Item 1.01 Entry into Material Definitive Agreement.
Share Purchase Agreement
On December 21, 2020, Gulf West Security Network, Inc., a Nevada corporation
("Gulf West"), Josephine Brown ("Brown"), an individual and Westech Security and
Investigations Inc., a New York Corporation entered into, a Share Purchase
Agreement (the "SPA"), pursuant to which, among other things, subject to the
satisfaction or waiver of the conditions set forth in the SPA, Brown, the sole
shareholder and owner of all the issued and outstanding securities of Westech,
will sell all of her shares to Gulf West (the "Sale"). Brown will receive an
aggregate of approximately 66% of the issued and outstanding shares of common
stock of Gulf West, post-closing, as consideration for the Sale. The remaining
approximately 34% of Gulf West's issued and outstanding shares of common stock
shall consist of presently issued and outstanding shares of common stock of Gulf
West (please refer to Stock Split set forth below) and the following to be
issued in the form of Gulf West's Series E Preferred stock ("Series E Stock"),
post-closing, convertible into one share of Gulf West's shares of common stock,
and shall consist of the following: (i) an exchange of all currently outstanding
preferred stock of Gulf West, (ii) an exchange of all outstanding loans to Gulf
West which shall either be satisfied or convert to Series E immediately
following the closing of the Sale so that there are no outstanding loans to Gulf
West at closing of the Sale (iii) a bridge loan of $500,000 previously made to
Westech, which shall convert to Series E immediately following the closing of
the Sale and (iv) an investment of $750,000 into Gulf West at closing of the
Sale.
Furthermore, subject to the approval of its shareholders and subject to the
discretion of the Board of Directors of Gulf West (the "Board") Gulf West will
(i) change its name to "Westech Security and Investigation Inc.;" (ii) increase
the number of shares of authorized Preferred Stock so it has a sufficient amount
of Preferred Stock to undertake the transactions contemplated by the Sale; and
(iii) undertake a 1 for 187 reverse stock split of its shares of common stock
(the "Stock Split"). In addition, in connection with, and subject to, an
additional acquisition post-closing of the Sale, and upon receipt of an
additional investment of $1.25 million acquisition, Gulf West shall issue
1,250,000 shares of Series E Stock for such investment.
Consummation of the transactions contemplated by the SPA is subject to certain
closing conditions, including, among other things, approval by the Board,
extinguishment of all outstanding loans owed by Gulf West as set forth above, a
$750,000 investment as set forth above and delivery of the required audited
financial statements of Westech. After the consummation of the Stock Split, Gulf
West shall have approximately 25,000 shares of common stock issued and
outstanding. The SPA contains certain termination rights for Gulf West and
Westech. The SPA also contains customary representations, warranties and
covenants made by, among others, Gulf West and Westech, including as to the
conduct of their respective businesses between the date of signing the SPA and
the closing of the transactions contemplated thereby. The closing of the SPA is
proposed to occur during the first quarter of 2021, subject to delivery of the
required audited financial statements of Westech, which is a condition to
closing of the Sale.
The foregoing description of the Merger Agreement and the transactions
contemplated thereby does not purport to be complete and is qualified in its
entirety by reference to the SPA, which is filed herewith as Exhibit 2.1 and is
incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d)
2.1 Share Purchase Agreement, dated as of December 21, 2020, by and among
the parties named therein.*
__________
* Certain schedules and exhibits to this agreement have been omitted pursuant to
Item 601(b)(2) of Regulation S-K. Gulf West Security Network Inc. agrees to
furnish a supplemental copy of any omitted schedule to the SEC (as defined
below) upon request.
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