STOCK PURCHASE AGREEMENT
THIS
AGREEMENT (this
“Agreement”), entered
into as of the 11th
day of
April, 2006, is made by and between Xxxxxx Xxxxxx, Xxxxx Xxxxxx, and Xxxx XxXxx
(together,
Xxxxxx
Xxxxxx, Xxxxx Xxxxxx, and Xxxx XxXxx are
referred to herein as the“Shareholders”),
Supreme Realty Investments, Inc. (“SRLT”),
and
Xxxxx Xx (“Xu”) (the
“Buyer”).
Whereas,
The
Shareholders desire to sell to the Buyer and the Buyer wishes to purchase and
acquire from the Shareholders an aggregate of 8,821,000 shares of SRLT’s common
stock, representing 70.56% of the capital stock of SRLT, pursuant to the terms
and conditions of this Agreement.
Now,
Therefore,
in
consideration of the representations, warranties and agreements set forth
herein, the parties hereto hereby agree as follows:
ARTICLE
1
DEFINITIONS
AND INTERPRETATION
1.1 Definitions.
In this
Agreement the following terms will have the following meanings:
| (a) |
“Agreement”
means this Stock Purchase
Agreement;
|
| (b) |
“Closing”
means the completion, on the date hereof, of the transactions
contemplated
hereby in accordance with Article 7 hereof;
|
| (c) |
“Place
of Closing”
means the offices of Berkman, Henoch, Xxxxxxxx & Xxxxx, P.C., or such
other place as the Buyer and SRLT may mutually agree
upon;
|
| (d) |
“SRLT
Accounts Payable and Liabilities”
means all accounts payable and liabilities of SRLT, on a consolidated
basis, due and owing or otherwise constituting a binding obligation
of
SRLT and its subsidiaries (other than an SRLT Material Contract)
as of
April 6, 2006, as set forth is Schedule “A”
hereto;
|
| (e) |
“SRLT
Accounts Receivable”
means all accounts receivable and other debts owing to SRLT, on a
consolidated basis, as of April 6, 2006, as set forth in Schedule
“B”
hereto;
|
| (f) |
“SRLT
Assets”
means the undertaking and all the property and assets of the SRLT
Business
of every kind and description wheresoever situated including, without
limitation, SRLT Equipment, SRLT Inventory, SRLT Material Contracts,
SRLT
Accounts Receivable, SRLT Cash, SRLT Intangible Assets and SRLT Goodwill,
and all credit cards, charge cards and banking cards issued to
SRLT;
|
| (g) |
“SRLT
Bank Accounts”
means all of the bank accounts, lock boxes and safety deposit boxes
of
SRLT and its subsidiaries or relating to the SRLT Business as set
forth in
Schedule “C” hereto;
|
| (h) |
“SRLT
Business”
means all aspects of any business conducted by SRLT and its
subsidiaries;
|
| (i) |
“SRLT
Cash”
means all cash on hand or on deposit to the credit of SRLT and its
subsidiaries on the date hereof;
|
| (j) |
“SRLT
Common Shares”
means the shares of common stock in the capital of
SRLT;
|
| (k) |
“SRLT
Preferred Shares”
means the non-voting series A preferred stock, no par value in the
capital
of SRLT;
|
| (l) |
“SRLT
Debt to Related Parties”
means the debts owed by SRLT and its subsidiaries to any affiliate,
director or officer of SRLT as described in Schedule “D”
hereto;
|
| (m) |
“SRLT
Equipment”
means all machinery, equipment, furniture, and furnishings used in
the
SRLT Business, including, without limitation, the items more particularly
described in Schedule “E” hereto;
|
| (n) |
“SRLT
Financial Statements”
means, collectively, the audited consolidated financial statements
of SRLT
for the fiscal year ended December 31, 2005, and the unaudited
consolidated financial statements of SRLT for the six month period
ended
June 31, 2005, true copies of which are attached as Schedule “F”
hereto;
|
| (o) |
“SRLT
Goodwill”
means the goodwill of the SRLT Business including the right to all
corporate, operating and trade names associated with the SRLT Business,
or
any variations of such names as part of or in connection with the
SRLT
Business, all books and records and other information relating to
the SRLT
Business, all necessary licenses and authorizations and any other
rights
used in connection with the SRLT
Business;
|
| (p) |
“SRLT
Insurance Policies”
means the public liability insurance and insurance against loss or
damage
to the SRLT Assets and the SRLT Business as described in Schedule
“G”
hereto;
|
| (q) |
“SRLT
Intangible Assets”
means all of the intangible assets of SRLT and its subsidiaries,
including, without limitation, SRLT Goodwill, all trademarks, logos,
copyrights, designs, and other intellectual and industrial property
of
SRLT and its subsidiaries;
|
| (r) |
“SRLT
Inventory”
means all inventory and supplies of the SRLT Business as of April
6, 2006,
as set forth in Schedule “H”
hereto;
|
| (s) |
“SRLT
Material Contracts”
means the burden and benefit of and the right, title and interest
of SRLT
and its subsidiaries in, to and under all trade and non-trade contracts,
engagements or commitments, whether written or oral, to which SRLT
or its
subsidiaries are entitled whereunder SRLT or its subsidiaries are
obligated to pay or entitled to receive the sum of $750 or more including,
without limitation, any pension plans, profit sharing plans, bonus
plans,
loan agreements, security agreements, indemnities and guarantees,
any
agreements with employees, lessees, licensees, managers, accountants,
suppliers, agents, distributors, officers, directors, attorneys or
others
which cannot be terminated without liability on not more than one
month's
notice, and those contracts listed in Schedule “I” hereto;
and
|
| (t) |
“Shares”
shall mean the 8,821,000 shares of SRLT Common Stock to be sold to
Buyer
by the Company hereunder.
