EXHIBIT 10.1

STOCK PURCHASE AGREEMENT

STOCK PURCHASE AGREEMENT, dated as of February 20, 2008 (this “ Agreement ”), by and among the persons listed on Schedule A to this Agreement (each a “ Seller ” and collectively, the “ Sellers ”); Fountainhead Capital Management Limited, an entity registered in Jersey (“ Fountainhead ”); and La Pergola Investments Limited, an entity registered in Jersey (“ La Pergola ”)(collectively, Fountainhead and La Pergola shall be hereinafter referred to as “ Purchasers ”). Each Seller and each Purchasers are referred to herein as a “ Party ” and collectively, as the “ Parties ”.

BACKGROUND

The Sellers are the owners of 16,400,000 shares of common stock of Blink Couture, Inc., a Delaware corporation (the “ Company ”) and collectively desire to sell the number of shares of said stock set forth opposite their names on Schedule A (the “ Seller Shares ”). The Seller Shares represent approximately 79.5% of the issued and outstanding capital stock of the Company as of the date hereof calculated on a fully-diluted basis. The Purchasers desire to purchase all of the Seller Shares in the following percentages: Fountainhead - 85%; and La Pergola - 15% (“ Purchasers Percentages ”), as follows.

NOW, THEREFORE, in consideration of the foregoing and the mutual promises and covenants herein contained, the Company, the Sellers and the Purchasers hereby agree as follows:

1.   Purchase and Sale.

 

Each Seller shall sell, transfer, convey and deliver unto the Purchasers the number of Seller Shares set forth opposite each such Seller’s name on Schedule A to this Agreement, and Purchasers shall acquire and purchase from the Sellers the Seller Shares based on Purchasers Percentages.

2.   Purchase Price.

 

(a)   General . The purchase price (the “ Purchase Price ”) for the Seller Shares, in the aggregate, is five hundred thousand Dollars ($500,000) payable as specified in this Section 2 subject to the other terms and conditions of this Agreement.

 

(b)   Cash Deposit. Concurrent with the execution of this Agreement, Purchasers shall make an aggregate cash deposit into escrow in the amount of Fifty Thousand Dollars ($50,000), pursuant to Section 3(b) below, which shall be fully credited against the Purchase Price at the Closing (the “ Cash Deposit ”).

 

 

(c)   Payment at Closing . At the Closing, the Purchasers shall pay to the Sellers, in the aggregate, four hundred fifty thousand Dollars ($450,000), which together with the Cash Deposit, shall be payable in the amounts set forth in Schedule A and allocated as set forth therein.

 

(d)   Company Assets and Liabilities at the Closing . The Purchase Price is based upon the assumption that at the Closing, the Company will have no assets and will be free and clear of any liabilities or claims of any description.  

 

3.   The Closing.

 

(a)   General . The closing of the transactions contemplated by this Agreement (the “ Closing ”) shall take place by exchange of documents among the Parties by fax or courier, as appropriate, following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transactions contemplated hereby (other than conditions with respect to actions the respective Parties will take at the Closing itself) not later than February 27, 2008 or such other date as the Purchasers and the Sellers may mutually determine (the “ Closing Date ”), which date shall be not later than fifteen days following Purchasers’ satisfactory completion of due diligence pursuant to Section 7 , below.

 

(b)   Escrow .

 

(i)   Concurrent with the execution of this Agreement, each Seller shall deliver certificates (the “ Certificates ”) evidencing all of the Seller Shares held by such Seller, together with stock powers guaranteed by a notary or a barrister and solicitor as required by the Company’s transfer agent to transfer the stock,, to Anslow & Jaclin, LLP (“ AJ Law Firm ”) on the date hereof. The AJ Law Firm shall hold such Certificates in escrow pursuant to an Escrow Agreement (the “ AJ   Escrow Agreement ”) in the form of Exhibit A being entered into on the date hereof by the AJ Law Firm, the Seller Representative (as defined below) and the Purchasers. Pursuant to the Anslow Escrow Agreement, the Certificates will be held in escrow until the Closing at which time the AJ Law Firm shall deliver the Certificates to the Purchasers against delivery to the Sellers of the portion of the Purchase Price that is due at Closing.

 

(ii)   Concurrent with the execution of this Agreement, Purchasers shall deliver the Cash Deposit to the AJ Law Firm. The AJ Law Firm shall hold such Cash Deposit in escrow pursuant to the AJ Escrow Agreement. Pursuant to the AJ Escrow Agreement, the Cash Deposit shall be held in escrow until the Closing, at which time the AJ Law Firm shall deliver the Cash Deposit to the Sellers against delivery to the Purchasers of the Certificates.

 

(c)   Deliveries at the Closing . At the Closing: (i) the Sellers shall deliver to the Purchasers the various certificates, instruments, and documents referred to in Section 11(a) below, (ii) the Purchasers shall deliver to the Sellers the various certificates, instruments, and documents referred to in Section 11(b) below, (iii) the Sellers shall deliver to the Purchasers the Certificates, endorsed in blank or accompanied by duly executed assignment documents and including stock powers guaranteed by a notary or a barrister and solicitor as required by the Company’s transfer agent to transfer the stock,, including delivery by releasing the Certificates from escrow and (iv) the Purchasers shall deliver to the Sellers the Purchase Price.

4. Representations and Warranties of the Sellers.

 

Each Seller jointly and severally represents and warrants to the Purchasers that the statements contained in this Section 4 are correct and complete as of the date of this Agreement and will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Section 4 ).

 

(a)   Each Seller has the power and authority to execute, deliver and perform such Seller’s obligations under this Agreement and to sell, assign, transfer and deliver to the Purchasers the Seller Shares as contemplated hereby. No permit, consent, approval or authorization of, or declaration, filing or registration with any governmental or regulatory authority or consent of any third party is required in connection with the execution and delivery any Seller of this Agreement and the consummation of the transactions contemplated hereby.

