EXHIBIT 10.1
STOCK PURCHASE AGREEMENT
THIS AGREEMENT made the 25 day of July, 2006, between X. X. XXXXX,
hereafter called the "Seller and E'PRIME AEROSPACE CORPORATION, hereafter called
the "Purchaser";
RECITALS: The parties have reached an understanding with respect to the
sale by the Sellers and the purchase by the Purchaser of all but Ninety Million
(90,000,000) Shares of the capital stock of E'PRIME AEROSPACE CORPORATION owned
by Seller.
THEREFORE IS AGREED:
1. Sale of Stock
The Seller shall sell to the Purchaser at a total purchase price of Three
million dollars ($3,000,000.00), 386,800,000 shares of the 476,800,000 shares of
common stock of the Corporation as represented by Certificates No.(s) 4302,
7457, 7606, 7616, 8151, 8433, 8879, 9348 and 10167 (hereafter called the
"Stock") and the Purchaser, in reliance on the representations and warranties of
the Seller contained in this instrument and subject to its terms and conditions,
shall purchase those shares at that purchase price. In the event that the
existing certificates do not total an even 90,000,000 shares, then the Purchaser
shall cause the Company to re-issue certificates to Seller representing Seller's
10% interest in the company.
2. Closing
The closing shall take place at 9:00 a.m. on or before July 24, 2006. At
the closing, the Seller shall deliver to Purchaser the endorsed shares
representing the purchased stock, and Purchaser shall deliver to Seller a note
and security agreement for the balance of the purchase price as set forth below.
Both parties shall execute such other closing documents as may be required to
complete this transaction. Seller shall also deliver resignations or retirements
of X. X. Xxxxx as President and Chairman of the Board of Directors and Xxxxx X.
Xxxxx as Secretary, Treasurer and Director, and Xxxxxxx X. Xxxxx as Director. X.
X. Xxxxx shall resign or retire as Director upon payment in full of the Note
provided for herein.
3. Payment of Purchase Price
A. Cash: At closing, Purchaser shall pay to Seller the sum of $500,000.00
towards the stock purchase. An additional sum of $500,000.00 shall paid within
twelve (9) months of the date of Closing.
B. Shareholder Notes: Within twelve (12) months of the date of closing,
Purchaser shall pay to Seller the cash sum of $1,024,710.46 representing the
repayment of the Seller's cash loans to the corporation. Said sum is in addition
to the purchase price and is not a credit against the Purchase Price.
C. Note: At closing, Purchaser shall deliver to Seller a secured and
convertible note (the "Note") in the amount of $2,000,000.00 with interest
thereon at the rate of 1.00% per annum, which note shall be due and payable in
full one year after the date of issuance thereof. If payment is not made in a
timely manner then the Note shall bear interest from the maturity date at the
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rate of 18.00% per annum until paid. Payment of the note shall be secured by a
secondary blanket security interest in the assets of the purchaser, subject to
the first security interest being acquired by the Corporation's new lender. In
addition, the Holder shall have the right, upon default by the Corporation, to
convert this Note into such number of fully paid and non-assessable shares of
Common Stock as shall be obtained by dividing the total amount of principal and
unpaid interest outstanding hereunder by the Conversion Price (as hereinafter
defined). The Conversion Price is equal to 100% of the average of the daily
closing sales prices of shares of Common Stock for the 30 consecutive trading
days immediately preceding the date on which the Holder elects to convert.
D. Default. In the event of a default by Purchaser in the payment of any
installment of the promissory note, the covenants and conditions of this
agreement, or the Security Agreement, Seller may declare all indebtedness under
the promissory notes to be immediately due and payable and may proceed to
enforce payment of same and exercise any and all rights and remedies provided by
the Uniform Commercial Code. Seller shall also have all conversion rights set
forth in the Note as well as any other remedy allowed by law or provided
therein.
E. Voting. It is understood and agreed that the Purchaser shall have all
voting rights for the shares of stock whatsoever, including all stock held in
Trust pursuant to the terms hereof.
F. The Company at closing will sign a 3 year consulting contract with Xxx
Xxxxx or his assigns for $280,000 dollars annually.
G. The Company will maintain a Florida office with Xxx Xxxxx having rent
free use of those offices for three years.
H. In the event that the Corporation (Purchaser) elects to restructure the
corporation the parties agree that the retained stock interest of X. X. Xxxxx
will not be less than ten percent (10%) of the outstanding common stock of the
corporation.
4. Representations and Warranties of Seller. Seller hereby warrants and
represents:
A. Seller is not a party to any agreement, written or oral, creating rights
in respect of the Stock in any third person or relating to the voting of the
Stock.
B. Seller is the lawful owner of the Stock, free and clear of all security
interests, liens, encumbrances, equities and other charges; and
C. There are no existing warrants, options, stock purchase agreements,
redemption agreements, and restrictions of any nature, calls or rights to
subscribe of any character relating to the Stock.