|
Any
other
terms defined within the text of this Agreement will have the meanings so
ascribed to them.
1.2 Captions
and Section Numbers.
The
headings and section references in this Agreement are for convenience of
reference only and do not form a part of this Agreement and are not intended
to
interpret, define or limit the scope, extent or intent of this Agreement or
any
provision thereof.
2
1.3 Section
References and Schedules.
Any
reference to a particular “Article”, “section”, “paragraph”, “clause” or other
subdivision is to the particular Article, section, clause or other subdivision
of this Agreement and any reference to a Schedule by letter will mean the
appropriate Schedule attached to this Agreement and by such reference the
appropriate Schedule is incorporated into and made part of this Agreement.
1.4 Severability
of Clauses.
If any
part of this Agreement is declared or held to be invalid for any reason, such
invalidity will not affect the validity of the remainder which will continue
in
full force and effect and be construed as if this Agreement had been executed
without the invalid portion, and it is hereby declared the intention of the
parties that this Agreement would have been executed without reference to any
portion which may, for any reason, be hereafter declared or held to be
invalid.
ARTICLE
2
PURCHASE
AND SALE
2.1 Issuance
of the Shares.
Subject
to all of the terms and conditions of this Agreement, the Shareholders do hereby
sell, assign, transfer and convey to the Buyer, and the Buyer does hereby
purchase and accept from the Shareholders, all of the Shares as set forth on
Exhibit
A,
free
and clear of all encumbrances, liens, charges and claims, which Shares represent
70.56% of the capital stock of SRLT.
2.2 Purchase
Price; Payment. The
purchase price for the Shares is Five Hundred Ninety Thousand Dollars ($590,000)
(the “Purchase
Price”)
and
shall be paid by wire transfer $590,000 of immediately available funds or bank
or certified check in accordance with Exhibit
A.
ARTICLE
3
SELLERS’
REPRESENTATIONS AND WARRANTIES
3.1 Representations
and Warranties.
The
Shareholders and SRLT jointly and severally make the representations and
warranties set forth below and intend and acknowledge that the Buyer will rely
thereon in entering into this Agreement and in approving and completing the
transactions contemplated hereby. Any schedules described in or contemplated
by
such representations and warranties shall be prepared both as of the date of
this Agreement and as of the date of the Closing.
The
Sellers
|
(a)
|
Power
and Capacity.
Each Shareholder has the power, authority and capacity to enter into
this
Agreement and to consummate the transactions contemplated hereby.
This
Agreement constitutes each Shareholder’s valid, legal and binding
obligation and is enforceable against such Shareholder in accordance
with
its terms, subject, however, as to enforcement, to bankruptcy, insolvency,
fraudulent transfer, moratorium and similar laws of general applicability
relating to or affecting creditors’ rights;
|
|
(b)
|
Legal
Proceedings, Etc. There
is no legal, equitable, administrative or arbitration action, suit,
proceeding or known investigation pending or threatened against or
affecting the Shareholder. There is no judgment, decree, injunction,
rule
or order of any court, governmental department, commission, agency,
instrumentality or arbitrator outstanding against either party
constituting the Shareholder and there is no basis for any action,
suit,
proceeding or investigation against either party constituting the
Shareholder.
|
3
|
(c)
|
Ownership.
The Sellers are the sole legal, beneficial and registered owner of
the
Shares, free and clear of any liens, security interests, charges
or other
encumbrances of any nature whatsoever. The Shares are validly issued,
fully paid and non-assessable.
|
SRLT
- Corporate Status and Capacity
| (d) |
Incorporation.
SRLT is a corporation duly incorporated and validly subsisting under
the
laws of the State of Nevada, and is in good standing with the office
of
the Secretary of State for the State of
Nevada;
|
| (e) |
Carrying
on Business.
SRLT does not currently conduct any business activity. SRLT is not
required to register or otherwise be qualified to carry on business
in any
foreign jurisdiction;
|
| (f) |
Corporate
Capacity.
SRLT has the corporate power, capacity and authority to own the SRLT
Assets;
|
| (g) |
Reporting
Status; Listing.
