Securities Purchase Agreement (2007)Full Document 

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SECURITIES PURCHASE AGREEMENT
 
THIS SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of June 29, 2007, by and among Buckeye Ventures, Inc., a Michigan corporation, with headquarters located at 4455 Lamont Street, Suite 3, San Diego, CA 92109 (the “Company”), and the Buyers listed on Schedule I attached hereto (individually, a “Buyer” or collectively “Buyers”).
 
WITNESSETH:
 
WHEREAS, the Company and the Buyer(s) are executing and delivering this Agreement in reliance upon an exemption from securities registration pursuant to Section 4(2) and/or Rule 506 of Regulation D (“Regulation D”) as promulgated by the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “1933 Act”);
 
WHEREAS, the parties desire that, upon the terms and subject to the conditions contained herein, the Company shall issue and sell to the Buyer(s), as provided herein, and the Buyer(s) shall purchase, up to Five Million Dollars ($5,000,000) of the 10% Secured Convertible Debentures to be issued by the Company substantially in the form of Exhibit A attached hereto (the “Convertible Debentures”) in the respective amounts set forth opposite each Buyer(s) name on Schedule I (the “Subscription Amount”) which shall be convertible into shares of the Company’s common stock, par value $.001, (the “Common Stock”) (as converted, the “Conversion Shares”) as set forth below in Section 1(a); and
 
WHEREAS, contemporaneously with the execution and delivery of this Agreement, the parties hereto are executing and delivering an Investor Registration Rights Agreement substantially in the form attached hereto as Exhibit B (the “Investor Registration Rights Agreement”) pursuant to which the Company has agreed to provide certain registration rights under the 1933 Act and the rules and regulations promulgated there under, and applicable state securities laws; and
 
WHEREAS, the aggregate proceeds of the sale of the Convertible Debentures contemplated hereby shall be held in escrow pursuant to the terms of an escrow agreement substantially in the form of the Escrow Agreement attached hereto as Exhibit C (the “Escrow Agreement”); and
 
WHEREAS, contemporaneously with the execution and delivery of this Agreement, the Company is executing and delivering Irrevocable Transfer Agent Instructions substantially in the form attached hereto as Exhibit D (the “Irrevocable Transfer Agent Instructions”); and
 
WHEREAS, contemporaneously with the execution and delivery of this Agreement, the parties hereto are executing and delivering a Security Agreement substantially in the form attached hereto as Exhibit E (the “Security Agreement”) pursuant to which the Company has agreed to provide the Buyer(s) a security interest in Pledged Collateral (as this term is defined in the Security Agreement dated the date hereof) to secure the Company’s obligations under this Agreement, the Convertible Debenture, the Investor Registration Rights Agreement, the Irrevocable Transfer Agent Instructions, the Security Agreement (collectively, the “Transaction Documents”) or any other obligations of the Company to the Buyer(s); and
 
 
 

 
 
NOW, THEREFORE, in consideration of the mutual covenants and other agreements contained in this Agreement, the Company and the Buyer(s) hereby agree as follows:
 
1.    PURCHASE AND SALE OF CONVERTIBLE DEBENTURES.
 
(a)    Purchase of Convertible Debentures. Subject to the satisfaction (or waiver) of the terms and conditions of this Agreement, each Buyer agrees, severally and not jointly, to purchase at each Closing (as defined herein below) and the Company agrees to sell and issue to each Buyer, severally and not jointly, at such Closing, Convertible Debentures in an aggregate amount of Five Million Dollars ($5,000,000.00) (the “Purchase Price”) in amounts corresponding with the Subscription Amount set forth opposite each Buyer’s name on Schedule I hereto, as follows: (i) Buyer(s) shall purchase an aggregate of One Million Five Hundred Thousand Dollars ($1,500,000.00) of Convertible Debentures (the “First Closing”) on or before the date set forth in a letter from the Secretary of the Company certifying that the Company intends to consummate acquisitions in San Diego and Phoenix (or such other acquisitions as may be mutually agreed to by Buyers and the Company) on the date set forth in such letter (the “First Certificate”); (ii) One Million Seven Hundred Fifty Thousand Dollars ($1,750,000.00) of Convertible Debentures (the “Second Closing”) on or before the date set forth in a letter from the Secretary of the Company certifying that the Company intends to consummate an acquisition in Orlando (or such other acquisitions as may be mutually agreed to by Buyers and the Company) on the date set forth in such letter (the “Second Certificate”); and (iii) One Million Seven Hundred Fifty Thousand Dollars ($1,750,000.00) of Convertible Debentures (the “Third Closing”) on or before the date set forth in a letter from the Secretary of the Company certifying that the Company intends to consummate an acquisition in Los Molinos (or such other acquisitions as may be mutually agreed to by Buyers and the Company) on the date set forth in such letter (the “Third Certificate”) (each individually referred to as a “Closing” and collectively referred to as the “Closings”). Upon execution hereof by a Buyer, the Buyer shall wire transfer the Subscription Amount set forth opposite his name on Schedule I in same-day funds or a check payable to: “James G. Dodrill II, P.A. as Escrow Agent for Buckeye Ventures./Trafalgar Capital Investment Fund”, which Subscription Amount shall be held in escrow pursuant to the terms of the Escrow Agreement (as hereinafter defined) and disbursed in accordance therewith.
 
(b)    Closing Date. The First Closing of the purchase and sale of the Convertible Debentures shall take place at 10:00 a.m. Eastern Standard Time on or before the date set forth in the First Certificate, subject to notification of satisfaction of the conditions to the First Closing set forth in Sections 6 and 7 below, which shall be no later than July 31, 2007, which may be extended up to twenty additional days by the mutual agreement of the parties (or such later date as is mutually agreed to by the Company and the Buyer(s)) (the “First Closing Date”). The Second Closing of the purchase and sale of the Convertible Debentures shall take place at 10:00 a.m. Eastern Standard Time on or before the date set forth in the Second Certificate, subject to notification of satisfaction of the conditions to the Second Closing set forth in Sections 6 and 7 below (or such later date as is mutually agreed to by the Company and the Buyer(s)) (the “Second Closing Date”). The Third Closing of the purchase and sale of the Convertible Debentures shall take place at 10:00 a.m. Eastern Standard Time on or before the date set forth in the Third Certificate, subject to notification of satisfaction of the conditions to the Third Closing set forth in Sections 6 and 7 below (or such later date as is mutually agreed to by the Company and the Buyer(s)) (the “Third Closing”)(together with the First Closing Date and Second Closing Date, collectively referred to as the “Closing Dates”). The Closings shall occur on their respective Closing Dates at the offices of James G. Dodrill II, P.A., 5800 Hamilton Way, Boca Raton, FL 33496 (or such other place as is mutually agreed to by the Company and the Buyer(s)).
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