 

(b)   Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby or compliance with the terms and conditions hereof by the Sellers will violate or result in a breach of any term or provision of any agreement to which any Seller is bound or is a party, or be in conflict with or constitute a default under, or cause the acceleration of the maturity of any obligation of any Seller under any existing agreement or violate any order, writ, injunction, decree, statute, rule or regulation applicable to any Seller or any properties or assets of any Seller.

 

(c)   This Agreement has been duly and validly executed by each Seller, and constitutes the valid and binding obligation of each Seller, enforceable against each Seller in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or other laws affecting creditors' rights generally or by limitations, on the availability of equitable remedies.

 

(d)   The Seller Shares are owned beneficially and of record by each Seller in the amounts specified on Schedule A and are validly issued and outstanding, fully paid for and non-assessable with no personal liability attaching to the ownership thereof. Each Seller owns the number of Seller Shares set forth opposite such Seller’s name on Schedule A free and clear of all liens, charges, security interests, encumbrances, claims of others, options, warrants, purchase rights, contracts, commitments, equities or other claims or demands of any kind (collectively, “ Liens ”), and upon delivery of the Seller Shares to the Purchasers, the Purchasers will acquire good, valid and marketable title thereto free and clear of all Liens. No Seller is a party to any option, warrant, purchase right, or other contract or commitment that could require the Seller to sell, transfer, or otherwise dispose of any capital stock of the Company (other than pursuant to this Agreement). No Seller is a party to any voting trust, proxy, or other agreement or understanding with respect to the voting of any capital stock of the Company.

 

(e)   The dates of acquisition of the Seller Shares as specified on Schedule A are true and correct.

 

 

(f)   The Company is a corporation in good standing duly incorporated in the State of Delaware. The Company is duly authorized to conduct business and is in good standing under the laws of each jurisdiction where such qualification is required. The Company has full corporate power and authority and all licenses, permits, and authorizations necessary to carry on its business. The Company has no subsidiaries and does not control any other subsidiaries, directly or indirectly, or have any direct or indirect equity participation in any other entity.

 

(g)   Neither the execution and delivery of this Agreement, nor the consummation of the transactions contemplated hereby or compliance with the terms and conditions hereof by the Company will violate or result in a breach of any term or provision of any agreement to which the Company is bound or is a party, or the Company’s Certificate of Incorporation or By-Laws, or be in conflict with or constitute a default under, or cause the acceleration of the maturity of any obligation of the Company under any existing agreement or violate any order, writ, injunction, decree, statute, rule or regulation applicable to the Company or any of its properties or assets.

 

(h)   The Company’s authorized capital stock, as of the date of this Agreement and as of the Closing, consists of 100,000,000 shares, comprising 80,000,000 shares of Common Stock, $0.0001 par value per share, of which 20,640,250 shares are issued and outstanding and 20,000,000 shares of Preferred Stock par value $0.0001 per share, none of which are issued and outstanding. The Company has not reserved any shares of its Common Stock for issuance upon the exercise of options, warrants or any other securities that are exercisable or exchangeable for, or convertible into, Common Stock. All of the issued and outstanding shares of Common Stock are validly issued, fully paid and non-assessable and have been issued in compliance with applicable laws, including, without limitation, applicable federal and state securities laws. There are no outstanding options, warrants or other rights of any kind to acquire any additional shares of capital stock of the Company or securities exercisable or exchangeable for, or convertible into, capital stock of the Company, nor is the Company committed to issue any such option, warrant, right or security. There are no agreements relating to the voting, purchase or sale of capital stock (i) between or among the Company and any of its stockholders, (ii) between or among any Seller and any third party, or (iii) to the best knowledge of the Sellers between or among any of the Company’s stockholders. The Company is not a party to any agreement granting any stockholder of the Company the right to cause the Company to register shares of the capital stock of the Company held by such stockholder under the Securities Act. The stockholder list provided to the Purchasers is a current shareholder list generated by its transfer agent, and such list accurately reflects all of the issued and outstanding shares of the Company’s Common Stock.

 

(i)   The Company does not have any restrictions in place relative to its ability to implement any reverse split of its common stock

 

(j)   As of the date hereof the Company has total Liabilities of no more than $25,000.00, which Liabilities will be paid off at or prior to the Closing and shall in no event become the Liability of the Purchasers or remain the Liabilities of the Company following the Closing.

 

 

(k)   There is no legal, administrative, investigatory, regulatory or similar action, suit, claim or proceeding which is pending or, to any Seller’s knowledge, threatened against the Company .

 

(l)   The Company has at least one market maker for its common shares and this market maker has obtained all permits and made all filings necessary in order for this market maker to continue as the market maker of the Company.

 

