COMMON STOCK PURCHASE AGREEMENT Private and Confidential
Private
and Confidential
THIS COMMON STOCK PURCHASE AGREEMENT,
(the “Agreement”) made as of the last executed date below (the “Effective
Date”), by and among China Xxxxx Xxxx Bio-pharmaceutical Holding Company
Limited, an entity with a principle address of Xxxxxxxx Building, 0 Xxxxx
Xxxxxx, Xxxx Xxxx, Xxxxxxx XX0000, British Virgin Islands (the “Buyer”) and
Belmont Partners, LLC a Virginia limited liability company with a principal
address of 000 Xxxx Xxxxxx, Xxxxxxxxxx Xxxxxxxx 00000 (“Seller”), and Cienega
Creek Holdings, Inc. a public vehicle organized in the state of Nevada and
traded under the symbol “CCKH” (the “Company”) (Buyer, Seller and Company each a
“Party” and collectively the “Parties”).
WITNESSETH:
WHEREAS,
the Company has seventy-five million (75,000,000) authorized common stock shares
and no preferred shares authorized;
WHEREAS,
the Company currently has 2,294,250 issued and outstanding common stock shares
and the Seller owns a majority of the issued and outstanding capital stock of
the Company; and
WHEREAS,
the Buyer wishes to purchase a control block of stock consisting
of 1,299,000 shares of the Company’s common stock which represents
fifty-six and sixty-two hundredths percent (56.62%) of the capital stock of the
Company (the “Stock”);
NOW, THEREFORE, in consideration of the
mutual promises, covenants, and representations contained herein, and subject to
the terms and conditions hereof, the Parties agree as follows:
1. Agreement to Purchase and
Sell. Seller will sell to Buyer and Buyer agrees to purchase
the Stock in exchange for:
a) Two
hundred eighty thousand U.S. dollars ($280,000.00) (the “Purchase Price”), to be
paid to Seller according to the terms and conditions set forth in Section 3
herein;
b) Five
percent (5.00%) of the issued and outstanding common stock of the Company
according to the terms and conditions set forth in Section 3(c) herein (the
“Position”); and
c) Two
hundred fifty U.S. dollars ($500.00) representing Buyer’s half of the Escrow
Fees to be paid by Buyer directly to the Escrow Agent on or before
Closing.
2. Closing. On
or about five (5) business days from the Effective Date (the “Closing”) the
Parties shall perform,:
a) At
Closing, the Company shall execute a resolution approving the terms of this
Agreement, attached hereto as Exhibit 3;
b) Within
ten (10) business days from the Closing, the Company shall deliver to Seller and
Buyer, a resolution of the board of directors of the Company and Irrevocable
Transfer Agent Instructions signed by an authorized officer of the Company to
effectuate performance of Sections 1(b) and 3(c) of this Agreement (attached
hereto as Exhibit 1 and 2) (the “Board Resolution”);
c) Seller
shall deliver to Buyer, to the extent reasonably available to Seller, and after
the full performance of Section 3(a), true and correct copies of the Company’s
business, financial and corporate records including but not limited to:
correspondence files, bank statements, checkbooks, minutes of shareholder and
directors meetings, financial statements, shareholder listings, stock transfer
records, agreements and contracts;
d) At
Closing, Seller shall deliver a fully executed copy of this Agreement to
Buyer;
e) At
Closing, Company shall deliver a fully executed copy of this Agreement to Buyer
and Seller;
f) At
Closing, Buyer shall deliver to Seller a copy of this Agreement executed by
Buyer;
g) At
Closing, the board of directors of the Company shall execute a resolution
appointing Buyer, or Buyer’s designee, a director and officer of the Company
(the “Appointment”) attached hereto as Exhibit 4. The officer
appointment shall be immediate and the director appointment shall be effective
on the tenth day following the mailing by the Company of an information
statement that complies with the requirements of Section 14f-1 of the Exchange
Act;
h) At
Closing, Seller shall deliver to Buyer the Appointment and letters of
resignation from the current directors and officers of the Company;
i) The
Purchase Price (defined in Section 3(a) herein) shall be released to
Seller;
j) Seller
shall deliver to Buyer, as soon as practicable after the full performance of
Buyer’s obligations in Sections 2(a) through 2(i) herein, the stock
certificate(s) evidencing the Stock together with valid signed stock power, gold
medallion guaranteed together with all documents necessary to effectuate the
transfer of the shares, including by not limited to a board resolution
demonstrating signature authority if shares are in the name of a legal
entity.
