Exhibit 10.1
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered
into as of the 19th day of December, 2005, by and between Halter Financial
Investments, L.P., a Texas limited partnership ("Purchaser"), maintaining an
address at 00000 Xxxxxxx Xxxx, Xxxxxx, Xxxxx 00000, and Hisonic International
Inc., formerly MYTOP International Inc., a Virginia corporation (the "Company"),
maintaining an address at 0000 Xxxxxxxxxx Xxxxx, Xxxxx 000, XxXxxx, XX 00000.
W I T N E S S E T H:
WHEREAS, the Company desires to sell to Purchaser and Purchaser desires
to purchase from the Company 20,000,000 shares (the "Shares") of the common
capital stock of MGCC Investment Strategies Inc.("MGCC"), representing
approximately 86.4% of the MGCC's issued and outstanding common capital stock at
the time of Closing (as hereinafter defined), upon the terms, provisions, and
conditions and for the consideration hereinafter set forth; and
NOW, THEREFORE, for and in consideration of the premises and mutual
covenants and agreements contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto do hereby represent, warrant, covenant, and agree as follows:
Section 1. Issuance and Sale of Shares.
Based upon the representations, warranties, and covenants and subject
to the terms, provisions, and conditions contained in this Agreement, the
Company agrees to sell and deliver the Shares to Purchaser, free and clear of
all liens, pledges, encumbrances, security interests, and adverse claims, and
Purchaser agrees to purchase the Shares from the Company for the consideration
hereinafter set forth.
Section 2. Purchase Price.
The total purchase price to be paid to the Company by Purchaser for the
Shares is $300,000.00 (the "Purchase Price"), payable in cash by wire transfer
of immediately available funds.
Section 3. The Closing.
The Closing of the transaction shall take place at the office of Xxxx &
Xxxxx LLP, 0000 X. Xxxxxx XX, Xxxxx 000, Xxxxxxxxxx XX. Upon execution of this
Agreement (the "Closing"), the Company shall deliver to Purchaser a
certificate(s) evidencing the Shares issued in the name of Purchaser, and
immediately upon delivery thereof, Purchaser shall deliver to Company the
Purchase Price.
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Section 4. Representations and Warranties of the Company.
In connection with the transactions contemplated by this Agreement, the
Company hereby represents and warrants to Purchaser to the best of Company's
knowledge as follows:
4.1. Organization, Standing and Power.
MGCC is duly organized, validly existing and in good standing under the
laws of the jurisdiction in which it is incorporated and has the requisite
corporate power and authority to carry on its business as now being conducted.
MGCC is duly qualified or licensed to do business and is in good standing in
each jurisdiction in which the nature of its business or the ownership or
leasing of its properties makes such qualification or licensing necessary. The
Company has heretofore delivered to the Purchaser true and complete copies of
MGCC's Articles of Incorporation, as amended, and By-laws, each as currently in
effect. MGCC 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.
4.2. Validity of Transaction.
This Agreement and, as applicable, each other agreement contemplated
hereby are, or upon execution will be, valid and legally binding obligations of
the Company, enforceable in accordance with their respective terms against the
Company, except as limited by bankruptcy, insolvency and similar laws affecting
creditors generally, and by general principles of equity. At the time that the
Shares are sold, assigned, transferred and conveyed to Purchaser pursuant to
this Agreement, the Shares will be duly authorized, validly issued, fully paid
and nonassessable. The execution, delivery and performance of this Agreement
have been duly authorized by the Company and will not violate any applicable
federal or state law, any order of any court or government agency or the
Articles of Incorporation or By-laws of the Company. The execution, delivery and
performance of this Agreement and each other agreement contemplated hereby will
not result in any breach of or default under, or result in the creation of any
encumbrance upon any of the assets of the Company pursuant to the terms of any
agreement by which the Company or any of its respective assets may be bound. The
Company does not have any knowledge that any consent, approval or authorization
of, or registration or filing with any governmental authority or other
regulatory agency, is required for the validity of the execution and delivery by
the Company of this Agreement or any documents related thereto.
