EXHIBIT TO SCHEDULE 13D
STOCK PURCHASE AGREEMENT
Dated as of June 18, 2009
By and Among
G. Xxxxx Xxxx
and
Xxxxxxx Xx
and
Xxxxx Xxxxxxxx
and
Xxxxxx Xxxxx
and
HSM Holdings, Inc.
STOCK PURCHASE AGREEMENT
This stock purchase agreement (Agreement), dated as of June 18,
2009, is entered into by and among HSM Holdings, Inc. (HSM or the
Company) and Xxxxxxx Xx, Xxxxxx Xxxxx and Xxxxx Xxxxxxxx, (each a
Seller and collectively, the Sellers), and G. Xxxxx Xxxx (the Purchaser and
together with the Company and the Sellers, the Parties).
W I T N E S S E T H:
WHEREAS, the Sellers, are shareholders of HSM, a corporation
organized and existing under the laws of the State of Delaware, who own
and/or control in the aggregate 10,000,000 shares of the Company, which
represents 100% of the issued and outstanding common shares of the
Company; and
WHEREAS, the Purchaser desires to acquire all of such shares of the
Company.
NOW, THEREFORE, in consideration of the premises and of the
covenants, representations, warranties and agreements herein contained, the
Parties have reached the following agreement with respect to the sale by the
Sellers of such common stock of the Company to the Purchaser:
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) This Agreement is the result of negotiations among and has been
reviewed by each Partys counsel. Accordingly, this Agreement shall not be
construed against any Party merely because of such Partys involvement in
its preparation.
(e) 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.
SECTION 2. THE TRANSACTION
2.1. Purchase Price:
The 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 the Sellers 10,000,000 common shares of the capital stock of HSM (the
Acquired Shares) for a total purchase price of $40,000 (the Purchase
Price), payable in full to the Sellers according to the terms of this
Agreement, in United States currency as directed by the Sellers at Closing.
2.2. Transfer of Shares and Terms of Payment:
In consideration for the transfer of the Acquired Shares by the Sellers
to the Purchaser, the Purchaser shall pay the Purchase Price in accordance
with the terms of this Agreement. Transfer of the shares and payment
thereof shall be in the following manner:
i) Upon execution of this Agreement, the Purchaser shall transfer
$40,000 (Payment) to Xxxxxx & Xxxxxx, LLP (the Escrow Agent).
ii) Simultaneously with the transfer of the Payment, the Sellers shall
deliver to the Escrow Agent, the certificates for the Acquired Shares
duly endorsed for transfer or with executed stock powers attached to be
released and delivered to Buyer upon receipt of the Payment by the
Escrow Agent.
2.3. Closing.
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 June 18, 2009 (the Closing Date).
SECTION 3. REPRESENTATIONS AND WARRANTIES
3.1. Representations and Warranties of the Sellers:
3.1.1 The Company is a corporation duly organized and validly
existing under the laws of the State of Delaware and has all corporate power
necessary to engage in all transactions in which it has been involved, 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 Delaware.
3.1.3 Prior to or at Closing, all of the Companys outstanding debts
and obligations shall be paid off (at no expense or liability to the
Purchaser) and the Seller shall provide Purchaser with evidence of such
payoff. 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 any and all such liabilities, whether outstanding or
contingent at the time of Closing.
3.1.4 The Company will have no assets or liabilities at 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.
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. The
Company has timely filed all income, real or personal property, sales, use,
employment or other governmental tax returns or reports required to be
filed by it with any federal, state or other governmental agency and all
taxes required to be paid by the Company in respect of such returns have
been paid in full. None of such returns are subject to examination by any
such taxing authority and the Company has not received notice of any
intention to require the Company to file any additional tax returns in any
jurisdiction to which it may be subject.
3.1.9 The Company, to the actual knowledge of Sellers, is not in
violation of any provision of laws or regulations of federal, state or local
government authorities and agencies.
3.1.10 The Sellers either are or on the Closing Date will be the
lawful owners of record of the Acquired Shares, and the Sellers presently
have, and will have at the Closing Date, the power to transfer and deliver
the Acquired Shares to the Purchaser in accordance with the terms of this
Agreement. The delivery to the Purchaser of certificates evidencing the
transfer of the Acquired Shares 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 There are no authorized shares of the Company other than
100,000,000 common shares and 10,000,000 preferred shares, and there are no
issued and outstanding shares of the Company other than 10,000,000 common
shares. Sellers at the Closing Date will have full and valid title to the
Acquired Shares, and there will be no existing impediment or encumbrance to
the sale and transfer of the Acquired Shares to the Purchaser; and on
delivery to the Purchaser of the Acquired Shares being sold hereby, all of
such Shares shall be free and clear of all liens, encumbrances, charges or
assessments of any kind; such Shares will be legally and validly issued and
fully paid and non-assessable shares of the Companys common stock; and all
such common stock has been issued under duly authorized resolutions of the
Board of Directors of the Company.
3.1.12 All issuances of the Company of the shares in their common
stock in past transactions have been legally and validly effected, without
violation of any preemptive rights, and all of such shares of common stock
are fully paid and non-assessable.
