STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement dated this 31 day of December. 1998 is
made and entered into by and between AMERI-CAP MORTGAGE GROUP, INC. ("Buyer").
XXXXXXX X. XXXXXXX ("Seller"), and FINANTRA CAPITAL, INC., a Delaware
corporation (Finantra")
WITNESSETH:
WHEREAS, the Seller owns 100% of the authorized, issued and outstanding
common shares of Suncoast Title Company, Inc. (the "Corporation"), consisting
of 100 shares (the Shares"), and
WHEREAS. The Corporation is organized under the laws of the state of
Florida and is engaged in providing title insurance and closing services, and
WHEREAS, the Buyer is desirous of purchasing from the Seller 80% of the
authorized, issued and outstanding shares of the Corporation and the Seller is
desirous of selling same to the Buyer, and
WHEREAS, the Buyer desires to retain the right subsequent to closing to
acquire the balance of the common shares of the Corporation retained by the
Seller, and
WHEREAS, the Buyer is a subsidiary of Finantra and Finantra is a
publicly traded over-the counter company, and
WHEREAS, the Parties desire to document their representations,
warranties, covenants, agreements and conditions relating to the purchase of the
Shares in a written instrument.
NOW, THEREFORE, in consideration of the mutual promises covenants
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:
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1. RECITALS: The above and foregoing recitals are true and correct and
are incorporated herein.
2. SALE AND PURCHASE OF SHARES: The Seller shall sell. transfer and
convey to the Buyer and the Buyer shall purchase and acquire from the Seller 80%
of the authorized. issued and outstanding common shares of the Corporation
consisting of 80 shares.
3. PURCHASE PRICE AND METHOD OF EXCHANGE OF SHARES: The purchase price
for the Shares shall be Fifty Thousand (50,000) shares of the common stock of
Finantra. The Finantra shares will be transferred on the closing date to the
Seller. The Seller acknowledges that THE FINANTRA COMMON STOCK BEING EXCHANGE
HAVE not been registered UNDER THE SECURITIES ACT OF 1933 as amended (the "Act")
for resale and may not be offered or sold except pursuant to an effective
registration under the Act or to the extent applicable, Rule 144 under the Act
or such other exemption from registration as may be given in an opinion of
counsel acceptable to counsel for Finantra.
4. BUYER'S ACQUISITION OF BALANCE OF SELLER'S SHARES. The balance of
the Seller's shares in the Corporation not conveyed on the closing date shall be
retained in the possession of the Seller and the Buyer shall acquire the balance
of the Seller's shares annually as follows:
A. Period One: The year ending December 3 l, 1999. The Seller shall
exchange 5 of his remaining issued and outstanding shares of the Corporation for
12.500 shares of common stock of Finantra.
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B. Periods Three and Four: For the calendar years ending December 31.
2000. 2001 and 2002 the Seller shall exchange 5 shares of his remaining issued
and outstanding common shares of the Corporation for 12.500 shares of the common
stock of Finantra.
5. DUE DILIGENCE PERIOD AND RIGHT OF TERMINATION: The Seller and Buyer
hereby acknowledge that the Buyer, as of the effective date of this Agreement.
has not had the opportunity to review and evaluate all aspects of the
Corporations, as represented by the Sellers. Therefore, the Buyer shall have.
from the effective date of this Agreement through the end of business 10 days
thereafter (Due Diligence Period) to inspect and assess all aspects of the
Corporations, financial and otherwise, and to make such investigations as the
Buyer deems necessary in the Buyer's sole discretion. The Seller agrees to
assist the Buyer in reviewing all records of the Corporations and to aid and
assist the Buyer in arranging meetings and providing documents. records. and/or
information reasonably required by the Buyer or the Buyer's attorneys or other
agents including accountants, in order that the Buyer may determine the
viability of the transaction contemplated by this Agreement. During the Due
Diligence Period, Sellers shall advise the Buyer of any negative information
learned by the Sellers which would have a material, financial impact upon the
Corporations. In the event the Buyer determines in its sole and absolute
discretion that the business of the Sellers is not satisfactory or suitable for
the Buyers acquisition for any reason, the Buyer may notify the Seller in
writing by facsimile delivery, mail or hand delivery, prior to the termination
of the Due Diligence Period and the Buyer may at the Buyer s sole discretion
terminate this Agreement. The Buyer's failure to provide written notice of
termination within the time period set forth in this section shall be deemed
conclusive evidence that the Buyer has waived its right to terminate as
contained herein.
