STOCK
PURCHASE AGREEMENT
This
STOCK PURCHASE AGREEMENT (this "Agreement") is made this 29
th
day of
December, 2009 by and among Fountainhead Capital Management Limited
(“Fountainhead” or the “Seller”), and Regent Private Capital, LLC (the
“Purchaser”).
Preliminary
Statement
Seller
owns of record 312,383 shares of the common stock of Blink Couture, Inc., a
Delaware company (the “Company”), representing approximately 79.45% of the
outstanding shares of common stock, of the Company (the “Shares”).
Additionally,
as of October 31, 2009, the Company is indebted to Fountainhead pursuant to the
terms of a Note dated January 31, 2009 in the current principal amount of
$90,453 (together with accrued interest thereon in the amount of $3,937) (the
“Seller Note”).
The Seller desires to sell the Shares
and the Seller Note to Purchaser, and Purchaser is willing to purchase the
Shares and the Seller Note from Seller, on the terms and subject to the
conditions set forth in this Agreement.
NOW,
THEREFORE, in consideration of the foregoing and the mutual promises and
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Seller and the
Purchaser hereby agree as follows:
1.
Purchase and
Sale.
On the terms and subject to the
conditions set forth in this Agreement, simultaneously with the execution and
delivery of this Agreement, Seller agrees to sell, transfer, convey and deliver
to the Purchaser or its designee, and the Purchaser agrees to acquire and
purchase from Seller, free and clear of all Liens (as hereinafter defined), all
of the Seller’s right, title and interest in and to the Shares and Fountainhead
agrees to transfer to Purchaser or its designee the Seller Note free and clear
of all Liens (as hereinafter defined). The Seller Note, together will
all amendments thereto, and its assignment is annexed hereto as Exhibit
A.
2.
Purchase
Price.
The total
purchase price (the “Purchase Price”) for the Shares and the Seller Note is
$350,000, of which $200,000 shall be payable in cash and the remaining $150,000
of which shall be payable by Purchaser’s assignment to Seller of all of
Purchaser’s right, title and interest in and to a promissory note, in the
principal amount of $150,000, issued by Altitude Group, LLC (the “Purchaser
Note”). The form of the Purchaser Note and its assignment is annexed hereto as
Exhibit B.
3.
The
Closing.
(a)
General
. The
closing of the transactions contemplated by this Agreement (the “Closing”) shall
take place simultaneously with the execution and delivery of this Agreement by
exchange of documents among the parties by fax, electronic transmission or
courier, as appropriate.
(b)
Deliveries at the
Closing
. At the Closing: (i) the Seller shall deliver to the Purchaser:
(A) stock certificates evidencing the Shares, endorsed in blank or accompanied
by duly executed assignment documents duly authenticated to the satisfaction of
the Company’s stock transfer agent; (B) a copy of the Certificate of
Incorporation of the Company, and all amendments thereto, together with a
certificate of good standing each certified by the Secretary of State of
Delaware dated as of a date not more than three days prior to the date of the
Closing, (C) a certificate from the appropriate governmental
authority of the State of Delaware dated as of a date not more than three days
prior to the date of the Closing showing that the Company has paid all taxes due
and payable to the State of Delaware as of such date; (D) a current stockholder
list generated by its transfer agent, and such list accurately reflects all of
the issued and outstanding shares of the Company’s common stock; (E) copies of
the By-laws of the Company; (F) a certificate from Seller’s Secretary (or other
applicable officer) certifying (x) the resolutions of the Board of Directors of
Seller authorizing the transactions contemplated hereunder and (y) attesting to
the incumbency of the officers of Seller; and (G) a mutually-acceptable
instrument evidencing assignment of the Seller Note; and (ii) the Purchaser
shall deliver to Seller, (A) the cash portion of the Purchase Price by wire
transfer of immediately available funds to an account designated by Seller; and
(B) a mutually-acceptable instrument evidencing assignment of the Purchaser
Note.
4.
Defined
Terms
.
The
following capitalized terms used in this Agreement without definition shall be
construed to have the meanings set forth or referenced below.