4.3. Capital Structure.
The authorized capital stock of MGCC consists of 90,000,000 shares of
common stock, par value $0.0001 per share (the "Common Stock"). As of the date
of this Agreement, there are 23,137,000 shares of Common Stock issued and
outstanding. No shares of Common Stock are held by MGCC in its treasury. All
outstanding shares of capital stock of MGCC have been duly authorized and
validly issued, are fully paid and nonassessable, and were not subject to
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preemptive or similar rights at the time of issuance. No bonds, debentures,
notes or other indebtedness of MGCC having the right to vote (or convertible
into, or exchangeable for, securities having the right to vote) on any matters
on which the stockholders of MGCC may vote are issued or outstanding. There are
no outstanding stock appreciation rights or similar derivative securities or
rights, including options or warrants, of MGCC.
4.4. Absence of Certain Changes or Events; No Undisclosed Material
Liabilities.
Except as otherwise set forth in Schedule 4.4 to this Agreement, MGCC
has no Liabilities. "Liability" means, as to any person, all debts, liabilities
and obligations, direct, indirect, absolute or contingent of such person,
whether accrued, vested or otherwise, whether known or unknown and whether or
not actually reflected, or required in accordance with accounting practices
generally accepted in the United States ("GAAP") to be reflected, in such
person's balance sheet.
4.5. Compliance with Applicable Laws.
MGCC has, and after giving effect to the transactions contemplated
hereby will have, in effect all federal, state, local and foreign governmental
approvals, authorizations, certificates, filings, franchises, licenses, notices,
permits and rights ("Permits") necessary for it to own, lease or operate its
properties and assets and to carry on its business as now conducted, and there
has occurred no default under any such Permit, except (a) for the lack of
Permits and for defaults under Permits which individually or in the aggregate
would not have a Material Adverse Effect, or (b) notices to be filed with the
U.S. Securities and Exchange Commission ("SEC") and state securities agencies
with regard to transactions contemplated herein. For purposes of this Agreement,
the term " Material Adverse Effect" means any material adverse effect with
respect to MGCC, taken as a whole, or any change or effect that adversely
affects, or is reasonably expected to adversely affect, the ability of MGCC to
maintain its current business operations. MGCC is in compliance with, and has no
liability or obligation under, all applicable statutes, laws, ordinances, rules,
orders and regulations of any court or governmental or regulatory authority or
body ("Governmental Entity"), including any liability or obligation to undertake
any remedial action under hazardous substances laws, except for (y) instances of
non-compliance, liabilities or obligations, which individually or in the
aggregate would only have an immaterial effect, or (z) notices to be filed with
the SEC and state securities agencies with regard to transactions contemplated
herein.
4.6. Litigation, etc.
As of the date hereof, (a) there is no suit, claim, action or
proceeding (at law or in equity) pending or threatened against MGCC (including,
without limitation, any product liability claims) before any Governmental
Entity, and (b) MGCC is not subject to any outstanding order, writ, judgment,
injunction, order, decree or arbitration order that, in any such case described
in clauses (a) and (b), (i) could reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect or (ii) involves an allegation of
criminal misconduct or a violation of the Racketeer and Influenced Corrupt
Practices Act, as amended. As of the date hereof, there are no suits, actions,
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claims or proceedings pending or threatened, seeking to prevent, hinder, modify
or challenge the transactions contemplated by this Agreement.
4.7. Disclosure.
The representations and warranties and statements of fact made in this
Agreement are, as applicable, accurate, correct and complete and do not contain
any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements and information contained herein not
false or misleading.
4.8. Taxes and Tax Returns.
All taxes payable have been paid when due; there is no examination or
audit, or any claim, asserted deficiency or assessment for additional taxes in
progress, pending, or threatened, nor is there any reasonable basis for the
assertion of any such claim, deficiency or assessment; no material special
charges, penalties, fines, liens, or similar encumbrances have been asserted
against MGCC with respect to payment of or failure to pay any taxes which have
not been paid or resolved without further liability to MGCC. MGCC has not
executed or filed with any taxing authority any agreements extending the period
for assessment or collection of any taxes. Proper amounts have been withheld by
MGCC from its employees' compensation payments for all periods in compliance
with the tax withholding provisions of applicable federal and state laws. MGCC
is not a party to any tax-sharing or tax-allocation agreement, nor does MGCC owe
any amounts under any tax-sharing or tax-allocation agreement.
