UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Rule 13-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
§ 240.13D-1(A) AND AMENDMENTS THERETO FILED
PURSUANT TO § 240.13D-2(A)
(Amendment No. )*
CCA
INDUSTRIES, INC.
(Name of Issuer)
Common Stock, par value $0.01 per share
Class A Common Stock, par value $0.01 per share
(Title of Class of Securities)
124867102
(CUSIP Number)
Capital Preservation Holdings, LLC
One Belmont Avenue, Suite 602
Bala Cynwyd, PA 19004
Attention: Lance T. Funston
Telephone: (610) 592-0049
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
September 5, 2014
(Date
of Event Which Requires Filing of This Statement)
If the filing
person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the
following box. ¨
Note. Schedules filed in paper format shall
include a signed original and five copies of the schedule, including all exhibits. See § 240.13d-7 for other parties to whom copies are to be sent.
* |
The remainder of this cover page shall be filled out for a reporting persons initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information
which would alter disclosures provided in a prior cover page. |
The information required on the remainder of this cover page
shall not be deemed to be filed for the purpose of section 18 of the Securities Exchange Act of 1934 (Act) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the
Act (however, see the Notes).
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13D |
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CUSIP No. 124867102 |
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Page
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1. |
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Names of
reporting persons Capital Preservation Holdings, LLC |
2. |
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Check the appropriate box if a member
of a group (a) ¨ (b) x |
3. |
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SEC use only
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4. |
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Source of funds
AF |
5. |
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Check box if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ¨ |
6. |
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Citizenship or place of
organization Delaware |
Number of
shares beneficially
owned by each
reporting person
with |
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7. |
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Sole voting power
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8. |
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Shared voting power
1,167,702 |
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9. |
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Sole dispositive power
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10. |
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Shared dispositive power
1,167,702 |
11. |
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Aggregate amount beneficially owned by each reporting person
1,167,702 |
12. |
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Check box if the aggregate amount in
Row (11) excludes certain shares ¨ |
13. |
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Percent of class represented by amount
in Row (11) 16.7% |
14. |
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Type of reporting person
OO |
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CUSIP No. 124867102 |
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1. |
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Names of
reporting persons Capital Preservation Solutions, LLC |
2. |
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Check the appropriate box if a member
of a group (a) ¨ (b) x |
3. |
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SEC use only
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4. |
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Source of funds
AF |
5. |
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Check box if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ¨ |
6. |
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Citizenship or place of
organization Delaware |
Number of
shares beneficially
owned by each
reporting person
with |
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7. |
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Sole voting power
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8. |
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Shared voting power
1,681,604 |
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9. |
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Sole dispositive power
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10. |
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Shared dispositive power
1,681,604 |
11. |
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Aggregate amount beneficially owned by each reporting person
1,681,604 |
12. |
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Check box if the aggregate amount in
Row (11) excludes certain shares ¨ |
13. |
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Percent of class represented by amount
in Row (11) 19.4% |
14. |
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Type of reporting person
OO |
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13D |
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CUSIP No. 124867102 |
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Page
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of 10 Pages |
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1. |
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Names of
reporting persons Lance T. Funston |
2. |
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Check the appropriate box if a member
of a group (a) ¨ (b) x |
3. |
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SEC use only
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4. |
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Source of funds
PF |
5. |
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Check box if disclosure of legal
proceedings is required pursuant to Items 2(d) or 2(e) ¨ |
6. |
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Citizenship or place of
organization United States |
Number of
shares beneficially
owned by each
reporting person
with |
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7. |
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Sole voting power
19,958 |
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8. |
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Shared voting power
2,849,306 |
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9. |
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Sole dispositive power
19,958 |
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10. |
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Shared dispositive power
2,849,306 |
11. |
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Aggregate amount beneficially owned by each reporting person
2,869,264 |
12. |
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Check box if the aggregate amount in
Row (11) excludes certain shares ¨ |
13. |
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Percent of class represented by amount
in Row (11) 33.02% |
14. |
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Type of reporting person
IN |
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13D |
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CUSIP No. 124867102 |
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The following constitutes the Schedule 13D filed by the undersigned (this Schedule
13D).
Item 1. |
Security and Issuer. |
The classes of equity securities to which this Schedule 13D
relates are the common stock, par value $0.01 per share (Common Stock), and the Class A Common Stock, par value $0.01 per share (Class A Common Stock and, together with shares of Common Stock, the Shares), of
CCA Industries, Inc. (the Company). The principal executive offices of the Company are located at 200 Murray Hill Parkway, East Rutherford, New Jersey 07073.
