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Exhibit 10.1
PURCHASE AGREEMENT
BETWEEN
SHAREHOLDERS OF LASALLE BRANDS CORPORPORATION
A NEVADA PUBLIC CORPORATION
AND
SHAREHOLDERS OF LASALLE BRANDS, INC.
A NEW YORK CORPORATION
AGREEMENT, made this 10th day of August 2007, by and between
LaSalle Brands,
Inc. ("LBI") and LaSalle Brands Corporation ("LBC").
RECITALS
WHEREAS, MedHat Mohamed is the owner of one hundred percent
(100%) of the
shares of LbI the licensee of LaSalle Brands Ice Cream and
related products, and
subsidiaries 489 Third Avenue Corp. and LaSalle Fine Imports,
Inc. (the
"SUBSIDIARIES") which includes all assets including but not
limited to
ownership, management, and control of LaSalle Brands Inc. brand
ice cream and
related products, and distribution system, as located at 547
Manida Street,
Bronx, New York 10474 and 489 Third Avenue New York, New York
10016, identified
in the list attached hereto as Exhibit A, including all
property, all furniture,
equipment, intellectual property rights, logos, commercial
symbols, slogans,
domain names, websites, recipes, handbooks, training manuals,
fixtures, signs,
accounts, and income allocable, as well as any liabilities
allocable as set
forth in LBI's financial statements attached hereto as Exhibit
B,
WHEREAS, LBI agrees to transfer its ownership including its
SUBSIDIARIES to
LBC, pursuant to the terms of this Agreement, for the
consideration recited
below;
NOW, THEREFORE, in consideration of the mutual promises,
covenants, and
representations contained herein,
THE PARTIES HERETO AGREE AS FOLLOWS:
CONSIDERATION
CONSIDERATION. LBI will transfer 100% of its interest including
all assets,
liabilities, management, and control allocable thereto, for the
following
consideration:
(a) LBC will deliver upon SIGNING of this agreement Eleven
Million Seven
Hundred Fifty Thousand shares (11,750,000) of restricted common
stock
of LBC. Said shares to be delivered in the amounts and to the
persons
listed on Exhibit C.
(b) LBC will deliver promptly after the SIGNING of this
agreement Two
Million Five Hundred Thousand dollars ($2,500,000) of $10.00 per
share
Convertible Preferred Shares (each share is convertible into two
(2)
common shares). Said shares shall be delivered in the amounts
and to
the persons listed on Exhibit D.
(c) LBC will deliver upon CLOSING $3,500,000.00 in cash and the
issuance
of $10.00 Convertible Preferred Stock for the balance up to
$4,000,000
based on the terms in Article 2.1.
<PAGE>
ARTICLE I
REPRESENTATIONS AND WARRANTIES OF LAS SALLE BRANDS, INC.
("LBI").
LBI hereby represents and warrants to LBC that:
1.1 LBI will transfer to LBC one hundred percent (100%) of the
shares in
LBI, the licensee of LaSalle Brands ice cream and related
products, and its
SUBSIDIARIES which includes all assets including but not limited
to ownership,
management, and control of LaSalle Brands Inc. brand ice cream
and related
products, and distribution system, as located at 547 Manida
Street Bronx, NY
10474 and 489 Third Avenue NY, NY 10016, identified in the list
attached hereto
as Exhibit A, including all property, all furniture, fixtures,
equipment,
intellectual property rights, logos, commercial symbols,
slogans, domain names,
websites, recipes, handbooks, training manuals, signs, accounts,
and income
allocable, as well as any liabilities allocable as set forth in
LBI's financial
statements attached hereto as Exhibit B. The licenses and
trademarks of LaSalle
brand ice cream and related products shall be delivered upon
SIGNING. These
items are attached as Exhibit E. The remainder is due upon
CLOSING.
1.2 Organization. LBI is a corporation duly organized, validly
existing and
in good standing under the laws of the State of New York, has
all necessary
corporate powers to own its property, including its
SUBSIDIARIES, and to carry
on its business as now owned and operated by it, and is duly
qualified to do
business and is in good standing in each of the states where its
business
requires qualification.
1.3 Capital. Management of LBI owns 100% control of LBI and its
SUBSIDIARIES
and therefore has the right to vote for the completion of this
transaction. LBI
represents that there are no other issued and outstanding open
subscriptions,
options, rights, warrants, debentures, instruments, convertible
securities, or
other agreements or commitments obligating LBI to issue or to
transfer from
treasury any additional shares of its capital stock.
1.4 Financial Statements. The most recent financial statements
of the LBI
and its SUBSIDIARIES are to be attached prior to Closing, as
Exhibit B. The
financial statements have been prepared in accordance with
generally accepted
accounting principles and practices consistently followed by
LBI. and its
SUBSIDIARIES throughout the period indicated, and fairly
represent the financial
position of LBI and its SUBSIDIARIES as of the date of the
Balance Sheet
included in the financial statements.
