BULLARD’S PEAK CORPORATION (A NEW MEXICO CORPORATION) STOCK PURCHASE AGREEMENT
Exhibit 10.11
XXXXXXX’X PEAK CORPORATION
(A NEW MEXICO CORPORATION)
THIS STOCK PURCHASE AGREEMENT (the “Agreement”) is dated the 18th day of August, 2017 by and among SANTA FE ACQUISITIONS, LCC, a New Mexico corporation (“Buyer”), and XXXXXXX’X PEAK CORPORATION, a New Mexico corporation (“BPC”), and BLACK HAWK CONSOLIDATED MINES COMPANY, a Colorado Corporation (“Seller”). Buyer and Seller together referenced herein as (the “Parties”).
WHEREAS, Seller is the owner of one hundred percent (100%) of all the issued and outstanding capital stock (common and preferred) of BPC pursuant to the Stock Certificates attached hereto as Exhibit A (the “Stock”); and
WHEREAS, BPC owns the patented and unpatented mining claims set forth in Exhibit B, attached hereto (the “Property”); which claims Seller and BPC both believe (but are not warranting) are free and clear of any liens or encumbrances that have priority over BPC’s interest except for potential “over-staking” of some of the Property pursuant to Exhibit D, attached hereto.
WHEREAS, Seller desires to sell to Buyer and Buyer desires to purchase from Seller the Stock for $3,000,000 plus two percent of the net smelter returns (the “Purchase Price”).
NOW, THEREFORE, in consideration of the foregoing premises, the provisions and the respective agreements hereinafter set forth, the Parties hereto hereby agree as follows:
1.Recitals. All the above Recitals are incorporated herein as if fully set forth herein.
Exhibit 10.11
2.3Xxxxxxx Money. Buyer shall pay Seller, by wire transfer in collectible funds to an account of Seller’s choice, upon execution of this Agreement, the sum of One Hundred Thousand Dollars ($100,000) as non-refundable earned money to be applied to the Three Million Dollar $3,000,000) Purchase Price. If Seller does not receive such wire transfer in collectible funds by 5:00 p.m. CST, August 21, 2017, then this Agreement shall be null and void. If Buyer does not close on or before 2:00 p.m. CST on August 30, 2017, the $100,000 of Earned Money is retained by Seller as partial payment for damages for Buyer not timely closing. If Buyer closes on or before 2:00 p.m. on August 30, 2017, then the $100,000 Xxxxxxx Money shall be applied to the Purchase Price.
A.$1,400,000 in collected funds at Closing (in addition to the $100,000 Xxxxxxx Money); and
B.$1,500,000 paid in three (3) monthly payments of $500,000 in cash in collected funds by wire transfer due on or before September 30, 2017, October 31, 2017, and November 30, 2017.
C.The two (2) percent of NSR shall be paid as set forth above in paragraph 2.2.
2.5Closing. The closing of the transaction contemplated herein (the “Closing”) will take place at 2:00 p.m. Central Standard Time on August 30, 2017 at the offices of Xxxxxxxx Merchant Corporation, Germantown, Wisconsin.
A.Resignation of all current officers and directors of BPC.
B.All books and records of BPC in Seller’s possession, including:
i.BPC’s current corporate minute book, directors meetings minutes, resolutions,
ii.BPC’s Articles of Incorporation, and all Annual Statements of Officers and Directors that BPC filed,
iii.A Certificate of Good Standing from the New Mexico Secretary of State,
iv.BPC’s corporate income tax returns for tax years 2010 through 2015,
v.BPC’s current internally prepared financial statement (Balance Sheet and Profit & Loss Statement),
vi.Copies of all Purchase Contracts, Abstracts of Title, Agreements, and patent filings on, or relating to, the patented claims that make up the Property which are in BPC’s possession.
C.A resolution/minutes from Black Hawk Mining Corporation’s Board of Directors approving the same of BPC.
D.A sworn certificate from Seller stating that all the books and records identified above are true and correct to Seller’s best knowledge and belief.
Exhibit 10.11
X.Xx Closing, Buyer shall execute a Promissory Note in favor of Seller for the unpaid Purchase Price of $1,500,000 with the payment terms set forth in paragraph 2.4 above, a copy of which is attached hereto as Exhibit H (the “Note”). There will be no interest charged on the unpaid principal balance owed on the Note, provided the same is timely paid. If any payment is received by Seller more than three business days after the scheduled due date of the payment, Buyer will be liable to immediately pay Seller a late fee of five (5) percent of the late payment. If any scheduled payment or late fee is more than twenty (20) days past due (“Default”), then the entire unpaid principal balance of the Note will automatically be accelerated and be immediately due and payable. The Note shall have all other customary terms of default. After Default the Note will accrue interest at twelve (12) percent per annum. The Note may be prepaid in part or in full with no penalty. If Buyer prepays the Note by August 31, 2017, then the Note may be satisfied by the payment of $1,400,000.
