STOCK PURCHASE AGREEMENT
Exhibit
10.1
THIS
STOCK PURCHASE AGREEMENT is
made as of the 11th
day of January, 2006 by and between the following:
(a)
AMERICHIP
INTERNATIONAL, INC. (the
"Company"), a Nevada corporation, whose address for purposes of this Agreement
is 0000 Xxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx 00000-0000; and
(b)
XXXX
XXXXXXX (“Xxxxxxx”)
whose address for purposes of this Agreement is 00000 Xxxxxxx Xxxxx, Xxxxxx,
XX
00000 and XXXXXX
XXXXXXXXX
(“Xxxxxxxxx”, with Walther the “Investors”), whose address for purposes of this
Agreement is 000 Xxxxxx Xxxx Xxxxx, Xxxxxx Xxx, XX 00000.
Recitals.
A.
The
Company and Investors are executing and delivering this Agreement in reliance
upon the exemption from securities registration afforded by the provisions
of
Regulation D (“Regulation D”), as promulgated by the U.S. Securities and
Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended
(the “Securities Act”).
B.
The
Company desires to satisfy and cancel the indebtedness due and owing to the
Investors under the terms of a Licensing Agreement entered into in January,
2003
with the issuance of shares of its $0.001 par value common stock (“Common
Stock”), and the Investors desire to purchase and receive shares of Common Stock
in satisfaction of indebtedness due and owing to them by the Company, all in
accordance with the terms and provisions set forth in this Agreement.
NOW
THEREFORE
in consideration of the foregoing recitals, the mutual representations,
warranties and covenants contained herein and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
the
parties agree as follows:
I. PURCHASE
AND SALE TRANSACTION.
1.1
Sale
and Issuance of Common Stock. Subject
to the terms and conditions of this Agreement, the Investors agree to purchase,
and the Company agrees to sell and issue to the Investors, shares of its Common
Stock as follows:
(a)
Walther
shall be sold and issued 12,000,000 shares of Common Stock in consideration
and
exchange for the payment, satisfaction and cancellation of indebtedness due
and
owing to Walther by the Company in the aggregate amount $1,020,000.00; being
the
accrued principal and accrued interest due and owing as of January 1, 2006
plus
the discounted present value of the monthly payments arising from the unpaid
$650,000 principal and interest due thereon
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to
him under the terms of that certain Licensing Agreement dated on or about
January 21, 2003. The purchase price per share of Common Stock shall be $0.085.
(b)
Xxxxxxxxx
shall be sold and issued 12,000,000 shares of Common Stock in consideration
and
exchange for the payment, satisfaction and cancellation of indebtedness due
and
owing to Xxxxxxxxx by the Company in the aggregate amount of $1,020,000.00;
being the accrued principal and accrued interest due and owing as of January
1,
2006 plus the discounted present value of the monthly payments arising from
the
unpaid $650,000 principal and interest due thereon to him under the terms of
that certain Licensing Agreement dated on or about January 21, 2003. The
purchase price per share of Common Stock shall be $0.085.
1.2
Closing.The
initial purchase, sale and issuance of the Common Stock (the “Closing”) shall
take place on January 11, 2006 (the “Closing Date”) at a time and place to be
mutually agreed upon by the parties. At the Closing:
(a)
The
Company shall deliver to, or cause to be delivered to, Walther a certificate
representing 12,000,000 shares of the Company’s Common Stock;
(b)
The
Company shall deliver to, or cause to be delivered to, Xxxxxxxxx a certificate
representing 12,000,000 shares of the Company’s Common Stock;
(c)
Walther
shall execute and deliver to the Company a document or instrument, in such
form
and content as acceptable to the Company, whereby Walther covenants,
acknowledges and agrees that the indebtedness due and owing to him under the
terms of that certain Licensing Agreement dated on or about January 21, 2003
has
been paid and satisfied in full;
(d)
Xxxxxxxxx
shall execute and deliver to the Company a document or instrument, in such
form
and content as acceptable to the Company, whereby Xxxxxxxxx covenants,
acknowledges and agrees that the indebtedness due and owing to him under the
terms of that certain Licensing Agreement dated on or about January 21, 2003
has
been paid and satisfied in full; and
(e)
Each
party hereto shall execute and deliver such other documents or instruments
as
may be necessary in order to consummate the purchase and sale transaction as
provided for under the terms and provisions of this Agreement.
