STOCK PURCHASE AGREEMENT
EXHIBIT
99.1
STOCK
PURCHASE AGREEMENT, dated as of April 23, 2008 (the "Agreement"),
by
and between Xxxx Xxxxx (“Xxxxx”),
residing at 0000 Xxxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000, and Vision
Opportunity Master Fund, Ltd. (“Vision”),
a
Cayman Islands company with its principal office located at c/o Citi Hedge
Fund
Services (Cayman) Limited, Cayman Corporate Centre, 00 Xxxxxxxx Xxxx,
0xx
Xxxxx,
Xxxxx Xxxxxx XX0-0000, Cayman Islands.
WITNESSETH:
WHEREAS,
Xxxxx is the owner of 5,000,000 shares of common stock, par value $.000001
per
share (the “Shares”),
of MH
& SC Incorporated (“MH
& SC”),
a
Delaware corporation with its principal executive office located at 0000
Xxxxxxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx 00000; and
WHEREAS,
Xxxxx desires to sell, and Vision desires to purchase, all of the Shares on
the
terms and conditions set forth herein;
NOW,
THEREFORE, in consideration of the mutual representations, warranties,
agreements and indemnities herein contained and other good and valuable
consideration, the receipt and sufficiency of which is hereby mutually
acknowledged, the parties agree as follows:
1. Purchased
Shares
Subject
to the terms and conditions herein stated, Xxxxx hereby agrees to sell, assign,
transfer and deliver to Vision on the Closing Date, and Vision hereby agrees
to
purchase from Xxxxx on the Closing Date, all right, title and interest of Xxxxx
in and to the Shares for a total purchase price of $345,000 (inclusive of
$20,000 in expenses, disbursements and legal fees incurred in connection
herewith).
2. Payment
of Consideration
In
furtherance of the consummation of the transactions contemplated hereby, Vision
shall (a) pay the purchase price by delivering to Xxxxxxxxx Xxxxxxx, LLP, with
offices at The MetLife Building, 000 Xxxx Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, as escrow agent (the “Escrow
Agent”),
(i)
Vision's check in the amount of $25,000 payable to the order of Xxxxx, or by
wire transferring such amount in immediately available funds to the Escrow
Agent’s designated account, as an initial deposit, simultaneously with the
execution and delivery of this Agreement, and (ii) the balance of the purchase
price in the amount of $320,000 by check or wire transfer, on the Closing Date,
and (b) Xxxxx shall deliver to the Escrow Agent (i) the stock certificate(s)
representing the Shares, properly endorsed and/or accompanied by instruments
of
transfer duly executed in blank, medallion guaranteed, simultaneously with
the
execution and delivery of this Agreement, and (ii) the opinion of counsel for
Xxxxx, dated on the Closing Date, in substantially the form provided in
Exhibit
A
hereto.
3. Closing
Date
The
consummation of the transactions contemplated by this Agreement (the
“Closing”)
shall
take place on or before May 31, 2008 (the “Closing
Date”),
at
the offices of the Escrow Agent in New York, New York.
4. Representations
and Warranties
4.1 By
Xxxxx.