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6. CLOSING DATE: The Closing under this Agreement shall take place on
or before January 15, 1999 at the Law Offices of Xxxxxxx X. Xxxxxxx, Esquire,
0000 Xxxxx xx Xxxx Xxxxxxxxx, Xxxxx Xxxxxx, Xxxxxxx 00000 or at such other time
and place as shall be set forth in a writing signed by the Parties hereto.
7. REPRESENTATIONS AND WARRANTIES OF SELLER: The Seller represents and
warrants to the Buyer as follows:
A. The Corporation is a validly existing Corporation in good standing
under the laws of the State of Florida.
B. The Seller and the Corporation have the power to enter into and
carry out their obligations under this Agreement.
C. The Corporation on the closing date will hold all licenses necessary
to conduct the business of the Corporation and will comply with all laws, rules
and regulations presently established by all governmental agencies in connection
with same.
D. The Shares being exchanged by the Seller to the Buyer are fully paid
and non assessable.
E. The aggregate number of shares that the Corporation is authorized to
have outstanding as of the date hereof is 100 shares of common stock of which
100 shares are presently issued and outstanding and held in the name of the
Seller.
F. The only stock authorized to be outstanding by the Corporation is
one class of common stock represented by the shares owned by the Seller.
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G. The Seller is and will be on the closing date the sole owners of all
of the authorized. issued. and outstanding shares of the common stock of the
Corporation. free and clear of any and all liens and encumbrances.
H. That as of the date of executing this Agreement. as well as on the
date of closing, the Corporation shall have no debts, liabilities, or
obligations for which payment needs to be made except for those debts,
liabilities. and obligations disclosed on balance sheet as of the Corporations
as of February 1, 1999 and those debts incurred thereafter in the ordinary
course of business.
I. The Seller does not have any knowledge or any basis for the
assertion of any material liability against the Corporation not disclosed in the
financial statements
J. The Corporation is not subject to any order, judgment, decree,
stipulation, or any other agreements with any governmental body or agency with
respect to the Corporation unless specifically set forth in this Agreement.
K. The Corporation is not a party to any long-term contract or
commitment.
L. Neither the Seller nor the Corporation has received notice nor have
any claims been made against the Corporation or the Seller by any governmental
authority to the effect that the Corporation or the business of the Corporation
fails to comply in any material respect to any law. rule, regulation, or
ordinance or that a license, permit, or order which is not in the possession of
the Corporation is necessary for the Corporation to conduct its business.
Neither the Seller's or the Corporation is aware of any pending or
threatened claims against the Corporation from any person. firm or Corporation
as of the date hereof and shall promptly notify the Buyer prior to closing
should any material claims be made against them or the Corporation other
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than non-material claims arising out of the ordinary course of business or as
disclosed in this agreement.
M. On the day of closing, the Seller will have the full and
unrestrictive legal and equitable title to the shares being sold to the Buyer,
free and clear of all liens and encumbrances.
N. Any action required to be taken by the Corporation in order to
complete the transaction contemplated in this Agreement has been or will be by
the closing date duly approved by the Board of Directors and Shareholder of the
Corporation.
O. The Seller represents that there are no liabilities, including but
not limited to liabilities for federal, state, and local taxes, penalties,
assessments, lawsuits or claims against the Corporations, whether such
liabilities, suits, or claims are contingent or absolute, direct or indirect,
matured or unmatured, which could in any way affect the assets of the
Corporation, or the Corporation's ability to conduct its business.
P. The Articles of Incorporation and By-Laws attached to this Agreement
as Exhibit "A" are complete and accurate as of the date hereof and contain all
amendments through the date hereof. The Minute Book; of the Corporation are
complete and accurate and reflects all proceedings of Shareholders and Directors
of the Corporations through the date of this Agreement.
Q. The transfer and delivery of the Shares to the Buyer, pursuant to
this Agreement, will be valid and will vest title to the Shares in the Buyer
free and clear of all liens. encumbrances, conditions and restrictions of any
kind.
