STOCK PURCHASE AGREEMENT
Exhibit 2.1
STOCK PURCHASE AGREEMENT, dated as of June 12, 2015 (the “Agreement”) by and between Huayue Electronics, Inc., an Delaware corporation having an address at 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (“Seller”), and Shudong Pan, an individual having an address at 51 Huilingxi Road, Zhouhuizheng, Wujin District, Changzhou, Jiangsu Province, P.R. China 213022 (“Buyer”).
WHEREAS, China Metal Holding Inc., a Delaware corporation (“CMHI”), a wholly-owned subsidiary of Seller, is the owner of 100% of the capital stock of Changzhou Huayue Electronics Inc., a Chinese corporation (“Changzhou Huayue”); and
WHEREAS, Seller desires to sell to Buyer and Buyer desires to purchase from Seller, all present and future right, title and interest in and to 100% of the issued and outstanding shares of common stock (the “Acquired Stock”), of CMHI, which shares represent all of the issued and outstanding shares of capital stock of CMHI, upon the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the promises and the mutual agreements, covenants and provisions herein contained, the parties hereto hereby agree as follows:
ARTICLE I
PURCHASE AND SALE
Section 1.1 Sale of the Acquired Stock. Upon the terms and subject to the conditions of this Agreement, on the date hereof, Seller hereby sells, transfers and assigns to Buyer the Acquired Stock and, on the date hereof, shall deliver to Buyer a certificate representing the Acquired Stock, duly endorsed or accompanied by stock powers duly endorsed in blank. Upon the terms and subject to the conditions of this Agreement, on the date hereof, Buyer hereby purchases and acquires the Acquired Stock and, in full payment therefor, shall deliver to Seller on the date hereof 10,000,000 shares of common stock of Seller (the “Purchase Consideration”) duly endorsed or accompanied by stock powers duly endorsed in blank.
Section 1.2 Transfer Taxes; Certain Expenses. (a) Seller shall be responsible for all transfer and similar taxes assessed or payable in connection with the sale and transfer of the Acquired Stock. Buyer shall not pay or be liable for or be required to pay any income, capital gains or other taxes incurred by Seller as a result of the sale of the Acquired Stock to Buyer, all of which shall be borne and paid by Seller.
(b) Buyer shall be responsible for all transfer and similar taxes assessed or payable in connection with the sale and transfer of the Purchase Consideration. Seller shall not pay or be liable for or be required to pay any income, capital gains or other taxes incurred by Buyer as a result of the transfer of the Purchase Consideration to Seller, all of which shall be borne and paid by Buyer.
ARTICLE II
REPRESENTATIONS AND
WARRANTIES OF SELLER
Seller hereby represents and warrants to Buyer as follows:
Section 2.1 Title to the Acquired Stock. Seller is the sole beneficial and record owner of the Acquired Stock free and clear of any setoff, claim, restriction, pledge, security interest, encumbrance or any other charges (collectively “Encumbrances”). Upon delivery to Seller of the certificates for the Purchase Consideration and receipt by Buyer of the certificates for the Acquired Stock, Buyer shall have good and marketable title to the Acquired Stock, free and clear of all Encumbrances.
Section 2.2 Authorization. Seller has full power and authority to enter into this Agreement and to carry out the transactions contemplated hereby. This Agreement constitutes the valid and binding obligation of Seller, enforceable in accordance with its terms.
Section 2.3 Consents. No consent or waiver of any party is required to be obtained by Seller in connection with the execution, delivery and performance of this Agreement, except such consents or waivers as have been obtained by Seller.
Section 2.4 Brokerage. Seller has not entered into any arrangement or agreement binding upon Seller which would give rise to any claims for brokerage commissions, finders’ fees or similar compensation in connection with the transactions contemplated by this Agreement, the fees and expenses of which shall be borne by Seller. Seller shall pay, and hold Buyer harmless against, any liability, loss or expense (including, without limitation, reasonable attorneys fees and out-of-pocket expenses) arising in connection with any such claim.
ARTICLE III
REPRESENTATIONS AND
WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller as follows:
Section 3.1 Authorization and Binding Obligation. Buyer has the requisite power and authority to execute, deliver and perform this Agreement. This Agreement has been duly executed by Buyer and constitutes the legal, valid, and binding obligation of Buyer, enforceable against Buyer in accordance with its terms.
Section 3.2 Purchase For Own Account. Buyer hereby confirms that the Acquired Stock purchased hereunder will be acquired for investment for Buyer’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part of the Acquired Stock in contravention of applicable law, and that Buyer has no present intention of selling, granting any participation in, or otherwise distributing the same. Buyer does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations to the person or to any third person in or with respect to any of the Acquired Stock.