1.3
Restrictions
on Transfer.
The Company’s shares of Common Stock, when issued and delivered to the Investors
hereunder, shall not be registered under the Securities Act, nor shall the
Investors be granted any registration rights as to such shares. Each certificate
representing shares of the Common Stock will bear a customary restrictive legend
which states in effect that such shares have not been registered under the
Securities Act and consequently may not be transferred, assigned, sold or
hypothecated unless registered under the Securities Act or, in the opinion
of
Company’s counsel, an exemption from the registration requirements of the
Securities Act is available for such transaction.
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II.
REPRESENTATIONS
AND WARRANTIES.
2.1
Representations
and Warranties of the Company.
The Company hereby represents and warrants to the Investors that the statements
contained in this Section 2.1 are correct and complete as of the date of this
Agreement and will be correct and complete as of the Closing Date (as though
then and as though the Closing Date was substituted for the date of this
Agreement throughout this Section 2.1), except as set forth in the disclosure
schedule accompanying this Agreement (the “Company Disclosure Statement”). The
Company Disclosure Statement will be arranged in paragraphs corresponding to
the
lettered subsections contained in this Section 2.1.
(a)
Due
Organization.
The Company and each of its subsidiaries is duly organized, validly existing,
and in good standing under the laws of the jurisdiction in which it is
organized, and has all requisite corporate power and authority to conduct its
business, to own its properties and to execute and deliver, and to perform
all
of its obligations under this Agreement to which it is a party.
(b)
Due
Authority.
The execution, delivery and performance under this Agreement and the documents
provided for herein by Company have been authorized by all necessary corporate
action.
(c)
Capitalization. As
of the date hereof and as of Closing, the Company’s authorized capitalization
consists of 500,000,000 shares of common stock, no par value, of which
245,918,635 shares are issued and outstanding and approximately 3,250,000 shares
have been reserved for potential issuance with respect to certain warrants.
All
issued and outstanding shares have been duly authorized, validly issued and
fully paid and nonassessable with no personal liability attached to the
ownership thereof, and subject to no preemptive rights of any shareholder.
(d)
Outstanding
Options, Warrants or Other Rights.
The Company has no outstanding warrants, options or similar rights whereby
any
person may subscribe for or purchase shares of its common stock, nor are there
any other securities outstanding which are convertible into or exchangeable
for
its common stock except for 3,250,000 warrants included in a Form SB-2
Registration Statement filed in September, 2004 which has never been declared
effective. There are no contracts or commitments pursuant to which any person
may acquire or the Company may become bound to issue any shares of its common
stock.
(e)
Issuance
of Shares. The
shares of Common Stock to be issued to the Investors are duly authorized and
reserved for issuance and, upon issuance, will be validly issued, fully paid
and
non-assessable, and free from all taxes, liens, claims and encumbrances and
will
not be subject to preemptive rights or other similar rights of stockholders
of
the Company, other than (i) restrictions on transferability as may be applicable
under federal and state securities laws, and (ii) restrictive stock legend
as
contemplated by this Agreement.
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(f)
Stockholder
Approval.
Approval of the stockholders of the Company is not required for the
authorization, execution and delivery of this Agreement, the performance of
all
obligations of the Company hereunder, and the authorization, issuance (or
reservation for issuance) and delivery of the certificates evidencing the shares
to be issued to the Investors as provided for in Sections 1.2(c) and (d) above.
(g)
Government
Consents.
Other than those that have been duly obtained or filings which are required
under applicable securities laws, which filings, if any, will be made within
the
applicable periods required by such laws, no consent, approval, order or
authorization of, or registration, qualification, designation, declaration
or
filing with, any local, state or federal governmental authority, on the part
of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement.