4.9. Employee Benefit Plans.
MGCC does not have in place any arrangement or policy (written or oral)
providing for insurance coverage, workers' compensation, disability benefits,
supplemental unemployment benefits, vacation benefits, retirement benefits or
deferred compensation, profit sharing, bonuses, stock options, stock
appreciation rights, stock purchases or other forms of incentive compensation or
post-retirement insurance, compensation or benefits which is maintained or
administered by MGCC, or to which MGCC contributes, and which covers any
employee or former employee of MGCC or under which MGCC has any liability,
including "employee welfare benefit plan," "employee benefit plan" and "employee
pension benefit plan" as defined under the Employee Retirement Income Security
Act of 1974, as amended ("ERISA").
MGCC is not a party to any collective bargaining agreements. There are
no strikes or labor disputes or lawsuits, unfair labor or unlawful employment
practice charges, contract grievances or similar charges or actions pending or
threatened by any of the employees, former employees or employment applicants of
MGCC that would have a Material Adverse Effect.
4.10. Certain Contracts.
There are no written employment agreements or termination agreements
with current officers, directors or consultants of MGCC and to which MGCC is a
party.
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As of the date of this Agreement, (i) MGCC is not a party to or bound
by any commitment, agreement or other instrument (excluding commitments and
agreements in connection with extensions of credit by MGCC) which contemplates
the payment of amounts in excess of $5,000, or which otherwise is material to
the operations, assets or financial condition of MGCC, including but not limited
to any royalty, franchising fees, or any other fee based on a percentage of
revenues or income and (ii) no commitment, agreement or other instrument to
which MGCC is a party or by which it is bound limits the freedom of MGCC to
compete in any line of business or with any person.
As of the date of this Agreement, MGCC is not in default in any
material respect under any material lease, contract, mortgage, promissory note,
deed of trust, loan agreement, license agreement (as to royalty payments) or
other commitment or arrangement.
4.11. Assets; Properties and Insurance.
MGCC has no assets, whether tangible or intangible, owns no real
property and maintains no insurance of any kind.
4.12. Minute Books.
The minute book of MGCC contains records which, in all material
respects, accurately record all meetings of their stockholders and Board of
Directors (including committees of the Board of Directors).
4.13. Environmental Matters.
MGCC has not received any written notice, citation, claim, assessment,
proposed assessment or demand for abatement alleging that MGCC is responsible
for the correction or cleanup of any condition resulting from the violation of
any law, ordinance or other governmental regulation regarding environmental
matters, which correction or cleanup would be material to the business,
operations, assets or financial condition of MGCC. MGCC does not have any
knowledge that any toxic or hazardous substances or materials have been emitted,
generated, disposed of or stored on any real property owned or leased by MGCC,
or owned or controlled by MGCC as a trustee or fiduciary (collectively,
"Properties"), in any manner that violates or, after the lapse of time may
violate, any presently existing federal, regional, state or local law or
regulation governing or pertaining to such substances and materials, the
violation of which would have a Material Adverse Effect. MGCC does not have any
knowledge that, during MGCC's ownership or lease of such Properties, any of such
Properties has been operated in any manner that violated any applicable
national, state or local law or regulation governing or pertaining to toxic or
hazardous substances and materials.
4.14. Loans, etc.
As of the date of this Agreement, there are no liabilities, obligations
or indebtedness of any kind whatsoever chargeable to any MGCC stockholder and
payable to MGCC by a MGCC stockholder other than a $30,000 loan from the Company
to MGCC made in June, 2005, which the Company will forgive upon the Closing.
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4.15. Intellectual Property.