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3. Payment
Terms.
a) Buyer
has previously placed a deposit of one hundred twenty thousand U.S. Dollars
($120,000.00) into an escrow account with the Escrow Agent on behalf of the
Seller on March 19, 2010 (the “Deposit”). The balance of the Purchase
Price (the “Balance”) shall be due and payable on or before Closing (“Maturity
Date”).
b) The
Purchase Price shall be made by wire transfer of immediately available funds to
Seller’s account as follows:
Wachovia
Bank, N.A.
000
Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxx,
XX 00000
SWIFT:
PNBPUS33
ABA:
000000000
Account:
Belmont Partners, LLC
Acct
Number: 2000049859375
c) Stock
Position.
(i) In
consideration of the benefits provided to the Company hereby, Company shall
issue and deliver to Seller, such fully paid, non-assessable restricted shares
of the Company’s common stock equal to a five percent (5.00%) post Merger (as
defined in Section 9 herein) ownership interest in the Company (the
“Position”). The Position shall be based on the capital structure of
the Company post Merger (taking into account any and all shares issued relating
to the Merger, initial contracts, and initial acquisition of any assets), post
reverse stock split (if any), post initial financing (whether that initial
financing be a single round or in multiple tranches over a period of time), and
after any other initial issuance of stock (including issuance to the Company’s
directors and/or officers), provided such subsequent issuances, when viewed as a
whole, are part of the Merger transaction. Buyer shall take all steps
necessary to fully effectuate the provisions of this Section 3.
(ii) Certificate(s)
evidencing the Position shall be issued and delivered to the Seller immediately
following the actions anticipated by Section 3(c)(i) herein (the “Actions”), but
in no case later than eleven (11) months following the Effective Date
hereof. In the event that all Actions have not been completed by the
eleventh month anniversary of this Agreement, Seller shall transfer to Buyer
shares comprising the Position on that date and shall issue additional shares as
necessary following completion of the Actions.
(iii) The
Parties acknowledge that the Seller is accepting the Position as consideration
for entering into this Agreement and undertaking the risk of taking equity as
consideration as of the effective date of this Agreement, therefore the
effective date of all Shares transferred pursuant to this Section 3 shall be the
Effective Date of this Agreement and shall be memorialized on the face of the
certificates evidencing such shares.
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d) The
Parties acknowledge and agree that the Position shall be newly issued,
restricted common shares of the Company. Buyer and Company agree to
accept as valid any legal opinion of Seller’s counsel regarding the removal of
restrictions from the Position in a form reasonably acceptable to the
Company. In the event that, in one year from the date of the
execution of this Agreement, the Position can not be sold in accordance with
Rule 144 of the Securities Act of 1933, the Company agrees to include and
register the shares representing the Position in the event the Company files a
registration statement with the Securities and Exchange
Commission. In the event that Buyer does not provide for the removal
of restrictions from the shares comprising the Position in accordance with Rule
144 upon Seller’s request (except in the event it is unlawful to do so in the
reasonable opinion of Company’s counsel), or does not recognize any opinion of
Seller’s counsel regarding the removal of such restrictions in a form reasonably
acceptable to the Company, the Company and the Buyer, jointly and severally,
shall pay to Seller liquidated damages in the amount of the bid price per share
as of the one year anniversary of this Agreement (as reported by the national
market on which the shares trade) multiplied by the number of shares in the
Position and upon payment of the liquidated damages to Seller, the Seller shall
transfer the Position to the Company. The Parties agree that the
liquidated damages hereunder are not a penalty.
e) In
consideration of the benefits provided to the Company hereby, Company and Buyer
agree to be jointly and severally liable for all amounts due
hereunder.
