AGREEMENT
This
Agreement (the “Agreement”) is made as of the 3rd
day of
December, 2007, by and between Capital Solutions I, Inc., a Delaware corporation
(the “Issuer”), and Xxxxxxxxxxx Xxxxxx, (“Xxxxxxxxxxx”) and Xxxxxxx Xxxxxx
(“Xxxxxxx” and together with Xxxxxxxxxxx, the “Sellers” and each, a
“Seller”).
WITNESSETH:
WHEREAS,
the Sellers are the owners of an aggregate of 50,001 shares (the “Shares”) of
the Issuer’s common stock, par value $.0000001 per share (“Common Stock”), in
the respective amounts set forth on Schedule A hereto, and
WHEREAS,
the Sellers desire to sell to the Issuer, and the Issuer desires to purchase
the
Shares from the Sellers, on and subject to the terms of this
Agreement;
WHEREFORE,
the parties hereto hereby agree as follows:
1. Sale
of the
Shares.
Subject
to the terms and conditions of this Agreement, and in reliance upon the
representations, warranties, covenants and agreements contained in this
Agreement, the Sellers shall sell the Shares to the Issuer, and the Issuer
shall
purchase the Shares from the Sellers for a purchase price (the “Purchase Price”)
equal to $625,000, allocated between the Sellers as set forth in Schedule A
attached hereto.
2. Closing.
(a) The
purchase and sales of the Shares shall take place at a closing (the “Closing”),
to occur immediately following execution and delivery of this
Agreement.
(b) At
the
Closing:
(i) The
Sellers shall deliver to the Issuer certificates for the Shares, duly endorsed
in form for transfer to the Issuer.
(ii) The
Issuer shall pay the purchase price for the Shares.
(iii)
The
Sellers shall deliver evidence that, as of Closing, the Issuer that all
liabilities and obligations of any kind and description, whether immediate,
direct, contingent or indirect, shall have been paid or cancelled, with the
result that the Issuer has, as of the Closing, no liabilities or obligations
of
any kind.
(iv)
The
Issuer shall deliver or cause the Issuer’s transfer agent to deliver a certified
copy of the stock ledger of the Issuer listing every stockholder of record
as of
the most recent practicable date.
(v)
Counsel for the Issuer shall have given its opinion to the Issuer, which may
be
relied on by any subsequent purchasers of the Issuer’s capital stock and their
counsel if such purchases take place as part of the next direct or indirect
merger or similar transaction with an operating business that results in a
change of control of the Issuer (“Reverse Merger Issuances”), to the effect that
all of the issued and outstanding capital stock has been duly and validly
authorized and issued and is fully paid and non-assessable and to such counsel’s
knowledge not issued in violation of any preemptive right, right
of
first refusal or other right, and that the issuance of such capital stock was
exempt from the registration requirements of the Securities Act of 1933, as
amended, by virtue of Section 4(2) of the Securities Act of 1933, as amended,
and/or Rule 506 or 506 of the Commission thereunder.
(vi)
The
Issuer shall deliver a good standing certificate issued by the Secretary of
State of the State of Delaware and a certified copy of the Issuer’s Articles of
Incorporation, as currently in effect, certified by the Secretary of State
of
the State of Delaware.
(vii)
The
Sellers will provide evidence that all liabilities of the Issuer have been
paid
and the Issuer has no obligation with respect to legal, accounting or other
professional fees relating to the transactions contemplated by this
Agreement.
(d) The
Sellers understand that following the Closing, the Issuer may engage a different
accounting firm. At and at any time after the Closing, the parties shall duly
execute, acknowledge and deliver all such further assignments, conveyances,
instruments and documents, and shall take such other action consistent with
the
terms of this Agreement to carry out the transactions contemplated by this
Agreement. Without limiting the foregoing, the Issuer and Sellers jointly and
severally agree that they shall cause the Issuer’s current management to execute
such certificates, auditor representation letters and other representations
(“Certifications”) as the Issuer may reasonably request in order to enable the
Issuer to prepare and file future reports with the Commission, including the
Issuer’s Report on Form 8-K relating to this Agreement, and Sellers shall pay
such fees and take such steps as may be necessary to facilitate the Issuer’s
auditor’s preparation of the financial
statements and its report for accounting periods and events prior to the Closing
related thereto for the current fiscal year and provide such additional
assistance as is required by the Issuer in order to file its financial
statements in filings made subsequent to the Closing; provided, however, that
Sellers shall have no obligation with respect to fees of any accountants engaged
by the Issuer after the Closing. Such Certifications shall specifically include
a representation letter for the benefit of the Issuer’s auditor in the form
requested by its auditors. Any such Certifications shall treat only periods
and
events prior to Closing. Further, at the cost of Sellers, the Issuer will file
its final federal and state returns..