There are no arrangements relating to the use by MGCC of any
intellectual property owned by another person, and MGCC has not at any time been
in breach of such arrangements. MGCC has not granted and is not obligated to
grant a license, assignment or other right with respect to any intellectual
property.
4.16. Criminal Proceedings.
Neither MGCC and its respective officers, directors, affiliates,
promoters nor any predecessor of MGCC have been subject to or suffered any of
the following:
o Any conviction in a criminal proceeding or being subject to a
pending criminal proceeding (excluding traffic violations and
other misdemeanor offenses) within ten (10) years from the
date hereof;
o Any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or
otherwise limiting such person's involvement in any type of
business, securities or banking activities within ten (10)
years from the date hereof; or
o Being found guilty by a court of competent jurisdiction (in a
civil action), the SEC or the Commodity Futures Trading
Commission ("CFTC") to have violated a federal or state
securities or commodities law within ten (10) years from the
date hereof, and the judgment has not been reversed, suspended
or vacated.
4.17. No Stockholder Approval Required.
The provisions of Sections 78.378 to 78.3793, inclusive, of the Nevada
General Corporation Law ("NGCL") do not apply to the Company due to the fact
that the Company does not meet the definition of "issuing corporation" set forth
in Section 78.3788 of the NGCL.
Section 5. Representations and Warranties of Purchaser.
Purchaser acknowledges and understands that the Shares are being
acquired for investment in a transaction that is considered to be exempt from
registration. In connection with the transactions contemplated hereby, Purchaser
hereby represents and warrants to the Company to the best of Purchaser's
knowledge that:
5.1. Organization, Standing and Power.
Purchaser is duly organized, validly existing and in good standing
under the laws of the jurisdiction in which it is incorporated and has the
requisite corporate power and authority to carry on its business as now being
conducted. Purchaser is duly qualified or licensed to do business and is in good
standing in each jurisdiction in which the nature of its business or the
ownership or leasing of its properties makes such qualification or licensing
necessary.
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5.2. Validity of Transaction.
This Agreement and, as applicable, each other agreement contemplated
hereby are, or upon execution will be, valid and legally binding obligations of
the Purchaser, enforceable in accordance with their respective terms against the
Purchaser, except as limited by bankruptcy, insolvency and similar laws
affecting creditors generally, and by general principles of equity. The
execution, delivery and performance of this Agreement have been duly authorized
by the Purchaser and will not violate any applicable federal or state law, any
order of any court or government agency or the Articles of Incorporation or
By-laws of the Purchaser. The execution, delivery and performance of this
Agreement and each other agreement contemplated hereby will not result in any
breach of or default under, or result in the creation of any encumbrance upon
any of the assets of the Purchaser pursuant to the terms of any agreement by
which the Purchaser or any of its respective assets may be bound. The Purchaser
does not have any knowledge that any consent, approval or authorization of, or
registration or filing with any governmental authority or other regulatory
agency, is required for the validity of the execution and delivery by the
Purchaser of this Agreement or any documents related thereto.
5.3. Investment Purposes.
Purchaser is acquiring the Shares solely for investment purposes and
not with a view to, or for resale in connection with, any distribution thereof
or with any present intention of distributing or selling any of the Shares,
except as allowed by the Securities Act of 1933, as amended, or any rules or
regulations promulgated thereunder (collectively, the "Act").
5.4. Disposition of Shares.
Purchaser will hold the Shares subject to all of the applicable
provisions of the Act, and Purchaser will not at any time make any sale,
transfer, or other disposition of the Shares in contravention of said Act.
5.5. Economic Risk.
Purchaser acknowledges that it must bear the economic risk of its
investment in the Shares for an indefinite period of time since the Shares have
not been registered under the Act and therefore cannot be sold unless the Shares
are subsequently registered or an exemption from registration is available.
5.6. No Public Solicitation.
The sale of the Shares to Purchaser is being made without any public
solicitation or advertisements.