(m)   During the period from its inception through October 31, 2007, the Company has filed or furnished (i) all reports, schedules, forms, statements, prospectuses and other documents required to be filed with, or furnished to, the Securities and Exchange Commission (the “ SEC ”) by the Company (all such documents, as amended or supplemented, are referred to collectively as, the “ Company SEC Documents ”) and (ii) all certifications and statements required by (x) Rule 13a-14 or 15d-14 under the Exchange Act, or (y) 18 U.S.C. §1350 (Section 906 of the Sarbanes-Oxley act of 2002) with respect to any applicable Company SEC Document (collectively, the “ SOX Certifications ”). The Company has made available to the Purchasers all SOX Certifications and comment letters received by the Company from the staff of the SEC and all responses to such comment letters by or on behalf of the Company. Through October 31, 2007, the Company complied in all respects with its SEC filing obligations under the Exchange Act and the Securities Act.  Each of the audited financial statements and related schedules and notes thereto and unaudited interim financial statements of the Company (collectively, the “ Company Financial Statements ”) contained in the Company SEC Documents (or incorporated therein by reference) were prepared in accordance with United States generally accepted accounting principles applied on a consistent basis (“ GAAP ”) (except in the case of interim unaudited financial statements) except as noted therein, and fairly present in all respects the consolidated financial position of the Company and its consolidated subsidiaries as of the dates thereof and the consolidated results of their operations, cash flows and changes in stockholders’ equity for the periods then ended, subject (in the case of interim unaudited financial statements) to normal year-end audit adjustments (the effect of which will not, individually or in the aggregate, be adverse) and, such financial statements complied as to form as of their respective dates in all respects with applicable rules and regulations of the SEC. The financial statements referred to herein reflect the consistent application of such accounting principles throughout the periods involved, except as disclosed in the notes to such financial statements. No financial statements of any Person not already included in such financial statements are required by GAAP to be included in the consolidated financial statements of the Company.  As of their respective dates, each the Company SEC Document was prepared in accordance with and complied with the requirements of the Securities Act or the Exchange Act, as applicable, and the rules and regulations thereunder, and the Company SEC Documents (including all financial statements included therein and all exhibits and schedules thereto and all documents incorporated by reference therein) did not, as of the date of effectiveness in the case of a registration statement, the date of mailing in the case of a proxy or information statement and the date of filing in the case of other the Company SEC Documents, contain any untrue statement of a fact or omit to state a fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. Neither the Company nor, to the Sellers’ knowledge, any of its officers has received notice from the SEC or any other governmental authority questioning or challenging the accuracy, completeness, content, form or manner of filing or furnishing of the SOX Certifications.

 

 

(n)   The Company has properly and timely filed all federal, state and local tax returns and has paid all taxes, assessments and penalties due and payable. All such tax returns were complete and correct in all respects as filed, and no claims have been assessed with respect to such returns. There are no present, pending, or threatened audit, investigations, assessments or disputes as to taxes of any nature payable by the Company or any of its subsidiaries, nor any tax liens whether existing or inchoate on any of the assets of the Company or any of its subsidiaries, except for current year taxes not presently due and payable. No IRS or foreign, state, county or local tax audit is currently in progress. Neither the Company nor any of its subsidiaries has waived the expiration of the statute of limitations with respect to any taxes. There are no outstanding requests by the Company or any of its Subsidiaries for any extension of time within which to file any tax return or to pay taxes shown to be due on any tax return.

 

(o)   As of the Closing, the Company will not have any ongoing operations and does not employ any employees and does not maintain any employee benefit or stock option plans.

 

(p)   Since October 31, 2007, there has not been any event or condition of any character which has adversely affected, or may be expected to adversely affect, the Company’s business or prospects, including, but not limited to any adverse change in the condition, assets, liabilities (existing or contingent) or business of the Company from that shown in the financial statements of the Company included in its annual report on Form 10-KSB filed for the fiscal year ended July 31, 2007 and Form 10-QSB filed for the quarter ended October 31, 2007.

 

(q)   The Company has complied in all material respects with all applicable laws (including rules, regulations, codes, plans, injunctions, judgments, orders, decrees, rulings, and charges thereunder) of all governmental authorities, and no action, suit, proceeding, hearing, investigation, charge, complaint, claim, demand, or notice has been filed or commenced against the Company alleging any failure so to comply. To the knowledge of any Seller, neither the Company, nor any officer, director, employee, consultant or agent of the Company has made, directly or indirectly, any payment or promise to pay, or gift or promise to give or authorized such a promise or gift, of any money or anything of value, directly or indirectly, to any governmental official, customer or supplier for the purpose of influencing any official act or decision of such official, customer or supplier or inducing him, her or it to use his, her or its influence to affect any act or decision of a governmental authority or customer, under circumstances which could subject the Company or any officers, directors, employees or consultants of the Company to administrative or criminal penalties or sanctions.

 

(r)   No representation or warranty by the Sellers in this Agreement, nor in any certificate, schedule or exhibit delivered or to be delivered pursuant to this Agreement contains or will contain any untrue statement of material fact, or omits or will omit to state a material fact necessary to make the statements herein or therein, in light of the circumstances under which they were made, not misleading.

 

 

5.   Representations and Warranties of the Purchasers.

 

Purchasers represent and warrants to the Sellers as follows:

(a)   Purchasers have full power and authority to enter into this Agreement and to carry out the transactions contemplated hereby. This Agreement constitutes a valid and binding obligation of Purchasers enforceable in accordance with its terms, except as (i) the enforceability hereof may be limited by bankruptcy, insolvency or similar laws affecting the enforceability of creditor's rights generally and (ii) the availability of equitable remedies may be limited by equitable principles of general applicability.

 

(b)   Neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby, nor compliance by Purchasers with any of the provisions hereof will: 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, would constitute a default) under, or result in the termination of, or accelerate the performance required by, or result in the creation of any Lien upon any of the properties or assets of Purchasers under any of the terms, conditions or provisions of any material note, bond, indenture, mortgage, deed or trust, license, lease, agreement or other instrument or obligation to which he is a party or by which he or any of his properties or assets may be bound or affected, except for such violations, conflicts, breaches or defaults as do not have, in the aggregate, any material adverse effect; or violate any material order, writ, injunction, decree, statute, rule or regulation applicable to Purchasers or any of its properties or assets, except for such violations which do not have, in the aggregate, any material adverse effect.

 

(c)   Purchasers are acquiring the Seller Shares for their own account for investment and not for the account of any other person and not with a view to or for distribution, assignment or resale in connection with any distribution within the meaning of the Securities Act. Purchasers agrees not to sell or otherwise transfer the Seller Shares unless they are registered under the Securities Act and any applicable state securities laws, or an exemption or exemptions from such registration are available. Each Purchaser has knowledge and experience in financial and business matters such that it is capable of evaluating the merits and risks of acquiring the Seller Shares.

 

(d)   No permit, consent, approval or authorization of, or declaration, filing or registration with any governmental or regulatory authority or the consent of any third party is required in connection with the execution and delivery by Purchasers of this Agreement and the consummation of the transactions contemplated hereby.