“
Adverse Consequences
” shall
mean 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.
“
Affiliate
” shall mean with
respect to any Person, any Person which, directly or indirectly, controls, is
controlled by, or is under common control with such Person, including, without
limitation, any partner, officer, director, or member of such Person and any
venture capital fund now or hereafter existing which is controlled by or under
common control with one or more general partners or shares the same management
company with such Person.
“
Liabilities
” shall mean any
liability or obligation, whether known or unknown, asserted or unasserted,
absolute or contingent, accrued or unaccrued, liquidated or unliquidated and
whether due or to become due, regardless of when asserted.
“
Person
” means any individual,
corporation, partnership, limited liability company, firm, joint venture,
association, joint-stock company, trust, unincorporated organization,
governmental body or other entity.
5.
Representations and
Warranties of the Seller.
Seller
represents and warrants to the Purchaser as follows:
(a) The
Seller has the power and authority to execute, deliver and perform the Seller’s
obligations under this Agreement and to sell, assign, transfer and deliver to
the Purchaser the Shares and Seller Note 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 by the 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 Seller will violate or result in a breach of any term or provision
of any agreement to which the 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 the Seller under any existing agreement or violate any order,
writ, injunction, decree, statute, rule or regulation applicable to the Seller
or any properties or assets of the Seller.
(c) This
Agreement has been duly and validly executed by the Seller and constitutes the
valid and binding obligation of the Seller, enforceable against the 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
Shares are owned of record by the Seller and are validly issued and outstanding,
fully paid for and non-assessable with no personal liability attaching to the
ownership thereof. The Seller owns the Shares 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 Shares to
the Purchaser, the Purchaser will acquire good, valid and marketable title
thereto free and clear of all Liens. The Seller is not 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). The Seller is
not 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
Seller Note is owned beneficially and of record by Fountainhead and is a bona
fide obligation of the Company payable in accordance with its
terms. Fountainhead owns the Seller Note free and clear of Liens and
upon delivery of the Seller Note to the Purchaser, the Purchaser will acquire
good, valid and marketable title thereto free and clear of all
Liens.
(f) No
representation or warranty by the Seller in this Agreement, or in any
certificate, schedule or exhibit delivered or to be delivered pursuant to this
Agreement, contains or will contain, at the time such statement was or is made,
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 or are made, not misleading.
(g) The
Seller has not employed or entered into any agreement with any Person which
obligates the Seller, the Company or Purchaser to pay any finder’s fee,
brokerage fee or commission or similar payment in connection with the
transactions contemplates hereby.
6.
Representations and
Warranties of the Seller concerning the Company
.
Seller
represents and warrants to the Purchaser as follows:
(a) 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 own or control, directly or indirectly,
any shares of capital stock of any other corporation or any interest in any
partnership, limited liability company, joint venture or other non-corporate
business enterprise.
(b) The
Company’s authorized capital stock consists of 20,000,000 shares of preferred
stock, $0.0001 par value, none of which have been issued or are outstanding, and
120,000,000 shares of common stock, of which 393,148 shares are issued and
outstanding. Except as disclosed in the Company SEC Documents (as
defined in Section 6(e) below), 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. To the knowledge of Seller, 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. Except as
set forth in the Company SEC Documents, 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 Seller and any third party, (ii) t between or among the Company and
any of its stockholders, or (iii) 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.
(c) There
are no outstanding obligations, contingent or otherwise, of the Company to
redeem, purchase or otherwise acquire any capital stock or other securities of
the Company.