(h)
Offering.
Subject to the truth and accuracy of the Investor’s representations set forth in
Section 1.2 of this Agreement, the offer, sale and issuance of the shares of
Common Stock as contemplated by this Agreement are exempt from the registration
requirements of the Securities Act of 1933, as amended, and applicable state
securities laws, and neither the Company nor any authorized agent acting on
its
behalf will take any action hereafter that would cause the loss of such
exemption.
(i)
Noncontravention.
The execution of this Agreement by the Company and the consummation of the
transactions contemplated hereby will not result in the breach of any term
or
provision of, or constitute a default under, any provision or restrictions
of
any indenture, agreement, or other instrument or any judgment, order, or decree
to which the Company is a party or by which it is bound, or will it conflict
with any provisions or the Articles of Incorporation or Bylaws of the Company.
(j)
Litigation.
There are no suits, actions or proceedings at law or in equity, pending or
threatened against or affecting the Company that can be expected to result
in
any materially adverse change in the business, properties, operations,
prospects, or assets or in its condition, financial or otherwise. At Closing,
there will be no outstanding order, judgment, injunction, award or decree of
any
court, government or regulatory body or other tribunal against or involving
the
Company.
(k)
Laws
and Regulations.
The Company has complied with all laws, rules, regulations and ordinances
relating to or affecting the conduct of the Company's business and the Company
possesses and holds all licenses and permits required in its business by
federal, state or local authorities.
(l)
Absence
of Certain Changes.
Since October 17, 2005, there has been no material adverse change and no
material adverse development in the business, properties, operations, financial
condition or results of operation of the Company or any of its subsidiaries,
except as set forth in the Company’s Disclosure Statement.
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(m)
SEC
Filings.
The Company has made all filings with the SEC that it has been required to
make
under the Securities Act and the Securities Exchange Act of 1934, as amended
(collectively the “Public Reports”). Each of the Public Reports has complied
with the Securities Act and the Securities Exchange Act in all material
respects. None of the Public Reports, 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 made therein, in light of the
circumstances under which they were made, not misleading.
(n)
Full
Disclosure.
Neither this Agreement nor any other instrument furnished by or on behalf of
the
Company contains any untrue statement of a material fact or omits to state
a
material fact necessary to make any statements made not misleading, and there
is
no fact that materially and adversely affects, or foreseeably may materially
and
adversely affect, the Company’s financial condition, liabilities, business, or
assets that have not been disclosed herein or in any other
instrument.
(o)
Representations
and Warranties True at Closing.
Except as expressly herein otherwise provided, all of the representations and
warranties of the Company set forth herein shall be true as of the Closing
Date
as though such representations and warranties were made on and as of such
date.
2.2
Representations
and Warranties of Investors.
The Investors represent and warrant to the Company that the statements contained
in this Section 2.2 are correct and complete as of the date of this Agreement
and will be correct and complete as of the Closing Date (as though then and
as
though the Closing Date was substituted for the date of this Agreement
throughout this Section 2.2):
(a)
Authorization.
The Investors have full power and authority to enter into this Agreement, which
constitutes the valid and legally binding obligation of the Investors
enforceable against the Investors in accordance with its terms, except (i)
as
limited by applicable bankruptcy, insolvency and other laws of general
application affecting the enforcement of creditors’ rights generally, and (ii)
as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies.
(b)
Investment
Intent.
Each Investor is acquiring his respective shares of the Company’s Common Stock
as contemplated under the terms of this Agreement for investment and his own
account, not as a nominee or agent, and not with a view to the resale or
distribution of any part thereof and each Investor has no present intention
of
selling, granting any participation in, or otherwise distributing the same.