Section 3.3 Accredited Investor. Buyer represents that he is an “accredited investor,” as defined in Rule 501 of Regulation D under the Securities Act of 1933, as amended (the “Securities Act”).
Section 3.4 No Market for Securities. Buyer understands that the Acquired Stock he is acquiring pursuant to this Agreement and the shares of capital stock of Changzhou Huayue that are owned by CMHI are “restricted securities” within the meaning of Rule 144 under the Securities Act (“Rule 144”) inasmuch as such shares will be acquired from Seller in a transaction not involving a public offering and that under the federal securities laws and applicable regulations such shares may be resold without registration under the Securities Act only in certain limited circumstances. In this connection, Buyer represents that he is familiar with Rule 144 and understands the resale limitations imposed thereby and by the Securities Act. Buyer further understands that there is no public or active market for the shares of CMHI or Changzhou Huayue and that such shares cannot be readily resold.
| 2 |
Section 3.5 Legends. Buyer understands that the certificates evidencing the Acquired Stock will bear an appropriate legend restricting transfers.
Section 3.6 Buyer is an Affiliate. Buyer acknowledges and agrees that as an officer and director of each of Seller, CMHI and Changzhou Huayue, he is currently an “affiliate” (as defined in the Securities Act) of each of such entities and has knowledge of, and access to, all relevant information, some of which may not be favorable, relating to the business and operations of each of such entities, including information that is not public and is not available to others. In purchasing the Acquired Stock, Buyer is not relying any representation or warranty of Seller other than those set forth in this Agreement as Buyer has access to all relevant information relating to each of Seller, CMHI and Changzhou Huayue as is necessary to make his own investment decision regarding each such entity.
Section 3.7 Due Diligence. Buyer has been given the opportunity for a reasonable time prior to the date hereof to ask questions of, and receive answers from, Seller or its other representatives concerning the Acquired Stock, and other matters pertaining to this investment, and has been given the opportunity for a reasonable time prior to the date hereof to obtain such additional information in connection with Seller in order for Buyer to evaluate the merits and risks of purchase of the Acquired Stock and the sale or transfer of the Purchase Consideration, to the extent Seller possesses such information or can acquire it without unreasonable effort or expense.
ARTICLE IV
MISCELLANEOUS
Section 4.1 Governing Law: Jurisdiction. This Agreement shall be governed by and construed in accordance with the laws of the State of New York (without giving effect to conflicts of law).
Section 4.2 Headings and Captions. The headings and captions contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.
Section 4.3 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original but all of which together shall constitute but one and the same instrument.
Section 4.4 Entire Agreement. This Agreement constitutes the entire understanding among the parties with respect to the subject matter hereof, superseding all negotiations, prior discussions and preliminary agreements made prior to the date hereof.
Section 4.5 Assignment. This Agreement shall not be assignable by any party hereto without the express prior written consent of the others. Nothing in this Agreement is intended to confer upon any person, other than the parties hereto and their successors or permitted assigns, any rights or remedies under or by reason of this Agreement.
Section 4.6 Separability. If any section, subsection or provision of this Agreement, or the application of such section, subsection or provision, is held invalid, the remainder of this Agreement and the application of such section, subsection or provision to persons or circumstances other than those to which it is held invalid shall not be affected.
| 3 |
Section 4.7 Notices. All notices, consents or other communications required or permitted to be given by any party hereunder shall be in writing and shall be given by delivery or by certified or registered mail, postage prepaid, nationally recognized overnight courier, postage prepaid, or by facsimile (if followed by a copy sent by overnight courier) to the respective address in the preamble of this Agreement or at such other address as any party may from time to time specify to the other parties hereto. Any notice, consent or other communication required or permitted to be given hereunder shall be deemed to have been given on the date of personal delivery on the second business day following the date of mailing or, in the case of overnight courier or facsimile, the next business day following the date of delivery to such overnight courier
Section 4.8 Costs. Each party will pay its own costs and expenses involved in carrying out the transactions contemplated by this Agreement.
Section 4.9 Amendment. This Agreement may not be amended except by an instrument in writing signed by or on behalf of the parties hereto.
Section 4.10 Further Assurances. Subject to the terms and conditions of this Agreement, each of the parties hereto will use all reasonable efforts to take, or cause to be taken, all action, and to do, or cause to be done, all things necessary, proper or advisable, under applicable laws and regulations or otherwise, to fulfill his or her obligations under this Agreement and to consummate the transactions contemplated by this Agreement.
[Remainder of Page Intentionally Left Blank]
| 4 |
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the date first written above.
| HUAYUE ELECTRONICS, INC. | ||
| By: | /s/ Xxxxx Xxxxxx | |
| Xxxxx Xxxxxx, Chief Executive Officer | ||
| /s/ Shudong Pan | ||
| SHUDONG PAN | ||
| 5 |
