Exhibit 10.01

 

PURCHASE AND SALE AGREEMENT

 

This Purchase and Sale Agreement (the “Agreement”) is made and effective as of
May 18, 2020 between H/Cell Energy Corporation (the “Company”) and Turquino
Equity LLC (“Turquino”). The Company and Turquino are referred to herein
collectively as the “Parties”. The “Closing Date” shall be May 18, 2020 once all
Parties have duly and properly executed this Agreement.

 

WHEREAS, on January 31, 2017 (the “Closing Date”), the Company entered into a
share exchange agreement (the “Exchange Agreement”) by and among the Company,
The Pride Group (QLD) Pty Ltd (“Pride”) and Turquino and the Mullane Family
Trust (the “Mullane Trust” and together with Turquino, the “Pride
Shareholders”). Andrew Hidalgo and Matthew Hidalgo, the Company’s Chief
Executive Officer and Chief Financial Officer, respectively, are each a managing
member of Turquino, and accordingly are related parties in connection with the
Exchange Agreement as well as this Agreement.

 

WHEREAS, pursuant to the Exchange Agreement, the Company acquired all of the
issued and outstanding capital stock of Pride from the Pride Shareholders in
exchange for an aggregate of 3,800,000 shares of the Company’s common stock, par
value $.0001 per share.

 

WHEREAS, pursuant to the Exchange Agreement, Pride became a wholly owned
subsidiary of the Company.

 

WHEREAS, on January 2, 2018, the Company and Andrew Hidalgo (“Hidalgo”)
completed a Convertible Debenture Agreement whereby Hidalgo lent the Company
$200,000 (the “Hidalgo Note”), which is still outstanding and due with accrued
interest by the Company.

 

WHEREAS, on February 8, 2019, the Company and Hidalgo completed a second
Convertible Debenture Agreement whereby Hidalgo lent the Company $75,000 (the
“Second Hidalgo Note”), of which is still outstanding and due with accrued
interest by the Company.

 

WHEREAS, on January 2, 2018, the Company and Michael Doyle (“Doyle”) completed a
Convertible Debenture Agreement whereby Doyle lent the Company $200,000 (the
“Doyle Note”), which is still outstanding and due with accrued interest by the
Company.

 

WHEREAS, on February 8, 2019, the Company and Doyle completed a second
Convertible Debenture Agreement whereby Doyle lent the Company $75,000 (the
Second Doyle Note”), which is still outstanding and due with accrued interest by
the Company.

 

WHEREAS, as of May 18, 2020, the aggregate notes balance due for the Hidalgo
Note and the Second Hidalgo Note is $275,000 plus accrued interest and the
aggregate notes balance due for the Doyle Note and the Second Doyle Note is
$275,000 plus accrued interest.

 

WHEREAS, in conjunction with the transactions described herein, pursuant to an
Assignment and Assumption Agreement, Hidalgo will assign the Hidalgo Note and
the Second Hidalgo Note and its accrued interest to Turquino and Turquino will
accept such assignment, at which time Turquino will become responsible for the
obligations upon the Notes and the Company will have no further note obligations
to Hidalgo.

 

WHEREAS, in conjunction with the transactions described herein, pursuant to an
Assignment and Assumption Agreement, Doyle will assign the Doyle Note and the
Second Doyle Note and its accrued interest to Turquino, and Turquino will accept
such assignment, at which time Turquino will become responsible for the
obligations upon the Notes and the Company will have no further note obligations
to Doyle.

 

WHEREAS, the Company wishes to sell 100% of the outstanding stock of Pride to
Turquino in return for the assignment and assumption of the balance and accrued
interest of the Hidalgo Note, Second Hidalgo Note, Doyle Note and Second Doyle
Note.

 

WHEREAS, in conjunction with the transaction provided for herein, the Company
retained the services of Stonebridge Advisory, Inc. to prepare an Independent
Valuation of Pride, which valuation valued Pride at $425,000 USD.

 

WHEREAS, this Agreement has been approved by the Company’s and Turquino’s Board
of Directors.

 

 

 

 

WHEREAS, the Closing Date shall represent the date upon which all of the
respective obligations of the Parties as set forth herein will be agreed and
duly authorized.