(c)
Disclosure
of Information. The
Investors have received all information they consider necessary or appropriate
for deciding whether to purchase the shares of the Company’s Common Stock as
provided for herein. The Investors further represent that they have
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had
an opportunity to ask questions and receive answers from the Company regarding
the terms and conditions of the offering of the Company’s Common Stock and the
business, properties, prospects and financial condition of the Company. The
foregoing, however, does not limit of modify the representations and warranties
in Section 1.2 of this Agreement of the right of the Investors to rely
thereon.
(d)
Investment
Experience.
Each Investor acknowledges that he is able to fend for himself, can bear the
economic risk of his investment, and has such knowledge and experience in
financial and business matters that he is capable of evaluating the merits
and
risks of an investment in the shares of the Company’s Common Stock.
(e)
Accredited
Investor.
Each Investor is an “accredited investor” within the meaning of Rule 501 of
Regulation D promulgated under the Securities Act of 1933, as amended, as
presently in effect.
(f)
Restricted
Securities.
The Investors understand that the shares of Common Stock they are purchasing
are
characterized as “restricted securities” under the federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and that under such laws and applicable regulations
such securities may be resold without registration under the Securities Act
of
1933, as amended, only in certain limited circumstances. In this connection,
the
Investors represent that they are familiar with Rule 144 promulgated under
the
Securities Act of 1933, as amended, as presently in effect, and understands
the
resale limitations imposed thereby and by the Securities Act of 1933, as
amended.
(g)
Stock
Legends.
Each Investor acknowledges and understands that the certificate(s) representing
his shares of Common Stock issued under the terms of this Agreement shall bear
a
customary restrictive legend conspicuously noted on said
certificate(s).
III.
COVENANTS.
From
the date of this Agreement until the Closing Date, the Company and Investors
agree as follows:
3.1
General. Each
of the parties hereto will use its best efforts to take all actions and to
do
all things necessary in order to consummate and make effective the transaction
contemplated by this Agreement (including satisfaction of the closing conditions
set forth in Article IV below).
3.2
Regulatory
Matters and Approvals.
The parties hereto will give notices to, make any filings with, and use its
best
efforts to obtain any authorizations, consents and approvals of governments
and
governmental agencies in connection with the matters referred to herein. Without
limiting the generality of the foregoing:
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(a)
Securities
Law Compliance.
The Company will take all actions as may be necessary, proper and advisable,
in
order to claim an exemption from registration requirements under Federal and
state securities laws in connect with the offering and issuance of the shares
of
Common Stock to the Investors as provided for under this Agreement.
3.3
Reporting
Status.
So long as the Investors beneficially own any shares of Common Stock , the
Company shall timely file all reports required to be filed with the SEC pursuant
to the Securities Exchange Act of 1934 (“Exchange Act”), and the Company shall
not terminate its status as an issuer required to file reports under the
Exchange Act even if the Exchange Act or the rules and regulations thereunder
shall permit such termination.
3.4
Access.
The Company agrees that it will permit the Investors and their agents,
accountants, attorneys and other representatives full access, during reasonable
business hours throughout the term or applicability of this Agreement, to all
premises, properties, personnel, books, records, contracts and documents of
or
pertaining to the Company’s business affairs, operations, properties and
financial affairs as the Investors may reasonably request. All information
provided shall be furnished strictly subject to the confidentiality provision
of
this Agreement.
3.5
Confidentiality.
All information and documents furnished pursuant to Section 3.4 of this
Agreement shall be deemed and treated as proprietary in nature. Each Investor
agrees that he shall hold all information received pursuant to or in connection
with this Agreement in the highest and strictest confidence and shall not reveal
any such information to any individual who is not one of his agents, attorney
or
accountant, and that he will not use any such information obtained for any
purpose whatsoever other than assisting in his due diligence inquiry precedent
to the Closing and, if this Agreement is terminated for any reason whatsoever,
agrees to return to the Company any all tangible embodiments (and all copies)
thereof which are in his possession. This covenant shall survive the
consummation or termination of this Agreement.
3.6
Publicity
and Filings.