3. Representations
and Warranties of the
Issuer and Sellers.
The
Issuer and Sellers hereby jointly and severally make the following
representations and warranties to each other and to any persons who acquire
the
Issuer’s capital stock following the Closing in Reverse Merger Issuances,
provided, that such representations and warranties shall survive the Closing
for
a period of one (1) year and provided further that each Seller makes no
representations and warranties other than with respect to himself and the Shares
to be sold hereunder:
(a) The
Issuer is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware. The Issuer has the corporate power
to
own its properties and to carry on its business as now being conducted and
is
duly qualified to do business and is in good standing in each jurisdiction
in
which the failure to be so qualified and in good standing would have a material
adverse effect on the Issuer. The Issuer is not in violation of any of the
provisions of its certificate of incorporation or by-laws. No consent, approval
or agreement of any individual or entity is required to be obtained by the
Issuer in connection with the execution and performance by the Issuer of this
Agreement or the execution and performance by the Issuer of any agreements,
instruments or other obligations entered into in connection with this Agreement.
The Issuer has no active subsidiary, and, except for an inactive subsidiary
which has no assets or liabilities, it does not have any equity investment
or
other interest, direct or indirect, in, or any outstanding loans, advances
or
guarantees to or on behalf of, any domestic or foreign individual or
entity.
-2-
(b) The
Issuer has authorized capital stock consisting of 900,000,000 shares of Issuer
Common Stock, and 20,000,000 shares of preferred stock, par value $.000000l
per
share (the “Preferred Stock”), of which 66,732 shares of Common Stock, including
the Shares (subject to adjustment in the event of a reverse split of the Common
Stock), and 50,000 shares of Preferred Stock are presently issued and
outstanding. Sellers own the Shares free and clear of any and all liens, claims,
encumbrances, preemptive rights, right of first refusal and adverse interests
of
any kind. The Issuer has not created or authorized any series of Preferred
Stock
and has no obligation or understanding to do so, except as contemplated in
that
certain securities purchase agreement to be executed in connection with a
reverse acquisition transaction with Moral Star Development Limited (the
“Purchase Agreement”), between the Issuer and the Investors named
therein.
(c) Neither
the Issuer nor Sellers are party to any agreement or understanding pursuant
to
which any securities of any class of capital stock are to be issued or created
or transferred. The Issuer has not acquired any shares of Common Stock, and
has
no formal or informal agreements or understandings pursuant to which it can
or
will acquire any shares of Issuer Common Stock (other than this Agreement).
Except as contemplated in the Purchase Agreement, neither the Issuer nor Sellers
nor any officer, director or 5% stockholder of the Issuer has any agreements,
plans, understandings or proposals, whether formal or informal or whether oral
or in writing, pursuant to which it or he granted or may have issued or granted
any individual or entity any Convertible Security or any interest in the Issuer
or the Issuer’s earnings or profits, however defined. As used in this Agreement,
the term “Convertible Securities” shall mean any options, rights, warrants,
convertible debt, equity securities or other instrument or agreement upon the
exercise or conversion of which or upon the exchange of which or pursuant to
the
terms of which additional shares of any class of capital stock of the Issuer
may
be issued.
(d) There
is
no private or governmental action, suit, proceeding, claim, arbitration or
investigation pending before any agency, court or tribunal, foreign or domestic,
or, to the Issuer’s Best Knowledge, threatened against the Issuer or any of its
properties or any of its officers or directors (in their capacities as such).
There is no judgment, decree or order against the Issuer that could prevent,
enjoin, alter or delay any of the transactions contemplated by this Agreement.
