EX 10.6
STOCK PURCHASE AGREEMENT
BETWEEN
CLARINET OVERSEAS LIMITED
AND
LOTUS PACIFIC, INC.
September 30, 1998
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is entered into effective
as of September 30, 1998, by and between Clarinet Overseas Limited (the
"Buyer"), a corporation registered in the British Virgin Islands, and Lotus
Pacific, Inc., a Delaware corporation (the "Seller"), each a "Party",
collectively the "Parties".
RECITALS
WHEREAS, the Seller owns one hundred percent (100%) of the outstanding
ownership interests in LPF International Corp., a New York Corporation
engaged in the apparel business ("LPF");
WHEREAS, LPF owns one hundred percent (100%) of the outstanding ownership
interests in Richtime Far East Ltd., a Hong Kong corporation, which is also
engaged in the apparel business ("Richtime");
WHEREAS, the Seller desires to sell all of its ownership interests in LPF,
including LPF's ownership interests in Richtime;
WHEREAS, the Buyer desires to purchase from the Seller all of its ownership
interests in LPF and Richtime, respectively.
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein made and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereby agree as
follows:
1. PURCHASE AND SALE OF LPF AND RICHTIME SHARES.
a. Basic Transaction. Subject to the terms and conditions of this
Agreement, the Buyer hereby purchases from the Seller, and the Seller hereby
sells to the Buyer its ownership interests in LPF and Richtime in the form
of shares (the "Shares"), including all assets and liabilities, for the
consideration specified below.
b. Purchase Price and Payments.
1. Purchase Price. The Buyer agrees to pay a total of nine hundred
thousand dollars ($900,000.00) for the LPF and Richtime Shares,
which Purchase Price will be paid as follows:
2. Payment from Buyer. Upon execution of this Agreement by the
Parties, the Buyer will pay to the Seller nine hundred thousand
dollars ($900,000.00) in certified funds or by wire transfer.
3. Return of Seller's Capital Investment Upon execution of this
Agreement by the Parties, LPF shall transfer, or cause to be
transferred, to Seller one million six hundred thousand dollars
($1,600,000.00) from its corporate account in certified funds or
by wire transfer.
c. The Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") shall occur upon execution and delivery
of this Agreement by the Parties together with all documents,
instruments, and agreements referred to herein by the respective
parties referred to in such documents, instruments, and agreements.
The date on which the Closing occurs shall be referred to as the
"Closing Date". The Closing shall occur at such location and at
such time as the Parties shall mutually agree.
d. Deliveries at the Closing.
1. Seller's Obligation at Closing. A the Closing, the Seller will:
(1) deliver to Buyer a stock certificate or stock certificates
representing and evidencing the LPF and Richtime Shares,
respectively, endorsed in blank or accompanied by duly
executed assignment documents or stock powers sufficient
to transfer good and marketable title to the LPF and Richtime
Shares to the Buyer; and
(2) execute and deliver this Agreement and all other documents,
instruments, and agreements referred to herein or contemplated
hereby.
2. Buyer's Obligations at Closing. At the closing, the Buyer will:
(1) deliver to Seller a certified check or confirmation of wire
transfer in the amount of nine hundred thousand dollars
($900,000.00); and
(2) execute and deliver this Agreement and all other documents,
instruments, and agreements referred to herein or
contemplated hereby.
2. REPRESENTATIONS AND WARRANTIES CONCERNING THE SELLER AND THE BUYER
a. Representations and Warranties of the Seller. The Seller hereby
represents and warrants to the Buyer that the statements contained in this
Section 2.a. are correct and complete as of the Closing Date. The Buyer may
rely on the representations and warranties contained in this Section 2.a.
1. Organization of the Seller. The Seller is duly organized,
validly existing, and in good standing under the laws of the jurisdiction of
its incorporation.
2. Authorization of Transaction. The Seller has full power and
authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally
binding obligations of the Seller, enforceable in accordance with its terms
and conditions. The Seller does not need to give any notice to, make any
filing with, or obtain any authorization, consent, or approval of any
governmental authorities in order to consummate the transactions contemplated
by this Agreement.
3. Noncontravention. Neither the execution and delivery of this
Agreement, nor the consummation of the transactions contemplated hereby, will
(a) violate any governing law or other restrictions of any governmental
authority to which the Seller is subject, or any provision of its charter or
bylaws, or (b) conflict with, result in a breach of, constitute a default
under, result in the acceleration of, create in any person the right to
accelerate, terminate, modify, or cancel, or require any notice under any
agreement, contract, lease, license, permit, governmental approval,
certificate, instrument, or other arrangement to which it is a party or by
which it is bound or to which any of its assets or properties is subject.
4. Broker's Fees. The Seller has no liability or obligation to pay
any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the Buyer could become
liable or obligated.
5. LPF Shares. The Seller holds of record and owns beneficially all
of the outstanding shares of capital stock of LPF International Corp., free
and clear of any restrictions on transfer (other than any restrictions under
the Securities Act of 1933, as amended, and applicable state securities
laws), taxes, security interests, options, warrants, purchase right, or other
contracts, commitments, equities, claims and demands. 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 LPF (other than 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 LPF. All of the issued and outstanding
equity interests of LPF have been duly authorized and are validly issued,
fully paid and non-assessable.