5.7. Criminal Proceedings.
Neither the Purchaser and its respective officers, directors,
affiliates, promoters nor any predecessor of the Purchaser have been subject to
or suffered any of the following:
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o Any conviction in a criminal proceeding or being subject to a
pending criminal proceeding (excluding traffic violations and
other misdemeanor offenses) within ten (10) years from the
date hereof;
o Any order, judgment or decree, not subsequently reversed,
suspended or vacated, of any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or
otherwise limiting such person's involvement in any type of
business, securities or banking activities within ten (10)
years of the date hereof; or
o Being found guilty by a court of competent jurisdiction (in a
civil action), the SEC or the CFTC to have violated a federal
or state securities or commodities law within ten (10) years
of the date hereof, and the judgment has not been reversed,
suspended or vacated.
5.8. Information.
Purchaser has received and reviewed such information as Purchaser deems
necessary to evaluate the risks and merits of its investment in MGCC.
5.9. Accredited Investor.
Purchaser is an "accredited investor" within the meaning of rule 501 of
Regulation D promulgated under the Act.
5.10. Financial Matters Experience.
Purchaser has such knowledge and experience in financial matters as to
be capable of evaluating the merits and risks of an investment in the Shares.
Section 6. Conditions to the Obligations of Purchaser at Closing.
The obligations of Purchaser at Closing are conditioned upon
satisfaction, on or prior to such date, of the following conditions, which
conditions are further conditioned upon the delivery of the Purchase Price by
Purchaser:
6.1. Stock Certificates.
The Company shall have delivered to Purchaser certificate(s) issued in
the name of Purchaser representing the number of Shares to be purchased by
Purchaser pursuant to this Agreement.
6.2. Resignation and Appointment of Officers and Directors.
MGCC shall have delivered duly executed letters of resignation from
each of its officers and each director; however, Xxxxxx Xxxx shall remain a
director of the Company until such time as Xxxxxxx X. Xxxxxx shall be appointed
to the Board of Directors in accordance with Rule 14f-1 of the Securities
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Exchange Act of 1934, as amended (the "Exchange Act"). The Company shall have
also delivered resolutions approved by the Board of Directors duly appointing
Xxxxxxx X. Xxxxxx as the sole officer of the Company, holding the titles of
President, Secretary and Chief Accounting Officer, and as a member of the Board
of Directors in compliance with Rule 14f-1 of the Exchange Act.
Section 7. Closing and Post-Closing Obligations.
7.1. Reverse Split.
Within 30 days of the Closing, MGCC shall, under the direction of
Purchaser, make all necessary filings to effect a 20 for one reverse split of
MGCC's common capital stock (the "Reverse Split"). Pursuant to the Reverse
Split, following the 20 for one conversion any partial shares of common capital
stock will be rounded up to the next full share.
7.2. Put Option Agreement.
After completion of the Reverse Split, Purchaser, Xxxxxx (Pin) Kang and
the Company shall enter into a Put Option Agreement pursuant to which the
Company and Xxxxxx (Pin) Kang may require Purchaser to purchase up to 75,000
post Reverse Split shares of common capital stock of MGCC held by the Company
and Xxxxxx (Pin) Kang at a price per share of $4.00 at any time during the
period of time commencing six months following the effectiveness of the Reverse
Split and ending six months after MGCC's completion of a transaction whereby
MGCC acquires operating control, or substantially all of the assets, of a
privately held corporation generating revenues as reported in financial
statements audited in conformity with GAAP. The Put Option Agreement shall be in
the form as attached hereto as Exhibit "A".
Section 8. Indemnification.
The Company acknowledges that it understands the meaning and legal
consequences of its representations, warranties and covenants and that the
Purchaser has relied upon such representations, warranties, and covenants, and
the Company hereby agrees to indemnify and hold harmless the Purchaser and its
agents and employees for a period of one year from the date of this Agreement
from and against any and all loss, damage or liability due to or arising out of
a breach of any such representation, warranty, or covenant or any adverse
consequence suffered by Purchaser as a result of the operation of MGCC by
Purchaser.