 

6.   Due Diligence.

 

Prior to the Closing, the Purchasers will conduct a due diligence investigation relative to the Company and the representations, warranties and covenants of the Sellers and the Company. Sellers and the Company agree to provide the Purchasers and its agents and representatives with any and all due diligence documents reasonably requested, including but not limited to financial statements and evidence of the Company’s good standing in all jurisdictions where it is authorized to do business. Purchasers shall complete their due diligence review by no later than February 22, 2008 based on the fact that they are in receipt of all due diligence materials (the “Due Diligence Period”). If Purchasers shall not complete their due diligence review within the Due Diligence Period, then the Sellers shall have the right to cancel this transaction by written notice to the Purchasers and its counsel. Purchasers shall have the right, in their sole discretion, to terminate this Purchase Agreement at any time prior to the end of the Due Diligence Period for any reason without any liability therefore and, at any time prior to the Closing, Purchasers may terminate this transaction without further liability if they shall determine that any representation, warranty or covenant of any Seller is untrue or misleading or cannot be otherwise verified. If the Purchasers terminate this transaction without any representation, warranty or covenant of any Seller being untrue or misleading or could not be otherwise verified and the Seller has satisfied all the conditions to Closing in accordance with Section 10(a) of this Agreement, the Purchasers will send notice to the AJ Law Firm to release the Cash Deposit to the Sellers.

 

 

7.   Payments at Closing; Brokers; Finders.

 

There are no other finders and no parties shall be responsible for the payment of any finders’ fees other than as specifically set forth herein. Other than the foregoing, n either any Seller nor the Company, nor any of their respective directors, officers or agents on their behalf, have incurred any obligation or liability, contingent or otherwise, for brokerage or finders’ fees or agents’ commissions or financial advisory services or other similar payment in connection with this Agreement.

 

8.   Pre-Closing Covenants.

 

The Parties agree as follows with respect to the period between the execution of this Agreement and the Closing.

 

(a)   General . Each of the Parties will use his or its best efforts to take all action and to do all things necessary, proper, or advisable in order to consummate and make effective the transactions contemplated by this Agreement (including satisfaction, but not waiver, of the closing conditions set forth in Section 11 below).

 

(b)   Cessation of Operations . Prior to the Closing, all operations of the Company shall have been sold, transferred, ceased or abandoned without any residual liability to the Company.

 

(c)   Form 8-K Filing; Notices and Consents . Concurrent with the Closing of this Agreement, the Company shall cause a Form 8-K to be filed with the U.S. Securities and Exchange Commission with respect to its having entered into a material definitive agreement. The Seller Representative will cause the Company to give any notices to third parties, and will cause the Company to use its best efforts to obtain any third party consents, that the Purchasers Representative may reasonably request. Each of the Parties will (and the Sellers will cause the Company to) give any notices to, make any filings with, and use its best efforts to obtain any authorizations, consents, and approvals of governmental authorities necessary in order to consummate the transactions contemplated hereby. The Purchasers and the Sellers agree to cooperate fully with the Company in the preparation and filing of such information statement and to provide all information therefore respectively needed from them in a timely manner, so as not to cause undue delay in the filing of the information statement or any amendment thereto. Otherwise, the Sellers are not aware of any third party consent nor other filing or notice to third parties that is necessary in respect of this Agreement.

 

(d)   Filing of Form 10-QSB . The Company shall have filed its Form 10-QSB for the period ended January 31, 2008 with the U.S. Securities and Exchange Commission and the officers of the Company shall have executed all SOX representations related thereto.

(e)   Operation of Business . The Seller will not cause or permit the Company to engage in any practice, take any action, or enter into any transaction except for ministerial matters necessary to maintain the Company in good standing and to arrange for the filing of all necessary reports required under the Securities Exchange Act to make the Company a reporting company. Without limiting the generality of the foregoing, the Sellers will not cause or permit the Company to (i) declare, set aside, or pay any dividend or make any distribution with respect to its capital stock or redeem, purchase, or otherwise acquire any of its capital stock except as otherwise expressly specified herein, (ii) issue, sell, or otherwise dispose of any of its capital stock, or grant any options, warrants, preemptive or other rights to purchase or obtain (including upon conversion, exchange, or exercise) any of its capital stock, (iii) make any capital expenditures, loans, or incur any other obligations or liabilities, (iv) enter into any agreements involving expenditures individually, or in the aggregate, of more than $1,000 (other than agreements for professional services which will be paid in full at or prior to the Closing), (v) enter into any agreement or incur any other commitment or (vi) otherwise engage in any practice, take any action, or enter into any transaction that is inconsistent with the transactions contemplated hereby.

 

(f)   Notice of Developments . The Seller Representative will give prompt written notice to the Purchasers of any material adverse development causing a breach of any of the representations and warranties in Section 4 above. No disclosure by any Party pursuant to this Section 9 , however, shall be deemed to amend or supplement the disclosures contained in the Schedules hereto or to prevent or cure any misrepresentation, breach of warranty, or breach of covenant.

 

(g)   Exclusivity . None of the Sellers shall, directly or indirectly, (i) solicit, initiate, or encourage the submission of any proposal or offer from any person relating to the acquisition of the Seller Shares or any capital stock or other voting securities, or any assets (including any acquisition structured as a merger, consolidation, or share exchange) of the Company or (ii) participate in any discussions or negotiations regarding, furnish any information with respect to, assist or participate in, or facilitate in any other manner any effort or attempt by any person to do or seek any of the foregoing. None of the Sellers will vote the shares of the Company’s Common Stock held by them in favor of any such acquisition structured as a merger, consolidation, or share exchange. The Sellers shall notify the Purchasers immediately if any person makes any proposal, offer, inquiry, or contact with respect to any of the foregoing.

