purchasing all of the outstanding shares of Atlas for an aggregate purchase price of $50,000. This purchase price will be paid through the issuance of 5,000,000 common shares, with a value of $0.01 per share, of the registrant.
In addition to the shares being issued, the registrant will grant an option for each seller to repurchase all of their Atlas shares for a cumulative price of $1.00, which is exercisable only upon the registrant filing a petition pursuant to Chapter 7 of the United States Bankruptcy Code.
Atlas currently has an operating line of credit with HEB. The registrant and Atlas have agreed to honor Atlas’s continuing obligations to HEB on a best efforts basis.
The shares of Atlas will remain pledged to the lender so long as the credit facility remains open.
Item 2.03: Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
On January 27, 2014, as part of the stock purchase agreement described above, the registrant has agreed to repay Atlas’ outstanding obligations to HEB on a best efforts basis. The total debt outstanding is approximately $5,100,000. HEB holds a security interest in all of the Atlas shares being purchased by the registrant in this offering.