Item 2. |
Identity and Background. |
(a) This Schedule 13D is filed by Capital Preservation
Holdings, LLC, a Delaware limited liability company (Capital Preservation Holdings), Capital Preservation Solutions, LLC, a Delaware limited liability company (Capital Preservation Solutions) and Lance T. Funston (Mr.
Funston). Each of the foregoing is referred to as a Reporting Person and collectively as the Reporting Persons.
(b) The principal business address of Capital Preservation Holdings, Capital Preservation Solutions and Mr. Funston is One Belmont
Avenue, Suite 602, Bala Cynwyd, Pennsylvania 19004.
(c) Capital Preservation Holdings is a Delaware limited liability company, the
principal purpose of which is to hold the Shares . Capital Preservation Solutions is a Delaware limited liability company, the principal purpose of which is to provide a loan to the Company and to hold the Warrant to Purchase Common Shares (the
Warrant). The principal occupation of Mr. Funston is serving as the Chairman of the Board of Managers of Ultimark Products, LLC, a privately held consumer products company. The principal business address of Ultimark Products, LLC is
One Belmont Avenue, Suite 602, Bala Cynwyd, Pennsylvania 19004. Mr. Funston is also the managing member of Capital Preservation Holdings and the sole member of Capital Preservation Solutions.
(d) No Reporting Person has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
(e) No Reporting Person has, during the last five years, been party to a civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
(f) Mr. Funston is a citizen of the United States.
Item 3. |
Source and Amount of Funds or Other Consideration. |
On September 5, 2014 (the
Closing Date), Capital Preservation Holdings entered into a Stock Purchase Agreement (the Stock Purchase Agreement) with David Edell (Edell) and Ira Berman (Berman), pursuant to which Edell and Berman
sold to Capital Preservation Holdings an aggregate of 200,000 shares of Common Stock and 967,702 shares of Class A Common Stock, representing all of the issued and outstanding shares of Class A Common Stock, for an aggregate purchase price
of approximately $4.087 million, which was paid from the private funds of Capital Preservation Holdings.
On the Closing Date, in
connection with the term loan of $1 million (the Term Loan) and the line of credit facility of up to $5 million (the Line of Credit and, together with the Term Loan, the Loans) provided by Capital Preservation
Solutions to the Company, the Company issued to Capital Preservation Solutions the Warrant, pursuant to which Capital Preservation Solutions has, subject to certain adjustments, the right to purchase from time to time until September 5, 2019 an
amount of Common Stock equal to, upon exercise, 24% of the issued and outstanding Shares of the Company as of the date of exercise at a purchase price of $3.17 per share (which represents the NYSE MKT per share closing price of the Common Stock on
the day prior to the Closing). The funds for the Loans were provided by Mr. Funston (see Item 6).
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Item 4. |
Purpose of Transaction. |
The purpose of the transactions was to provide financing to the
Company (see Item 6 which is incorporated herein). As a result of the transactions, the Reporting Persons have engaged in and intend to continue to engage in discussions with management and the Companys Board of Directors (the
Board) concerning the business, operations and future plans of the Company.
Holders of Common Stock and holders of
Class A Common Stock are entitled to one vote for each share of stock held, and the voting and other rights of each class are equivalent, except that the holders of the Class A Common Stock have the right to elect four directors to the
Board and the holders of Common Stock have the right to elect three directors to the Board. As a result of Capital Preservation Holdings purchase of the Class A Common Stock and Common Stock from Edell and Berman and the Companys
issuance of the Warrant to Capital Preservation Solutions, Capital Preservation Holdings, Capital Preservation Solutions and Mr. Funston may be deemed to control the Company as a result of the ability to elect four of seven directors to the
Board and their beneficial ownership of 33.02% (calculated in accordance with Rule 13d-3(d)(1) of the Act) of the Companys voting securities as of September 5, 2014 (the foregoing beneficial ownership percentage includes the shares of
Common Stock underlying the Warrant acquired by Capital Preservation Solutions).
On the Closing Date, Edell (a director elected by the
holders of the Class A Common Stock (a Class A Common Stock Director)) and Drew Edell (a director elected by the holders of the Common Stock (a Common Stock Director)) resigned from their positions as directors on the
Board. On the Closing Date in accordance with the Companys Amended and Restated Bylaws, the Board appointed (i) Richard Kornhauser (Mr. Kornhauser) as a Class A Common Stock Director, (ii) Stephen A. Heit (Mr.
Heit) as a Common Stock Director, and (iii) Josephine Belli as a Common Stock Director, each to serve as a director on the Board until the next annual meeting of the Companys stockholders and until his/her successor is duly elected
and qualified or until his/her earlier death, resignation or retirement. On the Closing Date, the Board also appointed Ms. Belli to the Audit Committee and Compensation Committee of the Board, effective immediately. In addition,
Mr. Kornhauser and Mr. Heit have a minority interest in Capital Preservation Holdings.