R. The Corporation will not issue any additional shares of its common
stock prior to the closing. There are no outstanding options, contracts,
commitments. warrants or other rights of any character affecting or relating in
any manner to the common stock of the Corporation.
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S. The documents, agreements. and materials delivered or to be
delivered by the Seller to the Buyer in furtherance of the Buyer s Due Diligence
examination of the Corporation shall be complete and accurate in all material
respects and will not have been amended or modified by any oral agreements.
T. Financial Statements: The Corporation has furnished the Buyer with
Financial Statements of the Corporation as of February I, 1999. The Financial
Statements fairly present the financial condition of the Corporations on such
date. To the best of the Seller's knowledge. there are no matters pending which
would have an adverse or material affect on the Financial Statements of the
Corporations.
The representations and warranties set forth above shall survive the
closing for a period of six (6) year following the Closing Date except that and
Federal or State tax liability pursuant shall survive for a period of three (3)
years subsequent to the Closing Date.
8. REPRESENTATIONS AND WARRANTIES OF THE BUYER: The Buyer represents
and warrants to the Sellers as follows:
A. The Buyer is a Corporation. duly organized and validly existing in
good standing under the laws of the State of Florida with full power and
authority to carry on its business.
B. The execution, delivery, and performance of this Agreement has been
duly approved or will be duly approved by all requisite corporate actions by the
closing date.
C. The Buyer has the power to enter into and carry out its obligations
under this agreement.
D. The common stock of Finantra being transferred to the Seller will be
fulls paid and non-assessable.
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E. The Buyer is not subject to any order. judgment. decree. stipulation
or other agreement which would prohibit the transaction contemplated under this
agreement.
F. Any action required to be taken by the Buyer in order to complete
the transaction contemplated in this agreement has been or will be by the
closing date duly approved by the Board of Directors of the Buyer.
G. The transfer and delivery of the Finantra shares contemplated under
this agreement will vest title to said shares in the Sellers free of all liens,
encumbrances conditions and restrictions except those pertaining to the Federal
Securities Act of 1933, as amended and such State Securities laws as may be
applicable.
9. REPRESENTATIONS AND WARRANTIES OF FINANTRA: Finantra represents and
warrants to the Seller as follows:
A. Finantra is a duly organized and existing corporation under the laws
of the State of Delaware and is authorized to conduct business in the state of
Florida.
B. Finantra has the power and authority to enter into this agreement
and the execution. delivery and performance of this agreement has been duly
approved or will be duly approved by all requisite corporate actions by the
closing date.
C. The authorized capital stock of Finantra consists of the following:
(1) 15 million shares of Common Stock having a par value of $.001 per
share of which 4,500,000 shares are issued and outstanding.
(2) five million shares of Preferred Stock of which .959.817 shares are
issued and outstanding
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(3) five million Warrants of which as of the present date approximately
2.8 million have been granted.
D. Finantra is a publicly traded company. whose registered shares trade
in the over the counter market and to the best of its knowledge all filings with
the Security and Exchange Commission or other public and private governing
bodies were accurate as of the date of their filing and all reports required by
1934 Securities Act have been filed.
E. The documents. agreements and materials delivered to the Seller in
furtherance of the Seller's due diligence of Finantra and the Buyer are complete
and accurate in all material respects.
F. Finantra does not have any knowledge or any basis for the assertion
of any material liability against Finantra.
G. Finantra is not subject to any order, judgment, decree, stipulation,
or any other agreements with any governmental body or agency with respect
Finantra unless specifically set forth in this Agreement.
H. On the day of closing, Finantra will have the full unrestrictive
legal and equitable title to the shares being exchanged, free and clear of all
liens and encumbrances.
I. The transfer and delivery of the Exchanged Shares to the Sellers,
pursuant to this Agreement. will vest title to the shares in the Sellers free
and clear of all liens and encumbrances.
J. Financial Statements: Finantra has furnished the Sellers with
audited financial statements as of December 31. 1997 and unaudited statements as
of June 30, 1998. The financial statements fairly present the financial
condition of Finantra on such date. To the best of the Sellers
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knowledge. there are no matters pending which would have an adverse or material
affect on the financial statements of Finantra.
K. Guaranty of Obligations: The performance of all of the obligations
of the Buyer as contained in this Agreement are guarantied by Finantra.