(d) Except
as set forth in the Company SEC Documents, there is no legal, administrative,
investigatory, regulatory or similar action, suit, claim or proceeding which is
pending or threatened against the Company. No bankruptcy,
receivership or debtor relief proceedings are pending or, to the Seller’s
knowledge, threatened against the Company. The Company is not subject
to or in default with respect to any order, writ, injunction or decree of any
federal, state, local or foreign court, department, agency or
instrumentality
(e) Since
March 4, 2008 (the date that Seller acquired control of the Company (the
“Control Date”)) and, to the knowledge of the Seller, during the period from its
inception through the Control Date, 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 (A) Rule 13a-14 or
15d-14 under the Exchange Act, or (B) 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 SEC Documents
from the Control Date to the date hereof and, to the knowledge of the Seller,
the Company SEC Documents filed prior to the Control Date (i) were prepared in
accordance with the requirements of the Securities Act or the Exchange Act, as
the case may be, and the rules and regulations promulgated thereunder, and (ii)
did not, at the time they were filed, or, if amended, as of the date of such
amendment, contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading. As of its filing date, each Company SEC
Document complied as to form in all material respects with the applicable
requirements of the Securities Act and the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), as the case may be. From the Control
Date to the date hereof and, to the knowledge of Seller, prior to the Control
Date, the Company has complied in all respects with its SEC filing obligations
under the Exchange Act and the Securities Act. From the Control Date to
the date hereof and to the knowledge of Seller, prior to the Control Date, each
of the audited financial statements and related schedules and notes thereto and
unaudited interim financial statements of the Company 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
financial position of the Company as of the dates thereof and the Company’s
results of 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. To Seller’s knowledge, 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. To Seller’s knowledge, no financial
statements of any Person not already included in such financial statements are
required by GAAP to be included in the financial statements of the
Company. To the knowledge of Seller, neither the Company nor any of the
Company’s officers, 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.
(f) From
the Control Date to the date hereof and, to the Seller’s knowledge, prior to the
Control Date, the Company’s independent public accountants, which have expressed
their opinion with respect to the financial statements of the Company included
in the Company SEC Reports (including the related notes), are and have been
throughout the periods covered by such financial statements, registered public
accounting firms with respect to the Company within the meaning of all
applicable laws and regulations and are registered with the Public Company
Accounting Oversight Board. With respect to the Company, the
Company’s independent public accountants are not and have not been in violation
of auditor independence requirements of the Sarbanes-Oxley Act and the rules and
regulations promulgated in connection therewith. None of the
non-audit services performed by Company’s independent public accountants for the
Company were prohibited services under the Sarbanes-Oxley Act and all such
services were pre-approved in advance by the Company’s audit committee, or its
Board of Directors if the Company did not have an audit committee, in accordance
with the Sarbanes-Oxley Act.
(g) From
the Control Date to the date hereof and, to the Seller’s knowledge, prior to the
Control Date, the Company has maintained disclosure controls and procedures
required by Rule 13a-15(b) or 15d-15(b) under the Exchange Act; such controls
and procedures are effective to ensure that all material information concerning
the Company is made known on a timely basis to the principal executive officer
and the principal financial officer.
(h) The
Company has properly filed all federal, state and local tax returns and has paid
all taxes, assessments and penalties due and payable; (ii) all such tax returns
were complete and correct in all respects as filed, and no claims have been
assessed with respect to such returns; (iii) there are no present, pending, or
threatened audit, investigations, assessments or disputes as to taxes of any
nature payable by the Company, nor any tax liens whether existing or inchoate on
any of the assets of the Company, except for current year taxes not presently
due and payable; (iv) no Internal Revenue Service or foreign, state, county or
local tax audit is currently in progress; (v) the Company has not waived the
expiration of the statute of limitations with respect to any taxes; and (vi)
there are no outstanding requests by the Company for any extension of time
within which to file any tax return or to pay taxes shown to be due on any tax
return.
(i) Since
October 31, 2009, 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 quarterly report on Form 10-Q filed for the quarter
ended October 31, 2009.
(j) 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, or, to the Seller’s knowledge,
threatened, against the Company alleging any failure to so
comply. Neither the Company, nor, to the Seller’s knowledge 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.