The Reporting Persons expect to evaluate
on an ongoing basis the Companys financial condition and prospects and their interest in, and intentions with respect to, the Company and their investment in the securities of the Company, and may propose various strategic transactions or
changes to the Companys strategic plan, including, but not limited to, possible transactions involving the Company and one or more affiliates of the Reporting Persons. There are no current plans or proposals relating to any such transactions
or changes. Except as disclosed above, none of the Reporting Persons have any other plans or proposals which relate to, or would result in, any of the matters referred to in paragraphs (a) through (j), inclusive, of the instructions to
Item 4 of Schedule 13D. The Reporting Persons will continuously evaluate the Companys business and prospects and all other factors deemed relevant in determining whether the Reporting Persons or their affiliates will acquire additional
Shares or whether the Reporting Persons will dispose of any Shares, in each case in the open market, in privately negotiated transactions (which may be with the Company or with third parties) or otherwise. As part of their ongoing evaluation of this
investment, the Reporting Persons may at any time consider such matters and, subject to applicable federal and state laws, formulate a plan with respect to such matters.
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Item 5. |
Interest in Securities of the Issuer. |
(a)
(i) Capital Preservation Holdings owns 1,167,702 Shares representing 16.7% of all of the outstanding Shares of the Company.
(ii) Capital Preservation Solutions beneficially owns 1,681,604 shares of Common Stock representing 19.4% of all of the outstanding Shares of
the Company calculated in accordance with Rule 13d-3(d)(1) of the Act.
(iii) Mr. Funston, as the managing member of Capital
Preservation Holdings and the sole member of Capital Preservation Solutions, may be deemed to beneficially own the 2,849,306 Shares held by them, representing 32.8% of all of the outstanding Shares of the Company calculated in accordance with Rule
13d-3(d)(1) of the Act. Mr. Funston disclaims beneficial ownership of those Shares, except to the extent of his pecuniary interest therein.
(iv) Mr. Funston individually owns 19,958 shares of Common Stock representing 0.2% of all of the outstanding Shares of the Company.
The percentages set forth in this response are based on the 7,006,684 Shares outstanding as of July 15, 2014, as reported by the Company
in its Quarterly Report on Form 10-Q for the quarter ended May 31, 2014 as filed with the Securities and Exchange Commission on July 15, 2014.
(b)
Mr. Funston may be
deemed to share with Capital Preservation Holdings and Capital Preservation Solutions the power to vote or direct the vote of and to dispose or direct the disposition of 1,167,702 Shares owned by Capital Preservation Holdings and 1,681,604 shares of
Common Stock owned by Capital Preservation Solutions reported herein. Mr. Funston, individually, has the sole power to vote or direct the vote of and to dispose or direct the disposition of the 19,958 shares of Common Stock reported herein as
individually owned by him.
(c) Except for the Stock Purchase Agreement and the Warrant, to the knowledge of any of the Reporting Persons,
no other transactions in the Shares were effected by the Reporting Persons or any of the entities or persons named in Item 2 hereto during the 60 days prior to the date of this Schedule 13D.
(d) Not applicable.
(e) Not
applicable.
Item 6. |
Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer. |
On the Closing Date, the Company entered into the Loan and Security Agreement (the Loan Agreement) with Capital Preservation
Solutions. The Loan Agreement provides for the Loans. The proceeds of the Loans are to be used for general working capital purposes. Pursuant to the Loan Agreement, all outstanding amounts of the Loans bear interest at 6% per annum, payable
monthly in arrears. The Loans mature on December 5, 2015. The Loans and all other amounts due and owing under the Loan Agreement and related documents are secured by a first priority perfected security interest in, and lien on, substantially
all of the assets of the Company. Amounts available for borrowing under the Line of Credit equal the lesser of the Borrowing Base (as defined below), and $5 million, in each case, as the same is reduced by the aggregate principal amount outstanding
under the Line of Credit. Borrowing Base under the Loan Agreement means, generally, the amount equal to (i) 80% of the Companys eligible accounts receivable, plus (ii) 50% of the value of eligible inventory, less
(iii) certain reserves.