 

 

9. Post-Closing Covenants.     The Parties agree as follows with respect to the period following the Closing.

 

(a)   General . In case at any time after the Closing any further action is necessary or desirable to carry out the purposes of this Agreement, each of the Parties will take such further action (including the execution and delivery of such further instruments and documents) as any other Party may reasonably request, all at the sole cost and expense of the requesting Party (unless the requesting Party is entitled to indemnification therefor under Section 11 below). The Sellers acknowledge and agree that from and after the Closing the Purchasers will be entitled to possession of all documents, books, records (including tax records), agreements, and financial data of any sort relating to the Company.

 

(b)   Litigation Support . In the event and for so long as any Party actively is contesting or defending against any action, suit, proceeding, hearing, investigation, charge, complaint, claim, or demand in connection with (i) any transaction contemplated under this Agreement or (ii) any fact, situation, circumstance, status, condition, activity, practice, plan, occurrence, event, incident, action, failure to act, or transaction on or prior to the Closing Date involving the Company, the other Party will cooperate with him or it and his or its counsel in the contest or defense, make available their personnel, and provide such testimony and access to their books and records as shall be necessary in connection with the contest or defense, all at the sole cost and expense of the contesting or defending Party (unless the contesting or defending Party is entitled to indemnification therefor under Section 11 below).

 

(c)   Restrictions on Reverse Split . The Purchasers shall not vote in favor of any reverse split of the Company’s Common Stock in excess of one for fifty-two and one-half shares (1 for 52 1/2 shares).

 

10.   Conditions to Obligation to Close.

 

(a)   Conditions to Obligation of the Purchasers .

 

The obligation of the Purchasers to consummate the transactions to be performed by the Purchasers in connection with the Closing is subject to satisfaction of the following conditions:

 

(i)   the representations and warranties set forth in Sections 4and 5 above shall be true and correct in all material respects at and as of the Closing Date;

 

(ii)   Each of the Pre-Closing Covenants set forth in Section 8 , above shall have been satisfied;

 

 

(iii)   the Sellers shall have performed and complied with all of their covenants hereunder in all material respects through the Closing;

 

(iv)   the Sellers shall have procured all of the third party consents required in order to effect the Closing;

 

(v)   no action, suit, or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local, or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling, or charge would (A) prevent consummation of any of the transactions contemplated by this Agreement, (B) cause any of the transactions contemplated by this Agreement to be rescinded following consummation, (C) affect adversely the right of the Purchasers to own the Seller Shares and to control the Company, or (D) affect adversely the right of the Company to own its assets and to operate its businesses (and no such injunction, judgment, order, decree, ruling, or charge shall be in effect);

 

(vi)   the Sellers shall have delivered to the Purchasers a certificate to the effect that (A) each of the conditions specified above in Section 10(a)(i)-(v) is satisfied in all respects, and (B) as of the Closing, the Company has no Liabilities;

 

(vii)   The Purchasers shall have received an opinion of counsel customary for transactions of this type that covers, among other things, that the Seller Shares were validly issued, are fully paid and non-assessable and were issued in compliance with all laws, including, without limitation, applicable federal and state securities law and that the transactions contemplated hereby are being effected in compliance with state and federal securities laws;

 

(viii)   the Purchasers shall have received the resignations, effective as of the Closing of each director and officer of the Company . The designees specified by th e Purchasers shall have been appointed as officers of the Company and any designees of the Purchasers who may be lawfully appointed to the Board of Directors of the Company as of the Company shall have been appointed;

 

(ix)   there shall not have been any occurrence, event, incident, action, failure to act, or transaction since October 31, 2007 which has had or is reasonably likely to cause a material adverse effect on the business, assets, properties, financial condition, results of operations or prospects of the Company;

 

(x)   the Purchasers shall have completed their business, accounting and legal due diligence review of the Company, and the results thereof shall be satisfactory to the Purchasers;

 

(xi)   the Purchasers shall have received such pay-off letters and releases relating to Liabilities as they shall have requested and such pay-off letters shall be in form and substance satisfactory to the Purchasers;

 

 

(xii)   the Purchasers shall have conducted UCC, judgment lien and tax lien searches with respect to the Company, the results of which indicate no liens on the assets of the Company;

 

(xiii)   the Sellers shall have delivered the Company’s Certificate of Incorporation and bylaws, both as amended to the Closing Date, certified by the Secretary of the Company, resolutions adopted by the Board of Directors of the Company authorizing this Agreement and the transactions contemplated hereby and the Company shall have delivered to the Purchasers the Company’s original minute book and corporate seal and all other original corporate documents and agreements;

 

(xiv)   the Company shall deliver to the Purchasers a Certificate of Good Standing in respect of the Company issued by the Delaware Secretary of State dated no earlier than 30 days prior to the closing.

 

(xv)   the Company shall have maintained at and immediately after the Closing its status as a company whose Common Stock is quoted on the OTC Bulletin Board; and

 

(xvi)   all actions to be taken by the Seller in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments, and other documents required to effect the transactions contemplated hereby will be satisfactory in form and substance to the Purchasers.

 

(xvii)   At the Closing, there shall be no more than 20,640,250 shares of the Company issued and outstanding other than shares held by the Purchasers on a pro-forma basis.

 

The Purchasers may waive any condition specified in this Section 10(a) at or prior to the Closing in writing executed by the Purchasers.

(b)   Conditions to Obligation of the Seller .

