Exhibit 10.1
SHARE PURCHASE
AGREEMENT
THIS SHARE PURCHASE AGREEMENT
(hereinafter referred to as the
“Agreement” ), is entered into as of the 26th
day of August, 2009, by and between One Holdings, Corp., a Florida
corporation (sometimes hereinafter referred to as “ One
Holdings ” and sometimes as the “ Buyer
”), Trade Finance Solutions Inc., an Ontario corporation (the
“ Company ”) and the shareholders listed on the
execution page of this Agreement (hereinafter sometimes
collectively referred to as the “ Shareholders
” and sometimes individually as the “
Shareholder ”).
W I T N E S S E T
H
WHEREAS, One Holdings desires to purchase from
the Shareholders and the Shareholder desire to sell to One
Holdings, Three Thousand Nine Hundred and Ninety (3990) common
shares (the “ Shares ”) of common stock
the Shareholders own in the Company, which represents all of the
issued and outstanding shares of the Company’s common stock
save for Ten (10) common shares, upon the terms and subject to the
conditions of this Agreement;
NOW
THEREFORE , in
consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as
follows:
ARTICLE I
PURCHASE OF TFS
STOCK
1.1
The Shareholders hereby agree to collectively sell to One Holdings
and One Holdings hereby agrees to purchase from the Shareholders
the Shares for a total purchase price consisting of cash and stock
of One Holdings (the “ Purchase Price ”) which
shall be determined and payable as follows:
(i) in each of months 7 to 18, both inclusive,
following the Closing of the transactions contemplated by this
Agreement (the “ Measuring Period ”) the
Monthly EBIT of the Company, (earnings before interest and taxes)
according to US GAAP, shall be measured;
(ii) when the
aggregate Monthly EBIT of the Company achieved at any time during
the Measuring Period is equal to or greater than $2,000,000.00 the
Payout Term shall commence on the 1 st day of
the month immediately next following;
(ii) failing
the aggregate Monthly EBIT of the Company achieved at any time
during the Measuring Period being equal to or greater than
$2,000,000.00 the Payout Term shall commence on the 1
st day of the month immediately next following
expiration of the Measuring Period;
(iii) if the aggregate Monthly EBIT of the
Company achieved at any time during the Measuring Period is equal
to or greater than $2,000,000.00 the total Purchase Price shall be
$6,000,000.00;
(iv) failing the aggregate Monthly EBIT of the
Company achieved at any time during the Measuring Period being
equal to or greater than $2,000,000.00 the total Purchase Price
shall be calculated as three (3) times the aggregate Monthly EBIT
of the Company achieved during the Measuring Period; and
(iv) for the purposes of calculation of the
Monthly EBIT of the Company pursuant to this Article 1.1, the
calculation of the quarter-yearly installment payment pursuant to
Article 1.1.2 (A) below and the calculation of EBIT pursuant to
Article 1.1.3 below, any distributions by or payments from the
Company or its subsidiary corporations to the Buyer, it’s
associated or affiliated companies, directly or indirectly, for
services, fees or otherwise, shall be excluded.
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Payments of the
Purchase Price shall initially be made in quarter-yearly
installments from cash flow, the first of such quarter-yearly
installments being due and payable on the 15th day of the 1st month
of the Payout Term and continuing thereafter on the 15th day
following expiration of each quarter year of the Payout
Term.
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Each
quarter-yearly installment payment shall be equal to the amount
determined by multiplying (A) Company’s EBITDA (earnings
before interest, taxes, depreciation and amortization) according to
US GAAP less interest, accrued taxes, and capital
expenditures for the applicable quarter by (B) 70% (the “
Quarterly Installment Payment
”). The Quarterly Installment Payments shall
continue until the Purchase Price is paid in full; Provided further
that upon that date which is 60 months following the Closing the
Shareholders shall be paid 50% of any portion of the Purchase Price
then unpaid and shall receive a promissory note (the “
Note ”) from the Company for the remaining 50%
of any balance of the Purchase price then unpaid. The Note shall be
for a term of 1 year, and be payable in 4 equal quarter-yearly
installments, without interest. Effective as of the
Closing and continuing until the Purchase Price is paid in full,
the Shareholders shall have security interests in the
Company’s assets and in the assets of the Company’s
subsidiary corporations, such security interests to be evidenced by
General Security/U.C.C. Agreements in form and content satisfactory
to Shareholder’s legal counsel and registered under the
Ontario Personal Property Security Act and applicable U.S.
