ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
Stock Purchase Agreement
On June 3, 2014
, the Board of Directors of Kleangas Energy Technologies, Inc.
corporation (the "Company"), finalized and authorized the execution of
that certain stock purchase agreement dated June 3, 2014
(the "Stock Purchase
Agreement") with Lori Willis
("Willis"), the sole shareholder of record of
Second Cycle Recycling Inc.
, a private Indiana
corporation ("SCR"). In
accordance with the terms and provisions of the Stock Purchase Agreement, the
Company shall acquire from Willis 100% of the total issued and outstanding
shares of common stock of SCR in consideration of the purchase price of $300,000
(the "Purchase Price"), which shall include all the assets of SCR. Thus, SCR
will become the wholly-owned subsidiary of the Company.
The Purchase Price shall be paid as follows: (i) issuance by the Company of
25,000,000 shares of its restricted common stock with a per share price of
for aggregate valuation of $100,000
; and (ii) $200,000
with (a) $5,000
paid upon closing of the Stock Purchase Agreement, (b) $2,000
per week until the
new facility is generating sufficient revenue pursuant to which the remaining
balance will be paid in full or payments will be accelerated, (c) $500
to be applied to start-up expenses until the new facility is generating
sufficient revenue pursuant to which the remaining balance will be paid in full
or payments will be accelerated.
In further accordance of the terms and provisions of the Stock Purchase
Agreement, the Company will invest $500,000
worth of equity and equipment over
the next twelve months to expand the operations of SCR. Willis agrees to a
non-compete agreement for a minimum of two years. It is anticipated that the
Company will enter into an employment agreement with Willis as soon as SCR
It is anticipated that the closing of the Stock Purchase Agreement will occur on
or before June 30, 2014
together with the issuance of the 25,000,000 shares and
payment of the $5,000
SCR is a paper pellet manufacturer that makes paper without a binder. The paper
pellets are comprised 100% of paper without the use of gums, plastics or rubber
to hold the pellets together. SCR has successfully infused fertilizer into its
paper pellets. The pellets were tested by an independent lab. SCR will by
applying for its land application permit with the State of Indiana
believes that this will open up markets into the horticulture, landscaping and
farming industries. SCR has also successfully made kitty litter from its pellets
and sells its products to pet store customers. The current products sold by SCR
are animal bedding pellets, kitty litter, home heating pellets and absorbing
ITEM 8.01 OTHER EVENTS
On April 7, 2014
, the Company through its lawyers filed a complaint against
several John Does who had posted defamatory comments on Investor Hub under
aliases captioned Kleangas Energy Technologies Inc.
, a Delaware
Plaintiff, vs John Does Defendants.
Subsequently, the Company, through its lawyer, sent a demand letter dated June
(the "Demand Letter") to one of those specific aliases, Perry Ferzoco
("Ferzoco"). The Demand Letter specifically demands that Ferzoco cease and
desist from circulating false and disparaging statements about the company
through postings on a message board at Investors Hub. The Company believes its
has suffered irreparable harm to its busienss reputation and business interests
as a result of these false and disparaging statements posted by Ferzoco. The
Demand Letter further demanded that Ferzoco pay all reasonable costs incurred by
the Company in addressing this situation. The Company did not receive any
response from Ferzoco.
Therefore, on June 10, 2014
, the Company filed an amended complaint with the
of the 11th Judicial District
in and for Miami-Dade County
captioned Kleangas Energy Technologies Inc.
, a Delaware
vs. Perry Ferzoco
, Defendent, Case No. 14-8954-CA-01 (the "Complaint"). The
Complaint alleges that Ferzoco has continuously defamed the Company and its
executive officers through postings on Investors Hub, an Internet forum for
investors to gather and share market insights. The Company further alleges that
such statements constitute defamation per se and seeks compensatory damages in
excess of $15,000
to be proven at trial, attorneys fees and costs incurred,
pre-judgment and post-judgment interest and any and all such other or additional
relief as is just and proper.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements of Business Acquired.
(b) Pro forma Financial Information.
(c) Shell Company Transaction.
10.1 Stock Purchase Agreement dated June 3, 2014
between Kleangas Energy
and Lori Willis