 

The obligations of the Sellers to consummate the transactions to be performed by it in connection with the Closing are subject to satisfaction of the following conditions:

 

(i)   the representations and warranties set forth in Section 5 above shall be true and correct in all material respects at and as of the Closing Date;

 

(ii)   Each of the Pre-Closing Covenants set forth in Section 8 , above shall have been satisfied;

 

(iii)   the Purchasers shall have performed and complied with all of its covenants hereunder in all material respects through the Closing;

 

(iv)   no action, suit, or proceeding shall be pending or threatened before any court or quasi-judicial or administrative agency of any federal, state, local, or foreign jurisdiction or before any arbitrator wherein an unfavorable injunction, judgment, order, decree, ruling, or charge would (A) prevent consummation of any of the transactions contemplated by this Agreement or (B) cause any of the transactions contemplated by this Agreement to be rescinded following consummation (and no such injunction, judgment, order, decree, ruling, or charge shall be in effect);

 

 

(v)   the Purchasers shall have delivered to the Sellers a certificate to the effect that each of the conditions specified above in Section 10(b)(i)-(iv) is satisfied in all respects;

 

(vi)   all actions to be taken by the Purchasers in connection with consummation of the transactions contemplated hereby and all certificates, opinions, instruments, and other documents required to effect the transactions contemplated hereby will be satisfactory in form and substance to the Sellers.

 

 

The Sellers may waive any condition specified in this Section 10(b) at or prior to the Closing in writing executed by the Seller.

 

11.   Remedies for Breaches of This Agreement.

 

(a)   Survival of Representations and Warranties . All of the representations and warranties of the Parties shall survive the Closing hereunder (even if a Party knew or had reason to know of any misrepresentation or breach of warranty by another Party at the time of Closing) and continue in full force and effect for a period of twenty four (24) months thereafter.

 

(b)   Indemnification Provisions for Benefit of the Purchasers .

 

(i)   In the event any Seller breaches (or in the event any third party alleges facts that, if true, would mean any Seller has breached) any of its representations, warranties, and covenants contained herein, and, if there is an applicable survival period pursuant to Section 11(a) above, provided that the Purchasers make a written claim for indemnification against the Sellers within such survival period, then the Sellers shall jointly and severally indemnify the Purchasers from and against the entirety of any Adverse Consequences the Purchasers may suffer through and after the date of the claim for indemnification (including any Adverse Consequences the Purchasers may suffer after the end of any applicable survival period) resulting from, arising out of, relating to, in the nature of, or caused by the breach (or the alleged breach). For purposes of this Agreement, “ Adverse Consequences ” means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, demands, injunctions, judgments, orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid in settlement, Liabilities, obligations, taxes, Liens, losses, lost value, expenses, and fees, including court costs and attorneys' fees and expenses.

 

(ii)   The Sellers shall indemnify the Purchasers from and against the entirety of any Adverse Consequences the Purchasers may suffer resulting from, arising out of, relating to, in the nature of, or caused by any Liability of the Company (whether or not accrued or otherwise disclosed) (x) for any taxes of the Company with respect to any tax year or portion thereof ending on or before the Closing Date (or for any Tax year beginning before and ending after the Closing Date to the extent allocable to the portion of such period beginning before and ending on the Closing Date) and (y) for the unpaid taxes of any Person (other than the Company) under Section 1.1502-6 of the Regulations adopted under the Code (or any similar provision of state, local, or foreign law), as a transferee or successor, by contract, or otherwise.

 

 

(iii)   The Sellers shall indemnify the Purchasers from and against the entirety of any Liabilities arising out of the ownership of the Shares or operation of the Company prior to the Closing.

 

(iv)   The Sellers shall indemnify the Purchasers from and against the entirety of any Adverse Consequences the Purchasers may suffer resulting from, arising out of, relating to, in the nature of, or caused by any indebtedness or other Liabilities of the Company existing as of the Closing Date.

 

(c)   Indemnification Provisions for Benefit of the Seller . In the event the Purchasers breach (or in the event any third party alleges facts that, if true, would mean the Purchasers has breached) any of their representations, warranties, and covenants contained herein, and, if there is an applicable survival period pursuant to Section 11(a) above, provided that the Seller makes a written claim for indemnification against the Purchasers within such survival period, then the Purchasers shall indemnify the Seller from and against the entirety of any Adverse Consequences the Seller may suffer through and after the date of the claim for indemnification (including any Adverse Consequences the Seller may suffer after the end of any applicable survival period) resulting from, arising out of, relating to, in the nature of, or caused by the breach (or the alleged breach).

 

(d)   Matters Involving Third Parties .

 

(i)   If any third party shall notify any Party (the “ Indemnified Party ”) with respect to any matter (a “ Third Party Claim ”) which may give rise to a claim for indemnification against any other Party (the “ Indemnifying Party ”) under this Section 11 , then the Indemnified Party shall promptly notify each Indemnifying Party thereof in writing; provided, however, that no delay on the part of the Indemnified Party in notifying any Indemnifying Party shall relieve the Indemnifying Party from any obligation hereunder unless (and then solely to the extent) the Indemnifying Party thereby is prejudiced.

 

(ii)   Any Indemnifying Party will have the right to defend the Indemnified Party against the Third Party Claim with counsel of its choice reasonably satisfactory to the Indemnified Party so long as (A) the Indemnifying Party notifies the Indemnified Party in writing within 10 days after the Indemnified Party has given notice of the Third Party Claim that the Indemnifying Party will indemnify the Indemnified Party from and against the entirety of any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim, (B) the Indemnifying Party provides the Indemnified Party with evidence reasonably acceptable to the Indemnified Party that the Indemnifying Party will have the financial resources to defend against the Third Party Claim and fulfill its indemnification obligations hereunder, (C) the Third Party Claim involves only money damages and does not seek an injunction or other equitable relief, (D) settlement of, or an adverse judgment with respect to, the Third Party Claim is not, in the good faith judgment of the Indemnified Party, likely to establish a precedential custom or practice adverse to the continuing business interests of the Indemnified Party, and (E) the Indemnifying Party conducts the defense of the Third Party Claim actively and diligently.

 

 

(iii)   So long as the Indemnifying Party is conducting the defense of the Third Party Claim in accordance with Section 11(d)(ii) above, (A) the Indemnified Party may retain separate co-counsel at its sole cost and expense and participate in the defense of the Third Party Claim, (B) the Indemnified Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnifying Party (not to be withheld unreasonably), and (C) the Indemnifying Party will not consent to the entry of any judgment or enter into any settlement with respect to the Third Party Claim without the prior written consent of the Indemnified Party (not to be withheld unreasonably).