SRLT is required to file current reports with the Securities and
Exchange
Commission pursuant to section 15(d) of the Securities Exchange Act
of
1934, as amended (the “Exchange Act”) and SRLT’s Common Shares are quoted
on the National Association of Securities Dealers, Inc.’s Over-the-Counter
Bulletin Board System (the “OTC Bulletin Board”). SRLT has filed all
reports required to be filed by it under the Exchange Act, including
pursuant to Section 13(a) or 15(d) thereof, for the five years preceding
the date hereof (or such shorter period as the SRLT was required
by law to
file such material) (the foregoing materials being collectively referred
to herein as the “SEC Documents”) and is current with respect to its
Exchange Act filing requirements. As of their respective dates, the
SEC Documents complied in all material respects with the requirements
of
the Securities Act of 1933, as amended (the “Securities Act”) and the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder, and none of the SEC Documents, when filed, contained
any
untrue statement of a material fact or omitted to state a material
fact
required to be stated therein or necessary in order to make the statement
therein, in light of the circumstances under which they were made,
not
misleading. All material agreements to which SRLT is a party or to
which the property or assets of SRLT are subject have been appropriately
filed as exhibits to the SEC Documents as and to the extent required
under
the Exchange Act. The financial statements of SRLT included in the
SEC Documents comply in all material respects with applicable accounting
requirements and the rules and regulations of the Commission with
respect
thereto as in effect at the time of filing, were prepared in accordance
with GAAP applied on a consistent basis during the periods involved
(except as may be indicated in the notes thereto, or, in the case
of
unaudited statements, as permitted by Form 10-Q of the Commission),
and
fairly present in all material respects (subject in the case of unaudited
statements, to normal, recurring audit adjustments) the financial
position
of SRLT as at the dates thereof and the results of its operations
and cash
flows for the periods then ended. SRLT is not aware of any facts
which would make SRLT’s Common Stock ineligible for quotation on the OTC
Bulletin Board;
|
4
SRLT
- Capitalization
|
(h)
|
Authorized
Capital.
The authorized capital of SRLT consists of: (i) 200,000,000 shares
of
Common Stock, $.001 par value, of which 12,540,000 are presently
issued
and outstanding; and (ii) 100,000,000 shares of non-voting series
A
preferred stock, no par value, of which none are presently issued
or
outstanding.
|
| (i) |
No
Option.
No person, firm or corporation has any agreement, warrant or option
or any
right capable of becoming an agreement or option for the acquisition
of
SRLT Common Shares or SRLT Preferred Shares or for the purchase,
subscription or issuance of any other securities of
SRLT;
|
SRLT
- Records and Financial Statements
|
(j)
|
Charter
Documents.
The charter documents of SRLT have not been altered since its
incorporation, except as filed in the record books of
SRLT;
|
|
(k)
|
Corporate
Minute Books.
The corporate minute books of SRLT and its subsidiaries are complete
and
each of the minutes contained therein accurately reflect the actions
that
were taken at a duly called and held meeting or by consent without
a
meeting. All actions by SRLT and its subsidiaries which required
director
or shareholder approval are reflected on the corporate minute books
of
SRLT and its subsidiaries. SRLT and its subsidiaries are not in violation
or breach of, or in default with respect to, any term of their respective
Certificates of Incorporation (or other charter documents) or
by-laws.
|
|
(l)
|
SRLT
Financial Statements.
The SRLT Financial Statements present fairly, in all material respects,
the assets and liabilities (whether accrued, absolute, contingent
or
otherwise) of SRLT, on a consolidated basis, as of the respective
dates
thereof, and the sales and earnings of the SRLT Business during the
periods covered thereby, in all material respects and have been prepared
in substantial accordance with generally accepted accounting principles
consistently applied;
|
|
(m)
|
SRLT
Accounts Payable and Liabilities.
There are no liabilities, contingent or otherwise, of SRLT or its
subsidiaries which are not disclosed in Schedule “A” hereto or reflected
in the SRLT Financial Statements and neither SRLT nor its subsidiaries
have guaranteed or agreed to guarantee any debt, liability or other
obligation of any person, firm or corporation. Without limiting the
generality of the foregoing, all accounts payable and liabilities
of SRLT
and its subsidiaries as of April 6, 2006 are described in Schedule
“A”
hereto;
|
|
(n)
|
SRLT
Accounts Receivable.
All the SRLT Accounts Receivable result from bona fide business
transactions and services actually rendered without, to the knowledge
and
belief of SRLT, any claim by the obligor for set-off or
counterclaim;
|
|
(o)
|
SRLT
Bank Accounts.
All of the SRLT Bank Accounts, their location, numbers and the authorized
signatories thereto are as set forth in Schedule “C”
hereto;
|
|
(p)
|
No
Debt to Related Parties.
Except as disclosed in Schedule “D” hereto, neither SRLT nor its
subsidiaries are, and on Closing will not be, indebted to any affiliate,
director or officer of SRLT;
|
|
(q)
|
No
Related Party Debt to SRLT.
No director or officer or affiliate of SRLT is now indebted to or
under
any financial obligation to SRLT or its subsidiaries on any account
whatsoever;
|
5
|
(r)
|
No
Dividends.
No dividends or other distributions on any shares in the capital
of SRLT
have been made, declared or authorized since the date of SRLT Financial
Statements;
|
|
(s)
|
No
Payments.
