Exhibit 10.1
PURCHASE AGREEMENT
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This Stock Purchase Agreement dated this 1st day of August, 2004
(hereinafter the "Agreement") is made and enter into by and among Anastasio
Mikroulus ("Seller"). and GFY Foods, Inc. (Buyer" or "Purchaser"). The effective
date of this Agreement shall be as defined herein below,
WITNESSETH:
WHEREAS, the Seller intends to sell to the Buyer all of its right,
title and interest in the business known as the Dionysus restaurant in Worth, IL
(the "Business"), as follows:
WHEREAS, the Buyer is a duly formed and validly existing corporation in
good standing under the laws of the State of Nevada and;
WHEREAS, Buyer wishes to purchase from the Seller and the Seller
desires to sell to the Buyer the capital stock and outstanding assets of the
Business, free and clear of any liens, charges, restrictions or encumbrances
thereon and:
WHEREAS, the Parties are desirous of documenting their representations,
warranties, covenants, agreements and conditions relating to the purchase and
sale of the Shares into a written agreement.
NOW, THEREFORE, in consideration of the foregoing, the mutual
covenants, representations, agreements and warranties herein contained, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Parties agree as follows:
1. RECITALS: The foregoing recitals are true and correct in all
material respects and are incorporated herein as if fully stated.
2. DEFINITION: The following terms shall have the following meanings
for the purposes of this Agreement:
2.1 "Closing" shall mean the completion of the transactions
contemplated in this Agreement.
2.2 "Closing Date" shall mean the date on which the Closing occurs
or is to occur and/or execution of the Purchase Agreement.
2.3 "Governmental Authority" shall mean the government of the
United States or any foreign country or any state or political
subdivision thereof and any entity, body or authority
exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government,
including the pension benefit guaranty corporation and other
quasi governmental entities established to perform such
functions.
2.4 "Law" shall mean any law, statue, regulation, ordinance, rule,
order, decree, judgment, consent decree, settlement agreement
or governmental requirement enacted, promulgated, entered
into, agree or imposed by any governmental authority.
2.5 "Lien" shall mean any mortgage, lien (except for any lien for
taxes not yet due and payable), charge, pledge, security
interest, option, lease or sublease, claim, right of any third
party or encumbrance.
2.6 "Person" shall mean any individual, corporation,
proprietorship, firm, partnership, limited partnership, trust,
association or other entity.
2.7 "Purchase Price" shall mean the aggregate amount set forth in
this Agreement.
2.8 "Taxes" shall mean all taxes, charges, fees, duties, levies or
other assessments, including income, gross receipts, net
proceeds, ad valor, turnover, real and personal property taxes
(tangible and intangible), sales, use, franchise, excise,
value added, stamp, leasing, lease, user, transfer, fuel,
excess profits, occupational, windfall profits, interest
equalization, severance, employees' income withholding,
unemployment and social security taxes and other withholding
taxes, which are imposed by any governmental authority, and
such terms shall include any interest, penalties or additions
to tax attributable thereto
3. SALE AND PURCHASE: The Seller hereby agrees to sell to the Buyer and
the Buyer shall purchase and acquire from the Seller all of Seller's right,
title and interest in the capital stock and outstanding assets of the Business.
Failure by Seller to cause delivery or transfer of 100% of its right, title and
interest in the assets of the Business of the Business within ten (10) days of
the date hereof shall be deemed an event of default hereunder.
4. PURCHASE PRICE AND METHOD OF PAYMENT:
The Purchase Price for the above purchase shall be $450,000 USD to be
paid in shares of restricted stock of GFY (which may be traded in accordance
with SEC Rule 144). Payment of said Purchase Price shall be by the delivery by
Buyer, within 14 business days of the date hereof, into escrow. The method of
distribution of the shares, liquidations of same and application of proceeds
shall be by separate agreement of the Shareholders and shall have no legal
impact this Agreement once the Shares are deposited into escrow. If liquidation
of the shares representing the purchase price shall take no more than one (1)
year. If liquidation cannot be accomplished in that time, this contract is null
and void and the business shall revert back to the Seller. Seller agrees to use
his best efforts to liquidate the shares at prevailing market price. In the
event that Seller cannot liquidate his shares within nine (9) months of the
execution of this contract, Seller must notify Buyer of this fact, in writing,
via certified mail or personal delivery. Upon receiving such notification, Buyer
may locate a buyer for the shares, at the prevailing market price. Seller shall
not unreasonably refuse to sell to the proposed buyer. Seller agrees not to
release his shares to any buyers until payment has been received or otherwise
guaranteed.