B.The Note and the two (2) percent of the NSR shall be secured by (i) a first lien on all real estate owed by BPC pursuant to a deed in trust/mortgage, a copy of which is attached hereto as Exhibit I and (ii) a stock collateral pledge agreement, a copy of which is attached hereto as Exhibit J (“Pledge Agreement”) pursuant to which Buyer pledges to Seller as collateral all the stock of BPC sold hereunder. Pursuant to the Pledge Agreement, Seller will retain possession of the original stock certificate(s) representing all the shares of stock of BPC until Buyer pays all amounts owed under the Note except for the two (2) percent of the NSR. If Buyer defaults in payment under the Note, Seller shall have the right under the Pledge Agreement to take immediate possession and ownership of the pledged Stock and all Buyer’s rights to the Stock shall immediately terminate and all Purchase Price paid by Buyer shall be forfeited to Seller, and Buyer shall have no legal or equitable rights to any of the Purchase Price Buyer paid Seller, nor (iii) any ownership interest in Black Hawk or BPC Stock, and (iv) the Stock Purchase Agreement will immediately terminate and Buyer shall have no further legal or equitable claims against Seller whatsoever. The Mortgage shall remain on the Property in perpetuity to secure the two (2) percent of the NSR obligation of Buyer.
A.Buyer may not engage in any mining activities (exclusive of geographical mapping and sample drilling to prove viability of the mines) until the Note is paid in full. As such, Buyer shall not remove any ore/materials/dirt, etc. from the ground that has a fair market value exceeding $10,000 cumulative total during the term of the Note until the Note is paid in full. Breach of this Agreement is an event of default of the Note and Collateral Pledge Agreement.
B.Until the entire Purchase Price is paid in full, Seller (or any assignee/agent/ designated party of Seller) shall have the right (without notice to Buyer) to come upon all real estate currently owned by BPC, including the unpatented mine claims of BPC, to inspect and observe the condition of the same and verify that the Buyer is in compliance with the Stock Purchase Agreement, the Note, and the Collateral Pledge Agreement. This includes the right of Seller to place a camper trailer on any real estate currently owned by BPC (and stay in the camper) until the Note is paid in full.
2.9Ownership of Unpatented Mining Claims. Since Buyer is paying for the Stock over time, title to, and ownership of, all unpatented mining claims of BPC (as set forth in Exhibit B to the Stock Purchase Agreement) the (“Unpatented Claims”) will be transferred before Closing to Seller, and Seller will retain ownership of the Unpatented Claims, until the Note is timely paid in full; and upon such event, Seller will immediately transfer ownership of the Unpatented Claims to Buyer (with such Unpatented Claims subject to all then existing over-stacking claims and any encumbrances that currently exist on the Unpatented Claims). Seller will timely pay/file all BLM fees/notices and County Notice of
Exhibit 10.11
Intent fees/notices on the Unpatented Claims until Buyer timely pays the Note in full and Seller transfers the Unpatented Claims to Buyer. Upon timely payment of the Note in full, Xxxxxx Xxxxxx will transfer without any warranties/representations to Buyer all his interest (if any) in the Unpatented Claims by Quit Claim Deed.
3.Representations and Warranties of the Seller. Seller represents and warrants to Buyer as follows:
3.3Compliance with Law. To the best of Seller’s knowledge, BPC is not in default with respect to any order of any court, governmental authority or arbitration board or tribunal to which BPC is a Party, or is subject, and BPC is not in known violation of any laws, ordinances, governmental rules, or regulations to which they are subject. To the best of Seller’s knowledge, BPC has obtained all licenses, paid all applicable taxes, obtained all permits and other authorizations, and has taken all actions required by applicable laws or governmental regulations in connection with its business, as now conducted. Seller has received no notice of a claim of non-compliance with any legal requirements relating to the Property. To the best of Seller’s knowledge (i) no governmental authority or any employee or agent thereof has made any claim to Seller that it considers the Property to be in violation of any legal requirements, and (ii) no investigation has been commenced or is contemplated respecting any possible violation.
3.4Validity and Effect of Agreements. This Agreement, along with all agreements and documents attached or contemplated hereby when executed and delivered pursuant hereto, will constitute the valid and legally binding obligations of Seller, enforceable in accordance with their terms, except that enforceability may be limited by applicable bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium, or other similar laws of general application.