 

(iv)   In the event any of the conditions in Section 11(d)(ii) above is or becomes unsatisfied, however, (A) the Indemnified Party may defend against, and consent to the entry of any judgment or enter into any settlement with respect to, the Third Party Claim in any manner it reasonably may deem appropriate (and the Indemnified Party need not consult with, or obtain any consent from, any Indemnifying Party in connection therewith), (B) the Indemnifying Parties will reimburse the Indemnified Party promptly and periodically for the costs of defending against the Third Party Claim (including attorneys' fees and expenses), and (C) the Indemnifying Parties will remain responsible for any Adverse Consequences the Indemnified Party may suffer resulting from, arising out of, relating to, in the nature of, or caused by the Third Party Claim to the fullest extent provided in this Section 11 .

 

(v)   Other Indemnification Provisions . The Seller hereby indemnifies the Company against any and all claims that may be filed by a current or former officer, director or employee of the Seller by reason of the fact that such person was a director, officer, employee, or agent of the Company or was serving the Company at the request of the Seller or the Company as a partner, trustee, director, officer, employee, or agent of another entity, whether such claim is for accrued salary, compensation, indemnification, judgments, damages, penalties, fines, costs, amounts paid in settlement, losses, expenses, or otherwise and whether such claim is pursuant to any statute, charter document, bylaw, agreement, or otherwise) with respect to any action, suit, proceeding, complaint, claim, or demand brought against the Company (whether such action, suit, proceeding, complaint, claim, or demand is pursuant to an agreement, applicable law, or otherwise).

 

 

12.   Termination.

 

(a)   Termination of Agreement . The Parties may terminate this Agreement as provided below:

 

(b)   the Purchasers and the Seller may terminate this Agreement by mutual written agreement at any time prior to the Closing;

 

(c)   the Purchasers may terminate this Agreement by giving written notice to the Seller at any time prior to the Closing if (A) the aggregate of the Company’s Liabilities is equal to, or exceeds $25,000; (B) in the event the Seller has breached any material representation, warranty, or covenant contained in this Agreement in any material respect and the Purchasers have notified the Seller of the breach, and the breach has continued without cure for a period of 2 days after the notice of breach; ( C ) if the Closing shall not have occurred on or before 25 days following the Seller’s delivery of all due diligence materials pursuant to Section 6 , above by reason of the failure of any condition precedent under Section 10(a) hereof (unless the failure results primarily from the Purchasers themselves breaching any representation, warranty, or covenant contained in this Agreement); and

 

(d)   the Sellers may terminate this Agreement by giving written notice to the Purchasers at any time prior to the Closing (A) in the event the Purchasers have breached any material representation, warranty, or covenant contained in this Agreement in any material respect, the Sellers have notified the Purchasers of the breach, and the breach has continued without cure for a period of 2 days after the notice of breach or (B) if the Closing shall not have occurred on or before 25 days following the Seller’s delivery of all due diligence materials pursuant to Section 7 , above, by reason of the failure of any condition precedent under Section 10(b) hereof (unless the failure results primarily from the Sellers themselves breaching any representation, warranty, or covenant contained in this Agreement).

 

(e)   Effect of Termination . Subject to the provisions of Section 6 , above, the Sellers shall in no event be permitted to terminate this Agreement unless prior to or accompanying any notice of termination delivered hereunder the Sellers (i) have delivered to the Purchasers the Cash Deposit and any portion of the Purchase Price theretofore paid by the Purchasers and (ii) have notified the AJ Law Firm in writing that any amounts held in escrow by it may be released to the Purchasers. If the Purchasers terminate this Agreement pursuant to this Section 12 , then the Sellers (subject to the provisions of Section 6 , above) shall immediately pay to the Purchasers any portion of the Purchase Price theretofore paid by the Purchasers and the Sellers shall immediately notify the AJ Law Firm in writing that any amounts held in escrow by it may released to the Purchasers. Except as aforesaid and subject to the provisions of Section 6 , above, if this Agreement terminates pursuant to this Section 12 , all rights and obligations of the Parties hereunder shall terminate without any Liability of any Party to any other Party, except for any Liability of a Party that is then in breach .

 

 

(f)   Termination for Cause . In the event that the transaction would have closed but for the failure of the other party to close, then the party at fault shall reimburse the not at fault party for its documented reasonable legal fees and related out-of-pocket expenses it has incurred in connection with the transaction not to exceed a maximum of $15,000.00. The parties agree that any damages payable on account of any breach of this Agreement shall be expressly limited to such amount.

 

(g)   Termination without Cause . In the event that the transaction would have closed but for the decision by the Purchasers to terminate this Agreement, or the failure of the Purchasers to close and the Seller has satisfied all the conditions to Closing in accordance with Section 10(a) of this Agreement, the Purchasers shall send notice to AJ Law Firm to release the Cash Deposit to the Sellers.

 

13.   Miscellaneous.

 

(a)   Facsimile Execution and Delivery . Facsimile execution and delivery of this Agreement is legal, valid and binding execution and delivery for all purposes.

 

(b)   Confidentiality; Press Releases and Public Announcements . Except as and to the extent required by law, no Party will disclose or use and will direct its representatives not to disclose or use any information with respect to the transaction which is the subject to this Agreement, without the consent of the other Parties. the Sellers shall not issue, or cause the Company to issue, any press release or make any public announcement relating to the subject matter of this Agreement without the prior written approval of the Purchasers; provided, however, that the Company may make any public disclosure it believes in good faith is required by applicable law or any listing or trading agreement concerning its publicly-traded securities (in which case the Sellers and the Company will use their best efforts to advise the other Parties prior to making the disclosure).

 

(c)   No Third-Party Beneficiaries . This Agreement shall not confer any rights or remedies upon any person other than the Parties and their respective successors and permitted assigns.