registration, as security for payment of the unpaid balance of the
Purchase Price, which security interests shall be subordinate and
postponed only to the following:
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to the
presently held security interests of all existing lenders to the
Company as at the date hereof; and,
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to any new
financing placed on or after Closing where the proceeds of which
are fully applied to the ordinary course business of the
Company or its subsidiary corporations, as
applicable.
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In addition to
the cash portion of the Purchase Price, the Shareholders shall
receive 1 share of the Buyer’s common stock (the “
One Holdings Stock ”) (adjusted for forward or
reverse splits following the Closing) for every $1.00 in EBIT
achieved during the Measuring Period (“ Stock
Compensation ”) subject to a maximum Stock
Compensation of 6 million shares of the Buyer’s common
stock. The Stock Compensation shall be payable within 30
days following the end of the Measuring Period. The
Shareholder’s ability to sell the Stock Compensation shall be
subject to lockup and leak-out as outlined in Section 1.2
below.
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1.2 Subject to the
Shareholder’s compliance with applicable securities laws,
after the applicable holding period, the Shareholder shall be
entitled to sell the shares of One Holdings Stock in the public
market as set forth in this Section 1.2. Except as
otherwise expressly provided herein and subject to the resale
requirements of Rule 144 promulgated under the Securities Act of
1933, as amended (the “1933 Act”), or any other rule or
agreement that otherwise restricts the Shareholder from selling the
One Holdings Stock, the Shareholder agrees that he/she may only
sell the One Holdings Stock subject to the following conditions
commencing from the date he/she receives the One Holdings Stock and
until the expiration of 36 months after the Stock Compensation is
paid as set forth in Section 1.1.3 hereof(the “ Lock
Up/Leak Out Period ”) as follows:
(i) if
on any day the Shareholder desires to sell any of the One Holdings
Stock, the Shareholder will not sell more than 10% of the average
daily volume of trading in the One Holdings Stock for the ten (10)
consecutive business days immediately preceding any such trading
day. For the purposes of this subsection “average daily
volume of trading” means the average of the number of shares
traded on trading days in which an actual trade or trades
occurs;
(ii) The
Shareholder will only sell the One Holdings Stock at the "offer" or
"ask" price stated by the relevant market maker and the Shareholder
agrees that he will not sell One Holdings Stock at the "bid"
price.
(iii) The
Shareholder agrees that he will not engage in any short selling of
the One Holdings Stock during the Lock-Up/Leak out
Period.
(iv) The
Shareholder agrees that he will comply with all obligations and
requirements under applicable “insider” trading
rules;
(v) Except
as set forth in this Section 1.2, the Shareholder agrees that he
will not transfer, pledge, or hypothecate the One Holdings Stock
without the prior written consent of One Holdings;
Notwithstanding
anything contained in this Agreement, the Shareholder may transfer
any or all of his One Holdings Stock as bona fide gifts or
transfers to any trust for the direct or indirect benefit of each
person of the Shareholder’s immediate family; provided that
it shall be a condition to any such gift or transfer that (i) the
transferee/donee agrees, in writing, to be bound by the terms of
this Agreement to the same extent as if the transferee/donee were a
party hereto; and (ii) the Shareholder provides written notice to
One Holdings prior to such gift or
transfer. “Immediate family” shall mean the
Shareholder’s children, stepchildren, grandchildren, parents,
stepparents, grandparents, spouse, former spouses, siblings,
nieces, nephews, mother-in-law, father-in-law, sons-in-law,
daughters-in-law, brother-in-law, or sister-in-law, including
adoptive relationships.