The term “Best Knowledge” of the Issuer shall mean and include (i) actual
knowledge and (ii) that knowledge which a prudent businessperson would
reasonably have obtained in the management of such Person’s business affairs
after making due inquiry and exercising the due diligence which a prudent
businessperson should have made or exercised, as applicable, with respect
thereto.
(e) There
are
no claims, actions, suits, proceedings, inquiries, labor disputes or
investigations (whether or not purportedly on behalf of the Issuer) pending
or,
to the Issuer’s Best Knowledge, threatened against the Issuer or any of its
assets, at law or in equity or by or before any governmental entity or in
arbitration or mediation. No bankruptcy, receivership or debtor relief
proceedings are pending or, to the best of the Issuer’s knowledge, threatened
against the Issuer.
(f) The
Issuer is in compliance with, is not in violation of, and has not received
any
notices of violation with respect to, any federal, state, local or foreign
Law,
judgment, decree, injunction or order, applicable to it, the conduct of its
business, or the ownership or operation of its business. References in this
Agreement to “Laws” shall refer to any laws, rules or regulations of any
federal, state or local government or any governmental or quasi-governmental
agency, bureau, commission, instrumentality or judicial body (including, without
limitation, any federal or state securities law, regulation, rule or
administrative order).
(g) The
Issuer has properly filed all tax returns required to be filed and has paid
all
taxes shown thereon to be due. All tax returns previously filed are true and
correct in all material respects.
-3-
(h) The
Issuer has no outstanding liabilities or obligations to any party except as
reflected on the Issuer’s Form 10-KSB for the year ended May 30, 2007 and the
Form 10-QSB for the quarter ended August 31, 2007, other than charges since
such
date similar to those incurred in past periods and consistent with past
practice, all of which will be discharged prior to or at the Closing so that,
at
the Closing, the Issuer will have no direct, contingent or other obligations
of
any kind or any commitment or contractual obligations of any kind and
description.
(i) All
of
the business and financial transactions of the Issuer have been fully and
properly reflected in the books and records of the Issuer in all material
respects and in accordance with generally accepted accounting principles
consistently applied.
(j) The
Issuer is current with its reporting obligations under Section 15(d) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”). None of the
Issuer’s filings made pursuant to the Exchange Act (collectively, the “Issuer
SEC Documents”) contain any misstatements of material fact or omit to state a
material fact necessary to make the statements made therein not misleading.
The
Issuer SEC Documents, as of their respective dates, complied in all material
respects with the requirements of the Exchange Act, and the rules and
regulations of the Commission there under, and are available on the Commission’s
XXXXX system. The financial statements included in the Issuer SEC Documents
present and reflect, in accordance with generally accepted accounting
principles, consistently applied, the financial condition of the Issuer on
the
balance sheet dates and the results of its operations, cash flows and changes
in
stockholders’ equity for the periods then ended in accordance with generally
accepted accounting principles, consistently applied. The accountants who
audited the Issuer’s financial statements are independent, within the meaning of
the Securities Act and are a member of the PCAOB. There has not occurred any
material adverse change, or any development involving a prospective material
adverse change, in the condition, financial or otherwise, or in the earnings,
business or operations of the Issuer, from that set forth in the Issuer’s Form
10-KSB for the year ended May 30, 2007.
(k) The
execution and delivery of this Agreement by the Issuer and the consummation
of
the transactions contemplated by this Agreement will not result in any material
violation of the Issuer’s certificate of incorporation or by-laws, or any
applicable Law.
(l) All
representations, covenants and warranties of the Issuer and Sellers contained
in
this Agreement shall be true and correct on and as of the Closing Date with
the
same effect as though the same had been made on and as of such
date.
4. Release.
(a) Each
Seller does hereby release and discharge the Issuer, its officers, directors
and
counsel their respective heirs, executors, administrators, successors and
assigns from any and all actions, causes of action, suits, debts, sums of money,
accounts, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, agreements, promises, damages, claims and demands whatsoever,
in
law, admiralty or equity which against them or any of them such Seller and
his
heirs, executors, administrators, successors and assigns ever had, now have
or
may in the future can, shall or may have, for, upon or by reason or any matter,
cause or thing whatsoever from the beginning of the world to the date of this
Agreement; provided, however, that nothing in this Section 4(a) shall be
construed as a release of any of the rights or obligations which either Seller
may have pursuant to this Agreement.