Exhibit 10.11
any way subject, (ii) paid or fully accrued for all taxes shown to be due and payable on such returns (which taxes are all the taxes due and payable under the laws and regulations pursuant to which such returns were filed), and (iii) properly accounted for all such taxes accrued with respect to BPC, or the assets and properties of BPC for periods subsequent to the periods covered by such returns. To Seller’s best knowledge, no deficiency in payment of taxes for any period has been asserted by any taxing body which remains unsettled or in question at the date of this Agreement. Copies of all federal, state, local and foreign tax returns of BPC have been made available for inspection by Buyer. To Seller’s best knowledge, BPC has paid the Maintenance Fees due Bureau of Land Management on the Property due by August 31, 2017 for time period of September 1, 2017 to August 31, 2018.
3.10Business Property Rights. No person or corporation has made or, to the knowledge of Seller, threatened to make any claims that the operation of the business of BPC is in violation of, or infringes on, any business property rights, or any other proprietary or trade rights of any third party. To the knowledge of BPC, no third party is in violation of, or is infringing upon, any business property rights of BPC.
3.11Litigation. To Seller’s best knowledge, there are no actions, suits or proceedings which are pending at law or in equity, before any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, against Seller or BPC. To Seller’s best knowledge, there are no orders, judgments, injunctions or decrees of any court or governmental agency with respect to which Seller or BPC have been named, or to which Seller or BPC is a party, which would result in any material adverse change in the business or prospects of BPC and/or the Property.
Exhibit 10.11
3.12Environmental Matters. To Seller’s best knowledge, there is no notice, notification, demand, request for information, citation, summons, complaint, or court order that has been received, and no known complaint filed, no penalty, no current investigation or known intent to investigate exists with regard to the claims and properties that are the subject of this Agreement. To Seller’s best knowledge, no governmental or regulatory body of any kind has alleged any violation of any environmental law by BPC and no issue has been raised with regard to the absence of any relevant environmental permit, certificate, license, approval, registration or authorization required by any environmental law.
3.13Compliance with Applicable Laws. To Seller’s best knowledge, BPC has conducted its business in full compliance with all applicable laws, including – without limitation – all insurance laws, ordinances, rules, regulations, decrees and orders of any governmental authority.
3.14Affiliate Transactions. There are no current contracts or arrangements of any kind between BPC and any officer, director, or principal shareholder of BPC, or any of their respective affiliates.
4.Representations and Warranties of Buyer. Buyer represents and warrants to Seller and BPC as follows:
4.5Authorization, Validity and Effect of Agreements. The execution and delivery of this Agreement and all agreements and documents contemplated hereby by Buyer, and the consummation by it of the transactions contemplated hereby, have been duly authorized by all requisite corporate action. This Agreement, and all agreements and documents contemplated hereby when executed and delivered pursuant hereto, will constitute, the valid and legally binding obligations of Buyer enforceable in accordance with their terms, except that enforceability may be limited by applicable bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium, or other similar laws of general application now or hereafter in effect relating to the enforcement of creditors’ rights generally, except that the remedies to specific performance, injunction and other forms of equitable relief are subject to certain tests of equity jurisdiction, equitable defenses, and the discretion of the court before which any proceeding therefore may be brought.
Exhibit 10.11
5.Seller’s Conditions of Closing. The obligation of Seller to close hereunder shall be subject to and conditioned upon the prior occurrence or satisfaction (or waiver by Seller) at the Closing of each of the following conditions:
5.1Buyer shall have first delivered to Seller the sum of One Million Five Hundred Thousand Dollars ($1,500,000) in collected funds representing partial payment of the Purchase Price prior to or on the time for Closing.
5.2All representations and warranties of Buyer contained in this Agreement shall be true and correct at and as of the Closing Date and Buyer shall have performed all agreements and covenants, as well as satisfied all conditions on its part to be performed or satisfied by the Closing Date pursuant to the terms of this Agreement.
5.3No suit, action, investigation, inquiry, or other proceeding by any governmental body or other person or legal or administrative proceeding shall have been instituted or threatened which questions the validity or legality of the transactions contemplated hereby.
5.4As of the Closing Date, there shall be no effective injunction, writ, preliminary restraining order, or any order of any nature issued by a court of competent jurisdiction directing that the transactions provided for herein, or any of them, not be consummated as so provided, or imposing any conditions on the consummation of the transactions contemplated hereby.