1.3
Legends . The Shareholder understands that until
such time as the resale of such shares have been registered under
the 1933 Act the certificates representing the shares of One
Holdings Stock shall bear any legend as required by the 1933 Act
and the "blue sky" laws of any state and a restrictive legend in
substantially the following form (and a stop-transfer order may be
placed against transfer of such stock certificates):
THE SECURITIES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED (i) IN THE ABSENCE OF (a) AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR (b) AN OPINION OF COUNSEL, IN A FORM
REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT OR (ii) UNLESS SOLD PURSUANT TO RULE 144
UNDER SAID ACT.
1.4
No Dilution . One Holdings shall neither effect,
nor fix any record date with respect to, any stock split, stock
dividend, reverse stock split, recapitalization, or similar change
in One Holdings' Stock between the date of this Agreement and the
Closing Date.
1.5
Closing . The consummation of the Transaction (the
"Closing" ) shall take place at the offices of Arnstein
& Lehr, LLP, on a date to be mutually agreed upon by the
Parties, which shall be no later than September 2, 2009 (the
“ Closing Date ”). Not later than 5
days prior to the Closing Date the parties shall take the following
actions:
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the
Shareholders shall deliver to Arnstein & Lehr, LLP as escrow
agent (“ Escrow Agent ”) under this Agreement
the certificate(s) evidencing the Shares together with a stock
power executed by Shareholder in favor of One Holdings, with
Medallion guarantee, dated as of the Closing Date.
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the Company
shall deliver to the Escrow Agent the following:
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a certified
copy of the Articles of Incorporation and bylaws of the
Company;
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a Certificate
of Status from the Ontario Ministry of Consumer and Business
Services dated as of a date within ten days prior to the Closing
Date certifying that the Company is in good standing as a
corporation in the Province of Ontario;
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a copy of the
consent resolution of the Company’s board of directors
approving the Transactions.
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(iii)
One Holdings shall deliver to the Escrow Agent the
following:
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a certified
copy of the Articles of Incorporation and bylaws of the One
Holdings;
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a good standing
certificate from the Secretary of State of Florida dated as of a
date within ten days prior to the Closing Date certifying that the
One Holdings is in good standing as a corporation in the State of
Florida;
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a copy of the
consent resolution of the One Holdings’ board of directors
approving the Transactions.
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Within sixty
(60) days from the date of this Agreement, the Company shall
deliver to One Holdings true and correct copies of the Company
Financial Statements as defined and set forth in Section 2.10
hereof. One Holdings shall have five (5) days from its
receipt of the Company Financial Statements to approve the Company
Financial Statements. If One Holdings approves the
Company Financial Statements, One Holdings shall notify the Escrow
Agent in writing of such approval and the Escrow Agent shall
release (i) to the respective party, signed copies of this
Agreement, the good standing certificate and the Board consent
resolutions to the other party hereto, and (ii) to One Holdings,
the certificate(s) evidencing the Shares and the Stock Power
executed by Shareholder (with Medallion guarantee) in favor of One
Holdings and the Closing shall be effective as of the Closing
Date. If the Company fails to deliver the Company
Financial Statements to One Holdings within said sixty (60) day
period, notwithstanding any other rights One Holdings may have
under this Agreement, One Holdings may waive such failure and close
the Transactions effective as of the Closing Date and the Escrow
Agent shall deliver to the respective party the documents, the
stock certificate(s) evidencing the Shares and the stock powers as
set forth in the previous sentence. If (x) One Holdings
does not accept the Company Financial Statements, or (y) if the
Company fails to deliver the Company Financial Statements to One
Holdings within the 60 day period and One Holdings does not waive
such failure by the Company or (z) if One Holdings does not notify
the Escrow Agent within said five (5) day period that it accepts
the Company Financial Statements, this Agreement shall
terminate.