Xxxxx
represents and warrants as follows and acknowledges that Vision is relying
upon
such representations and warranties in connection with the purchase by Vision
of
the Shares:
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(a)
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MH
& SC is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of
Delaware;
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(b)
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The
authorized capital stock of MH & SC consists of 1,000,000,000 shares
of common stock and 20,000,000 shares of preferred stock; and of
such
authorized capital, only 6,265,000 shares of common stock (inclusive
of
the Shares) have been duly issued and are outstanding and are fully
paid
and non-assessable;
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(c)
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No
person, corporation or other entity has any agreement, option or
warrant,
or any right or privilege (whether by law, pre-emptive or contractual,
or
whether by means of any exercise, conversion or other right or action)
which has the effect of or is capable of becoming an agreement, option
or
warrant, for the purchase from MH & SC of any securities (including
convertible securities) of MH & SC; and the Call Option Agreement with
the former members of My Health and Safety Company LLC, as disclosed
in MH
& SC’s 2007 Form 10-KSB, will expire on April 25, 2008, and will not
be extended by MH & SC;
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(d)
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All
of the Shares are owned by Xxxxx as the registered and beneficial
owner of
record, with good and marketable title thereto, free and MH & SCar of
all mortgages, liens, charges, security interests, adverse claims,
pledges, encumbrances, restrictions and demands whatsoever (other
than
restrictions imposed by federal or state securities
laws);
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(e)
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No
person, corporation or other entity (other than Vision pursuant to
this
Agreement) has any agreement, option or warrant, or any right or
privilege
(whether by law, pre-emptive or contractual, or whether by means
of any
exercise, conversion or other right or action) which has the effect
of or
is capable of becoming an agreement, option or warrant, for the purchase
of any of the Shares;
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(f)
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Neither
Xxxxx nor MH & SC is party to, bound or affected by or subject to any
indenture, mortgage, lease, agreement, instrument, charter or by-law
provision, statute, regulation, order, judgment, decree or law which
would
be violated, contravened or breached by, or under which any default
would
occur as a result of, the consummation of the transactions provided
for
herein;
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(g)
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Xxxxx
has all requisite power and authority to execute, deliver and perform
his
obligations under this Agreement; the execution, delivery and performance
of this Agreement by Xxxxx has been duly authorized by all necessary
action on the part of Xxxxx; and this Agreement constitutes the legal,
valid and binding obligation of Xxxxx, enforceable against him in
accordance with its terms;
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(h)
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None
of the reports, notices, statements and other filings made by MH
& SC
with the SEC (the “SEC
Documents”)
since March 1, 2007, as of their respective dates, contained any
untrue
statement of a material fact or omitted to state a material fact
necessary
in order to make the statements contained therein not misleading.
Nothing
has occurred with respect to which the Company would be required
to file
any current report on Form 8-K since March 1, 2007. The balance sheets
and
statements of income, changes in financial position and stockholders’
equity contained in any of the SEC Documents have been prepared in
accordance with generally accepted accounting principles applied
on a
basis consistent with prior periods (and, in the case of unaudited
financial information, on a basis consistent with year-end audits);
and
without limitation of the foregoing, MH & SC has no material
liabilities, fixed or contingent, known or unknown, except to the
extent
reflected in such financial statements or thereafter incurred in
the
ordinary course of business.
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(i)
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MH
& SC has not been informed that its shares of common stock fail to
qualify or will be delisted from the OTC Bulletin
Board.
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(j)
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Since
January 1, 2008, (i) the business of MH & SC has been operated in the
ordinary course, (ii) there has been no material adverse change in
the
financial condition, operations or business of MH & SC from that
reflected in the aforesaid financial statements, and MH & SC has not
incurred any material obligation or liability except in the ordinary
course of business, and (iii) there has not been any (A) declaration,
setting aside the payment of any dividend or other distribution with
respect to the capital stock of MH & SC, (B) direct or indirect
redemption, purchase or other acquisition by MH & SC of any of its
capital stock, or (C) increase in the rate of salary or compensation
paid
or payable by MH & SC to Xxxxx or any other officer, director or
employee of MH & SC;
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(k)
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MH
& SC is not in material default of any of its obligations (including,
but not limited to, all leases to which MH & SC is a party or by which
MH & SC is bound, whether for realty or
personalty);
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(l)
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MH
& SC has, to the date hereof, filed all tax returns and paid or made
adequate reserve on its books for all taxes, assessments and other
impositions as and to the extent required by
law;
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(m)
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MH
& SC is in compliance in all material respects with all laws,
statutes, regulations, rules and ordinances applicable to the conduct
of
its business, and has in full force and effect all licenses, permits
and
other authorizations required for the conduct of its business as
presently
constituted;
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(n)
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MH
& SC does not own any real estate or any interest therein, and Xxxxx
has previously delivered to Vision true and complete copies of all
leases
respecting real estate to which MH & SC is a party or by which MH
& SC may be bound;
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(o)
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MH
& SC maintains, has in full force and effect, and has paid all
premiums in respect of insurance covering its business and assets
against
such hazards and in such amounts as are normal and customary for
similar
businesses of similar size in the
locality;
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(p)
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MH
& SC is not a party to or bound by any collective bargaining
agreement, employment agreement, consulting agreement or other commitment
for the employment or retention of any
person;
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(q)
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MH
& SC does not maintain and is not required to make any contributions
to any pension, profit-sharing, retirement, deferred compensation
or other
such plan or arrangement for the benefit of any employee, former
employee
or other person;
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(r)
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there
is no pending or, to Xxxxx’x knowledge, threatened litigation,
arbitration, administrative proceeding or other legal action or proceeding
against or relating to MH & SC’s
business;
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(s)
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MH
& SC has the valid right to utilize all trade names and other
intellectual property utilized in its business, and has not received
notice of any claimed infringement of such intellectual property
with the
rights or property of any other person;
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(t)
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neither
Xxxxx nor MH & SC has any knowledge of any fact, event, circumstance
or condition that would materially impair MH & SC’s ability to
continue its normal operations as heretofore conducted (other than
general, industry-wide conditions);
and
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(u)
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MH
& SC is not a shell company, as defined in Rule 12b-2 of the
Securities Exchange Act of 1934, as amended, and has been in continuous
operation since January 2006.
