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Amended and
Restated
SHARE PURCHASE
AGREEMENT
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This SHARE PURCHASE AGREEMENT, effective as of
June 15, 2009, is by and among Cogenco International, Inc., a
Colorado corporation (“Cogenco” or the
“Company”) and Bernd J. Hamacher-Schwieren
(“ Purchaser ’),
and fully amends and replaces that certain share purchase agreement
entered into by the parties dated April 28, 2009 (extended by
amended dated May 31, 2009). By entering into this Agreement, the
Purchaser agrees to purchase and Cogenco agrees to sell 540,000
shares of Cogenco common stock (the “ Purchased Shares
”) as described below and subject to adjustment as provided
herein.
A. Cogenco is
currently a development stage company, has only limited cash
resources, and is currently not actively involved in business
operations.
B. Purchaser is an
investor with experience investing in, and/or working with,
development stage companies such as the Company, has been provided
all information about the Company he or it, and his or its,
advisors have sought (including being afforded the opportunity to
ask and receive answers from the Company and its management about
the Company’s current and/or contemplated business
activities), and is able to bear the risk of losing all of his or
its investments in the Purchased Shares.
C. Cogenco and
Purchaser desire to enter into this agreement pursuant to which
Purchaser will purchase from Cogenco, and Cogenco will sell to
Purchaser, the restricted common stock described herein.
D. Purchaser
understands that, should Cogenco common stock be registered under
the Securities Exchange Act of 1934, the Purchaser, as the holder
of greater than 5% of the outstanding shares, will be obligated to
file certain reports with the Securities and Exchange Commission
(including reports on Schedule 13D or 13G, as applicable, and
reports pursuant to Section 16(a) of the Securities Exchange Act of
1934.
NOW, THEREFORE, in consideration of the mutual
covenants and agreements set forth herein and for good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
PURCHASE AND SALE OF COMMON
SHARES
1.1 Purchase
and Sale of Common Shares . Subject to the terms and conditions
herein set forth, Cogenco agrees to issue and sell to Purchaser,
and Purchaser agrees to subscribe for and take up, at the Closing,
the Purchased Shares.
1.2 Purchase
Price. Purchaser shall pay the purchase price of $5.00 (U.S.) per
share of Common Stock for a total purchase price of
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$2,700,000. The Purchaser shall pay the purchase
price to Cogenco in accordance with wiring instructions provided to
Purchaser. The total purchase price shall be paid as follows: (i) a
minimum of $250,000 shall be paid on or before June 30, 2009; and
(ii) the unpaid balance of the total purchase price shall be paid
on or before July 31, 2009.
1.3 Use of
Proceeds . Cogenco intends to
use approximately $70,000 received from the Purchaser as working
capital for itself, pay $135,000 to Genesis Capital Management
Limited (“GCM”) as a finder’s fee pursuant to an
agreement between Cogenco and GCM, and lend the balance of the
proceeds from the sale of the Purchased Shares (expected to be
approximately $2,495,000 to GCM, which to the Knowledge of Cogenco,
will use the funds: (i) to repay approximately $185,900 of
indebtedness owed by GCM to Cogenco, and the balance for general
working capital purposes for itself and certain of its subsidiary
or related entities including (without limitation, the entities
described in the attached promissory note). The parties acknowledge
that under United States law, Cogenco will have to maintain
appropriate controls over the expenditure of the funds by itself
and GCM to ensure compliance with the Foreign Corrupt Practices
Act, the USA Patriot Act, and other United States laws.
1.4 Related
Party Transaction . The Purchaser understands that the
Company’s largest shareholder, Genesis Investment Funds
Limited, is controlled by GCM, and this loan can be considered to
be a related party transaction. Cogenco cannot offer any assurance
that any funds lent to GCM will be sufficient to permit it, or any
subsidiary or related entity of GCM, will be sufficient for GCM to
carry on its planned business operations. Further, Cogenco cannot
offer any assurance that GCA will be able to fully and timely repay
any funds Cogenco may lend to GCA. Cogenco plans to loan the funds
to GCM pursuant to the promissory note that is attached as an
exhibit to this subscription agreement but, in general, Cogenco
will have little ability to control GCM’s activities or
operations. GCM has provided Cogenco and the Purchaser with copies
of GCM’s most recent financial statements which reflect its
financial condition and results of operations through its most
current fiscal period. Furthermore, the Purchaser acknowledges that
the terms of the loan were not negotiated at arms’-length. By
purchasing Cogenco common stock, the Purchaser represents that he
has discussed the investment and the use of funds with GCM as well
as Cogenco, and further acknowledges and approves of the use of
proceeds of the Purchaser’s investment.
1.5
Closing.