3.1.13 There are no outstanding subscriptions, options, warrants,
convertible securities or rights or commitments of any nature in regard to
the Companys authorized but unissued common stock or any agreements
restricting the transfer of outstanding or authorized but unissued common
stock.
3.1.14 There are no outstanding judgments, liens or any other
security interests filed against the Company or any of its properties.
3.1.15 The Company has no subsidiaries.
3.1.16 The Company has no employment contracts or agreements with
any of its officers, directors, or with any consultants; and the Company has
no employees or other such parties.
3.1.17 The Company has no insurance or employee benefit plans
whatsoever.
3.1.18 The Company is not in default under any contract, or any
other document.
3.1.19 The Company has no outstanding powers of attorney and no
obligations concerning the performance of the Sellers concerning this
Agreement.
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 common stock of the Company is registered under Section
12(g) of the Securities Exchange Act of 1934, as amended (the Exchange Act)
and there are no proceedings pending to revoke or terminate such
registration. Since the date of the common stocks registration under the
Exchange Act, the Company has filed all reports with the Securities and
Exchange Commission required to be filed by the Exchange Act, including its
Quarterly Report on Form 10-Q for the first quarter of 2009, and all such
reports were filed timely.
The representations and warranties herein by the Sellers 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.
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 twelfth 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, to the best of their respective abilities,
preserve intact the current status of the Company as a 1934 Exchange Act
company.
3.2.2 The Sellers will furnish Purchaser with all corporate
records and documents, such as Articles of Incorporation and Bylaws, minute
books, stock books, or any other corporate document or record (including
financial and bank documents, books and records) requested by the Purchaser.
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 At Closing, the Company and the Sellers will obtain and
submit to the Purchaser resignations of current officers and directors.
3.2.10 The Sellers agree to indemnify the Purchaser against and to
pay any loss, damage, expense or claim or other liability incurred or
suffered by the Purchaser by reason of the breach of any covenant or
inaccuracy of any warranty or representation contained in this Agreement.
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
such Purchaser and the consummation by it of the transactions contemplated
hereby and thereby have been duly authorized by all necessary action, and no
further consent or authorization of such Purchaser is required. This
Agreement has been duly authorized, executed and delivered by such
Purchaser and constitutes, or shall constitute when executed and delivered,
a valid and binding obligation of such Purchaser enforceable against such
Purchaser in accordance with the terms thereof.
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 On the Closing Date, such Purchaser will purchase the
Acquired Shares pursuant to the terms of this Agreement 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 Acquired Shares
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 Acquired Shares 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 Acquired Shares, or interests
in the Acquired Shares, and deliver the Acquired Shares, or interests in the
Acquired Shares, to close out their short or other positions or otherwise
settle other transactions, or loan or pledge the Acquired Shares, or
interests in the Acquired Shares, to third parties who in turn may dispose
of these Acquired Shares.
3.3.5 The Acquired Shares 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.
3.3.6 The offer to sell the Acquired Shares was directly
communicated to such Purchaser by the Company. At no time was such
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 Such 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 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 Delaware
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 HSMs Articles of Incorporation and/or Bylaws to (a) appoint the
below named persons to their respective positions, to be effective on the
eleventh day following 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 and
check signers as of the Closing Date.
Name
Position
G. Xxxxx Xxxx
Director, President and CEO
4.4. Disclosure.
The Sellers and the Company 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 Purchaser, which consent shall not be
unreasonably withheld.
4.5. 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 Sellers, to:
Xxxxxxx Xx
Xxxxx Xxxxxxxx
Xxxxxx Xxxxx
X.X. Xxx 000000
Xxxxxxxx, XX 00000
If to the Company:
HSM Holdings, Inc.
X.X. Xxx 000000
Xxxxxxxx, XX 00000
With a copy to (which shall not constitute notice):
Xxxxx X. Xxxxxx, Esq.
Xxxxxx & Jaclin, LLP
000 Xxxxx 0, Xxxxx 000
Xxxxxxxxx, XX 00000
If to the Purchaser, to:
G. Xxxxx Xxxx
X.X. Xxx 00000
Xxxxxxxxx, XX 00000-0000
With a copy to (which shall not constitute notice):
Xxxxx X. Spring, III
Chamberlain, Hrdlicka, White, Xxxxxxxx & Xxxxxx
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
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.
4.6. 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.
4.7. 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, including, but not limited to, the LOI.
4.8. Amendments.
This Agreement may not be amended or modified orally, but only by
an agreement in writing signed by the Parties.
4.9. 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.
4.10. 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.
[-signature page follows-]
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:
HSM Holdings, Inc.
By: /s/ Xxxxxxx Xx
Name: Xxxxxxx Xx
Title: Chief Executive Officer
Sellers:
By: /s/ Xxxxxxx Xx
Name: Xxxxxxx Xx, Individually
By: /s/ Xxxxxx Xxxxxxxx
Name: Xxxxx Xxxxxxxx, Individually
By: /s/ Xxxxxx Xxxxx
Name: Xxxxxx Xxxxx, Individually
Purchaser:
By: /s/ G. Xxxxx Xxxx
Name: G. Xxxxx Xxxx, Individually