(k) The
execution, delivery and performance of this Agreement and the transactions
contemplated hereby do not and will not: (i) conflict with or violate any
provision of the Company’s Certificate of Incorporation, By-laws or other
organizational or charter documents; or (ii) to the knowledge of Seller,
conflict with, or constitute a default (or an event that with notice or lapse of
time or both would become a default) under, or give to others any rights of
termination, amendment, acceleration or cancellation (with or without notice,
lapse of time or both) of any agreement, credit facility, debt or other
instrument (evidencing a Company debt or otherwise) or other understanding to
which the Company is a party or by which any property or asset of the Company is
bound or affected; or (iii) to the knowledge of Seller, result in a violation of
any law, rule, regulation, order, judgment, injunction, decree or other
restriction of any court or governmental authority to which the Company is
subject (including federal and state securities laws and regulations), or by
which any property or asset of the Company is bound or affected.
(l) To
the knowledge of Seller, the Company: (i) is not in default under or in
violation of (and no event has occurred that has not been waived that, with
notice or lapse of time or both, would result in a default by the Company
under), nor to the knowledge of Seller has the Company received notice of a
claim that it is in default under or that it is in violation of, any indenture,
loan or credit agreement or any other agreement or instrument to which it is a
party or by which it or any of its properties is bound (whether or not such
default or violation has been waived); (ii) is not in violation of any order of
any court, arbitrator or governmental body; and (iii) is not and has not been in
violation of any statute, rule or regulation of any governmental
authority.
(m) 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 the
Seller of this Agreement and the consummation of the transactions contemplated
hereby.
(n) The
Company does not own or lease any real property. Additionally, the
Company does not have more than nominal assets. The Company is being
delivered to Purchaser without any Liabilities.
(o) The
Company does not currently own or have rights to any patents, trademarks,
copyrights or other intellectual property other than the name “Blink
Couture.” To the knowledge of Seller, the Company has not
received any communications alleging that the Company has violated or, by
conducting its business as conducted violates any the intellectual property
rights of any third party, and to the Seller’s Knowledge, the business as
conducted by the Company will not cause the Company to infringe or violate any
such third party intellectual property rights.
(p) The
Company does not have any employees and does not have any employee benefit plans
subject to the provisions of the Employee Retirement Income Security Act of
1974.
7.
Representations and
Warranties of the Purchaser.
The Purchaser represents and warrants
to the Seller as follows:
(a) This
Agreement has been duly and validly executed by the Purchaser and constitutes
the valid and binding obligation of the Purchaser, enforceable against the
Purchaser 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.
(b) Neither
the execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby, nor compliance by the Purchaser 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, the Purchaser
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 Purchaser is a party or by which Purchaser or
any of Purchaser’s 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 the Purchaser or
any of Purchaser’s properties or assets, except for such violations which do not
have, in the aggregate, any material adverse effect.
(c) 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 the
Purchaser of this Agreement and the consummation of the transactions
contemplated hereby.
(d) No
representation or warranty by the Purchaser in this Agreement, nor in any
certificate, schedule or exhibit delivered or to be delivered pursuant to this
Agreement, contains or will contain, at the time such statement was or is made,
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 or are made, not misleading.
(f) The
Purchaser has not employed or entered into any agreement with any Person which
obligates the Purchaser or the Seller to pay any finder’s fee, brokerage fee or
commission or similar payment in connection the transactions contemplated
hereby.
9.
Agreements of the
Parties
.
Seller
and Purchaser (together, the “Parties”) agree as follows:
(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 1
0
).
(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 date hereof 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
10
).
(c) Appointment
of New Directors of the Company; Resignation of Sole Officer and Director of the
Company. Immediately after the Closing, Thomas W. Colligan, the sole
director of the Company shall appoint Lawrence Field as a new director of the
Company, to serve until such time as his successor is duly elected and
qualified, and Mr. Colligan immediately thereafter shall resign as a director of
the Company. Furthermore, at such time, Mr. Colligan, the sole
officer of the Company also shall resign from all positions held by him in the
Company.
(d)
Securities Law
Disclosure.
The Company shall, within four (4) business days
after the Closing, file a Current Report on Form 8-K with the Commission which
shall summarize the transactions consummated pursuant to this
Agreement. Seller agrees to assist Purchaser and the Company in
connection with the preparation of such report.
10.
Remedies for Breaches of
This Agreement
.