1.5 Investigation of Financial Condition. Without in any manner
reducing or
otherwise mitigating the representations contained herein, LBC
and/or its
attorneys shall have the opportunity to meet with the
accountants and attorneys
to discuss the financial condition of LBI and its SUBSIDIARIES.
LBI shall make
available to LBC and/or its attorney all books and records of
LBI., and its
SUBSIDIARIES, once reasonable notice of such request has been
given.
1.6 Authority. The Board of Directors of LBI has authorized the
execution
of this Agreement and the consummation of transactions
contemplated herein, and
LBI has full power and authority to execute, deliver, and
perform this Agreement
and this Agreement is a legal, valid and binding obligation of
LBI and is
enforceable in accordance with its terms and conditions.
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1.7 Ability to Carry Out Obligations. The execution and delivery
of this
Agreement by LBI of its obligations hereunder in the time and in
the manner
contemplated will not cause, constitute or conflict with or
result in (a) any
breach or violation of any of the provisions or constitute a
default under any
license, indenture, mortgage, charter, instrument, articles of
incorporation,
bylaws, or other agreement or instrument to which either is a
party, or by which
it may be bound, nor will any consents or authorizations of any
party other than
those hereto be required, (b) an event that would permit any
party to any
agreement or instrument to terminate it or to accelerate the
maturity of any
indebtedness or other obligation of LBI., or (c) any event that
would result in
the creation or imposition of any lien, charge, or encumbrance
on any asset of
LBI.
1.8 Full Disclosure. None of the representations and warranties
made by LBI
herein, or in any exhibit, certificate or memorandum furnished
or to be
furnished by either, or on their behalf, contains or will
contain any untrue
statement of material fact, or omit any material fact the
omission of which
would be misleading.
1.9 Good Title. Other than as described in Exhibit 1.9, LBI has
good and
marketable title to the Membership Interest, free and clear of
any liens, claims
and encumbrances of any nature, form or description.
1.10 Indemnification. LBI and its SUBSIDIARIES agrees to defend
and hold
LBC harmless against and in respect of any and all claims,
demands, losses,
costs, expenses, obligations, liabilities, damages, recoveries,
and
deficiencies, including interest, penalties, and reasonable
attorney's fees,
that it shall incur or suffer, which arise out of, result from
or relate to any
breach of, or failure by LBI to perform any of its
representations, warranties,
covenants and agreements in this Agreement or in any exhibit or
other instrument
furnished or to be furnished by LBI under this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF LASALLE BRANDS CORPORATION ("LBC")
LBC hereby represents and warrants to LBI. that:
2.1 LBC will deliver upon SIGNING Eleven Million Seven Hundred
Fifty
Thousand shares (11,750,000) of restricted common stock of LBC
and Two Million
Five Hundred Thousand dollars ($2,500,000) of $10.00 per share
Convertible
Preferred Shares (each share is convertible into two (2) common
shares). Said
shares to be delivered in the amounts and to the persons listed
in Exhibits C
and D respectively. Upon CLOSING a minimum of $3,500,000.00 or
7.0 times audited
Earnings Before Interest, Taxes, Depreciation, and Amortization
"EBITDA", to a
maximum of $4,000,000 (providing EBITDA is at least
$500,000.00), plus the value
of equipment acquired outside of the assets owned by LBI and its
SUBSIDIARIES
(This value to be determined by a Replacement Value Independent
Appraisal). The
purchase price will be payable on the Closing Date by payment in
cash of
$3,500,000.00 and the issuance of $10.00 Convertible Preferred
Stock for the
balance. It is understood that LBI shall have the right to
require LBC to redeem
a portion of its holding of Preferred Stock resulting in
proceeds of One Million
Five Hundred Thousand Dollars ($1,500,000) within 18 months of
closing.
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2.2 Financial Ability. LBC is a Nevada corporation duly
organized, validly
existing and in good standing, and has the necessary wherewithal
to execute this
Agreement.
2.3 Authority. LBC has authorized the execution of this
Agreement and the
consummation of transactions contemplated herein by and through
its President
and CEO. LBC's President and CEO has full power and authority to
execute,
deliver, and perform this Agreement and this Agreement is a
legal, valid and
binding obligation of LBC, and is enforceable in accordance with
its terms and
conditions.
2.4 Ability to Carry Out Obligations. The execution and delivery
of this
Agreement by LBC and the performance by LBC of its obligations
hereunder in the
time and in the manner contemplated will not cause, constitute
or conflict with
or result in (a) any breach or violation of any of the
provisions or constitute
a default under any license, indenture, mortgage, charter,
instrument, articles
of incorporation, bylaws, or other agreement or instrument to
which LBC is a
party, or by which it may be bound, nor will any consents or
authorizations of
any party other than those hereto be required except approvals
required by law,
if any, (b) an event that would permit any party to any
agreement or instrument
to terminate it or to accelerate the maturity of any
indebtedness or other
obligation of LBC, or (c) any event that would result in the
creation or
imposition of any lien, charge, or encumbrance on any asset of
LBC.