All press releases, shareholder communications, filings with the SEC or other
governmental agency or body and other information and publicity generated by
the
Company regarding this Agreement shall be reviewed and approved by the Investors
and their counsel before release or dissemination to the public or filing with
any governmental agency or body whatever.
3.7
Notice
of Developments.
Each party hereto will give prompt written notice to the other of any material
adverse development causing a breach of any of its own representations and
warranties in Sections 2.1, 2.2 and 2.3 above. No disclosure by any party hereto
pursuant to this Section 3.7, however, shall be deemed to amend or supplement
the disclosure statement provided under the terms of this Agreement or to
prevent or cure any breach of warranty, breach of covenant or
misrepresentation.
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IV.
CONDITIONS
TO THE CLOSING.
4.1
Conditions
Precedent to Closing by Company.
The obligation of the Company to consummate the sale and issuance to the
Investors of shares of Common Stock contemplated by this Agreement are subject
to satisfaction, or written waiver by the Investors, of the following conditions
by the Investors at or before the Closing Date:
(a)
Representations
and Warranties True.
The representations and warranties by Investors shall have been correct on
and
as of the Closing Date with the same force and effect (except as expressly
provided in the Agreement or otherwise approved in writing by the Company)
as
though such representations and warranties had been made on and as of the
Closing Date.
(b)
Performance.
The Investors shall have performed and complied with all terms, covenants,
agreements and conditions contained in this Agreement that are required to
be
performed or complied with by them on or before the Closing.
(c)
Acknowledgment
of Satisfaction of Indebtedness.
The Investors shall have executed and delivered to the Company such document
or
instrument at the Closing as contemplated pursuant to Sections 1.2(c) and (d)
above.
(d)
Qualification.
All authorizations, approvals, or permits, if any, of any governmental authority
or regulatory body of the United States or of any state that are required in
connection with the lawful issuance and sale of the shares of Common Stock
as
contemplated by this Agreement shall be duly obtained and effective as of the
Closing.
4.2
Conditions
to Investor's Obligations.
The obligations of the Investors under this Agreement are subject to
satisfaction, or written waiver by the Company, of the following conditions
by
the Company at or before the Closing Date:
(a)
Representations
and Warranties True.
The representations and warranties by the Company in the Agreement shall have
been correct on and as of the Closing Date with the same force and effect
(except as expressly provided in the Agreement or otherwise approved in writing
by the Shareholders) as though such representations and warranties had been
made
on and as of the Closing Date.
(b)
Performance.
The Company shall have performed and complied in all material respects with
all
terms, covenants, agreements and conditions contained in this Agreement that
are
required to be performed or complied with by it on or before the Closing.
(c)
Secretary’s
Certificate.
The Investors shall have received a certificate, dated the Closing Date and
signed by the corporate secretary of the Company (or other authorized officer
or
representative of the Company), certifying the truth and correctness of the
resolutions of
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the
Board approving the Company entering into this Agreement, the consummation
of
the transactions contemplated herein and certifying as to the incumbency of
the
officers authorized to execute this Agreement and other related documents and
instruments.
(d)
Qualifications.
All authorizations, approvals, or permits, if any, of any governmental authority
or regulatory body of the United States or of any state that are required in
connection with the lawful issuance and sale of the shares of Common Stock
as
contemplated by this Agreement shall be duly obtained and effective as of the
Closing.
(e)
Stock
Certificates.
The Company shall have delivered to the Investors stock certificates
representing the shares of Common Stock as set forth in Sections 1.2 above.
V.
TERMINATION.
5.1
Termination
of Agreement.