1.6
Closing Events . At the Closing, each of the
Parties hereto shall execute, acknowledge, and deliver (or shall
cause to be executed, acknowledged, and delivered) any and all
stock certificates, officers’ certificates, agreements,
resolutions, schedules, or other instruments required by this
Agreement to be so delivered at or prior to the Closing, together
with such other items as may be reasonably requested by the other
Parties hereto and their respective legal counsel in order to
effectuate or evidence the transactions contemplated by this
Agreement. If agreed to by the Parties, the Closing may
take place through the exchange of documents (other than the
exchange of stock certificates) by efax, fax, email and/or express
courier.
ARTICLE II
REPRESENTATIONS, COVENANTS, AND
WARRANTIES OF THE SHAREHOLDER AND ONE HOLDINGS
Each Shareholder, to the best of his knowledge,
individually and jointly and severally with the other Shareholders,
represents and warrants to, and covenants and agrees with, the
Company as follows:
2.1
The Shareholder is acquiring the One Holdings Stock for its own
account for investment only and not with a view towards the public
sale or distribution thereof and not with a view to or for sale in
connection with any distribution thereof.
2.2
The Shareholder is (i) an “accredited investor” as that
term is defined in Rule 501 of the General Rules and Regulations
under the Securities Act of 1933 Act, as amended (“
1933 Act ”) , (ii) experienced in making
investments of the kind described in this Agreement and the related
documents, (iii) able, by reason of the business and financial, to
protect its own interests in connection with the transactions
described in this Agreement, and the related documents, and (iv)
able to afford the entire loss of its investment in the One
Holdings Shares.
2.3
The Shareholder understands that its investment in the One
Holdings Stock involves a high degree of risk.
2.4
The Shareholder understands that the One Holdings Stock is deemed
to be “restricted stock” as defined under the 1933
Act.
2.5
The Shareholder has good and marketable title to all of the Shares,
free and clear of any liens, claims, charges, options, rights of
tenants or other encumbrances and shall not, until the transactions
contemplated by this Agreement is closed, or this Agreement is
terminated, sell, hypothecate, encumber, transfer or otherwise
dispose of the Shares. At the Closing, the Shareholder
will convey to One Holdings all right, title, and interest in and
to the Shares free and clear of all liens, claims, pledges,
encumbrances, options, charges, restrictions, and adverse rights or
interests whatsoever. The Shareholder has the exclusive
right to vote the Shares.
2.6
The entering into of this Agreement by the Shareholder, and the
performance by the Shareholder of his obligations hereunder, will
not conflict with or constitute a breach of or default under any
agreement to which the Shareholder is a party or any order or
decree of any court or regulatory body to which the Shareholder is
subject.
The Company represents and warrants to, and
covenants and agrees with, One Holdings as follows:
2.7
Organization . The Company is a corporation duly
organized, validly existing, and in good standing under the laws of
the Province of Ontario. A certified copy of the
Articles of Incorporation and bylaws of the Company are attached
hereto as Schedule 2.7. The Company has the power and is
duly authorized, qualified, franchised, and licensed under all
applicable laws, regulations, ordinances, and orders of public
authorities to own all of its properties and assets and to carry on
its business in all material respects as it is now being conducted,
including qualification to do business as a foreign corporation in
jurisdictions in which the character and location of the assets
owned by it or the nature of the business transacted by it requires
qualification. The execution and delivery of this
Agreement does not, and the consummation of the Transactions in
accordance with the terms hereof will not, violate any provision of
the Company’s organizational documents. The
Company has taken all action required by laws, its articles of
incorporation, certificate of business registration, or otherwise
to authorize the execution and delivery of this Agreement. The
Company has full power, authority, and legal right and has taken or
will take all action required by law, its Certificate of
Incorporation, and otherwise to consummate the
Transactions.
2.8
Capitalization . The Company has a total of 4,000
issued and outstanding shares of common stock, each of which is
legally issued, fully paid, and non-assessable. All such
shares of the Company’s Common Stock are held of record by
the Shareholders, save for 10 common shares registered in the name
of Jim Reddon. The Company has no other capital stock,
warrants, options, or other securities convertible into shares of
the Company capital stock.
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