2.5 Full Disclosure. None of the representations and warranties
made by
LASALLE BRANDS CORPORATION herein, or in any exhibit,
certificate or memorandum
furnished or to be furnished by LASALLE BRANDS CORPORATION, or
on its behalf,
contains or will contain any untrue statement of material fact,
or omit any
material fact the omission of which would be misleading.
2.6 Indemnification. LBC agrees to defend and hold LBI harmless
against
and in respect to any and all claims, demands, losses, costs,
expenses,
obligations, liabilities, damages, recoveries, and deficiencies,
including
interest, penalties, and reasonable attorney's fees, that it
shall incur or
suffer, which arise out of, result from or relate to any breach
of, or failure
by LBC to perform any of its respective representations,
warranties, covenants
and agreements in this Agreement or in any exhibit or other
instrument furnished
or to be furnished by LBC under this Agreement.
2.7 Capitalization. As of the date hereof, the authorized
capital stock LBC
consists of (i) 200,000,000 shares of Common Stock, of which
19,674,092 shares
are issued and outstanding, no shares are reserved for issuance
pursuant to
LBC's stock option plans, no shares are reserved for issuance
pursuant to
securities exercisable for, or convertible into or exchangeable
for shares of
common stock and (ii) 1,000,000 shares of preferred stock, of
which no shares
are issued and outstanding. All of such outstanding shares of
capital stock are,
or upon issuance will be, duly authorized, validly issued, fully
paid and
nonassessable. No shares of capital stock of LBC are subject to
preemptive
rights or any other similar rights of the shareholders of LBC or
any liens or
encumbrances imposed through the actions or failure to act of
LBC. Except as
otherwise disclosed , as of the effective date of this
Agreement, (i) there are
no outstanding options, warrants, scrip, rights to subscribe
for, puts, calls,
rights of first refusal, agreements, understandings, claims or
other commitments
or rights of any character whatsoever relating to, or securities
or rights
convertible into or exchangeable for any shares of capital stock
of LBC or any
of its Subsidiaries, or arrangements by which LBC or any of its
Subsidiaries is
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<PAGE>
or may become bound to issue additional shares of capital stock
of LBC or any of
its Subsidiaries, (ii) there are no agreements or arrangements
under which LBC
or any of its Subsidiaries is obligated to register the sale of
any of its or
their securities under the 1933 Act (except the Registration
Rights Agreement)
and (iii) there are no anti-dilution or price adjustment
provisions contained in
any security issued by LBC (or in any agreement providing rights
to security
holders) that will be triggered by the issuance of the
restricted stock
hereunder.
2.8 No Conflicts. The execution, delivery and performance of
this Agreement
and the consummation by LBC of the transactions contemplated
hereby (including,
without limitation, the issuance and reservation for issuance of
the shares of
Convertible Preferred Shares and restricted common stock) will
not (i) conflict
with or result in a violation of any provision of the Articles
of Incorporation
or By-laws or (ii) violate or conflict with, or result in a
breach of any
provision of, or constitute a default (or an event which with
notice or lapse of
time or both could become a default) under, or give to others
any rights of
termination, amendment, acceleration or cancellation of, any
agreement,
indenture, patent, patent license or instrument to which LBC or
any of its
Subsidiaries is a party, or (iii) result in a violation of any
law, rule,
regulation, order, judgment or decree (including federal and
state securities
laws and regulations and regulations of any self-regulatory
organizations to
which LBC or its securities are subject) applicable to LBC or
any of its
Subsidiaries or by which any property or asset of LBC or any of
its Subsidiaries
is bound or affected (except for such conflicts, defaults,
terminations,
amendments, accelerations, cancellations and violations as would
not,
individually or in the aggregate, have a Material Adverse
Effect, as hereinafter
defined). "Material Adverse Effect" means any material adverse
effect on the
business, operations, assets, financial condition or prospects
of by LBC or its
Subsidiaries, if any, taken as a whole, or on the transactions
contemplated
hereby or by the agreements or instruments to be entered into in
connection
herewith Neither LBC nor any of its Subsidiaries is in violation
of its Articles
of Incorporation, By-laws or other organizational documents and
neither LBC nor
any of its Subsidiaries is in default.
2.9 Listing Requirements. LBC is not in violation of the
listing
requirements of the Over-the-Counter Bulletin Board (the
"OTCBB"), has not
received a notice of removal from the OTCBB and does not
anticipate that the
Common Stock will be delisted by the OTCBB in the foreseeable
future. LBC and
its management are unaware of any facts or circumstances which
might give rise
to any of the foregoing.
2.10 SEC Documents; Financial Statements. LBC, as of the date of
signing,
has filed all reports, schedules, forms, statements and other
documents required
to be filed by it with the SEC pursuant to the reporting
requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act")
(all of the
foregoing filed prior to the date hereof an
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