It is understood that Seller shall not be obligated to transfer title
to the Business until after the full Purchase Price has been received. It is
further understood that the Buyer shall enjoy all the benefits of ownership,
including, but not limited to, income or loss from the operation of the Business
and the right to operate the Business, from the Closing Date until title has
passed. Buyer shall only be responsible for the liabilities, costs and operating
expenses of the Business after the Closing Date.
Seller hereby expressly agrees that upon receipt of the full Purchase
Price contemplated by this Agreement, Seller shall immediately return to the
Buyer any shares remaining in Seller's possession. Seller shall not knowingly
sell Shares in excess of the number needed to allow the Seller gross recovery of
monies from the sale of Shares to exceed the Purchase Price.
In the event the Shareholders have not received realized proceeds from
stock issuances or liquidations equal the Purchase Price, Seller shall give
Buyer written notice thereof (along with proof of sale and confirmation of
proceeds received therefore) and the Buyer shall, in its sole discretion,
deliver to Seller either the cash difference or additional restricted shares of
sufficient value that the balance should satisfy the shortfall, and said process
shall continue until the Seller have received full payment of the Purchase
Price. It is agreed that the Buyer shall provide a stock broker who can sell the
shares representing the Purchase Price on the open market.
5. REPRESENTATIONS AND WARRANTIES OF SELLER AND BUYER: The Seller and the
Corporation represent and warrant to the Buyer, as of the date of this Agreement
and as of the Closing Date (as if such representations and warranties were
remade on the Closing Date). As follows:
5.1 The Business is a corporation duly organized, validly existing,
with all requisite power and authority to own, lease and operate its businesses
as it now being owned, operated and conducted. The Business is licensed or
qualified to do business in each jurisdiction where the nature of the properties
owned, leased or operated by it and the business where the nature of the
properties owned, leased or operated by it in and the business transacted by it
requires such licensing or qualification. The Business has no direct or indirect
Subsidiaries, either wholly or partially owned, and the Business does not hold
any economic, voting or management interest in any Person or own any security
issued by any Person. True, correct and complete copies of the Certificate of
Incorporation, By-laws as amended, and minutes (or written consents in lieu of
meetings) of the Board of Directors (and all committees thereof) and
stockholders of the Corporation have been delivered to the Buyer.
5.2 AUTHORIZATIONS: Seller has full power and authority to enter into
this Agreement and to consummate the transaction contemplated hereby. The Seller
has duly and validly executed and delivered this Agreement and has duly and
validly executed and delivered any related agreements required hereby. This
Agreement constitutes the legal, valid and binding obligations of Seller and is
enforceable against Seller in accordance with the terms contained herein.
5.3 APPROVALS: The execution, delivery and performance by Seller and
the Corporation of this Agreement does not and will not (i) violate or conflict
with, results in a breach termination of, constitute a default (or a
circumstance which, with or without notice or lapse of time or both, would
constitute a default) or give any third party any additional right (including a
termination right) under, permit cancellation of, or result in the creation of
any lien upon any of the assets or properties of the Sellers or the Corporation,
or Seller is a party or by which Seller, a Subsidiary or any of their respective
assets or properties are bound; (ii) permit the acceleration of the maturity of
any of the circumstances in which they were made, not misleading. Seller shall
retain a first lien position on al Business assets, until the Purchase Price is
paid in full.
The Buyer represents and warrants to Seller and the Business, as of the
date of this Agreement and as of the Closing Date (as if such representations
and warranties were remade on the Closing Date). As follows:
5.4 The Buyer is a corporation duly organized, validly existing and in
good standing under the laws of Nevada, with all requisite power and authority
to own, lease and operate its businesses as it now being owned, operated and
conducted. The Corporation is licensed or qualified to do business and is in
good standing as a foreign corporation authorized to do business in Nevada and
in each jurisdiction where the nature of the properties owned, leased or
operated by it and the business where the nature of the properties owned, leased
or operated by it in and the business transacted by it requires such licensing
or qualification. The Corporation has no direct or indirect Subsidiaries, either
wholly or partially owned, and the Corporation does not hold any economic,
voting or management interest in any Person or own any security issued by any
Person.
5.5 AUTHORIZATIONS: The Buyer has full power and authority to enter
into this Agreement and to consummate the transaction contemplated hereby. The
Buyer has duly and validly executed and delivered this Agreement and has duly
and validly executed and delivered any related agreements required hereby. This
Agreement constitutes the legal, valid and binding obligations of the Buyer and
is enforceable against the Buyer in accordance with the terms contained herein.
5.6 APPROVALS: The execution, delivery and performance by the Buyer of
this Agreement does not and will not (i) violate or conflict with, results in a
breach termination of, constitute a default (or a circumstance which, with or
without notice or lapse of time or both, would constitute a default) or give any
third party any additional right (including a termination right) under, permit
cancellation of, or result in the creation of any lien upon any of the assets or
properties of the Buyer or the Buyer is a party or by which the Buyer or any of
their respective assets or properties are bound; (ii) permit the acceleration of
the maturity of any of the circumstances in which they were made, not
misleading.