5. Transfer of Trade Secrets
The parties understand and acknowledge that Seller is the holder of certain
Trade Secrets and other Intellectual Property In consideration of the promises
and payments contained in the employment agreement, Seller agrees, upon payment
in full of the Note, to transfer, convey and assign said Trade Secrets and other
Intellectual Property to the Purchaser. During the term of this Agreement said
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Trade Secrets and Intellectual Property shall continue to be licensed to
Purchaser on the same terms as are in effect on the date of closing. In the
event that Purchaser defaults under the terms of the Note, or under the terms of
this Agreement, then the obligation to convey or assign said Trade Secrets and
Intellectual Property shall lapse and the said rights shall remain the property
of the Seller.
6. Representations and Warranties of Purchaser. Purchaser hereby represents
and warrants that:
A. Authority Relative to this Agreement
Except as otherwise stated herein, the Purchaser has full power and
authority to execute this Agreement and carry out the transactions
contemplated by it and no further action is necessary by the Purchaser to
make this Agreement valid and binding upon Purchaser and enforceable
against it in accordance with the terms hereof, or to carry out the actions
contemplated hereby. The execution, delivery and performance of this
Agreement by the Purchaser will not (i) constitute a breach or a violation
of the Corporation's Certificate of Incorporation, By-Laws, or of any law,
agreement, indenture, deed of trust, mortgage, loan agreement or other
instrument to which it is a party, or by which it is bound; (ii) constitute
a violation of any order, judgment or decree to which it is a party or by
which its assets or properties is bound or affected; or (iii) result in the
creation of any lien, charge, or encumbrance upon its assets or properties,
except as stated herein.
B. Securities Law
The execution and performance of the terms of this Agreement will not
violate any Federal, State or Local law, rule or regulation relating to the
sale and transfer of securities. Purchaser shall take all actions required
to make this transaction conform to said securities laws, rules and
regulations.
C. Dividends.
The Corporation will not declare or pay any cash dividend or make any
other cash distribution on account of the Common Stock or Preferred Stock
of the Corporation, or purchase, acquire, redeem, or retire any capital
stock of the Corporation, whether now or hereafter outstanding, as long as
any part of the Note remains outstanding.
D. Mergers.
The Corporation will not merge or consolidate with any corporation
without the approval of the Note holder, or unless or until the Note holder
has been paid in full.
E. Location of Corporate Headquarters
As long as the Note remains unpaid, the Corporation will keep its
headquarters located in the State of Florida.
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F. Conversion Registration Rights
(1) Required Registration. In the event of a default under the Note, and in
the event Seller notifies the Corporation of the need to file, the
Corporation shall be required to file a registration on behalf of the
Seller.
(2) Voluntary Registration. If, at any time while the Note remains unpaid
in full, the Corporation does a registration statement, the Corporation
agrees to register a sufficient quantity of stock to retire the Note, or
agrees with the underwriter that the note will be paid in full prior to the
effective date of such registration.
(3) Indemnification. The Purchaser hereby agrees to indemnify each holder
of Conversion Shares covered by any such registration statement, its
officers and directors, if any, and each person, if any, who controls such
holder within the meaning of Section 15 of the Act, against all losses,
claims, damages, liabilities, expenses, and actions in respect thereof
(under the Act or common law or otherwise) insofar as such losses, claims,
damages, liabilities, or expenses arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in any registration
statement or prospectus (and as amended or supplemented if the Purchaser
shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, or filing for state qualification, except insofar
as such losses, claims, damages, liabilities, or expenses arise out of or
based upon any untrue statement or omission contained in information
furnished in writing to the Purchaser by such holder or a person
controlling such holder expressly for use therein. Each holder of
Conversion Shares covered by any such registration statement agrees to
indemnify the Purchaser to the same extent as the foregoing indemnity from
the Purchaser to the holder, but only with respect to information furnished
in writing by the holder expressly for use in such registration statement
or preliminary or final prospectus or state filing. If the offering
pursuant to any such registration statement is made through underwriters,
the Purchaser agrees to enter into an underwriting agreement in customary
form with such underwriters and to indemnify such underwriters and each
person who controls such underwriters within the meaning of the Act. In
connection with any registration statement in which a holder is
participating, each such holder will furnish to the Purchaser in writing
such information as shall reasonably be requested by the Purchaser for use
in any such registration statement or prospectus.
H. Buyer will agree to immediately complete the audit, file all required
paper work to have the company reinstated onto the OTC-BB.
7. Expenses
Each of the parties hereto shall pay its own expenses in connection with
this Agreement and the transactions contemplated hereby, including the fees and
expenses of its councel and its certified public accountants and other experts.
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8. Broker
Each of the parties to this Agreement represents and warrants, each to the
other, that no broker is involved in this Agreement. Each of the Parties agrees
to indemnify the other party against and hold them harmless from any and all
liabilities to any person, firm, or corporation claiming any broker's or
finder's fee or commission of any kind, on account of services rendered on
behalf of such party in connection with the transactions contemplated by this
Agreement.
