owned companies in the past and, with its representatives, has
such knowledge and experience in financial, tax and other business matters as to
enable such Purchaser to utilize the
information made available by the Company to evaluate the merits and risks of
and to make an informed investment decision with respect to the proposed
purchase, which represents a speculative investment. The Purchaser
has the authority and is duly and legally qualified to purchase and own shares
of the Company. The Purchaser is able to bear the risk of such
investment for an indefinite period and to afford a complete loss
thereof. The information set forth on the signature page hereto
regarding the Purchaser is
accurate.
3.3.3 If,
on the Closing Date, Purchaser purchases the Stock pursuant to the terms of this
Agreement, Purchaser will do so for its own account for investment only and not
with a view toward, or for resale in connection with, the public sale or any
distribution thereof.
3.3.4 The
Purchaser understands and agrees that the Stock have not been registered under
the 1933 Act or any applicable state securities laws, by reason of their
issuance in a transaction that does not require registration under the 1933 Act
(based in part on the accuracy of the representations and warranties of the
Purchaser contained herein), and that such
Stock must be held indefinitely unless a subsequent disposition is registered
under the 1933 Act or any applicable state securities laws or is exempt from
such registration. In any event, and subject to compliance with
applicable securities laws, the Purchaser may enter into lawful hedging
transactions in the course of hedging the position they assume and the Purchaser
may also enter into lawful short positions or other derivative transactions
relating to the Stock, or interests in the Stock, and deliver the Stock, or
interests in the Stock, to close out their short or other positions or otherwise
settle other transactions, or loan or pledge the Stock, or interests in the
Stock, to third parties who in turn may dispose of these Stock.
3.3.5 The
Stock shall bear the following or similar legend:
“THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, NOR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED
OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR
THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION
OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS
SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING
ARRANGEMENT SECURED BY THE SECURITIES.”
PAGE 8 OF
13
3.3.6 The
offer to sell the Stock was directly communicated to the Purchaser by the
Company. At no time was any Purchaser presented with or solicited by
any leaflet, newspaper or magazine article, radio or television advertisement,
or any other form of general advertising or solicited or invited to attend a
promotional meeting otherwise than in connection and concurrently with such
communicated offer.
3.3.7 The
Purchaser represents that the foregoing representations and warranties are true
and correct as of the date hereof and, unless such Purchaser otherwise notifies
the Company prior to the Closing Date shall be true and correct as of the
Closing Date.
3.3.8 The
foregoing representations and warranties shall survive the Closing Date and for
a period of one year thereafter.
Section
4. Miscellaneous
4.1. Expenses.
Each of the Parties shall bear its/his
own expenses in connection with the transactions contemplated by this
Agreement.
4.2. Governing Law.
The interpretation and construction of
this Agreement, and all matters relating hereto, shall be governed by the laws
of the State of Nevada applicable to agreements executed and to be wholly
performed solely within such state.
4.3. Resignation of Old and Appointment
of New Board of Directors and Officers.
The Company and the Sellers shall take
such corporate action(s) required by Bellmore's Articles of Incorporation and/or
Bylaws to (a) appoint the below named persons to their respective positions,
to be effective on the Closing
Date, and (b) obtain and submit to the Purchaser, together with all required
corporate action(s) the resignation of the current board of directors, and any
and all corporate officers as of the Closing Date.
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Name
|
Position
|
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇
|
President,
Chief Executive Officer, Director and Chairman of the Board of
Directors
|
4.4 Indemnification.
The Purchaser shall indemnify and
hold harmless the Sellers from and against any and all losses, damages, expenses
and liabilities (collectively “Liabilities”) or actions, investigations,
inquiries, arbitrations, claims or other proceedings in respect thereof,
including enforcement of this Agreement (collectively “Actions”)
(Liabilities and Actions are herein collectively referred to as “Losses”). Losses
include, but are not limited to all reasonable legal fees, court costs and other
expenses incurred in connection with investigating, preparing, defending,
paying, settling or compromising any suit in law or equity arising out of this
Agreement or for any breach of this Agreement notwithstanding the absence of a
final determination as to a Purchaser’s obligation to reimburse the Sellers for
such Losses and the possibility that such payments might later be held to have
been improper.