(a)
Survival of Representations
and Warranties
. All of the representations, warranties and
covenants 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 twelve (12) months thereafter, except that any obligations relating
to the payment of taxes shall survive until sixty (60) days after the expiration
of the applicable statute of limitations.
(b)
Indemnification Provisions
for Benefit of the Purchaser
.
(i) In
the event the Seller breaches (or in the event any third party alleges facts
that, if true, would mean the Seller has breached) any of its representations,
warranties, and covenants contained herein, then the Seller shall indemnify the
Purchaser from and against the entirety of any Adverse Consequences the
Purchaser may suffer resulting from, arising out of, relating to, in the nature
of, or caused by the breach (or the alleged breach).
(ii) The
Seller shall indemnify the Purchaser from and against the entirety of any
Adverse Consequences the Purchaser 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) (A) for any taxes of the Company
with respect to any tax year or portion thereof ending on or before the date of
this Agreement (or for any tax year beginning before and ending after the date
of this Agreement to the extent allocable to the portion of such period
beginning before and ending on the date of this Agreement), or (B) for the
unpaid taxes of any Person (other than the Company) under Section 1.1502-6 of
the Regulations adopted under the Internal Revenue Code of 1986, as amended (or
any similar provision of state, local, or foreign law), as a transferee or
successor, by contract, or otherwise.
(iii) The
Seller shall indemnify the Purchaser from and against the entirety of any
Liabilities arising out of the operation of the Company prior to the
Closing.
(iv) The
Seller shall indemnify the Purchaser from and against the entirety of any
Adverse Consequences the Purchaser 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 date of this
Agreement.
(v) Seller
shall indemnify the Purchaser from and against the entirety of any Liabilities
arising out of the ownership of the Shares or the breach of any of Seller’s
representation and warranties set forth in Section 5 or Section 6 of this
Agreement.
(vi) Notwithstanding
anything to the contrary contained herein, the Seller shall indemnify the
Purchaser from and against any amounts payable by the Company, in respect of
Delaware Franchise taxes for 2009, in excess of $500.00.
(vi) In
furtherance of the indemnifications provided herein, Seller specifically agrees
to indemnify the Purchaser from and against any taxes that the Company may be
required to pay to the State of California for periods prior to the date of the
Closing.
(c)
Indemnification Provisions
for Benefit of the Seller
. In the event the Purchaser breaches (or in the
event any third party alleges facts that, if true, would mean the Purchaser has
breached) any of its representations, warranties, and covenants contained
herein, then the Purchaser shall indemnify the Seller from and against the
entirety of any Adverse Consequences the Seller may suffer 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 10
,
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 10(d)(ii)
,
(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 10(d)(ii)
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
10
.
11.
Miscellaneous.
(a)
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:
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If
to the Seller:
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Fountainhead
Capital Management Limited
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Portman
House, Hue Street
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St.
Helier, Jersey J E45RP Channel islands
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Attn: Adrian
Liddell
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Tel:
011-44-7711-138852
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Fax:
011-44-1534-630110
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E-Mail:
Adrian.liddell@fhcpartners.com
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With
a copy to:
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Robert
L. B. Diener, Esq.
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Law
Offices of Robert Diener
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122
Ocean Park Blvd. Suite 307
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Santa
Monica, CA 90405
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Tel: 310-396-1691
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Fax:
310-362-8887
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E-mail:
r.diener@verizon.net
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If
to the Purchaser:
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Regent
Private Capital, LLC
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152 West 57th
Street, 9th Floor
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New
York
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NY
10019
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Attn:
Anurag Agarwal
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Tel:
212 792 5301
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Fax:
646 278 9699
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E-Mail:
aagarwal@regentprivatecapital,com
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With
a copy to:
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Feldman
LLP
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420
Lexington Avenue, Suite 2620
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New
York, NY 10170
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Attn: Scott
M. Miller, Esq.
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Tel: (212)
869-7000
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Fax:
(212) 997-4242
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E-Mail:
smiller@feldmanllp.com
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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.