Pursuant to the Loan Agreement, the Company has the obligation to negotiate in good faith and, as soon as
reasonably practicable following the Closing Date, enter into a registration rights agreement with Capital Preservation Solutions and Capital Preservation Holdings providing for customary demand and piggyback registration rights with respect to the
Companys capital stock that Capital Preservation Solutions and Capital Preservation Holdings own or have the right to acquire following the Closing Date. The Companys failure to list on the NYSE MKT the shares of Common Stock, which are
issuable under the Warrant by October 5, 2014 constitutes an event of default under the Loan Agreement. The Loan Agreement otherwise contains customary events of default. Upon the occurrence of an event of default, Capital Preservation
Solutions may elect to declare the entire unpaid principal balance of the Loans to be immediately due and payable, together with interest thereon through the date of payment and all costs incurred by and payable to Capital Preservation Solutions
under the Loan Agreement. The Loan Agreement contains customary representations, warranties and covenants on the part of the Company.
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CUSIP No. 124867102 |
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On September 5, 2014, in addition to the $1 million in Term Loan proceeds which the
Company received, the Company drew $600,000 on the Line of Credit. Under the Loan Agreement, the Company is not permitted to make additional draws under the Line of Credit until the Company has listed on the NYSE MKT the Common Stock issuable under
the Warrant.
The information regarding the Stock Purchase Agreement and the Warrant set forth in Item 3 is incorporated herein by
reference.
Item 7. |
Material to be Filed as Exhibits. |
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Exhibit 99.1 |
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Stock Purchase Agreement, dated as of September 5, 2014, by and among Capital Preservation Holdings, LLC, David Edell and Ira Berman. |
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Exhibit 99.2 |
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Loan and Security Agreement, dated as of September 5, 2014, by and between CCA Industries, Inc. and Capital Preservation Solutions, LLC (incorporated by reference to Exhibit 10.1 to the Companys Form 8-K filed on September 11,
2014). |
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Exhibit 99.3 |
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Warrant to Purchase Common Stock, dated as of September 5, 2014, by and between CCA Industries, Inc. and Capital Preservation Solutions, LLC (incorporated by reference to Exhibit 10.2 to the Companys Form 8-K filed on
September 11, 2014). |
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true,
complete and correct.
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CAPITAL PRESERVATION HOLDINGS, LLC |
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By: |
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/s/ Lance T. Funston |
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Name: |
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Lance T. Funston |
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Title: |
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Managing Member |
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CAPITAL PRESERVATION SOLUTIONS, LLC |
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By: |
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/s/ Lance T. Funston |
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Name: |
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Lance T. Funston |
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Title: |
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Sole Member |
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/s/ Lance T. Funston |
LANCE T. FUNSTON |
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CUSIP No. 124867102 |
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EXHIBIT INDEX
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Exhibit 99.1 |
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Stock Purchase Agreement, dated as of September 5, 2014, by and among Capital Preservation Holdings, LLC, David Edell and Ira Berman. |
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Exhibit 99.2 |
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Loan and Security Agreement, dated as of September 5, 2014, by and between CCA Industries, Inc. and Capital Preservation Solutions, LLC (incorporated by reference to Exhibit 10.1 to the Companys Form 8-K filed on September 11,
2014). |
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Exhibit 99.3 |
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Warrant to Purchase Common Stock, dated as of September 5, 2014, by and between CCA Industries, Inc. and Capital Preservation Solutions, LLC (incorporated by reference to Exhibit 10.2 to the Companys Form 8-K filed on
September 11, 2014). |
Exhibit 99.1
STOCK PURCHASE AGREEMENT
by and among
CAPITAL
PRESERVATION HOLDINGS, LLC, as the Buyer,
and
DAVID EDELL and
IRA BERMAN, as
the Sellers
Dated as of September 5, 2014
STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT (this Agreement) is made and entered into as of September 5, 2014, by and among
Capital Preservation Holdings, LLC, a Delaware limited liability company (the Buyer), and David Edell (Edell) and Ira Berman (Berman and, together with Edell, the
Sellers and each, individually, a Seller).
BACKGROUND
A. Each Seller owns the number of shares of Common Stock, par value $0.01 per share, of CCA Industries, Inc., a Delaware corporation (the
Company, and such stock, Common Stock), and shares of Class A Common Stock, par value $0.01 per share, of the Company (Class A Common Stock and, together with Common
Stock, Company Common Stock), in each case set forth next to such Sellers name on Exhibit A attached hereto.
B. The Sellers wish to sell to the Buyer, and the Buyer wishes to acquire from the Sellers, the number of shares of Common Stock and
Class A Common Stock next to the applicable Sellers name on Exhibit A, in each case in the manner contemplated by Section 1.1 and all upon the terms and subject to the conditions set forth herein.