4. Transfer
Agent. Until such time as the terms and conditions of Section
3(c) herein are fully performed, Buyer agrees that Pacific Stock Transfer, LLC
(the “Transfer Agent”) shall act as the Company’s sole transfer
agency.
5. Representations and
Warranties of Seller. Seller hereby represents and warrants,
to Buyer that the statements in the following paragraphs of this Section 5 are
all true and complete as of the date hereof:
a) Title
to Stock. Seller is the record and beneficial owner and has sole
managerial and dispositive authority with respect to the Stock and has not
granted any person a proxy that has not expired or been validly
withdrawn. The sale and delivery of the Stock to Buyer pursuant to
this Agreement will vest in Buyer the legal and valid title to the Stock, free
and clear of all liens, security interests, adverse claims or other encumbrances
of any character whatsoever (“Encumbrances”) (other than Encumbrances created by
Buyer and restrictions on resales of the Stock under applicable securities
laws).
b) Liabilities
of the Company. The Company has no liability or liabilities that have not been
previously disclosed to Buyer and listed on Schedule A
herein. Notwithstanding the foregoing, the representation contained
in this Section 11(b) shall terminate 24 months following the Effective
Date.
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c) Full
Power and Authority. Seller represents that it has full power and authority to
enter into this Agreement.
6. Representations and
Warranties of Buyer. Buyer hereby represents and warrants to Seller
that the statements in the following paragraphs of this Section 6 are all true
and complete as of the date hereof:
a) Affidavit
of Source of Funds. Prior to any transfer of funds to
Seller, Buyer shall execute an Affidavit of Source of Funds (attached
hereto as Exhibit 5), which attests that the funds to be transferred are not the
proceeds of nor are intended for or being transferred in the furtherance of any
illegal activity or activity prohibited by federal or state laws. Such activity
may include, but is not limited to: tax evasion; financial misconduct;
environmental crimes; activity involving drugs and other controlled substances;
counterfeiting; espionage; kidnapping; smuggling; copyright infringement; entry
of goods into the United States by means of false statements; terrorism;
terrorist financing or other material support of terrorists or terrorism; arms
dealing; bank fraud; wire fraud; mail fraud; concealment of assets or any effort
by conspiracy or otherwise to defeat, defraud or otherwise evade, any party or
the Court in a bankruptcy proceeding, a receiver, a custodian, a trustee, a
marshal, or any other officer of the court or government or regulatory official;
bribery or any violation of the Foreign Corrupt Practices Act; trading with
enemies of the United States; forgery; or fraud of any kind. Buyer
further warrants that all transfers of monies will be in accordance with the
Money Laundering Control Act of 1986 as amended.
b) Exempt
Transaction. Buyer understands that the offering and sale of the
Stock is intended to be exempt from registration under the Securities Act of
1933, as amended (the “Act”) and exempt from registration or qualification under
any state law.
c) Full
Power and Authority. Buyer represents that it has full power and
authority to enter into this Agreement.
d)
Stock. The Stock to be purchased by Buyer hereunder will be acquired
for investment for Buyer’s own account, not as a nominee or agent, and not with
a view to the public resale or distribution thereof, and Buyer has no present
intention of selling, granting any participation in, or otherwise distributing
the same.
e) Information
Concerning the Company. Buyer has conducted its own due diligence
with respect to the Company and its liabilities and believes it has enough
information upon which to base an investment decision in the Stock.
f) Investment
Experience. The Buyer understands that purchase of the Stock involves
substantial risk. The Buyer:
(i) has
experience as a purchaser in securities of companies in the development stage
and acknowledges that he can bear the economic risk of Buyer’s investment in the
Stock; and,
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(ii) has
such knowledge and experience in financial, tax, and business matters so as to
enable Buyer to evaluate the merits and risks of an investment in the Stock, to
protect Buyer’s own interests in connection with the investment and to make an
informed investment decision with respect thereto.
g) No
Oral Representations. No oral or written representations have been
made other than or in addition to those stated in this Agreement. Buyer is not
relying on any oral statements made by Seller, Seller's representatives,
employee’s or affiliates in purchasing the Stock.