 

(d)   Entire Agreement . This Agreement (including the documents referred to herein) constitutes the entire agreement among the Parties and supersedes any prior understandings, agreements, or representations by or among the Parties, written or oral, to the extent they related in any way to the subject matter hereof.

 

(e)   Succession and Assignment . This Agreement shall be binding upon and inure to the benefit of the Parties named herein and their respective successors and permitted assigns. No Party may assign either this Agreement or any of his or its rights, interests, or obligations hereunder without the prior written approval of the Purchasers and the Sellers; provided, however, that the Purchasers may (i) assign any or all of its rights and interests hereunder to one or more of its Affiliates, and (ii) designate one or more of its Affiliates to perform its obligations hereunder, but no such assignment shall operate to release Purchasers or a successor from any obligation hereunder unless and only to the extent that Seller agrees in writing.

 

 

(f)   Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument.

 

(g)   Headings . The Section headings contained in this Agreement are inserted for convenience only and shall not affect in any way the meaning or interpretation of this Agreement.

 

(h)   Notices . All notices, requests, demands, claims, and other communications hereunder will be in writing. Any notice, request, demand, claim, or other communication hereunder shall be deemed duly given if (and then two business days after) it is sent by registered or certified mail, return receipt requested, postage prepaid, and addressed to the intended recipient as set forth below:

 

If to the Seller (or the Company prior to the Closing):

 

Penny Green  

c/o Bacchus Corporate and Securities Law

925 W. Georgia Street Suite 1820

Vancouver, BC, V6C 3L2

Tel: 604 632 1700

Fax: 604 632 1730

 

If to the Purchasers:

Fountainhead Capital Management Limited

La Pergola Investments Limited

c/o Anslow & Jaclin, LLP

195 Route South, Suite 204

Manalapan, New Jersey 07726

(732) 409-1212

Fax (732) 577-1188

E-Mail: ranslow@anslowlaw.com

Any Party may send any notice, request, demand, claim, or other communication hereunder to the intended recipient at the address set forth above using any other means (including personal delivery, expedited courier, messenger service, telecopy, telex, ordinary mail, or electronic mail), but no such notice, request, demand, claim, or other communication shall be deemed to have been duly given unless and until it actually is received by the intended recipient. Any Party may change the address to which notices, requests, demands, claims, and other communications hereunder are to be delivered by giving the other Parties notice in the manner herein set forth.

 

 

(i)   Governing Law. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of New York .

 

(j)   Amendments and Waivers . No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by the Purchasers and the Sellers or their respective representatives. No waiver by any Party of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of any prior or subsequent such occurrence.

 

(k)   Severability . Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.

 

(l)   Expenses . Each of the Parties and the Company will bear his or its own costs and expenses (including legal fees and expenses) incurred in connection with this Agreement and the transactions contemplated hereby. The Sellers agree that the Company has not borne or will not bear any of the Sellers’ costs and expenses (including any of his legal fees and expenses) in connection with this Agreement or any of the transactions contemplated hereby.

 

(m)   Construction . The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. Any reference to any federal, state or local statute or law shall be deemed also to refer to all rules and regulations promulgated thereunder, unless the context requires otherwise. The word “including” shall mean including without limitation. The Parties intend that each representation, warranty, and covenant contained herein shall have independent significance. If any Party has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty, or covenant relating to the same subject matter (regardless of the relative levels of specificity) which the Party has not breached shall not detract from or mitigate the fact that the Party is in breach of the first representation, warranty, or covenant. Nothing in the disclosure Schedules attached hereto shall be deemed adequate to disclose an exception to a representation or warranty made herein, however, unless the disclosure Schedules identifies the exception with particularity and describes the relevant facts in detail. Without limiting the generality of the foregoing, the mere listing (or inclusion of a copy) of a document or other item in the disclosure Schedules or supplied in connection with the Purchasers’ due diligence review, shall not be deemed adequate to disclose an exception to a representation or warranty made herein (unless the representation or warranty has to do with the existence of the document or other item itself).

 

 

(n)   Incorporation of Exhibits and Schedules . The Exhibits and Schedules identified in this Agreement are incorporated herein by reference and made a part hereof.

 

(o)   Specific Performance . Each of the Parties acknowledges and agrees that the other Parties would be damaged irreparably in the event any of the provisions of this Agreement are not performed in accordance with their specific terms or otherwise are breached. Accordingly, each of the Parties agrees that the other Parties shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically this Agreement and the terms and provisions hereof in any action instituted in any court of the United States or any state thereof having jurisdiction over the Parties and the matter (subject to the provisions set forth in Section 13(p) below), in addition to any other remedy to which they may be entitled, at law or in equity.

 

(p)   Submission to Jurisdiction . Each of the Parties submits to the jurisdiction of any state or federal court sitting in New York County, New York, in any action or proceeding arising out of or relating to this Agreement and agrees that all claims in respect of the action or proceeding may be heard and determined in any such court. Each of the Parties waives any defense of inconvenient forum to the maintenance of any action or proceeding so brought and waives any bond, surety, or other security that might be required of any other Party with respect thereto. Any Party may make service on any other Party by sending or delivering a copy of the process to the Party to be served at the address and in the manner provided for the giving of notices in Section 13(h) above. Nothing in this Section 13(p) , however, shall affect the right of any Party to bring any action or proceeding arising out of or relating to this Agreement in any other court or to serve legal process in any other manner permitted by law or at equity. Each Party agrees that a final judgment in any action or proceeding so brought shall be conclusive and may be enforced by suit on the judgment or in any other manner provided by law or at equity.

 

[signature pages follow]

[Seller Signature Page]

 

IN WITNESS WHEREOF, each of the undersigned Sellers has duly executed this Agreement the date first above written.

	For Individuals:
	Name: Penny Green

 

[Purchasers Signature Page]

IN WITNESS WHEREOF, each of the undersigned Purchasers has duly executed this Agreement the date first above written.