The Purchaser acknowledges that it understands the meaning and legal
consequences of its representations, warranties and covenants and that the
Purchaser has relied upon such representations, warranties, and covenants, and
the Purchaser hereby agrees to indemnify and hold harmless the Company and its
agents and employees for a period of one year from the date of this Agreement
from and against any and all loss, damage or liability due to or arising out of
a breach of any such representation, warranty, or covenant by Purchaser
resulting in any adverse consequence suffered by Company. In addition, the
Purchaser agrees to indemnify and hold harmless Xxxxxx (Pin) Kang from and
against any and all loss, damage or liability due to or arising out of her
serving, at the request of the Purchaser, as a "holdover" director .
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Section 9. Survival of Representations and Warranties.
All representations, warranties, covenants, and agreements contained
herein shall not be discharged or dissolved upon, but shall survive the Closing
and shall be unaffected by any investigation made by any party at any time.
Section 10. Entirety and Modification.
This Agreement constitutes the entire agreement between the parties
hereto with respect to the subject matter hereof and supersedes any and all
prior agreements and understandings, whether oral or written, between the
parties hereto relating to such subject matter. No modification, alteration,
amendment, or supplement to this Agreement shall be valid or effective unless
the same is in writing and signed by all parties hereto. Section 11. Successors
and Assigns.
This Agreement shall be binding upon and inure to the benefit of the
respective parties hereto, their successors and permitted assigns, heirs, and
personal representatives.
Section 12. Notices.
All notices or other communications required or permitted to be given
pursuant to this Agreement shall be in writing and shall be considered as
properly given or made if hand delivered, mailed from within the United States
by certified mail, or sent by overnight delivery service to the applicable
address appearing in the preamble to this Agreement, or to such other address as
either party may have designated by like notice forwarded to the other party
hereto. All notices shall be deemed given when postmarked (if mailed), when
delivered to an overnight delivery service or, if hand delivered, when delivered
to the recipient.
Section 13. Severability.
Every provision of this Agreement is intended to be severable. If any
term or provision hereof is illegal or invalid for any reason whatever, such
illegality or invalidity shall not affect the validity of the remainder of this
Agreement.
Section 14. Headings.
The headings of this Agreement are inserted for convenience and
identification only, and are in no way intended to describe, interpret, define
or limit the scope, extent or intent hereof.
Section 15. Counterparts.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
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Section 16. Legal Fees and Costs.
If a legal action is initiated by any party to this Agreement against
another, arising out of or relating to the alleged performance or
non-performance of any right or obligation established hereunder, or any dispute
concerning the same, any and all fees, costs and expenses reasonably incurred by
each successful party or his, her or its legal counsel in investigating,
preparing for, prosecuting, defending against, or providing evidence, producing
documents or taking any other action in respect of, such action shall be the
joint and several obligation of and shall be paid or reimbursed by the
unsuccessful party or parties.
Section 17. Publicity.
Except as otherwise required by law, none of the parties hereto shall
issue any press release or make any other public statement, in each case
relating to, connected with or arising out of this Agreement or the matters
contained herein, without obtaining the prior approval of the other to the
contents and the manner of presentation and publication thereof.
Section 18. Governing Law.
This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Nevada without reference to conflicts
of law provisions.
Section 19. Jurisdiction.
Each party to this Agreement hereby irrevocably agrees that any legal
action or proceeding arising out of or relating to this Agreement or any
agreements or transactions contemplated hereby may be brought in the courts of
the State of Nevada or of the United States of America for the District of
Nevada and hereby expressly submits to the personal jurisdiction and venue of
such courts for the purposes thereof and expressly waives any claim of improper
venue and any claim that such courts are an inconvenient forum. Each party
hereby irrevocably consents to the service of process of any of the
aforementioned courts in any such suit, action or proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, to the address
specified in Section 12, such service to become effective 10 days after such
mailing.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
agreement as of the date first written above.
PURCHASER: HALTER FINANCIAL INVESTMENTS, L.P.
By: Halter Financial Investments GP, LLC,
its general partner
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, Chairman
THE COMPANY: HISONIC INTERNATIONAL INC.
By: /s/ Xxxxxx Xxxx
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President, Chief Executive Officer
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