6.0 MISCELLANEOUS MATTERS:
(a) To the maximum extent permitted by law, Seller and the Business, on
behalf of itself and any affiliate thereof, shall hereby and hereafter release,
indemnify, hold-harmless and defend Buyer from all liability of Seller and the
Business and any other claim or demand regarding Seller or the activities of the
Business, prior to the date of closing.
(b) Wherever the context shall require, all words herein in the
masculine gender shall be deemed to include the feminine or neuter gender, all
singular words shall include the plural, and all plural shall include the
singular.
(c) If any provision hereof is deemed unenforceable by a court of
competent jurisdiction, the remainder of this Agreement, and the application of
such provision in other circumstances shall not be affected thereby.
(d) From and after the date of this Agreement, each of the parties
hereto agrees to execute whatever additional documentation or instruments as are
necessary to carry out the intent and purposes of this Agreement or to comply
with any law.
(e) No waiver of any provision of this Agreement shall be valid unless
in writing and signed by the waiving party. The failure of any party at any time
to insist upon strict performance of any condition, promise, agreement or
understanding set forth herein, shall not be construed as a waiver or
relinquishment of any other condition, promise, agreement or understanding set
forth herein or of the right to insist upon strict performance of such waived
condition, promise, agreement or understanding at any other time.
(f) Except as otherwise provided herein, each party hereto shall bear
all expenses incurred by each such party in connection with this Agreement and
in the consummation of the transactions contemplated hereby and in preparation
thereof.
(g) This Agreement may only be amended or modified at any time, and
from time to time, in writing, executed by the parties hereto.
(h) Any notice, communication, request, reply or advice (hereinafter
severally and collectively called "Notice") in this Agreement provided or
permitted to be given, shall be made or be served by delivering same by
overnight mail or by delivering the same by a hand-delivery service, such Notice
shall be deemed given when so delivered. For all purposes of Notice, the
addresses of the parties set out below their signatures herein shall be their
addresses unless later advised in writing.
(i) Captions herein are for the convenience of the parties and shall
not affect the interpretation of this Agreement.
(j) This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument and this Agreement may be executed by fax.
(k) This Agreement is not assignable without the written consent of the
parties.
(l) Provisions of this Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties, their heirs, executors,
administrators, other permitted successors and assigns, if any. Nothing
contained in this Agreement, whether express or implied, is intended to confer
any rights or remedies under or by reason of this Agreement on any persons other
than the parties to it and their respective successors and assigns, not is
anything in this Agreement intended to relieve or discharge the obligation or
liability of any third persons to any party to this Agreement, not shall any
provision give any third persons any right of subrogation over, or action
against, any party to this Agreement.
(m) This Agreement constitutes the entire agreement and understanding
of the parties on the subject matter hereof and supercedes all prior agreements
and understandings on the subject thereof.
(n) The parties hereto agree to cooperate with one another in respect
of this Agreement, including reviewing and executing any document necessary for
the performance of this Agreement, to comply with law or as reasonably requested
by any party hereto, or legal counsel to any party hereto.
(o) The parties hereto agree to cooperate with one another in respect
of this Agreement, including reviewing and executing any document necessary for
the performance of this Agreement, to comply with law or as reasonably requested
by any party hereto, or legal counsel to any party hereto.
(p) the parties have both conducted due diligence investigations and
have been represented by independent counsel prior to executing this Agreement.
(q) The law of the State of Illinois shall apply to this Agreement
without reference to conflict of law principles, and the sole venue for any
dispute or suit between the parties shall be a court of competent jurisdiction
in the location of the Buyer.
(r) Buyer shall provide a stock broker who can sell the restricted
stock of GFY which may be traded in accordance with SEC Rule 144 on behalf of
the Seller.
(s) In the event of default or breach of this Agreement, the parties
hereby stipulate to the value of the Business as a percentage of the Purchase
Price as set forth in Rider A attached hereto.
(t) The parties further agree that any dispute regarding advertising
expenditures shall not be considered to be the basis for a default or breach of
this Agreement.
(u) In the event that Purchaser is in bankruptcy, either voluntary or
involuntary, ownership of the Business shall revert to the Seller immediately.
IN WITNESS WHEREOF, the parties have executed this Agreement on the
date herein.
DATE: August 1, 2004
SELLER:
Anastasio Mikroulus
By: /s/ Anastasio Mikroulus
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BUYER:
GFY Foods, Inc.
BY: /s/ Edward Schwalb
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Edward Schwalb, President