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4.2 By
Vision.
Vision
represents and warrants as follows and acknowledges that Xxxxx is relying upon
such representations and warranties in connection with the sale by Xxxxx of
the
Shares:
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(a)
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Vision
is a company validly existing and in good standing under the laws
of the
Cayman Islands;
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(b)
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Vision
has all requisite power and authority to execute, deliver and perform
its
obligations under this Agreement; the execution, delivery and performance
of this Agreement by Vision has been duly authorized by all necessary
action on the part of Vision; and this Agreement constitute the legal,
valid and binding obligation of Vision, enforceable against Vision
in
accordance with its terms;
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(c)
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Vision
is not a party to, bound or affected by or subject to any indenture,
mortgage, lease, agreement, instrument or charter provision, statute,
regulation, order, judgment, decree or law which would be violated,
contravened or breached by, or under which any default would occur
as a
result of, the consummation of the transactions provided for herein;
and
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(d)
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Vision
is purchasing the Shares for its own account for investment purposes,
and
not with a view to the distribution thereof in violation of any applicable
securities laws.
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5. Survival
of Representations and Warranties
5.1 Xxxxx.
The
representations and warranties of Xxxxx contained in this Agreement, or any
agreement, certificate or other document delivered or given pursuant to this
Agreement, shall survive the consummation of the transactions contemplated
by
this Agreement and, notwithstanding such completion or any investigation made
by
or on behalf of Vision, shall continue in full force and effect for the benefit
of Vision and any claim in respect thereof shall be made in
writing:
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(a)
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with
respect to representations and warranties of Xxxxx, relating to matters
other than tax matters, for a period of 18 months after the Closing
Date;
and
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(b)
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with
respect to representations and warranties of Xxxxx, relating to tax
liability or other tax matters, within the period commencing on the
Closing Date and expiring on the date on which the last applicable
limitation period (without giving effect to any voluntary extension(s)
hereafter granted by or on behalf of MH & SC) under any applicable
taxation legislation expires with respect to any fiscal year of MH
&
SC which is relevant in determining any relevant tax liability of
MH &
SC.
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5.2 Vision.
The
representations and warranties of Vision contained in this Agreement, or any
agreement, certificate or other document delivered or given pursuant to this
Agreement, shall survive the completion of the transactions contemplated by
this
Agreement and, notwithstanding such completion or any investigation made by
or
on behalf of Xxxxx, shall continue in full force and effect for the benefit
of
Xxxxx and any claim in respect thereof shall be made in writing for a period
of
18 months after the Closing Date.
5.3 General.
The
provisions of this Section 5 respecting the expiration of claims periods is
expressly subject to Section 10.3 hereof.
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6. Transfer
and Escrow
6.1 Transfer.
This
Agreement shall operate as an immediate and effective transfer and assignment
of
the Shares by Xxxxx to Vision as at the Closing Date. The parties agree to
do
all such other acts and things as may be necessary to give effect to the
provisions hereof, and without limiting the generality of the foregoing, to
validly and effectively transfer the Shares from Xxxxx to Vision as at the
Closing Date, and to disclose the resulting change in control of MH & SC in
a current report on Form 8-K to be filed with the U.S. Securities and Exchange
Commission (“SEC”)
following the Closing. This Agreement will constitute, and may be presented
to
MH & SC and its transfer agent and registrar as, Xxxxx’x irrevocable
authorization to transfer the record ownership of the Shares to Vision on the
stock transfer ledger of MH & SC.