9. Survival of Representations, Warranties, etc.
Each of the parties to this Agreement covenants and agrees that the
representations, warranties, covenants, and statements and agreements contained
in this Agreement and the exhibits hereto, and in any documents delivered by the
parties in connection herewith, shall survive the Closing and terminate on the
maturity date of the purchase money promissory note.
10. Notices
All notices, requests, demands and other communications which are required
or may be given under this Agreement shall be in writing and shall be deemed to
have been duly given if delivered or mailed, postage prepaid to each party at
the following addresses:
Seller: With copy to:
X. X. XXXXX Xxxxxxx X. Xxxxxxx, Esq.
0000 Xxxx Xxxx Xxxxxx 0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
Purchaser: With copy to:
OLDHAMP GROUP, INC.
E'Prime Aerospace Corporation L
Xxxxx X. Xxxxxx, III 0000 Xxxxx Xxxxxx, Xxxxx 000
000 Xxxxx Xxxxxx Xxxxxxx, XX 00000
Memphis, TN. 338127 ATTN: Xxxxx Xxxxxx
or to such other address as such party shall have specified by notice in writing
to the other party.
11. Section and Other Headings
The section and other headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
12. Confidentiality
The parties agree that the terms of this Agreement shall remain
confidential and shall not be disclosed to any person or entity other than
officers and directors of the Corporation and parties to whom disclosure is
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required to carry out the terms of this Agreement. Upon payment of the full
purchase price and satisfaction of the Note, then the terms may be made public
by either party.
12. Miscellaneous
A. This Agreement shall not become effective until it has been executed by
all of the parties hereto, but shall be dated for purposes hereof as of the date
and year first above written.
B. This Agreement shall be construed under the laws of the State of
Florida.
C. Time is of the essence.
D. This Agreement shall be binding upon and inure to the benefit of,
respectively, the parties, their successors, legal representatives, grantees and
assigns, as applicable and appropriate, of all parties of this Agreement.
E. This Agreement shall not be construed more strongly against any party
regardless of who was more responsible for its preparation.
F. All rights, powers and remedies provided herein may be exercised only to
the extent that the exercise thereof does not violate any applicable laws and
are intended to be limited to the extent necessary so that they will not render
this Agreement invalid or unenforceable. If any term of this Agreement shall be
held to be invalid, illegal, or unenforceable, the validity of the other terms
of this Agreement shall in no way be affected thereby.
G. This Agreement may be executed in any number of counterparts, each of
which, when so executed and delivered, shall be an original, but each
counterpart shall together constitute one and the same instrument.
H. In the event it becomes necessary for either party herein to seek legal
means to enforce the terms of this Agreement, the non-prevailing party will be
liable for all reasonable attorneys' fees, travel expenses, deposition costs,
expert witness expenses and fees and any other cost of whatever nature
reasonably and necessarily incurred by the prevailing party as a necessary
incident to the prosecution or defense of such action, or in any post judgment
or collection proceeding, plus court costs. In the event it becomes necessary
for either party to institute, defend, appear or attend any Bankruptcy
proceedings as a result of the filing of Bankruptcy proceedings by or against
the other party, all fees and expenses as delineated above incurred shall be
borne by such party and shall become an additional amount due or a set-off
against the amounts due under the terms of this Agreement. If either party files
a bankruptcy proceeding or has a bankruptcy proceeding filed against it the
other party shall be entitled to recover all attorneys' and expert witness fees
incurred in connection with any bankruptcy proceeding, hearing or trial.
I. No waiver of any breach of this Agreement shall be held to be a waiver
of any other or subsequent breach. All remedies afforded in this Agreement shall
be taken and construed as cumulative, this is, in addition to every other remedy
provided therein or by law. The failure of either party to enforce at any time
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any of the provisions of this Agreement, or to exercise any option which is
herein provided, or to require at any time performance by the other party of any
of the provisions hereof, shall in no way be construed to be a waiver or create
an estoppel from enforcement of such provisions, nor in any way to affect the
validity of this Agreement or any part thereof, or the right of either party to
thereafter enforce each and every such provision, or to seek relief as a result
of the prior breach.
J. This Agreement contains the entire understanding of the parties and
supersedes all previous verbal and written agreements; there are no other
agreements, representations or warranties not set forth herein.
IN WITNESS WHEREOF, this Agreement has been executed by each of the
individual parties hereto, all on the date. first above written.
Signed, Sealed and Delivered SELLER
in the Presence of
/s/ Xxxxxxx X Xxxxxxx /s/ X. X. XXXXX
------------------------------- ------------------------------------
Witness X. X. XXXXX
/s/ Xxxx Xxxx
------------------------------
Witness
PURCHASER
E'PRIME AEROSPACE CORPORATION
/s/ Xxxxxxx X Xxxxxxx /s/ Xxxxx X. Xxxxxx, III
------------------------------- ------------------------------------
Witness Xxxxx X. Xxxxxx, III
/s/ Xxxx Xxxx
-------------------------------
Witness
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