For good and other valuable consideration hereinafter set forth, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound, hereby agree as follows:
ARTICLE I
AGREEMENT TO SELL AND PURCHASE
Section 1.1 Sale and Purchase of Shares. Subject to the terms and conditions hereof, at the Closing: (a) each Seller hereby
sells, conveys, transfers and assigns the (i) shares of Common Stock (the Purchased Common Shares) identified as Purchased Common Shares next to such Sellers name on Exhibit A and (ii) shares
of Class A Common Stock (the Purchased Class A Common Shares and, together with the Purchased Common Shares, the Purchased Company Shares) identified as Purchased Class A Common
Shares next to such Sellers name on Exhibit A, in consideration for the purchase price for the Purchased Company Shares set forth on Exhibit A next to such Sellers name, and (b) the Buyer hereby
acquires from such Seller the number of Purchased Company Shares next to such Sellers name on Exhibit A in consideration for the purchase price as described above.
ARTICLE II
CLOSING OF
SALE AND PURCHASE
Section 2.1 Closing. The closing of the sale and purchase of the Purchased Company Shares
pursuant to this Agreement (the Closing) shall take place at the offices of Drinker Biddle & Reath LLP, 105 College Road East, Princeton, New Jersey 08542 on the date of execution and delivery of this Agreement by
the parties hereto (such date is hereinafter referred to as the Closing Date).
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Section 2.2 Closing Deliveries by the Sellers. At the Closing, subject to the
terms and conditions hereof, each Seller shall deliver, or arrange to be delivered, to the Buyer:
(a) stock certificates representing
such Sellers Purchased Shares together with fully-executed stock powers;
(b) a resignation letter, duly executed by David Edell and
Drew Edell, pursuant to which each such person is resigning from the Board of Directors of the Company; and
(c) Letter Agreements,
attached hereto as Exhibit B, duly executed by such Seller and the other parties thereto.
Section 2.3 Deliveries by the
Buyer. At the Closing, subject to the terms and conditions hereof, the Buyer shall deliver to each Seller the wire transfer of immediately available funds in the amount set forth on Exhibit A.
Section 2.4 Consummation of Transactions. All acts, deliveries and confirmations comprising the Closing, regardless of
chronological sequence, shall be deemed to occur contemporaneously and simultaneously upon the occurrence of the last act, delivery or confirmation of such Closing and none of such acts, deliveries or confirmations shall be effective unless and
until the last of the same shall have occurred or shall have been validly waived in accordance herewith.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLERS
Each Seller hereby represents and warrants to the Buyer, severally as to himself and not jointly with the other Seller, as follows:
Section 3.1 Requisite Power. Such Seller has all requisite right, power and authority to execute and deliver this Agreement
and any other agreements, documents and instruments to be delivered by such Seller that are contemplated herein or delivered pursuant hereto and to carry out their respective provisions.
Section 3.2 Authorization; Binding Obligations. All action on the part of such Seller necessary for the authorization of
this Agreement and the performance of all obligations of such Seller hereunder has been taken. This Agreement, when executed and delivered, will be a legal, valid and binding obligation of such Seller enforceable against such Seller in accordance
with its terms, except as limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting enforcement of creditors rights and (ii) general principles of equity that restrict
the availability of equitable remedies.
Section 3.3 Litigation. There is no claim, action, suit, proceeding or
investigation pending or, to such Sellers knowledge, currently threatened against such Seller that questions the validity of this Agreement or the right of such Seller to enter into this Agreement or challenges, or seeks to enjoin, prevent or
otherwise delay, the ability of such Seller to consummate the transactions contemplated hereby.
Section 3.4 Ownership of the
Purchased Shares. Such Seller owns beneficially and of record, and has good and marketable title to, his respective Purchased Company Shares, free and
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clear of any lien, charge, mortgage, pledge, easement, encumbrance, security interest, matrimonial or community interest, tenancy by the entirety claim, adverse claim, or any other title defect
or restriction of any kind (collectively, Encumbrances).
Section 3.5 Finders Fees. No
agent, broker, investment banker, person or firm, acting on behalf of or under the authority of such Seller is or will be entitled to any brokers or finders fee or any other commission directly or indirectly in connection with the
transactions contemplated hereby.
Section 3.6 No Conflicts. The execution, delivery and performance of, and compliance
with, this Agreement, does not and will not, with or without the passage of time or giving of notice, violate, be in conflict with or constitute a default under (a) any provision of any mortgage, indenture, contract, agreement, instrument or
contract to which such Seller is party or by which he is bound, (b) any judgment, decree, order, writ, injunction, law, statute, rule or regulation of any domestic or foreign government (whether federal, state or local, including any political
subdivision, department, instrumentality, commission, board, bureau or agency thereof, and any other regulatory, arbitral or administrative body, each a Governmental Entity) or (c)the laws and regulations of the Securities
and Exchange Commission (including, without limitation, the Securities Act of 1933, as amended (including the rules and regulations of the Securities and Exchange Commission promulgated thereunder) and the Securities Exchange Act of 1934, as amended
(including the rules and regulations of the Securities and Exchange Commission promulgated thereunder)) or any foreign securities regulatory body, or any Governmental Entity succeeding to any or all of the functions of any of the foregoing, or any
national securities exchange, including, without limitation, the New York Stock Exchange) applicable to the Company or such Seller.