6.2 Escrow.
The
Escrow Agent shall not be obligated to see to the proper application of the
escrow funds and stock certificate(s), but shall merely be obligated to disburse
and deliver same to Xxxxx and Vision at their request, as more fully set forth
in the Escrow Agreement attached as Exhibit
B
hereto.
The Escrow Agent shall not be liable for its actions as such except for gross
negligence or willful misconduct.
7. Additional
Agreements
7.1 Xxxxx
shall remain the Chief Executive Officer, Principal Financial Officer, Principal
Accounting Officer and a member of the Board of Directors of MH & SC
following the Closing. As such, Xxxxx shall cause MH & SC to prepare and
file its Quarterly Report on Form 10-Q for the quarter ended March 31, 2008,
and
any quarterly reports on Form 10-Q for the quarters ended thereafter, and any
current reports on Form 8-K, as required, so long as he remains an executive
officer of MH & SC.
7.2 Each
of
Xxxxx and Vision shall take or cause to be taken all necessary or desirable
actions, steps and corporate proceedings to approve or authorize the
transactions contemplated by this Agreement and the execution and delivery
of
this Agreement and other agreements, understandings and documents contemplated
hereby, and shall cause all necessary meetings of directors and stockholders
to
be held for such purpose.
8. Conditions
8.1 Conditions
to the Obligation of Vision.
The
obligation of Vision to complete the transactions contemplated herein is subject
to the satisfaction of, or compliance with, on or before the Closing Date,
each
of the following conditions (each of which is acknowledged to be for the
exclusive benefit of Vision and may be waived by it in whole or in
part):
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(a)
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the
representations and warranties of Xxxxx contained herein shall be
true and
correct as at the Closing Date;
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(b)
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Xxxxx
shall have performed all of his obligations under this Agreement
to be
performed by him on or prior to the Closing Date and Xxxxx shall
not be in
breach of any agreement on his part contained in this Agreement;
and
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(c)
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all
documents relating to the due authorization and completion of the
transactions contemplated hereby and all actions and proceedings
taken on
or prior to the Closing Date in connection with the performance by
Xxxxx
of his obligations under this Agreement shall be satisfactory to
Vision
and its counsel and Vision shall have received copies of all such
documents or other evidence as it may reasonably request in form
and
substance satisfactory to Vision and its
counsel.
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If
any of
the conditions contained in Section 8.1 hereof shall not be fulfilled or
performed at or before the Closing Date to the reasonable satisfaction of
Vision, Vision may, by written notice to Xxxxx, terminate all its obligations
hereunder.
8.2 Conditions
to the Obligation of Xxxxx.
The
obligation of Xxxxx to complete the transactions contemplated hereunder is
subject to the satisfaction of, or compliance with, on or before the Closing
Date, each of the following conditions (each of which is acknowledged to be
for
the exclusive benefit of Xxxxx and may be waived by him in whole or in
part):
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(a)
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the
representations and warranties of Vision contained herein shall be
true
and correct as at the Closing Date;
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(b)
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Vision
shall have performed all its obligations under this Agreement to
be
performed by it on or prior to the Closing Date and Vision shall
not be in
breach of any agreement on its part contained in this Agreement;
and
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(c)
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all
documents relating to the due authorization and completion of the
transactions contemplated hereby and all actions and proceedings
taken on
or prior to the Closing Date in connection with the performance by
Vision
of its obligations under this Agreement shall be satisfactory to
Xxxxx and
his counsel and Xxxxx shall have received copies of all such documents
or
other evidence as he may reasonably request in form and substance
satisfactory to Xxxxx and his
counsel.
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If
any of
the conditions contained in Section 8.2 hereof shall not be fulfilled or
performed on or before the Closing Date to the reasonable satisfaction of Xxxxx,
Xxxxx may, by written notice to Vision, terminate all his obligations
hereunder.