5.5As of the Closing, there shall have been no material adverse change in the amount of issued and outstanding common stock of BPC.
5.6Buyer shall have executed and delivered to Seller all documents required in Section 2.6 above consisting of the Note, Mortgage, and Pledge Agreement.
5.7Upon the occurrence of 5.1 to 5.6 above, Seller will do the following:
5.7.1Seller shall deliver to the Buyer the documents required from Seller in Section 2.6 above.
6.Buyer’s Conditions of Closing. The obligation of Buyer to close will be subject only to following:
6.1All representations and warranties of Seller and BPC contained in this Agreement shall be true and correct now and as of the Closing Date. Further, Seller and BPC shall have performed all agreements and covenants, and satisfied all conditions on their part to be performed or satisfied by the Closing Date pursuant to the terms of this Agreement.
6.2As of the Closing Date, there shall have been no material adverse change to the Property owned by BPC prior to the date of the Closing Date of this Agreement from the execution date of this Agreement, and BPC shall not have suffered any material loss (whether or not insured) by reason of physical damage caused by fire, earthquake, accident, or other calamity which materially affects the value of its assets, properties, or business between the execution date of this Agreement and the Closing Date.
6.3As of the Closing Date, no suit, action, investigation, inquiry, or other proceeding by any governmental body or other person or legal, or administrative proceeding shall have been instituted or threatened which questions the validity or legality of the transactions contemplated hereby.
Exhibit 10.11
6.4As of the Closing Date, there shall be no effective injunction, writ, preliminary restraining order, or any order of any nature issued by a court of competent jurisdiction directing that the transactions provided for herein, or any of them, not be consummated as so provided, or imposing any conditions on the consummation of the transactions contemplated hereby.
6.5As of the Closing Date, there shall have been no material adverse change in the amount of issued and outstanding common stock of the BPC from the execution date of this Agreement.
7.Termination.
7.1.1By mutual written agreement of Seller and Buyer; or
7.1.2By Seller, if any of the conditions provided for in Section 5 hereof shall not have been timely met or waived in writing by Seller prior to Closing, or
7.1.3By Buyer, if any of the conditions provided for in Section 6 hereof shall not have been timely met or waived in writing by Buyer prior to Closing, or
Seller:
Black Hawk Consolidated Mines Company x/x Xxxxxx Xxxxxx Xxx 00 Xxxxxxx, XX 00000 Tel: 000-000-0000 Fax: 000-000-0000 Email: Xxxxxxxx@xxxxxx.xxx
| Buyer:
Santa Fe Acquisitions, LLC c/o Xxxxxx Xxxxxxxxxx 000 X. Xxxxxx Xxxxxx Xxxxxx Xxxx, XX 00000 Phone: 000-000-0000 Email: Xxxxxx@xxxx-xx.xxx
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Exhibit 10.11
With a copy to:
Attorney Xxxxx X. Xxxxxx Xxxxxx Law Xxxxxx 000 X. Xxxxxxxxxx Xxxxxx Xxxxxx, XX 00000 Tel: Tel: 000-000-0000 Fax: 000-000-0000 Email: xxxx@xxxxxxxxx.xxx
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8.5Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Wisconsin, exclusive of the conflict of law provisions thereof. Venue will be in the Circuit Court for Waukesha County, Wisconsin.
8.6Survival. All of the terms, conditions, warranties and representations contained in this Agreement shall survive the Closing.
Exhibit 10.11
8.9Waivers. No action taken pursuant to this Agreement, including without limitation any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by the Party taking such action of compliance with any representations, warranties, covenants or agreements contained in this Agreement. The written waiver by any Party hereto of a breach of any provision hereunder by the other Party shall not operate or be construed as a waiver of any prior or subsequent breach of the same or any other provision hereunder by the other Party.
8.12Severability. If for any reason whatsoever, any one or more of the provisions of this Agreement shall be held or deemed to be inoperative, unenforceable, or invalid as applied to any particular case or in all cases, such circumstances shall not have the effect of rendering such provision invalid in any other case or of rendering any of the other provisions of this Agreement inoperative, unenforceable or invalid.
SELLER:BLACK HAWK CONSOLIDATED | XXXXXXX’X PEAK CORPORATION | ||
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By: | /s/Xxxxxx Xxxxxx | By: | /s/Xxxxxx Xxxxxx |
| Xxxxxx Xxxxxx, President |
| Xxxxxx Xxxxxx, President |
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BUYER: SANTA FE ACQUISITIONS, LLC |
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By: | /s/Xxxxxx X. Laws |
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| Name:Xxxxxx X. Laws |
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| Title:CEO |
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