This Agreement may be terminated as provided below:
(a)
The
parties hereto may terminate this Agreement by mutual consent at any time prior
to the Closing Date;
(b)
The
Company may terminate this Agreement by giving written notice to the Investors
at any time prior to the Closing Date (1) in the event the Investors have
breached any material representation, warranty, or covenant contained in this
Agreement in any material respect, the Company has notified the Investors of
this breach, and the breach has continued without cure for a period of 10 days
after the notice of breach, or (2) if the Closing shall not have occurred on
or
before January 17, 2006 by reason of the failure of any condition precedent
under Section 4.1 hereof (unless the failure results primarily from the Company
breaching any representation, warranty, or covenant contained in this
Agreement); and
(c)
The
Investors may terminate this Agreement by giving written notice to the Company
at any time prior to the Closing Date (1) in the event the Company has breached
any material representation, warranty, or covenant contained in this Agreement
in any material respect, the Investors have notified the Company of this breach,
and the breach has continued without cure for a period of 10 days after the
notice of breach, or (2) if the Closing shall not have occurred on or before
January 17, 2006 by reason of the failure of any condition precedent under
Section 4.2 hereof (unless the failure results primarily from the Investors
breaching any representation, warranty, or covenant contained in this
Agreement).
5.2
Effect
of Termination.
If any party hereto terminates this Agreement pursuant to Section 5.1 above,
all
rights and obligations of the parties hereunder shall terminate without any
liability of any party to the other party (except for any liability of any
Party
then in breach);
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provided,
however, that the confidentiality provisions contained in Section 3.5 above
shall survive any such termination.
VI.
GENERAL
PROVISIONS.
6.1
Entire
Agreement.
This Agreement embodies the entire agreement and understanding between the
parties concerning the subject matter hereof and supersedes any and all prior
negotiations, understandings or agreements in regard thereto.
6.2
Applicable
Law.
This Agreement shall be construed in accordance and governed by the laws of
the
State of Nevada.
6.3
Notices.
Unless otherwise changed by notice given in accordance with this provision,
any
notice or other communications required or permitted herein shall be deemed
given if delivered personally or sent by certified mail, postage prepaid, return
receipt requested, addressed to the other parties at the addresses set forth
above.
6.4
Waiver.
All rights and remedies under this Agreement are cumulative and are not
exclusive of any other rights and remedies provided by law. No delay or failure
in the exercise of any right or remedy arising under this Agreement shall
operate as a waiver of any subsequent right or remedy subsequently arising
under
this Agreement.
6.5
Survival
of Provisions.
All agreements, representations, covenants and warranties on the part of the
parties contained herein or in any instrument executed and delivered in
connection herewith shall survive closing of this Agreement and any
investigation at any time made with respect thereto.
6.6
Expenses.
Each party will party will bear their own respective costs and expenses in
connection with the preparation of this Agreement and consummation of the
transaction contemplated herein.
6.7
No
Finder's and Broker's Fees.
The parties hereto have not retained the services of any person in connection
herewith and the parties agree to mutually indemnity and hold each other
harmless from any and all loss, claims, costs and expenses (including attorney's
fees) occasioned to the other by reason of the claim of any person to
compensation arising from the consummation of the transactions provided for
herein.
6.8
Attorney's
Fees.
In the event of litigation for enforcement of the terms of this Agreement or
to
enforce any remedy hereunder, the prevailing party shall be entitled to recover
from the other party any and all costs and expenses, including reasonable
attorney's fees, as may be incurred.
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6.9
Binding
Effect. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective personal representatives, successors and
assigns.
6.10
Headings.
The section headings contained in this Agreement are inserted for convenience
only and shall not affect in any way the meaning or interpretation of this
Agreement.
6.11 Execution
by Facsimile.
Facsimile execution of this Agreement by any party is authorized and shall
be
binding upon all parties.
6.12 Counterparts.
This Agreement may be executed in any number of counterparts, each of which
shall be considered an original hereof.
IN
WITNESS WHEREOF,
this Agreement has been executed on the date first above written.
| AMERICHIP INTERNATIONAL, INC. | ||||
| By | /s/ Xxxx Xxxxxxx | |||
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| Its | President | |||
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| INVESTORS | ||||
| /s/ Xxxx Xxxxxxx | ||||
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Xxxx
Xxxxxxx
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| /s/ Xxxxxx Xxxxxxxxx | ||||
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Xxxxxx
Xxxxxxxxx
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