9. Termination
This
Agreement may be terminated at any time prior to the Closing Date referred
to in
Section 3 hereof by Vision. In the event of such termination, neither party
shall have any liability of any kind to the other party.
10. Indemnification
10.1 Each
party hereto agrees to indemnify and hold harmless the other party from and
in
respect of any cost, claim, loss, damage, liability or expense which such other
party may suffer or incur, whether at law or in equity, arising out, resulting
from or in connection with the inaccuracy of any representation or warranty
contained herein, for the time periods provided in Section 5.1
hereof.
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10.2 No
claim
for indemnification will arise until written notice thereof is given to the
party from whom indemnification is sought or claimed (the “Indemnitor”).
Such
notice shall be sent within a reasonable time following the determination by
the
party seeking indemnification (the "Indemnitee")
that a
claim for indemnity may exist. In the event that any legal proceedings shall
be
instituted or any claim or demand is asserted by any third person in respect
of
which either party may seek any indemnification from the other party, the
Indemnitee shall give or cause to be given to the Indemnitor written notice
thereof and the Indemnitor shall have the right, at its option and expense,
to
be present at the defense of such proceedings, claim or demand, but not to
control the defense, negotiation or settlement thereof, which control shall
at
all times remain with the Indemnitee, unless the Indemnitor irrevocably
acknowledges full and complete responsibility for indemnification of the
Indemnitee in respect of the subject claim, in which case the Indemnitor may
assume such control through counsel of its choice; provided,
however,
that no
settlement shall be entered into without the Indemnitee's prior written consent
(which shall not be unreasonably withheld). The parties agree to cooperate
fully
with each other in connection with the defense, negotiation or settlement of
any
such third party legal proceeding, claim or demand.
10.3 Notwithstanding
anything in this Agreement to the contrary, the indemnity provided for in this
Section 10 shall apply to any loss, claim, cost, damage, expense or liability,
whether or not the actual amount thereof shall have been ascertained prior
to
the final day upon which a claim for indemnity with respect thereto may be
made
hereunder in accordance with Section 5 hereof, so long as written notice thereof
shall have been given to the party from whom indemnification is sought prior
to
said date, setting forth specifically and in reasonable detail, so far as is
known, the matter as to which indemnification is being sought, but nothing
herein shall be construed to require payment of any claim for indemnity until
the actual amount payable shall have been finally ascertained.
11. Notices
Notices
required or permitted to be given under this Agreement shall be in writing
and
shall be deemed to be sufficiently given when sent by certified or registered
mail or by hand, addressed to the addresses set forth on the first page of
this
Agreement or to such other address furnished by notice given in accordance
with
this Section 11. A copy of any notice sent to Vision shall also be sent to
Vision Capital Advisors LLC, 00 Xxxx 00xx
Xxxxxx,
0xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxx Xxxxxxx, Esq., Legal and
Operations.
12. Governing
Law
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York. In the event there is any dispute between the parties as
to
their rights and obligations under this Agreement, the parties submit to the
jurisdiction of any state or federal court sitting in the State and City of
New
York, and waive any defense of inconvenient forum to the maintenance of any
action so brought.
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13. Entire
Agreement
This
Agreement constitutes the entire agreement between the parties relating to
the
subject matter hereof. There are no verbal statements, representations,
warranties, undertakings or agreements between the parties. This agreement
may
be amended only by an instrument in writing signed by both parties.
14. Time
of the Essence
Time
shall be of the essence of this Agreement.
15. Assignment
Neither
this Agreement nor any rights or obligations hereunder may be assigned by either
party without the prior written consent of the other party, which consent may
be
withheld in either party's sole and absolute discretion, except that Vision
may
assign its rights hereunder to MH & SC without Xxxxx’x consent.
16. Binding
Effect
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns. This Agreement may be
executed in counterparts.
IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
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/s/
Xxxx Xxxxx
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Xxxx Xxxxx
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VISION
OPPORTUNITY MASTER FUND, LTD.
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By:
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/s/
Xxxx Xxxxxxxx
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Xxxx Xxxxxxxx
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Director
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