(a)
Subject to the satisfaction or waiver of the conditions set forth
in Articles IV and V, the subscription for and issuance of the
Purchased Shares shall take place at Cogenco’s principal
offices (or as Cogenco may otherwise designate), or at such other
times and places as the parties shall agree. The parties agree that
there may be one or more closings under this agreement (each a
“Closing”).
(b)
Delivery . Cogenco will
prepare a stock certificate in the name of Purchaser for the total
number of shares purchased and shall deliver the certificate to
Purchaser on the Closing against payment of the Purchase Price, by
certified check or wire transfer payable to the Company or its
designated agent.
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ARTICLE II
REPRESENTATIONS AND WARRANTIES OF
COGENCO
Cogenco represents and warrants to Purchaser as
follows:
2.1 Corporate
Existence and Power . Cogenco (a) is a corporation duly
organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation; (b) has all requisite power
and authority to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which
it is currently, or is proposed to be, engaged; (c) is not
qualified as a foreign corporation in any other state, and (d) has
the corporate power and authority to execute, deliver and perform
its obligations under this Agreement. Cogenco has no
Subsidiaries.
2.2
Authorization; No Contravention . The execution, delivery
and performance by Cogenco of this Agreement and the transactions
contemplated hereby and thereby (a) have been duly authorized by
all necessary corporate action; (b) do not contravene the terms of
the Articles of Incorporation or the By-laws; (c) do not violate,
conflict with or result in any breach, default or contravention of
(or with due notice or lapse of time or both result in any breach,
default or contravention of), or the creation of any Lien under,
any Contractual Obligation of Cogenco or any Requirement of Law
applicable to Cogenco; (d) do not give rise to any right of another
party thereto to accelerate, terminate or otherwise modify any
Contractual Obligation and (e) do not violate any judgment,
injunction, writ, award, decree or order of any nature
(collectively, “Orders”) of any Governmental Authority
against, or binding upon, Cogenco.
2.3
Governmental Authorization; Third Party Consents . Except
for compliance with securities laws in connection with the offer
and sale of the Purchased Shares, no approval, consent, compliance,
exemption, authorization, confirmation, transfer or other action
by, or notice to, or filing with, any Governmental Authority or any
other Person, and no lapse of a waiting period under a Requirement
of Law, is necessary or required in connection with the execution,
delivery or performance (including, without limitation, the sale,
issuance and delivery of the Purchased Shares) by, or enforcement
against, Cogenco of this Agreement and the other Transaction
Documents or the transactions contemplated hereby and
thereby.
2.4 Binding
Effect . This Agreement and
each of the other Transaction Documents has been duly executed and
delivered by Cogenco, and constitutes the legal, valid and binding
obligations of each such entity, enforceable against it in
accordance with their terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance or transfer, moratorium or similar laws
affecting the enforcement of creditors’ rights generally and
by general principles of equity relating to enforceability
(regardless of whether considered in a proceeding at law or in
equity).
2.5
Litigation . There are no
actions, suits, proceedings, claims, complaints, disputes,
arbitrations or investigations (collectively, “
Claims ”) pending or, to the Knowledge of
Cogenco, threatened, at law, in equity, in arbitration or before
any Governmental Authority against or involving Cogenco nor to the
Knowledge of Cogenco is there any basis for any of the foregoing.
The foregoing includes, without limitation, Claims pending or, to
the Knowledge of Cogenco, threatened or any basis therefor known by
Cogenco involving the prior employment of any employee of Cogenco,
their use in connection with the
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business of
such entity of any information or techniques allegedly proprietary
to any of their former employers or their obligations under any
agreements with prior employers. No Order has been issued by any
court or other Governmental Authority against Cogenco or any of
Cogenco’s assets, including any Order purporting to enjoin or
restrain the execution, delivery or performance of this Agreement
or any of the other Transaction Documents.
2.6 Compliance
with Laws .
(a)
Except as provided herein or in the Disclosure Documents,
Cogenco is in compliance with all Requirements of Law and all
Orders issued by any court or Governmental Authority against or
affecting such entity or its assets. To Cogenco’s Knowledge,
there is no existing or proposed Requirement of Law which could
reasonably be expected to prohibit or restrict Cogenco from, or
otherwise materially adversely effect Cogenco in, conducting its
Business in any jurisdiction in which it now conducts or proposes
to conduct its Business.
(b)
Cogenco has all material licenses, permits, registrations and
approvals of any Governmental Authority (collectively, “
Permits ”) that are necessary or required for the
conduct of the Business; Cogenco holds or will acquire such Permits
and have made or will make all filings necessary for the conduct of
their Business; such Permits as have been obtained are in full
force and effect; and no material violations or notices of any
violations or deficiencies are or have been received or recorded in
respect of any Permit.