No payments of any kind have been made or authorized since the date
of the
SRLT Financial Statements to or on behalf of officers, directors,
shareholders or employees of SRLT or its subsidiaries or under any
management agreements with SRLT or its subsidiaries, except payments
made
in the ordinary course of business;
|
|
(t)
|
No
Pension Plans.
There are no pension, profit sharing, group insurance or similar
plans or
other deferred compensation plans affecting SRLT or its
subsidiaries;
|
|
(u)
|
No
Adverse Events.
Since the date of the SRLT Financial
Statements
|
|
(i)
|
there
has not been any adverse change in the financial position or condition
of
SRLT, its subsidiaries, its liabilities or the SRLT Assets or any
damage,
loss or other change in circumstances affecting SRLT, the SRLT Business
or
the SRLT Assets or SRLT’s right to carry on the SRLT Business, other than
changes in the ordinary course of
business,
|
|
(ii)
|
there
has not been any damage, destruction, loss or other event (whether
or not
covered by insurance) adversely affecting SRLT, its subsidiaries,
the SRLT
Business or the SRLT Assets,
|
|
(iii)
|
there
has not been any increase in the compensation payable or to become
payable
by SRLT to any of SRLT’s officers, employees or agents or any bonus,
payment or arrangement made to or with any of
them,
|
|
(iv)
|
the
SRLT Business has been and continues to be carried on in the ordinary
course,
|
|
(v)
|
SRLT
has not waived or surrendered any right of material
value,
|
|
(vi)
|
Neither
SRLT nor its subsidiaries have discharged or satisfied or paid any
lien or
encumbrance or obligation or liability other than current liabilities
in
the ordinary course of business,
and
|
|
(vii)
|
no
capital expenditures in excess of $500 individually or $1,000 in
total
have been authorized or made.
|
SRLT
- Income Tax Matters
| (v) |
Tax
Returns.
All tax returns and reports of SRLT and its subsidiaries required
by law
to be filed have been filed and are true, complete and correct, and
any
taxes payable in accordance with any return filed by SRLT and its
subsidiaries or in accordance with any notice of assessment or
reassessment issued by any taxing authority have been so
paid;
|
| (w) |
Current
Taxes.
Adequate provisions have been made for taxes payable for the current
period for which tax returns are not yet required to be filed and
there
are no agreements, waivers, or other arrangements providing for an
extension of time with respect to the filing of any tax return by,
or
payment of, any tax, governmental charge or deficiency by SRLT or
its
subsidiaries. There are no contingent tax liabilities or any grounds
which
would prompt a reassessment including aggressive treatment of income
and
expenses in filing earlier tax
returns;
|
6
SRLT
- Applicable Laws and Legal Matters
| (x) |
Licenses.
SRLT and its subsidiaries hold all licenses and permits as may be
required
for carrying on the SRLT Business in the manner in which it has heretofore
been carried on, which licenses and permits have been maintained
and
continue to be in good standing except where the failure to obtain
or
maintain such licenses or permits would not have an adverse effect
on the
SRLT Business;
|
|
(y)
|
Applicable
Laws.
Neither SRLT nor its subsidiaries have been charged with or received
notice of breach of any laws, ordinances, statutes, regulations,
by-laws,
orders or decrees to which they are subject or which apply to them
the
violation of which would have an adverse effect on the SRLT Business
(greater than $500), and to SRLT’s knowledge, neither SRLT nor its
subsidiaries are in breach of any laws, ordinances, statutes, regulations,
bylaws, orders or decrees the contravention of which would result
in an
adverse impact on the SRLT
Business;
|
|
(z)
|
Pending
or Threatened Litigation.
There is no litigation or administrative or governmental proceeding
pending or threatened against or relating to SRLT, its subsidiaries,
the
SRLT Business, or any of the SRLT Assets nor does SRLT have any knowledge
after due investigation of any deliberate act or omission of SRLT
or its
subsidiaries that would form any basis for any such action or
proceeding;
|
|
(aa)
|
No
Bankruptcy.
Neither SRLT nor its subsidiaries have made any voluntary assignment
or
proposal under applicable laws relating to insolvency and bankruptcy
and
no bankruptcy petition has been filed or presented against SRLT or
its
subsidiaries and no order has been made or a resolution passed for
the
winding-up, dissolution or liquidation of SRLT or its subsidiaries;
|
|
(bb)
|
Labor
Matters.
Neither SRLT nor its subsidiaries are party to any collective agreement
relating to the SRLT Business with any labor union or other association
of
employees and no part of the SRLT Business has been certified as
a unit
appropriate for collective bargaining or, to the best knowledge of
SRLT,
has made any attempt in that
regard;
|
|
(cc)
|
Finder's
Fees.
Neither SRLT nor its subsidiaries are party to any agreement which
provides for the payment of finder's fees, brokerage fees, commissions
or
other fees or amounts which are or may become payable to any third
party
in connection with the execution and delivery of this Agreement and
the
transactions contemplated herein;
|
Execution
and Performance of Agreement
| (dd) |
Authorization
and Enforceability.