(b) The
Issuer does hereby release and discharge each Seller, their, counsel their
respective heirs, executors, administrators, successors and assigns from any
and
all actions, causes of action, suits, debts, sums of money, accounts,
reckonings, bonds, bills, specialties, covenants, contracts, controversies,
agreements, promises, damages, claims and demands whatsoever, in law, admiralty
or equity which against them or any of them such Issuer, its officers, directors
and counsel and heirs, executors, administrators, successors and assigns ever
had, now have or may in the future can, shall or may have, for, upon or by
reason or any matter, cause or thing whatsoever from the beginning of the world
to the date of this Agreement; provided, however, that nothing in this Section
4(b) shall be construed as a release of (i) any of rights or the obligations
which the Issuer may have pursuant to this Agreement or (ii) any loss,
liability, damage or expense which the Issuer may incur as a result of a
violation of Laws by either Seller.
-4-
5. Finder’s
Fee.
Sellers
jointly and severally represent and warrant that no person is entitled to
receive a finder’s fee from Sellers in connection with this Agreement as a
result of any action taken by the Issuer or Sellers pursuant to this Agreement,
and agree jointly and severally to indemnify and hold harmless the Issuer,
its
officers, directors and affiliates, in the event of a breach of the
representation and warranty set forth in this Section 5, except that the Issuer
has agreed to issue stock to Belmont Partners LLC (“Belmont”) contemporaneously
with the Closing, the number of shares being equal to 1% of the . This
representation and warranty shall survive the Closing.
6. Termination
by Mutual Agreement.
This
Agreement may be terminated at any time by mutual consent of the parties hereto,
provided that such consent to terminate is in writing and is signed by each
of
the parties hereto.
7. Miscellaneous.
(a) Entire
Agreement.
This
Agreement constitutes the entire agreement of the parties, superseding and
terminating any and all prior or contemporaneous oral and written agreements,
understandings or letters of intent between or among the parties with respect
to
the subject matter of this Agreement. No part of this Agreement may be modified
or amended, nor may any right be waived, except by a written instrument which
expressly refers to this Agreement, states that it is a modification or
amendment of this Agreement and is signed by the parties to this Agreement,
or,
in the case of waiver, by the party granting the waiver. No course of conduct
or
dealing or trade usage or custom and no course of performance shall be relied
on
or referred to by any party to contradict, explain or supplement any provision
of this Agreement, it being acknowledged by the parties to this Agreement that
this Agreement is intended to be, and is, the complete and exclusive statement
of the agreement with respect to its subject matter. Any waiver shall be limited
to the express terms thereof and shall not be construed as a waiver of any
other
provisions or the same provisions at any other time or under any other
circumstances.
(b) Severability.
If any
section, term or provision of this Agreement shall to any extent be held or
determined to be invalid or unenforceable, the remaining sections, terms and
provisions shall nevertheless continue in full force and effect.
(c) Notices.
All
notices provided for in this Agreement shall be in writing signed by the party
giving such notice, and delivered personally or sent by overnight courier,
mail
or messenger against receipt thereof or sent by registered or certified mail,
return receipt requested, or by facsimile transmission or similar means of
communication if receipt is confirmed or if transmission of such notice is
confirmed by mall as provided in this Section 7(c). Notices shall be deemed
to
have been received on the date of personal delivery or telecopy or attempted
delivery. Notice shall be delivered to the parties at the following
addresses:
| If to the Issuer: |
c/o
Jiangxi Moral Star Copper Technology Co., Ltd.
|
Ge
Xxx
Xx, Xxx Xxxx, Xxxxxx
Xxxxxxx,
XXX 000000
Attention:
Xx.Xx Yiting
E-mail:
xxx0000@000.xxx
Fax:
00
000 0000000
-5-
With
a
copy to:
Sichenzia
Xxxx Xxxxxxxx Xxxxxxx LLP
00
Xxxxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Xxxxx X. Xxxxxxxx PC
E-mail:
xxxxxxxxx@xxxx.xxx
Fax:
(000) 000-0000
| If to Xxxxxxxxxxx: |
Xxx
X.X. Xxxxx Xxxxxx, Xxxxx 000
|
Xxxxx,
Xxxxxxx 00000
Email:
Fax:
(000)
000-0000
| If to Xxxxxxx: |
Xxx
X.X. Xxxxx Xxxxxx, Xxxxx 000
|
Xxxxx,
Xxxxxxx 00000
Email:
xxx@xxxxxxxxxxxxxxxxxxxxx.xxx
Fax:
(000)
000-0000
With
a
copy to
Xxxxx
X.