(c) No
material expenditure is presently required by Cogenco to comply
with any existing Requirement of Law or Order.
2.7
Capitalization .
(a)
The Company currently has 600 million shares of stock authorized,
of which 500 million are shares of Common Stock and 100 million are
shares of preferred stock. As of June 15, 2009 there are 1,233,000
shares of common stock outstanding and no shares of preferred stock
outstanding.
(b)
There are no options, warrants, conversion privileges, subscription
or purchase rights (including any preemptive rights) or other
rights outstanding to purchase or otherwise acquire (i) any
authorized but unissued, unauthorized or treasury shares of
Cogenco, (ii) any Share Equivalents or (iii) other securities of
Cogenco, and there are no commitments, contracts, agreements,
arrangements or understandings by Cogenco to issue any shares of
Cogenco or any Share Equivalents or other securities of
Cogenco.
(c)
The Purchased Shares will, as of the Closing, have been duly
authorized, and when issued and sold to Purchaser after payment
therefor, will be validly issued, fully paid and non-assessable and
not subject to any preemptive or similar rights, will be issued in
compliance with the registration and qualification requirements of
all applicable securities laws and will be free and clear of all
other Liens. All of the issued and outstanding shares of Common
Shares are duly authorized, validly issued, fully paid and
non-assessable.
2.8 No Default
or Breach; Contractual Obligations . Since April 1, 2008,
Cogenco has not received notice of a default and is not in default
under, or with respect to, any Contractual Obligation nor does any
condition exist that with notice or lapse of time or both would
constitute a default or cause the acceleration of any of the
obligations of any such entity thereunder.
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2.9
Real Estate . Cogenco does not
own any real property. Cogenco leases certain office space at its
principal place of business from an unaffiliated party.
2.10 Charter
Documents and Corporate Records . Cogenco has offered to
provide to Purchaser true and complete copies of the Articles of
Incorporation and Bylaws of Cogenco as in effect on the date hereof
(which documents are also filed with the Securities and Exchange
Commission). The minute books, or comparable records, of Cogenco
are also available to Purchaser at its request and contain true and
complete records of all meetings and resolutions of the Board of
Directors (and any committee thereof) and shareholders of such
entities since the time of organization of such entities and
accurately reflect all transactions referred to in such minutes and
consents in lieu of meeting.
2.11 Financial
Statements . Cogenco’s Disclosure Documents contain
financial statements as described therein.
2.12 Taxes
.
(a)
Cogenco has paid all Taxes which have come due and are required to
be paid by it through the date hereof, other than Taxes being
disputed in good faith for which adequate reserves have been
specifically made on the most recent balance sheet delivered to
Genesis;
(b)
Cogenco has timely filed or caused to be filed Tax Returns that it
is required to have filed, and all such Tax Returns and other
filings are accurate and complete in all material
respects;
(c)
with respect to all Tax Returns of Cogenco, (i) there is no
assessment or reassessment proposed or, to the Knowledge of
Cogenco, threatened against Cogenco other than assessment in the
normal course of filing of Cogenco and (ii) no audit is in progress
with respect to any Tax Returns and Cogenco has never been subject
to any such audit, no extension of time is in force with respect to
any date on which any Tax Return was or is to be filed and no
waiver or agreement is in force for the extension of time for the
assessment or payment of any Tax;
(d) there are no Liens for Taxes on
the assets of Cogenco;
(e) Cogenco has no liability for
Taxes of any Person other than itself;
(f)
Cogenco has not been and no such entity is in violation (or with
notice would be in violation) of any applicable Requirement of Law
relating to the payment or withholding of Taxes;
(g)
Cogenco has duly and timely withheld from employee, officer or
director salaries, wages, and other compensation and paid over to
the appropriate taxing authorities all material amounts required to
be so withheld and paid over for all periods under all applicable
laws;
(h) there is
no contract, agreement, plan or arrangement covering any Person
that, individually or collectively, could give rise to the payment
of any amount that would not be deductible by Cogenco;
and
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(i) Cogenco will
not have any liability on or after the date hereof under any Tax
sharing agreement or similar contract to which they have been a
party, and all such Tax sharing agreements in effect before the
date hereof shall terminate and be of no further force and effect
as of the date hereof.