PAGE 9 OF
13
The
Sellers shall indemnify and hold harmless the Purchaser from and against any and
all losses, damages, expenses and liabilities (collectively “Liabilities”) or
actions, investigations, inquiries, arbitrations, claims or other proceedings in
respect thereof, including enforcement of this Agreement (collectively “Actions”)
(Liabilities and Actions are herein collectively referred to as “Losses”). Losses
include, but are not limited to all reasonable legal fees, court costs and other
expenses incurred in connection with investigating, preparing, defending,
paying, settling or compromising any suit in law or equity arising out of this
Agreement or for any breach of this Agreement notwithstanding the absence of a
final determination as to Sellers’ obligation to reimburse the Purchaser for
such Losses and the possibility that such payments might later be held to have
been improper.
4.5.
Disclosure.
The Parties agree that they will not
make any public comments, statements, or communications with respect to, or
otherwise disclose the execution of this Agreement or the terms and conditions
of the transactions contemplated by this Agreement without the prior written
consent of the Parties, which consent shall not be unreasonably
withheld.
4.6.
Notices.
Any notice or other communication
required or permitted under this Agreement shall be sufficiently given if
delivered in person or sent by facsimile or by overnight registered mail,
postage prepaid, addressed as follows:
If to the
Sellers, to:
Bellmore Corporation
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Telephone:
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile:
(▇▇▇) ▇▇▇-▇▇▇▇
If to the
Purchaser, to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
Telephone:
(▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Or such other address or number as
shall be furnished in writing by any such Party, and such notice or
communication shall, if properly addressed, be deemed to have been given as of
the date so delivered or sent by facsimile.
PAGE 10
OF 13
4.7.
Parties in Interest.
This Agreement may not be transferred,
assigned or pledged by any Party hereto, other than by operation of
law. This Agreement shall be binding upon and shall inure to the
benefit of the Parties hereto and their respective heirs, executors,
administrators, successors and permitted assigns.
4.8. Entire Agreement.
This Agreement and the other documents
referred to herein contain the entire understanding of the Parties hereto with
respect to the subject matter contained herein. This Agreement shall supersede
all prior agreements and understandings between the Parties with respect to the
transactions contemplated herein.
4.9. Amendments.
This Agreement may not be amended or
modified orally, but only by an agreement in writing signed by the
Parties.
4.10. Severability.
In case any provision in this Agreement
shall be held invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof will not in any way be
affected or impaired thereby.
4.11. Counterparts.
This Agreement may be executed in any
number of counterparts, including counterparts transmitted by telecopier, PDF or
facsimile transmission, any one of which shall constitute an original of this
Agreement. When counterparts of copies have been executed by all
parties, they shall have the same effect as if the signatures to each
counterpart or copy were upon the same document and copies of such documents
shall be deemed valid as originals. The Parties agree that all such
signatures may be transferred to a single document upon the request of any
Party.
[-REMAINDER
OF PAGE LEFT BLANK-]
PAGE 11
OF 13
In Witness
Whereof, each of the Parties hereto has caused its/his name to be
hereunto subscribed as of the day and year first above written.
Company:
Bellmore
Corporation
By: ____________________
Name: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
Title: Chief Financial
Officer
Sellers:
________________________
▇▇▇▇ ▇▇▇▇▇▇▇,
Individually
________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
Individually
Purchaser:
By:
____________________
Name:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Individually
Escrow
Agent:
▇▇▇▇▇▇
& ▇▇▇▇▇▇, LLP
By:____________________
PAGE 12
OF 13
SCHEDULE
A
|
Shareholder
Name
|
No.
of Shares
|
|
▇▇▇▇
▇▇▇▇▇▇▇
|
1,000,000
|
|
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
|
1,000,000
|
|
Total
|
2,000,000
|
PAGE 13 OF
13