(b)
Successors and
Assigns
. The provisions of this Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns; provided that the Purchaser shall have the right to
assign this Agreement to an affiliate or assignee of the Purchaser reasonably
acceptable to the Seller and no other party hereto may assign, delegate or
otherwise transfer any of its rights or obligations under this Agreement without
the consent of each other party hereto, but any such transfer or assignment will
not relieve the appropriate party of its obligations hereunder.
(c)
Governing
Law
. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
principles of conflicts of law thereof.
(d)
Jurisdiction
. Any
suit, action or proceeding seeking to enforce any provision of, or based on any
matter arising out of or in connection with, this Agreement or the transactions
contemplated hereby may be brought in any federal or state court located in New
York, New York, and each of the parties hereby consents to the jurisdiction of
such courts (and of the appropriate appellate courts therefrom) in any such
suit, action or proceeding and irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of the venue of any such suit, action or proceeding in any such court or that
any such suit, action or proceeding which is brought in any such court has been
brought in an inconvenient forum. Process in any such suit, action or
proceeding may be served on any party anywhere in the world, whether within or
without the jurisdiction of any such court. Without limiting the
foregoing, each party agrees that service of process on such party as provided
in this Section shall be deemed effective service of process on such
party.
EACH PARTY
HERETO (INCLUDING ITS AFFILIATES, AGENTS, OFFICERS, DIRECTORS AND EMPLOYEES)
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
(e)
Amendments; No
Waivers
. Any provision of this Agreement with respect to
transactions contemplated hereby may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed, in the case of an amendment, by
the Seller and the Purchaser; or in the case of a waiver, by the party against
whom the waiver is to be effective. No failure or delay by any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. The rights and remedies herein provided shall be
cumulative and not exclusive of any rights or remedies provided by
law.
(f)
Entire
Agreement
. This Agreement and the Exhibits and Schedules
hereto constitute the entire agreement between the parties with respect to the
subject matter of this Agreement and supersedes all prior agreements and
understandings, both oral and written, between the parties with respect to the
subject matter hereof.
(g)
Severability
. If
any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any parties. Upon such a determination, the
parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner in order that the transactions contemplated hereby be consummated as
originally contemplated to the fullest extent possible.
(h)
Expenses
. Each of the
Parties will bear its own costs and expenses (including the fees and expenses of
counsel, accountants and financial advisors) incurred in connection with this
Agreement and the transactions contemplated hereby.
(i)
Effectiveness
. This
Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by all of the other parties
hereto. Facsimile execution and delivery of this Agreement is legal,
valid and binding execution and delivery for all purposes.
(j)
No Third Party
Beneficiaries
. No provision of this Agreement is
intended to confer upon any Person other than the parties hereto any rights or
remedies hereunder.
(k)
Confidentiality; Press
Releases and Public Announcements
. Except as and to the extent
required by law, none of the parties hereto will disclose or use, or will direct
its representatives to disclose or use, any information with respect to the
transaction which is the subject of this Agreement, without the consent of the
other parties.
(l)
Counterparts; Facsimile
Signatures.
This Agreement may be executed in counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument. The exchange of copies of
this Agreement or amendments thereto and of signature pages by facsimile
transmission or by email transmission in portable digital format, or similar
format, shall constitute effective execution and delivery of such instrument(s)
as to the parties and may be used in lieu of the original Agreement or amendment
for all purposes. Signatures of the parties transmitted by facsimile
or by email transmission in portable digital format, or similar format, shall be
deemed to be their original signatures for all purposes.
(m)
Captions
. The
captions herein are included for convenience of reference only and shall be
ignored in the construction or interpretation hereof.
[signature
page follows]
IN
WITNESS WHEREOF, the undersigned have executed, or caused to be executed on
their behalf by an agent thereunto duly authorized, this Agreement as of the
date first above written.
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PURCHASER:
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REGENT
PRIVATE CAPITAL, LLC
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By:
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/s/ Lawrence Field
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Name:
Lawrence Field
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Title:
Managing Director
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SELLER:
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FOUNTAINHEAD
CAPITAL
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MANAGEMENT
LIMITED
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By:
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/s/ Robert Diener
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Name:
Robert Diener
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Title:
Authorized Signatory
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