The completion of the transactions contemplated hereby, have been
duly and
validly authorized by all necessary corporate action on the part
of
SRLT;
|
| (ee) |
No
Violation or Breach.
The execution and performance of this Agreement will
not:
|
|
(i)
|
violate
the charter documents of SRLT or result in any breach of, or default
under, any loan agreement, mortgage, deed of trust, or any other
agreement
to which SRLT or its subsidiaries are
party,
|
7
|
(ii)
|
give
any person any right to terminate or cancel any agreement including,
without limitation, the SRLT Material Contracts, or any right or
rights
enjoyed by SRLT or its
subsidiaries,
|
|
(iii)
|
result
in any alteration of SRLT’s or its subsidiaries’ obligations under any
agreement to which SRLT or its subsidiaries are party including,
without
limitation, the SRLT Material
Contracts,
|
|
(iv)
|
result
in the creation or imposition of any lien, encumbrance or restriction
of
any nature whatsoever in favor of a third party upon or against the
SRLT
Assets,
|
|
(v)
|
result
in the imposition of any tax liability to SRLT or its subsidiaries
relating to the SRLT Assets, or
|
|
(vi)
|
violate
any court order or decree to which either SRLT or its subsidiaries
are
subject;
|
SRLT
Assets - Ownership and Condition
| (ff) |
Business
Assets.
The SRLT Assets comprise all of the property and assets of the SRLT
Business, and no other person, firm or corporation owns any assets
used by
SRLT in operating the SRLT Business, whether under a lease, rental
agreement or other arrangement, other than as disclosed in Schedules
“E”
or “H” hereto;
|
|
(gg)
|
Title.
SRLT is the legal and beneficial owner of the SRLT Assets, free and
clear
of all mortgages, liens, charges, pledges, security interests,
encumbrances or other claims whatsoever, save and except as disclosed
in
Schedules “E” or “H” hereto;
|
| (hh) |
No
Option.
No person, firm or corporation has any agreement or option or a right
capable of becoming an agreement for the purchase of any of the SRLT
Assets;
|
|
(ii)
|
SRLT
Insurance Policies.
SRLT and its subsidiaries maintain the public liability insurance
and
insurance against loss or damage to the SRLT Assets and the SRLT
Business
as described in Schedule “G”
hereto;
|
| (jj) |
SRLT
Material Contracts.
The SRLT Material Contracts listed in Schedule “I” constitute all of the
material contracts of SRLT and its
subsidiaries;
|
| (kk) |
No
Default.
There has not been any default in any obligation of SRLT or any other
party to be performed under any of the SRLT Material Contracts, each
of
which is in good standing and in full force and effect and unamended
(except as disclosed in Schedule “I” hereto), and SRLT is not aware of any
default in the obligations of any other party to any of the SRLT
Material
Contracts;
|
| (ll) |
No
Compensation on Termination.
There are no agreements, commitments or understandings relating to
severance pay or separation allowances on termination of employment
of any
employee of SRLT or its subsidiaries. Neither SRLT nor its subsidiaries
are obliged to pay benefits or share profits with any employee after
termination of employment except as required by
law;
|
8
SRLT
Assets - SRLT Equipment
|
(mm)
|
SRLT
Equipment.
The SRLT Equipment has been maintained in a manner consistent with
that of
a reasonably prudent owner and such equipment is in good working
condition;
|
SRLT
Assets - SRLT Goodwill and Other Assets
| (nn) |
SRLT
Goodwill.
SRLT and its subsidiaries do not carry on the SRLT Business under
any
other business or trade names. SRLT does not have any knowledge of
any
infringement by SRLT or its subsidiaries of any patent, trademarks,
copyright or trade secret;
|
SRLT
Business
| (oo) |
Maintenance
of Business.
Since the date of the SRLT Financial Statements, SRLT and its subsidiaries
have not entered into any agreement or commitment except in the ordinary
course and except as disclosed
herein;
|
| (pp) |
Subsidiaries.
SRLT does not own any subsidiaries and does not otherwise own, directly
or
indirectly, any shares or interest in any other corporation, partnership,
joint venture or firm; and
|
SRLT
- Shares
| (qq) |
Shares.
The Shares when delivered to the Buyer shall be validly issued and
outstanding as fully paid and non-assessable shares and the Shares
shall
be transferable upon the books of SRLT, in all cases subject to the
provisions and restrictions of all applicable securities
laws.
|
3.2 Survival.
The
representations and warranties herein will be true at and as of the date hereof
in all material respects. Notwithstanding the completion of the transactions
contemplated hereby, the waiver of any condition contained herein (unless such
waiver expressly releases a party from any such representation or warranty)
or
any investigation made by the Buyer, the representations and warranties made
herein shall survive the Closing and be effective for a period of thirty-six
months (36) months from the date hereof.