Xxxxxxx, Esquire
Legal
& Compliance, LLC
000
Xxxxxxxx Xxxxxx; Xxxxx 000
Xxxx
Xxxx
Xxxxx, XX 00000
E-Mail:
Xxxxxxxxxxxxxx@xxx.xxx
Fax:
000-000-0000
Any
party
may, by like notice, change the address, person or telecopier number to which
notice shall be sent.
(d) Governing
Law.
This
Agreement shall be governed and construed in accordance with the laws of the
State of New York applicable to agreements executed and to be performed wholly
within such State, without regard to any principles of conflicts of law. Each
of
the parties hereby irrevocably consents and agrees that any legal or equitable
action or proceeding arising under or in connection with this Agreement shall
be
brought in the federal or state courts located in the County of New York in
the
State of New York, by execution and delivery of this Agreement, irrevocably
submits to and accepts the jurisdiction of said courts, (iii) waives any defense
that such court is not a convenient forum, and (iv) consent to any service
of
process made either (x) in the manner set forth in Section 10(c) of this
Agreement (other than by telecopier), or (y) any other method of service
permitted by law.
-6-
(e) Waiver
of Jury Trial.
EACH
PARTY, TO THE EXTENT PERMITTED BY LAW, HEREBY EXPRESSLY WAIVES ANY RIGHT TO
A
TRIAL BY JURY IN THE EVENT OF ANY SUIT, ACTION OR PROCEEDING TO ENFORCE THIS
AGREEMENT OR ANY OTHER ACTION OR PROCEEDING WHICH MAY ARISE OUT OF OR IN ANY
WAY
BE CONNECTED WITH THIS AGREEMENT OR ANY OF THE OTHER
DOCUMENTS.
(f) Expenses.
Sellers
shall be responsible and liable for their and the Issuer’s expenses incurred in
connection with the preparation of this Agreement, the consummation of the
transactions contemplated by this Agreement.
(g) Successors.
This
Agreement shall be binding upon the parties and their respective heirs,
executors, administrators, legal representatives, successors and assigns;
provided, however, that the Issuer may not assign this Agreement or any of
its
rights under this Agreement without the prior written consent of the Sellers,
and neither Seller may assign this Agreement or any of his rights under this
Agreement without the prior written consent of the Issuer.
(h) Further
Assurances.
Each
party to this Agreement agrees, without cost or expense to any other party,
to
deliver or cause to be delivered such other documents and instruments as may
be
reasonably requested by any other party to this Agreement in order to carry
out
more fully the provisions of, and to consummate the transaction contemplated
by,
this Agreement.
(i) Counterparts.
This
Agreement may be executed simultaneously in two or more counterparts, each
of
which shall be deemed an original but all of which together shall constitute
one
and the same instrument.
(j) No
Strict Construction.
The
language used in this Agreement will be deemed to be the language chosen by
the
parties with the advice of counsel to express their mutual intent, and no rules
of strict construction will be applied against any party.
(k) Headings.
The
headings in the Sections of this Agreement are inserted for convenience only
and
shall not constitute a part of this Agreement.
IN
WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed as of the
date
first above written.
| |
|
|
| By: | /s/ Xx Xxxxxx | |
|
Xx Xxxxxx, CEO |
||
| /s/ Xxxxxxxxxxx Xxxxxx | ||
|
Xxxxxxxxxxx Xxxxxx |
||
| /s/ Xxxxxxx Xxxxxx | ||
|
Xxxxxxx Xxxxxx |
||
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Schedule
A
|
Seller
|
Number
of Shares
|
|
Purchase
Price
|
||||
|
20,001
|
* |
$
|
437,500
|
||||
|
Xxxxxxx
Xxxxxx
|
30,000
|
$
|
187,500
|
||||
*
Xxxxxxxxxxx Xxxxxx also held 50,000 shares of series A convertible preferred
stock which have been cancelled.
-8-