Section 3.7 Acknowledgement. Such Seller is a sophisticated investor and has made his own independent investigation, review
and analysis regarding the Company and the transactions contemplated hereby. Such Seller hereby acknowledges that such Seller (a) has been supplied with, has had access to, and is familiar with all existing information with respect to the
Company including financial information, to which a reasonable seller would attach significance in making decisions with respect to the sale of the Purchased Company Shares, and has had the opportunity to ask questions of, and receive answers from,
knowledgeable individuals concerning the Company; (b)is not relying on any statement, representation or warranty, oral or written, express or implied, made by the Buyer or any of its affiliates or representatives; and (c) understands that he
should consult his own legal and tax advisors regarding the legal and tax implications to him of the transactions contemplated hereby.
Section 3.8 Full Disclosure. No representation or warranty by the Sellers in this Agreement contains any untrue statement of a
material fact, or omits to state a material fact necessary to make the statements contained therein, in light of the circumstances in which they are made, not misleading.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
The Buyer hereby represents and warrants to each Seller as follows:
Section 4.1 Organization; Requisite Power. The Buyer is a limited liability company, duly organized and validly existing
under the laws of the State of Delaware. The Buyer has all requisite power and authority to execute and deliver this Agreement and any other agreements, documents and instruments to be delivered by the Buyer that are contemplated herein or delivered
pursuant hereto and to carry out their respective provisions.
Section 4.2 Authorization; Binding Obligations. All
limited liability company action on the part of the Buyer necessary for the authorization of this Agreement and the performance of all obligations of the Buyer hereunder has been taken. This Agreement, when executed and delivered, will be legal,
valid and binding obligations of the Buyer enforceable against the Buyer in accordance with its terms, except as limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other laws of general application affecting
enforcement of creditors rights and (ii) general principles of equity that restrict the availability of equitable remedies.
Section 4.3 No Conflicts; Government Approvals. The execution, delivery and performance of, and compliance with, this
Agreement, will not, with or without the passage of time or giving of notice, violate, be in conflict with or constitute a default under (a) any term of the certificate of formation, limited liability company agreement or other organizational
or governing document of the Buyer or (b) any judgment, decree, order, writ, injunction, law, statute, rule or regulation of any Governmental Entity applicable to the Buyer. No authorization, consent or approval of any Governmental Entity
(including courts) is required for the execution and delivery by the Buyer of this Agreement or the performance of its obligations hereunder.
Section 4.4 Litigation. There is no claim, action, suit, proceeding or investigation pending or, to the Buyers
knowledge, currently threatened against the Buyer that questions the validity of this Agreement or the right of the Buyer to enter into this Agreement or to consummate the transactions contemplated hereby.
ARTICLE V
MISCELLANEOUS
Section 5.1 Governing Law. This Agreement shall be construed in accordance with and governed by the domestic laws
of the State of Delaware (without giving effect to any conflicts or choice of law provisions that would cause the application of the substantive domestic laws of any other jurisdiction).
Section 5.2 Arbitration. Any controversy or claim arising out of or relating to this Agreement, or any breach hereof, shall
be settled solely by arbitration administered by the American Arbitration Association in accordance with its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction
pursuant to this Section 5.2. The arbitration proceeding shall be located in Wilmington, Delaware. Within 14 days after the commencement of arbitration, the Buyer, on the one hand, and the Sellers, on the other hand, shall each select
one person to act as arbitrator and the two selected shall select a third arbitrator within 10 days of their appointment. If the arbitrators selected by the parties are unable or fail to agree upon the third arbitrator, the third arbitrator shall be
selected by the American Arbitration Association. The arbitrators shall apply the substantive law of the State of Delaware. The award shall include a statement of the factual and legal basis for the decision. Any award of the arbitrators shall be
final and binding on the parties to this Agreement and shall be enforceable in any court having jurisdiction over the losing party or its or his assets, to the extent permitted by the law
4
of such jurisdiction. The parties to any arbitration hereby expressly submit to the jurisdiction of the courts of the State of Delaware and of the United States of America for the sole purpose of
enforcing, modifying or vacating arbitral awards and for disputes that are removed from the arbitration in accordance with the Commercial Arbitration Rules. Each party hereto agrees that any and all proceedings, notices and documents so served shall
have been properly served upon such party within the State of Delaware and that such service shall thereby confer personal jurisdiction upon such party.