h) Restricted
Securities. Buyer understands that the Stock is characterized as
“restricted securities” under the Act inasmuch as they were acquired from the
Company in a transaction not involving a public offering.
i) Opinion
Necessary. Buyer acknowledges that if any transfer of the Stock is
proposed to be made in reliance upon an exemption under the Act, the Company may
require an opinion of counsel satisfactory to the Company that such transfer may
be made pursuant to an applicable exemption under the Act. Buyer
acknowledges that a restrictive legend appears on the Stock and must remain on
the Stock until such time as it may be removed under the Act.
j) Shareholder
Value. Buyer represents that Buyer intends to implement a business
plan designed to return value to the shareholders of the Company.
k) Compliance. Buyer
shall comply with all applicable securities laws, rules and regulations
regarding this Agreement, the Merger and all related transactions, including but
not limited to filing any forms required by the U.S. Securities and Exchange
Commission.
7. Indemnification.
a) Indemnification.
Buyer covenants and agrees it shall indemnify and hold harmless the Seller, its
members, officers, directors, agents, employees, attorneys, accountants,
consultants, subsidiaries, successors, affiliates and assigns (collectively the
“Seller Covenantees”) from and against any and all losses, damages, expenses and
liabilities (collectively “Liabilities”) or actions, investigations, inquiries,
arbitrations, claims or other proceedings as a result of or relating to any
breach of any of the representations, warranties, covenants or agreements made
by the Buyer in this Agreement (collectively “Actions”) (Liabilities and Actions
are herein collectively referred to as “Losses”). Seller covenants
and agrees it shall indemnify and hold harmless the Buyer, its members,
officers, directors, agents, employees, attorneys, accountants, consultants,
subsidiaries, successors, affiliates and assigns (collectively the “Buyer
Covenantees”) from and against any Losses as a result of or relating to any
breach of any of the representations, warranties, covenants or agreements made
by the Seller in this Agreement. Losses include, but are not limited to all
reasonable legal fees, court costs and other expenses incurred in connection
with investigating, preparing, defending, paying, settling or compromising any
suit in law or equity arising out of this Agreement or for any breach of this
Agreement by the indemnifying party. Notwithstanding the foregoing,
nothing shall prevent Seller or Buyer from pursuing any remedies available
enforce the Parties’ obligation under the Agreement.
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8. Governing
Law. This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Virginia, U.S.A. without giving
effect to any other choice or conflict of law provision that would cause the
application of the laws of any other jurisdiction other than the Commonwealth of
Virginia.
9. Merger and Exchange of
Stock. Buyer shall, as soon as practicable, effect a merger
(the “Merger”), between the Company, or a wholly owned subsidiary of the
Company, and a target corporation (the “Sub”). The Company, or its
wholly owned subsidiary, shall be the surviving corporation of the Merger, and
shall continue unimpaired by the Merger. Upon Merger, the Company
shall succeed to and shall possess all the assets, properties, rights,
privileges, powers, franchises, immunities and purposes, and be subject to all
the debts, liabilities, obligations, restrictions and duties of the
Sub. A reverse acquisition transaction where the Company acquires an
operating subsidiary shall be deemed a “Merger” under this section, even if a
merger does not occur.
10. Term /
Survival. The terms of this Agreement shall be effective as of
the Effective Date, and continue until such time as the payment of the Purchase
Price and all other amounts due hereunder are fully satisfied, however; the
terms, conditions, and obligations of Sections 10, 11, 15, 16, 19, 21 and 22
hereof shall survive the termination of this Agreement.
11. Successors and
Assigns. The terms and conditions of this Agreement shall
inure to the benefit of and be binding upon the respective successors and
assigns of the parties, except that Buyer may not assign or transfer any of its
rights or obligations under this Agreement.
12. Counterparts. This
Agreement may be executed in two or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
agreement. A telefaxed copy of this Agreement shall be deemed an
original.
13. Headings. The
headings used in this Agreement are for convenience of reference only and shall
not be deemed to limit, characterize or in any way affect the interpretation of
any provision of this Agreement.