3.3 Indemnity.
The
Shareholders agree to jointly and severally indemnify and save harmless the
Buyer from and against any and all claims, demands, actions, suits, proceedings,
assessments, judgments, damages, costs, losses and expenses, including any
payment made in good faith in settlement of any claim (subject to the right
of
the Shareholders to defend any such claim), resulting from the breach by them
of
any representation or warranty made under this Agreement or from any
misrepresentation in or omission from any certificate or other instrument
furnished or to be furnished by SRLT to the Buyer hereunder.
ARTICLE
4
REPRESENTATIONS
AND WARRANTIES OF THE BUYER
4.1 Representations
and Warranties.
The
Buyer makes the representations and warranties set forth below and intend and
acknowledge that SRLT and the Shareholders will rely thereon in entering into
this Agreement and in approving and completing the transactions contemplated
hereby. Any schedules described in or contemplated by such representations
and
warranties shall be prepared both as of the date of this Agreement and as of
the
date of the Closing.
9
|
(a)
|
Power
and Capacity.
The Buyer has the power, authority and capacity to enter into this
Agreement and to consummate the transactions contemplated hereby.
This
Agreement constitutes the Buyer’s valid, legal and binding obligation and
is enforceable against it in accordance with its terms, subject,
however,
as to enforcement, to bankruptcy, insolvency, fraudulent transfer,
moratorium and similar laws of general applicability relating to
or
affecting creditors’ rights and to general principles of equity,
regardless of whether such enforceability is considered in equity
or at
law;
|
|
(b)
|
No
Conflict.
Neither the execution and delivery of this Agreement by the Buyer,
nor
compliance with any of the provisions hereof, nor the consummation
of the
transactions contemplated hereby, will: (a)
result in a default, or give rise to any right of termination,
cancellation or acceleration, under any term, condition or provision
of
any contract or other instrument or obligation to which the
Buyer
is a party or by which its assets may be bound; or (b) violate any
order,
writ, injunction or decree applicable to the
Buyer,
or any of its properties or assets.
|
|
(c)
|
Legal
Proceedings, Etc.
There
is no legal, equitable, administrative or arbitration action, suit,
proceeding or known investigation pending or threatened against or
affecting the Buyer. There is no judgment, decree, injunction, rule
or
order of any court, governmental department, commission, agency,
instrumentality or arbitrator outstanding against either party
constituting the Buyer and there is no basis for any action, suit,
proceeding or investigation against
Buyer.
|
4.2 Survival.
The
representations and warranties of the Buyer contained herein will be true at
and
as of Closing in all material respects as though such representations and
warranties were made as of such time. Notwithstanding the completion of the
transactions contemplated hereby, the waiver of any condition contained herein
(unless such waiver expressly releases a party from any such representation
or
warranty) or any investigation made by the Sellers, the representations and
warranties of the Buyer made herein shall survive the Closing and be effective
for a period of thirty-six (36) months from the date hereof.
ARTICLE
5
FURTHER
COVENANTS
5.1 Legend. The
Buyer
agrees to the imprinting of the following legend on any certificates
representing the Shares:
“THESE
SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS. THESE SECURITIES ARE “RESTRICTED SECURITIES” WITHIN THE MEANING
OF RULE 144(3) OF THE SECURITIES ACT AND MAY NOT BE RESOLD PUBLICLY UNDER RULE
144 UNTIL CERTAIN HOLDING PERIOD REQUIREMENTS ARE MET.”
5.2 Expenses
of the Parties.
Except
as otherwise expressly provided in this Agreement, all expenses incurred by
SRLT
and the Shareholders in the preparation, negotiation, authorization and
consummation of this Agreement and the transactions contemplated hereby,
including all fees and expenses of agents, representatives, counsel and
accountants, shall be borne solely by the Shareholders, and neither the Buyer
nor SRLT shall have any responsibility with respect thereto.
10
5.3 Further
Assurances.
Each
party shall cooperate with the other, take such further action and execute
and
deliver such further documents as may be reasonably requested by any other
party
in order to carry out the terms and purposes of this Agreement.
ARTICLE
6
CONDITIONS
PRECEDENT
6.1 Conditions
Precedent in favor of SRLT and the Shareholders.
The
obligations of SRLT and the Shareholders to carry out the transactions
contemplated hereby are subject to the fulfillment of each of the following
conditions precedent on or before the Closing:
|
(a)
|
all
documents or copies of documents required to be executed and delivered
to
SRLT hereunder will have been so executed and
delivered;
|
|
(b)
|
all
of the terms, covenants and conditions of this Agreement to be complied
with or performed by the Buyer at or prior to the Closing will have
been
complied with or performed; and
|
|
(c)
|
the
transactions contemplated hereby shall have been approved by all
other
regulatory authorities having jurisdiction over the subject matter
hereof,
if any.
|
6.2 Waiver
by SRLT and the Shareholders.
The
conditions precedent set out in the preceding section are inserted for the
exclusive benefit of SRLT and the Shareholders and any such condition may be
waived in whole or in part by SRLT or the Shareholders at or prior to Closing
by
delivering to the Buyer a written waiver to that effect signed by SRLT or the
Shareholders, as the case may be. In the event that the conditions precedent
set
out in the preceding section are not satisfied on or before the Closing, the
Shareholders shall be released from all obligations under this
Agreement.