Section 5.3 Cumulative Remedies; Failure to Pursue Remedies. The rights and remedies provided by this Agreement are
cumulative and the use of any one right or remedy by any party shall not preclude or waive its right to use any or all other remedies. Except where a time period is specified, no delay on the part of any party in the exercise of any right, power,
privilege or remedy hereunder shall operate as a waiver thereof, nor shall any exercise or partial exercise of any such right, power, privilege or remedy preclude any further exercise thereof or the exercise of any other right, power, privilege or
remedy.
Section 5.4 Equitable Remedies. The parties hereto agree that irreparable harm would occur in the event that
any of the provisions of this Agreement were not performed fully by the parties hereto in accordance with their specific terms or conditions or were otherwise breached, and that money damages are an inadequate remedy for breach of this Agreement
because of the difficulty of ascertaining and quantifying the amount of damage that will be suffered by the parties hereto in the event that this Agreement is not performed in accordance with its terms or conditions or is otherwise breached. It is
accordingly hereby acknowledged that, notwithstanding Section 5.2 hereof, the parties hereto shall be entitled to petition the courts of the State of Delaware or the United States District Court for the District of Delaware for an
injunction or injunctions to restrain, enjoin and prevent a failure to perform this Agreement by the other party and to enforce specifically such terms and provisions of this Agreement.
Section 5.5 Amendment and Waiver. No provision of this Agreement may be amended, modified or waived except upon the written
consent of the Buyer and the Sellers. The failure of any party to enforce any of the provisions of this Agreement shall in no way be construed as a waiver of such provisions and shall not affect the right of such party thereafter to enforce each and
every provision of this Agreement in accordance with its terms.
Section 5.6 Assignment; Binding Effect. The rights and
obligations set forth herein may not be assigned or delegated by the Sellers, and may be assigned or delegated by the Buyer to any person. This Agreement shall be binding upon and inure to the benefit of all of the parties and, to the extent
permitted by this Agreement, their successors, legal representatives and permitted assigns.
Section 5.7 Costs and
Expenses. Except as otherwise expressly provided herein, each party shall bear its own costs and expenses in connection herewith.
5
Section 5.8 Notices. All demands, notices, requests, consents and other
communications required or permitted under this Agreement shall be in writing and shall be personally delivered or sent by facsimile or electronic transmission, commercial (including Federal Express) or U.S. Postal Service overnight delivery
service, or deposited with the U.S. Postal Service mailed first class, registered or certified mail, postage prepaid, as follows:
Ira Berman
61 Bryant Avenue, Apt. 316
Roslyn, NY 11576
Facsimile:
(201) 935-0415
and
David Edell
791 Emerald Harbor
Drive
Long Boat Key, FL 34228-1609
Facsimile: (201) 935-0415
Capital Preservation Holdings, LLC
One Belmont Avenue
Suite 602
Bala Cynwyd, PA 19004
Attention: Lance T. Funston
Facsimile: (610) 592-0049
Email: lfunston@ultimarkproducts.com
Notices
shall be deemed given upon the earlier to occur of (i) receipt by the party to whom such notice is directed; (ii) if sent by facsimile or electronic transmission, the day (other than a Saturday, Sunday or legal holiday in the jurisdiction
to which such notice is directed) such notice is sent if sent prior to 5:00 p.m. U.S. Eastern Time, or the day (other than a Saturday, Sunday or legal holiday in the jurisdiction to which such notice is directed) after which such notice is sent if
sent after 5:00 p.m. U.S. Eastern Time; (iii) if sent by overnight delivery service, the first business day (other than a Saturday, Sunday or legal holiday in the jurisdiction to which such notice is directed) following the day the same is
deposited with the commercial carrier or U.S. Postal Service; or (iv) if sent by first class mail, registered or certified, postage prepaid, the fifth day (other than a Saturday, Sunday or legal holiday in the jurisdiction to which such notice
is directed) following the day the same is deposited with the U.S. Postal Service. Each party, by notice duly given in accordance herewith, may specify a different address for the giving of any notice hereunder.
Section 5.9 Severability. If any term or provision of this Agreement, or the application thereof to any person or
circumstance, shall, to any extent, be invalid or unenforceable, the remainder of this Agreement, or application to other persons or circumstances, shall not be affected thereby, and each term and provision of this Agreement shall be enforced to the
fullest extent permitted by law.
Section 5.10 Survival. The representations and warranties made herein and in the
other documents delivered pursuant hereto shall survive the Closing indefinitely. The covenants and agreements made herein shall survive the Closing indefinitely.