14. Costs, Expenses. Each
party hereto shall bear its own costs in connection with the preparation,
execution and delivery of this Agreement.
15. Modifications and
Waivers. No change, modification or waiver of any provision of
this Agreement shall be valid or binding unless it is in writing, dated
subsequent to the Effective Date of this Agreement, and signed by both the Buyer
and Seller. No waiver of any breach, term, condition or remedy of this Agreement
by any party shall constitute a subsequent waiver of the same or any other
breach, term, condition or remedy. All remedies, either under this
agreement, by law, or otherwise afforded the Buyer shall be cumulative and not
alternative.
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16. Severability. If
one or more provisions of this Agreement are held to be unenforceable under
applicable law, such provision(s) shall be excluded from this Agreement and the
balance of the Agreement shall be interpreted as if such provision(s) were so
excluded and shall be enforceable in accordance with its terms.
17. Termination. Buyer
or Seller may, upon written notice to the other party, terminate this Agreement
upon their own discretion prior to any funds being distributed. Upon
the distribution of any funds, this termination clause is null and
void.
18. Entire
Agreement. This Agreement constitutes the entire
agreement and understanding of the Parties with respect to the subject matter
hereof and supersedes any and all prior negotiations, correspondence,
agreements, understandings duties or obligations between the parties with
respect to the subject matter hereof.
19. Further
Assurances. From and after the date of this Agreement, upon
the request of the Buyer or Seller, Buyer and Seller shall execute and deliver
such instruments, documents or other writings as may be reasonably necessary or
desirable to confirm and carry out and to effectuate fully the intent and
purposes of this Agreement.
20. Notices. All notices
or other communications required or permitted by this Agreement shall be in
writing and shall be deemed to have been duly received:
a) if
given by telecopier, when transmitted and the appropriate telephonic
confirmation received if transmitted on a business day and during normal
business hours of the recipient, and otherwise on the next business day
following transmission,
b) if
given by certified or registered mail, return receipt requested, postage
prepaid, three business days after being deposited in the U.S. mails
and
c) if
given by courier or other means, when received or personally delivered, and, in
any such case, addressed as indicated herein, or to such other addresses as may
be specified by any such Person to the other Person pursuant to notice given by
such Person in accordance with the provisions of this Section 20.
21. Xxxxxxx
Xxxxxxx. Seller and Buyer hereby certify that they have not
themselves, nor through any third parties, purchased nor caused to be purchased
in the public marketplace any publicly traded shares of the
Company. Seller and Buyer further certify they have not communicated
the nature of the transactions contemplated by the Agreement, are not aware of
any disclosure of non public information concerning said transactions, and are
not a party to any xxxxxxx xxxxxxx of Company shares.
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22. Binding
Arbitration. In the event of any dispute, claim, question, or
disagreement arising from or relating to this agreement or the breach thereof,
the Parties hereto shall use their best efforts to settle the dispute, claim
question, or disagreement. To this effect, they shall consult and negotiate with
each other in good faith and, recognizing their mutual interests, attempt to
reach a just and equitable solution satisfactory to both parties. If they do not
reach such a solution within a period of sixty (60) days, then, upon notice by
either party to the other, all disputes, claims, questions, or disagreements
shall be settled by arbitration administered by the American Arbitration
Association in accordance with its Commercial Arbitration Rules including the
Optional Rules for Emergency Measures of Protection, and judgment on any award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
thereof.
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[Signature
Page Follows]
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In Witness
Whereof, the Parties hereto have executed this Agreement as of the last
date written below.
| SELLER | BUYER | |||
| BELMONT PARTNERS, LLC |
CHINA XXXXX XXXX
BIO-PHARMACEUTICAL
HOLDING COMPANY
LIMITED
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By: Xxxxxx Xxxxx,
Managing Member
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By: Xxxx Tik
Man
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Date:
____________________
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Date:
________________________
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| COMPANY | ||||
| CIENEGA CREEK HOLDINGS, INC. |
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By: Xxxxxx Xxxxx,
Director
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Date:
____________________
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