6.3 Conditions
Precedent in Favor of the Buyer.
The
obligation of the Buyer to carry out the transactions contemplated hereby is
subject to the fulfillment of each of the following conditions precedent on
or
before the Closing:
| (a) |
all
documents or copies of documents required to be executed and delivered
to
the SRLT or the Shareholders hereunder will have been so executed
and
delivered;
|
| (b) |
SRLT,
its officers and directors and each Shareholder shall be current
in their
respective filing obligations with the Securities and Exchange Commission
(it being understood that Schedule 13Ds and Forms 3 and 4 may be
required
to be filed by such parties, as
applicable);
|
| (c) |
all
of the terms, covenants and conditions of this Agreement to be complied
with or performed by the Shareholders or SRLT at or prior to the
Closing
will have been complied with or
performed;
|
| (d) |
SRLT
will have delivered the Shares, duly and validly issued, to the Buyer
at
the Closing;
|
| (e) |
title
to the Shares will be free and clear of all mortgages, liens, charges,
pledges, security interests, encumbrances or other claims
whatsoever;
|
11
| (h) |
the
transactions contemplated hereby shall have been approved by all
other
regulatory authorities having jurisdiction over the subject matter
hereof,
if any;
|
| (i) |
the
completion of the transfer of all assets and liabilities of SRLT
on or
prior to the Closing will have been completed to the satisfaction
of the
Buyer, which transfer shall reflected in the schedules provided to
the
Buyer as of the date of the Closing; and
|
| (j) |
The
Buyer shall have received from SRLT’s counsel a legal opinion in form and
substance satisfactory to SRLT.
|
6.4 Waiver
by the Buyer.
The
conditions precedent set out in the preceding section are inserted for the
exclusive benefit of the Buyer and any such condition may be waived in whole
or
in part by the Buyer at or prior to the Closing by delivering to SRLT and
Shareholders a written waiver to that effect signed by the Buyer. In the event
that the conditions precedent set out in the preceding section are not satisfied
on or before the Closing the Buyer shall be released from all obligations under
this Agreement.
6.5 Confidentiality.
Notwithstanding any provision herein to the contrary, the parties hereto agree
that the existence and terms of this Agreement are confidential and that if
this
Agreement is terminated pursuant to the preceding section the parties agree
to
return to one another any and all financial, technical and business documents
delivered to the other party or parties in connection with the negotiation
and
execution of this Agreement and shall keep the terms of this Agreement and
all
information and documents received from the other party and the contents thereof
confidential and not utilize nor reveal or release same, provided, however,
that
SRLT will be required to issue news releases regarding the execution and
consummation of this Agreement and file a Current Report on Form 8-K with the
Securities and Exchange Commission respecting the proposed transaction
contemplated hereby together with such other documents as are required to
maintain SRLT’s status as being current in all of its filings with the
Securities and Exchange Commission, subject to the review and approval of the
Buyer of any and all copy and/or documents drafted by SRLT.
ARTICLE
7
CLOSING
7.1 Closing.
The sale
of the Shares and the other transactions contemplated by this Agreement will
be
closed at the Place of Closing in accordance with the closing procedure set
out
in this Article.
7.2 Closing
Deliveries of the Buyer. On
or
before the Closing, the Buyer will deliver or cause to be delivered to the
Sellers:
| (a) |
this
Agreement, duly executed by the
Buyer;
|
| (b) |
the
Purchase Price
|
| (c) |
all
reasonable consents or approvals required to be obtained by the Buyer
for
the purposes of completing the transaction contemplated herein and
preserving and maintaining the interests of the Buyer;
and
|
| (d) |
such
other documents as SRLT may reasonably require to give effect to
the terms
and intention of this Agreement.
|
12
7.3 Closing
Deliveries of the Sellers.
On or
before the Closing, SRLT and the Shareholders shall deliver or cause to be
delivered to the Buyer:
| (a) |
this
Agreement, duly executed by the
Sellers;
|
| (b) |
share
certificates representing the
Shares;
|
| (c) |
resignations
of all of the officers of SRLT as of the date
hereof;
|
| (d) |
updated
schedules of SRLT and the Shareholders, dated as of the date of the
Closing;
|
| (e) |
a
certified copy of a resolution of the directors of SRLT dated as
of the
date hereof appointing the nominees of the Buyer as officers of the
Buyer;
|
| (f) |
an
undated resolution of the directors of SRLT appointing the nominee
of the
Buyer listed below in Article 8 to the board of directors of
SRLT;
|
| (g) |
undated
resignation Xxxxxx Xxxxxx as a director of
SRLT;
|
| (h) |
resignations
of all directors other than Xxxxxx Xxxxxx, as directors of SRLT dated
as
of the date hereof;
|
| (i) |
all
reasonable consents or approvals required to be obtained by the Buyer
for
the purposes of completing the transaction contemplated herein and
preserving and maintaining the interests of the Buyer;
|
| (j) |
the
legal opinion of SRLT’s counsel referred to in Section 6.3(j);
and
|
| (k) |
such
other documents as the Buyer may reasonably require to give effect
to the
terms and intention of this
Agreement.