2.13 No
Material Adverse Change; Ordinary Course of Business . Other
than as contemplated herein or in the Disclosure
Documents,
(a)
There has not been a Material Adverse Effect other than
Cogenco’s continuing expenditure of funds to meet its
contractual obligations and in efforts to develop a prototype
product for demonstration;
(b)
Cogenco has not participated in any transaction material to the
Condition of Cogenco or otherwise acted outside the ordinary course
of business, including, without limitation, declaring or paying any
dividend or declaring or making any distribution to its
Shareholders;
(c)
Cogenco has not engaged in any related party transaction except as
set forth in the Disclosure Document;
(d)
Cogenco has not increased the compensation of any of its officers
or the rate of pay of any of its employees;
(e) Cogenco has not created or
assumed any Lien on a material asset;
(f) Cogenco
has not entered into any Contractual Obligation, other than in the
ordinary course of business or as contemplated by this Agreement;
and
(f)
There has not occurred a material change in the accounting
principles or practice of Cogenco.
2.14 Private
Offering . No form of general
solicitation or general advertising was used by Cogenco or
representatives of Cogenco in connection with the offer or sale of
the Purchased Shares or any shares offered to or purchased by the
Other Purchasers. No registration of the Purchased Shares or filing
of a prospectus in connection therewith, pursuant to the provisions
of the Securities Act, applicable rules of the Commission, any
other foreign securities laws or any state securities or
“blue sky” laws, will be required by the offer, sale or
issuance of the Purchased Shares or any shares offered to or
purchased by the Other Purchasers. Cogenco agrees that neither it,
nor anyone acting on its behalf, shall offer to sell the Purchased
Shares or any other securities of Cogenco so as to require the
registration of the Purchased Shares or filing of a prospectus in
connection therewith, pursuant to the provisions of the Securities
Act, applicable rules and instruments of the Commission, or any
state securities or “blue sky” laws.
2.15 Employee
Benefit Plans . Cogenco has not adopted any retirement,
pension, supplemental pension, savings, retirement savings,
retiring allowance, bonus, profit sharing, stock purchase, phantom
stock, share appreciation rights, deferred compensation, severance
or termination pay, change of control, life insurance, medical,
hospital, dental care, vision care, drug, sick leave, short term or
long term disability, salary continuation, unemployment benefits,
vacation, incentive, compensation or other employee benefit plan,
program, arrangement, policy or practice whether written or oral,
formal or informal,
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funded or
unfunded, registered or unregistered, insured or self-insured that
is maintained or otherwise contributed to, or required to be
contributed to, by or on behalf of Cogenco for the benefit of
current or former employees, directors, officers, shareholders,
independent contractors or agents of Cogenco. Cogenco may, in the
future adopt health insurance and other insurance and employee
benefit plans.
2.16
Insurance . Cogenco has no
insurance policies held by or on behalf of Cogenco.
2.17
Environmental Matters . To the Knowledge of Cogenco, Cogenco
is in full compliance with all applicable Environmental Laws and,
without limiting the foregoing, has not caused or permitted the
release of a contaminant into the environment except in full
compliance with Environmental Laws and all permits or
authorizations required pursuant to Environmental Laws have been
obtained, are valid and in full force. There is no civil, criminal
or administrative judgment, action, suit, demand, claim, hearing,
notice or violation, investigation, proceeding or demand letter
pending or, to the Knowledge of Cogenco, threatened against Cogenco
pursuant to Environmental Laws; and, to the Knowledge of Cogenco,
there are no past or present events, conditions, circumstances,
activities, practices, incidents, agreements, actions, omissions or
plans which could reasonably be expected to prevent full compliance
with, or which have given rise to or will give rise to liability
under, Environmental Laws.
2.18
Broker’s, Finder’s or Similar Fees . There are
no brokerage commissions, finder’s fees or similar fees or
commissions payable by Cogenco in connection with the transactions
contemplated hereby based on any agreement, arrangement or
understanding with Cogenco, except that Cogenco is obligated to pay
GCM a fee equal to 5% of the total purchase price for the Purchased
Shares.
2.19
Disclosure . The Disclosure
Documents are accurate and complete in all material respects as of
the dates such documents were filed with the Securities and
Exchange Commission.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
PURCHASER
Purchaser hereby represents and warrants to
Cogenco, as follows:
3.1 Existence
and Power . Purchaser, (a) if
Purchaser is a non-natural person, is duly organized and validly
existing under the laws of the jurisdiction of its formation and
(b) has the requisite power and authority to execute, deliver and
perform its obligations under this Agreement and to complete the
transactions herein contemplated.
3.2
Authorization; No Contravention . The execution, delivery
and performance by Purchaser of this Agreement and each of the
other Transaction Documents to which it is a party and the
transactions contemplated hereby and thereby, (a) have been duly
authorized by all necessary action, (b) if Purchaser is a
non-natural person, do not contravene the terms of Purchaser’
organizational documents, or any amendment thereof, and (c) do not
violate, conflict with or result in any breach or contravention of,
or the
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