10. CONDITIONS PRECEDENT TO CLOSING: The Buyer s obligation to close
the transaction contemplated by this Agreement is subject to the following
conditions:
A. The Buyer has not terminated this Agreement during its Due Diligence
Period
B. The representations and warranties of the Parties contained in this
Agreement are true and correct in all material respects on the closing date.
C. Any and all agreements to be performed by the Parties prior to the
closing date have been performed.
In the event any of the conditions precedent to closing have not be
fulfilled by the closing date. the Buyer may extend the closing date in order
for the Seller to fulfill the condition or may terminate this agreement.
whereupon all parties will be relieved from their obligations hereunder.
11. INDEMNIFICATION:
A. By Seller: Subject to the items disclosed in this Agreement. the
Seller shall defend, indemnify, and hold the Buyer, the Corporations, or
Finantra and any of the Buyer's or Finantra's successors and assigns
("Indemnified Party"), harmless against all damages, losses. costs, or expenses
[including reasonable attorney's fees at all levels of trial or appeal incurred
in defending any claim for such damage, loss. cost, or expense incurred by the
Buyer or Finantra resulting from or in respect to:
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(1) Any breach of the Seller s representations. warranties. or
covenants in this Agreement or any untruth or inaccuracy thereof.
(2) Any claim by a broker, agent, or finder alleged to be employed by.
representing, or otherwise involved with the Corporation or the Sellers relating
to this transaction.
B. By Buyer: Subject to the items disclosed in this Agreement, the
Buyer shall defend. indemnify, and hold the Seller. his successors and assigns
("Indemnified Party"), harmless against all damages, losses. costs. or expenses
(Including reasonable attorney s fees at all levels of trial or appeal incurred
in defending any claim for such damages. Loss, cost. or expense incurred by the
Seller resulting from or in respect to:
(1) Any breach of the Buyer's representations, warranties, or covenants
in this Agreement or any untruth or inaccuracy thereof.
(2) Any claim by a broker, agent, or finder alleged to be employed by.
representing, or otherwise involved with the Corporation or the Buyer relating
to this transaction.
12. Notice of claims: In the event the Indemnified Party shall receive
any written notice of any claim or proceeding against them the Indemnified Party
shall give the Indemnifying Party written notice of any such clam or demand and
the Indemnifying Party shall have the right to contest or defend any action
brought against the Indemnified Party at the Indemnifying Party s own expense,
provided, that should the Indemnifying Party fail to notify the Indemnified
Party of the assumption of the defense of any action within 10 days of the
Indemnified Party giving written notice to the Indemnifying Party. then the
Indemnified Party shall have the right to take any such action it deems
reasonable to defend. contest. settle or compromise any action or claim made
against the Indemnified Party. If the Indemnifying Party defends any action for
which indemnification is claimed, the
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Indemnified Party shall be entitled to participate at its own expense in the
defense of such action; provided. however. that the Indemnifying Party shall
bear the fees and e:cpenses of the Indemnified Party's counsel should there
exist a conflict of interest between Indemnified Party and Indemnifying Party
which would render it inappropriate for counsel selected by the Indemnifying
Party to represent the Indemnified Party.
The indemnification set forth above shall survive the closing of this
transaction and shall enure to the benefit of the heirs, successors and assigns
of the parties to this agreement.
In no event shall a claim for indemnification be made by the
Indemnified Party until the aggregate total of all claims under this Section
exceeds $10,000.00 and then only to the extent that such claims in the aggregate
exceed $10,000.00.
13. INSTRUMENTS TO BE DELIVERED AT CLOSING: At the Closing, the
following instruments shall be executed and delivered, if required.
A. Certificates representing the Shares of the Corporation being
exchanged. duly endorsed by the Seller in favor of the Buyer with all required
transfer tax stamps affixed.
B. A Resolution of the Board of Directors of the Corporation
authorizing the execution and delivery of this agreement and the consummation of
the transactions contemplated hereby certified as of the closing date by an
officer of the Corporation as having been adopted being in full force and effect
and unmodified on the closing date.
C. An affidavit by the Seller affirming that the warranties and
representations of the Seller are true and correct on the closing date.
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D. A certificate by the Board of Directors of the Corporation to the
effect that the representations and warranties of the Corporation are true and
correct in all material respects as of the closing date.
E. Certificates representing the shares of Finantra being duly
endorsed. being transferred to the Seller.