 

NOW THEREFORE, In consideration of the mutual covenants and agreements
hereinafter set forth and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the above WHEREAS clauses
above are agreed to as well as the following specific terms:

 

1. Divestiture

 

Upon the terms and subject to the conditions set forth in this Agreement, the
Company will sell, transfer and deliver to Turquino its entire ownership
interest in Pride which consists of 100% of the issued and outstanding shares of
Pride, free and clear of all liens, claims or encumbrances of any kind (the
Company represents that the Pride shares are not certificated, accordingly, the
transfer thereof shall be deemed to have occurred as of the Closing Date) in
exchange for the following consideration: (a) Turquino assuming the Hidalgo Note
and the Second Hidalgo Note and the debt obligations associated with the balance
and accrued interest (b) Turquino assuming the Doyle Note and the Second Doyle
Note and the debt obligations associated with the balance and accrued interest.
The aggregate consideration or debt obligations for (a) and (b) are $550,000
plus accrued interest.

 

2. Assignment

 

In conjunction with the transactions provided for herein the applicable Parties
will execute an Assignment and Assumption Agreement, as follows: (a) Hidalgo
shall assign the Hidalgo Note and the Second Hidalgo Note to Turquino and
Turquino accept such assignment and assumption; (b) Doyle shall assign the Doyle
Note and the Second Doyle Note to Turquino and Doyle shall accept such
assignment and assumption.

 

3. Closing

 

The consummation of the transaction contemplated hereby (the “Closing”) will
take place by the reciprocal delivery of closing documents by electronic mail,
regular mail, fax, or any other means mutually agreed upon by the Parties.

 

4. Representations and Warranties

 

The execution of this Agreement and the delivery hereof, and the sale
contemplated herein, have been or will be prior to the Closing Date, duly
authorized by all necessary corporate action. Each Party has the full legal
right, power, and authority to execute, deliver and carry out the terms and
provisions of this Agreement, and this Agreement has been duly and validly
executed and delivered and constitutes a valid and binding obligation
enforceable in accordance with its terms.

 

4. Mutual Release – Release of the Parties

 

Except as set forth in this Agreement, the Parties mutually agree to release one
another and hereby discharge and release the other party and their respective
current and former officers, directors, employees, shareholders, note holders,
attorneys, assigns, agents, representatives, predecessors and successors in
interest, from any and all claims, demands, obligations, or causes of action,
known or unknown, heretofore or hereafter arising out of, connected with, or
incidental to the Purchase Agreement and any understandings, arrangements or
other agreements, verbal or written, related thereto.

 

5. Further Assurances

 

The Parties each agree to execute and deliver such other documents or agreements
and to take such other action as may be reasonably necessary or desirable for
the implementation of this Agreement and the consummation of the transactions
contemplated hereby.

 

6. Legal Advice

 

The parties received independent legal advice from their attorneys with respect
to the advisability of making this Agreement.

 

 

 

 

7. Non-Disparagement

 

The Parties agree that they shall take no action that is inimical to the best
interests of their counter-party respectively, including but not limited to:
publishing material that disparages or makes any negative comments whatsoever
about the other party, any Releases, to any person, entity, or the media be it
orally, in writing, via e-mail or otherwise; participating in interviews or
publishing press releases regarding this Agreement except as may be required by
law, rule or regulation.

 

8. Meaning of Terms

 

When necessary herein, all terms used in the singular shall apply to the plural,
and vice versa, and all terms used in the masculine shall apply to the neuter
and feminine genders, and vice versa. The headings of paragraphs of this
Agreement are inserted solely for convenience of reference and are not a part of
and are not intended to govern, limit or aid in the construction of any term or
provision hereof.

 

9. Entire Agreement

 

This Agreement is intended to be the sole, integrated understanding and
agreement of the parties hereto with respect to all matters addressed herein and
may not be modified except by a writing executed by all parties.

 

10. Counterparts.

 

This Agreement may be executed in counterparts, each of which shall be deemed an
original, but all of which together shall be deemed to be one and the same
agreement. A signed copy of this Agreement delivered by facsimile, e-mail or
other means of electronic transmission shall be deemed to have the same legal
effect as delivery of an original signed copy of this Agreement.

 

The Parties have caused this agreement to be executed on the date first set
forth above.

 

H/CELL ENERGY CORPORATION

 

By: /s/ Andrew Hidalgo   Andrew Hidalgo, Chief Executive Officer  

 

TURQUINO EQUITY LLC

 

By: /s/ Andrew Hidalgo   Andrew Hidalgo, Managing Member