|
ARTICLE
8
POST-CLOSING
MATTERS
Forthwith
after the Closing, the Buyer and the Shareholders agree to use all their best
efforts to:
| (a) |
file
with the Securities and Exchange Commission a report on Form 14f-1
disclosing the change in control of SRLT and, 10 days after such
filing,
date the resolutions appointing to the board of directors of SRLT,
Xxxxx
Xx, and forthwith date and accept the resignation of Xxxxxx Xxxxxx
as a
director of SRLT;
|
| (b) |
file
a Form 8-K with the Securities and Exchange Commission disclosing
the
terms of this Agreement;
|
| (c) |
file
reports on Forms 13D and 3 with the Securities and Exchange Commission
disclosing the acquisition of the Shares by the Buyer;
and
|
| (d) |
take
such steps are required to change the name of SRLT to as Buyer may
determine.
|
13
ARTICLE
9
GENERAL
PROVISIONS
9.1 Arbitration.
The
parties hereto shall attempt to resolve any dispute, controversy, difference
or
claim arising out of or relating to this Agreement by negotiation in good faith.
If such good negotiation fails to resolve such dispute, controversy, difference
or claim within fifteen (15) days after any party delivers to any other party
a
notice of its intent to submit such matter to arbitration, then any party to
such dispute, controversy, difference or claim may submit such matter to
arbitration in Nassau County, New York.
9.2 Notice.
Any
notice required or permitted to be given by any party will be deemed to be
given
when in writing and delivered to the address for notice of the intended
recipient by personal delivery, prepaid single certified or registered mail,
or
telecopier. Any notice delivered by mail shall be deemed to have been received
on the fourth business day after and excluding the date of mailing, except
in
the event of a disruption in regular postal service in which event such notice
shall be deemed to be delivered on the actual date of receipt. Any notice
delivered personally or by telecopier shall be deemed to have been received
on
the actual date of delivery.
9.3 Addresses
for Service.
The
address for service of notice of each of the parties hereto is as
follows:
|
(a)
|
the
Shareholders:
|
0000
Xxxxxxxxx Xxxx. Xxxxx 000
Xxxxxxx,
Xxxxxxx 00000
|
(b)
|
the
Buyer:
|
Xxxxx
Xx
Xx.
0X,
Xxxxxxx Xx, Xxxxxxx Xx Tian Xxxx Xxxx,
Fu
Tian
Qu, Shenzhen City, P.R. China.
with
a
copy to:
Berkman,
Henoch, Xxxxxxxx & Xxxxx, P.C.
000
Xxxxxx Xxxx Xxxxx
Xxxxxx
Xxxx, Xxx Xxxx 00000
Attention:
Xxxxxxx X. Xxxxx, Esq.
9.4 Change
of Address.
Any
party may, by notice to the other parties change its address for notice to
some
other address in North America and will so change its address for notice
whenever the existing address or notice ceases to be adequate for delivery
by
hand. A post office box may not be used as an address for service.
9.5 Amendment.
This
Agreement may be amended only by a writing executed by each of the parties
hereto.
9.6 Entire
Agreement.
The
provisions contained herein constitute the entire agreement among the Buyer
and
the Sellers respecting the subject matter hereof and supersede all previous
communications, representations and agreements, whether verbal or written,
among
the Buyer and the Sellers with respect to the subject matter
hereof.
9.7 Enurement.
This
Agreement will enure to the benefit of and be binding upon the parties hereto
and their respective heirs, executors, administrators, successors and permitted
assigns.
14
9.9 Assignment.
This
Agreement is not assignable without the prior written consent of the parties
hereto.
9.10 Counterparts.
This
Agreement may be executed in counterparts, each of which when executed by any
party will be deemed to be an original and all of which counterparts will
together constitute one and the same Agreement. Delivery of executed copies
of
this Agreement by telecopier will constitute proper delivery, provided that
originally executed counterparts are delivered to the parties within a
reasonable time thereafter.
9.11 Governing
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York applicable to agreements made and to be performed entirely
within such State. The parties agree to be subject to the exclusive jurisdiction
and venue of the state and federal courts located in Nassau County, New
York.
[Remainder
of page intentionally left blank.]
15
IN
WITNESS WHEREOF
the
parties have executed this Agreement effective as of the day and year first
above written.
|
Shareholders:
_________________________
Xxxxxx
Xxxxxx
_________________________
Xxxxx
Xxxxxx
_________________________
Xxxx
XxXxx
Buyer:
_____________________
Xxxxx
Xx
SRLT
By:
__________________
Xxxxxx
Xxxxxx, President
|
16
Exhibit
A
|
Name
of Shareholder
|
Number
of Shares
|
Percent
of Outstanding
|
||
|
Xxxxxx
Xxxxxx
|
5,306,927
|
41.76
|
||
|
Xxxxx
Xxxxxx
|
1,500,000
|
12
|
||
|
Xxxx
XxXxx
|
2,014,208
|
16.11
|
17