F. A resolution of the Board of Directors of the Buyer authorizing the
transaction.
G. A resolution of the Board of Directors of Finantra authorizing the
transaction.
H. A certificate by the Board of Directors of the Buyer to the effect
that the representations and warranties of the Corporation are true and correct
in all material respects as of the closing date.
I. A certificate by the Board of Directors of Finantra to the effect
that the representations and warranties of the Corporation are true and correct
in all material respects as of the closing date.
J. Such other documents as may reasonably be requested by either party
or their counsel.
14. COVENANT OF FURTHER ASSURANCES: After the closing, each party to
this agreement shall, at the reasonable request of the other party and without
further consideration. furnish, executed and deliver such documents,
instruments, certificates, notices or other further assurances as the requesting
party shall reasonably request as necessary or desirable to effect complete
consummation of this agreement and the transaction contemplated herein.
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15. NOTICES: Except as otherwise provided for herein, all notices,
requests. demands and other communications hereunder shall be in writing and
will be deemed to have been duly given if personally delivered, or when
transmitted by facsimile with confirmation of receipt from one party to the
other or when received if mailed by the United States first class certified or
registered mail. postage prepaid, with return receipt requested and marked
delivered or refused, or via an overnight delivery service with proof of
delivery or refusal of delivery, to the other parties at the following
addresses:
Finantra and Buyer: Xxxxxx X. Press
0000 Xxxxx Xx Xxxx Xxxx.
Xxxxx Xxxxxx, Xxxxxxx 00000
Seller: Xxxxxxx X. Xxxxxxx
0000 Xxxxx xx Xxxx Xxxx.
Xxxxx Xxxxxx, Xx. 00000
16. TERMINATION:
A. This agreement may be terminated upon written notice by either party
in the event the closing of the transaction contemplated by this agreement does
not take place on or before March l, 1999 unless extended by a written
instrument executed by all of the parties hereto.
B. A breach of the representations and warranties of either party not
cured by the closing date or extended closing date. if applicable.
17. MISCELLANEOUS PROVISIONS:
A. Assignment: No party may assign its obligations or rights under this
agreement without the written consent of the other parties.
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B. Modification: There are no other agreements, promises or
undertakings between the parties except as specifically set forth herein. No
alteration. change, modification or amendment to this agreement shall be made
except in writing and signed by the parties hereto.
C. Severability: If any provision or paragraph of this agreement is
deemed to be unlawful or unenforceable by any court. administrative agency or
statute, law or ordinance, the said provision or paragraph shall be severed from
this agreement without affecting the enforceability of the remainder of this
agreement. The parties shall make a good faith effort to redraft the severed
provision or paragraph consistent with the party s original intention but in
such a way as to be lawful and enforceable.
D. Binding Effect: This agreement supersedes and cancels any and all
other agreements referring to the subject matter herein. This agreement shall be
binding upon and inure to the benefit of the respective parties, their
successors and assigns, if applicable as well as to the heirs and legal
representatives of the parties hereto, if applicable.
E. Construction: This agreement shall be construed and enforced under
the laws of the state of Florida.
F. Counterparts: This agreement may be executed in several
counterparts, each of which shall be deemed an original but all of which
counterparts collectively shall constitute one instrument representing the
agreement between the parties.
G. Captions and Headings: The captions and headings of each section or
subsection in this agreement are for convenience of reference only and shall in
no manner or way whatsoever effect the interpretation or meaning of such section
or subsection.
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H. Exhibits: The exhibits attached hereto together with all documents
incorporated by reference herein form an integral part of this agreement and are
hereby incorporated herein wherever reference is made to them to the same extent
as if they were set out in full at the point at which such reference is made.
I. Attorney's Fees: The prevailing party in any litigation arising out
of the terms of this agreement shall be entitled to reimbursement of reasonable
attorney s fees and costs at the trial and appellate court level.
IN WITNESS WHEREOF, the parties have hereunto executed this agreement
the date above written.
AMERI-CAP MORTGAGE GROUP, INC.
By:
----------------------------------
XXXXXXX X. XXXXXXX, Vice President
-------------------------------------
XXXXXXX X. XXXXXXX
FINANTRA CAPITAL, INC.
By:
---------------------------------
XXXXXX X. PRESS, President
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