Section 5.11 Construction. Whenever the context requires, the gender of any word used in this Agreement includes the
masculine, feminine or neuter, and the number of any word includes the singular or plural. Unless the context otherwise requires, all references to articles and sections refer to articles and sections of this Agreement.
6
Section 5.12 Headings. The headings and subheadings in this Agreement are
included for convenience and identification only and are in no way intended to describe, interpret, define or limit the scope, extent or intent of this Agreement or any provision hereof.
Section 5.13 Counterparts. This Agreement may be executed in any number of counterparts with the same effect as if all
parties hereto had signed the same document, and all counterparts shall be construed together and shall constitute one and the same instrument. A facsimile, PDF or photocopied signature shall be deemed to be the functional equivalent of an original
for all purposes.
Section 5.14 Entire Agreement. This Agreement and Exhibits hereto, and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement among the parties hereto pertaining to the subject matter hereof and supersede all prior understandings and agreements pertaining thereto, whether oral or written.
Section 5.15 Further Assurances. Each party hereto shall, from time to time and without further consideration after the
Closing Date, execute such further instruments and take such other actions as any other party hereto shall reasonably request in writing to effectuate the purposes of this Agreement.
Section 5.16 Voting Agreement. The Sellers understand that the Company and Ultimark Products, Inc.
(Ultimark) have engaged in preliminary, non-binding discussions regarding the terms of a possible transaction involving Ultimark (or an affiliate thereof) and the Company (the Proposed Transaction). Each Seller,
with respect to such Sellers shares of Common Stock, does hereby constitute and appoint the Buyer, and each nominee of the Buyer, with full power of substitution, as his true and lawful attorney and proxy, for and in his name, place and stead,
to vote each of such shares of Common Stock, whether now owned or hereinafter acquired by such Seller or with respect to which such Seller has or hereafter acquires, as his proxy, at every annual, special or adjourned meeting of the stockholders of
the Company (including the right to sign his name (as stockholder) to any consent, certificate or other document relating to the Company that may be permitted or required by applicable law) (a) in favor of the approval of the Proposed
Transaction and any other transactions or agreements contemplated or entered into pursuant to the Proposed Transaction, (b) against any transaction pursuant to a Proposal (as defined in the Standstill Agreement Letter, dated as of
August 25, 2014, between the Company and Capital Preservation Solutions, LLC) by any party other than Ultimark, Buyer or their affiliates or any other action or agreement that would result in a breach of any covenant, representation or warranty
or any other obligation or agreement of the Company related to the Proposed Transaction or which could result in any of the conditions to the Companys obligations related to the Proposed Transaction or any other transaction or agreement
contemplated or entered into pursuant to the Proposed Transaction not being fulfilled, and (c) in favor of any other matter relating to the consummation of any agreement or transaction contemplated or entered into pursuant to the Proposed
Transaction. Each Seller further agrees to cause the number of shares of Common Stock over which he has voting power, whether now owned or hereinafter acquired by such Seller or with respect to which such Seller has or hereafter acquires voting
power, to be voted in accordance with the foregoing. Each Seller shall perform further acts and execute such further documents and instruments as may reasonably be required to vest in the Buyer the power to carry out the provisions of this
Section 5.16. The obligations of each Seller under this Section 5.16 shall terminate upon the earlier of (i) the date of termination of negotiations regarding the Proposed Transaction and (ii) the date of
termination of any transaction or agreement entered into pursuant to the Proposed Transaction.
[Signature Page Follows]
7
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first
above stated.
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|
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BUYER: |
|
CAPITAL PRESERVATION HOLDINGS, LLC |
|
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By: |
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/s/ Lance T. Funston |
|
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Name: |
|
Lance T. Funston |
|
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Title: |
|
Managing Member |
|
SELLERS: |
|
/s/ David Edell |
DAVID EDELL |
|
/s/ Ira Berman |
IRA BERMAN |
[Signature Page to Stock Purchase Agreement]
Exhibit A
Summary of Transfers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Seller |
|
Class A Common Shares |
|
|
Common Shares |
|
|
Total |
|
|
Purchase Price @$3.50/share |
|
Ira Berman |
|
|
483,087 |
|
|
|
100,000 |
|
|
|
583,087 |
|
|
$ |
2,040,805 |
|
David Edell |
|
|
484,615 |
|
|
|
100,000 |
|
|
|
584,615 |
|
|
$ |
2,046,152 |
|
Grafico Azioni CCA Industries (PK) (USOTC:CAWW)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni CCA Industries (PK) (USOTC:CAWW)
Storico
Da Giu 2023 a Giu 2024