6. Richtime Shares. LPF holds of record and owns beneficially all of
the outstanding shares of capital stock of Richtime Far East Ltd. free and
clear of any restrictions on transfer (other than any restrictions under the
Securities Act of 1933, as amended, and applicable state securities laws),
taxes, security interests, options, warrants, purchase right, or other
contracts, commitments, equities, claims and demands. LPF is not a party to
any option, warrant, purchase right, or other contract or commitment that
could require LPF to sell, transfer, or otherwise dispose of any capital
stock of Richtime (other than this Agreement). LPF is not a party to any
voting trust, proxy, or other agreement or understanding with respect to the
voting of any capital stock of Richtime. All of the issued and outstanding
equity interests of Richtime have been duly authorized and are validly
issued, fully paid and non-assessable.
7. Disclosure. The representations and warranties contained in this
Section 2.a. 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 in this Section 2.a. not misleading.
b. Representations and Warranties of the Buyer. The Buyer hereby
represents and warrants to the Seller that the statements contained in this
Section 2.b. are correct and complete as of the Closing Date. The Seller may
rely on the representations and warranties contained in this Section 2b.
1. Organization of the Buyer. The Buyer is duly organized, validly
existing, and in good standing under the laws of the jurisdiction of its
incorporation.
2. Authorization of Transaction. The Buyer has full power and
authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally
binding obligations of the Buyer, enforceable in accordance with its terms
and conditions. The Buyer does not need to give any notice to, make any
filing with, or obtain any authorization, consent, or approval of any
governmental authorities in order to consummate the transactions contemplated
by this Agreement.
3. Noncontravention. Neither the execution and delivery of this
Agreement, nor the consummation of the transactions contemplated hereby,
will (a) violate any governing law or other restrictions of any governmental
authority to which the Buyer is subject, or any provision of its charter or
bylaws, or (b) conflict with, result in a breach of, constitute a default
under, result in the acceleration of, create in any Person the right to
accelerate, terminate, modify, or cancel, or require any notice under any
agreement, contract, lease, license, permit, governmental approval,
certificate, instrument, or other arrangement to which it is a party or by
which it is bound or to which any of its assets or properties is subject.
4. Broker's Fees. The Buyer has no liability or obligation to pay any
fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the Seller could become
liable or obligated.
5. Disclosure. The representations and warranties contained in this
Section 2.b. 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 in this Section 2.b. not misleading.
3. MISCELLANEOUS
1. Entire Agreement. This Agreement (including the documents referred
to herein) constitutes the entire agreement between the Parties and
supersedes any prior understandings, agreements, or representations by or
between the Parties, written or oral, to the extent they related in any way
to the subject matter hereof.
2. Succession and Assignment. This Agreement shall be binding upon
and inure to the benefit of the Parties named herein and their respective
successors and assigns. No Party may assign this Agreement or any of its
rights, interests, or obligations hereunder without the prior written consent
of the other; provided, however, that such consent shall not be unreasonably
withheld.
3.Counterparts. This Agreement may be executed by facsimile signature
and 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.
4. Headings. The section headings contained herein are inserted for
convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
5. 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 five (5) business days after) it is sent by air mail, postage
prepaid, and address to the intended recipient as set forth below:
Seller:
Lotus Pacific, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attn: Xxxxx Xxx
Buyer:
Clarinet Overseas Limited
0000 Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxxxxx Xxx
Any Party may send any notice, request, demand, claim, or other
communication hereunder to the intended recipient at the addresses set forth
above using any other means (including personal delivery, recognized
overnight or international courier, messenger service, confirmed telecopy,
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 or receipt is confirmed by
a third party or by electronic means. Any Party may change the address to
which notices, requests, demands, claims, and other communications hereunder
are to be delivered by giving the other Party notice in the manner herein
set forth.
6. Applicable Law. This Agreement shall be governed by and construed
in accordance with the domestic laws of the State of Delaware, U.S.A.,
without giving effect to any choice or conflict of law provision or rule
(whether of the State of Delaware or any other state or jurisdiction) that
would cause the application of the laws of any state or jurisdiction other
than the State of Delaware.
7. Amendments and Waivers. No amendments of any provision of this
Agreement shall be valid unless the same shall be in writing and signed by
the Parties. No waiver by any Party of any default, misrepresentation, or
breach of warranty or covenants hereunder, whether intentional or not,
shall be deemed to extend to any prior or subsequent default,
misrepresentation, or breach of warranty or covenant hereunder to affect
in any way any rights arising by virtue of any prior or subsequent such
occurrence.
8. Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any situation in any state or jurisdiction
shall not affect the validity or enforceability of the remaining terms and
provision hereof or the validity or enforceability of the offending term
or provision in any other situation or in any other state or jurisdiction.
9. Expenses. Each of the Parties will bear its own costs and
expenses (including legal fees and expenses) incurred in connection with
this Agreement and the transactions contemplated hereby.
10. Construction: Official Version. 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.
11. Specific Performance. Each of the Parties acknowledges and agrees
that the other Party 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 Party shall be entitled to an injunction or injunctions
to prevent breach 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 U.S.A. or any state thereof having
jurisdiction over the Parties and the matter, in addition to any other
remedy to which they may be entitled, at law or equity.
IN WITNESS WHEREOF, the Parties have executed and delivered this
Agreement on the date first above written.
SELLER: BUYER:
LOTUS PACIFIC, INC. CLARINET OVERSEAS LIMITED,
a Delaware corporation a British Virgin Islands corporation
By: /S/ By: /S/
Xxxxx Xxx , President Xxxxxxx Xxx, President
