Item 5.01. Change in Control of the Registrant.
Deseo Swimwear Inc. ("Deseo") was incorporated in the State of Nevada on April
20, 2015 and established a fiscal year end of December 31st. Deseo was
originally organized to design, manufacture and sell Dominican Republic inspired
swimwear. However, to entry into the agreements described below Deseo was an
inactive public company which did not have any revenues and did not operate any
trade or business.
In July 2022, Deseo and its affiliates entered into a series of agreement which,
if all conditions to closing shall occur, would result in a change of control of
Deseo and its entry into the construction business.
On July 15, 2022, Deseo entered into a contribution agreement (the "Contribution
Agreement") with Cody Development Corp,, a Louisiana corporation ("Cody") and
its sole shareholder Steven Ricks. Under the terms of the Contribution
Agreement, subject to the satisfaction of the conditions to closing set forth
therein, Mr. Ricks agreed to contribute to Deseo 100% of the capital stock of
Cody to Deseo. Based in Louisiana, Cody is engaged in the construction business
and is a subcontractor on a number of significant private and government
construction projects.
In a related development, Ricks Investment entered into a stock purchase
agreement, dated as of July 15, 2022, with Michael Rosen, the principal
stockholder and chief executive officer of Deseo (the "Rosen Purchase
Agreement"). Under the terms of the Rosen Purchase Agreement, and subject to
the satisfaction of the conditions to closing set forth therein, Mr. Rosen
agreed to sell to Rick Investment agreed, all 38,500,000 shares of Deseo common
stock owned by Mr. Rosen for a total purchase price of $202,493 payable in the
form of a twelve (12) month $202,493 installment note issued by Ricks Investment
(the "Note"). No payments will be required for the first 30 days after closing
and then the Note is payable in installments of $20,000 per month, commencing
September 30, 2022, for 10 months and $2,493 as a final payment at the end of
the 12th month following the closing. The Note is secured by a pledge of the
38,500,000 shares and as monthly installment payments are made on the Note, a
pro-rata percentage of the shares are subject to release from the pledge.
Deseo is currently indebted to Jon Darmstadter ("Darmstadter") for loans made in
the amount of $127,304. On June 23, 2022, Ricks Investments paid $75,000 on
behalf of Deseo in partial payment of the debt and agreed to pay the $52,304
balance on the closing of the transactions with Cody and its affiliate.
At closing of the above transactions, Deseo (to be renamed Cody Development
Holdings, Inc.) will enter into a consulting agreement with Darmstadter,
effective as of September 1, 2022, under which the consultant shall serve as a
business development advisor and report to Mr. Ricks, as the new Chief Executive
Officer. The agreement expires August 31, 2025; provided, that if (a) the
consolidated net revenues of Deseo over the three-year term of the agreement
equals or exceeds $15,000,000, and (b) the consolidated net revenues in the
third anniversary year of the term ending August 31, 2025 equal or exceed
consolidated net revenues in the second anniversary year of the Term ending
August 31, 2024, the term of the agreement shall be extended to August 31, 2026;
and provided further if consolidated net revenues in the anniversary year ending
August 31, 2026 equal or exceed $15,000,000, then and in such event the term of
this Agreement shall be extended to as late as August 31, 2027. In consideration
for his services, Mr. Darmstadter shall receive an annual consulting fee equal
to 2% of the consolidated net revenues of Deseo and its Cody subsidiary. Payable
in cash on a monthly basis; provided that if mutually agreed upon such
consulting fee may be paid in shares of Deseo common stock, valued at 100% of
the closing price as traded on any national securities exchange or trading
market at the time of issuance.
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Closing of the transactions contemplated by the above agreements are subject to
a number of conditions, including completion of the audited financial statements
of Cody for the two years ended December 31, 2021 and interim unaudited
financial statements for the two six month periods ended June 30, 2022, as well
as the preparation and filing with the SEC of a "jumbo" Form 8-K containing a
full description of the business and management of Deseo and Cody and a
description of the new board of directors of Deseo and its Cody subsidiary.
Item 5.02. Departure of Directors or Principal Officers; Election of Directors;
Appointment of Principal Officers.
Upon consummation of the above transactions, Ricks Investments will own a
minimum of 38,500,000 shares of the common stock of Deseo or approximately 60%
of the then outstanding shares. Accordingly, Ricks Investments or its affiliate
will have the power to appoint all of the members of the board of directors of
Deseo and all of its executive officers. It is contemplated that at the closing
Michael Rosen shall resign as Chief Executive Officer and a director, Steven
Ricks will become the new Chief Executive Officer of Deseo and its subsidiary
and Mr. Ricks and his designees shall become all of the members of the board of
directors of Deseo and its subsidiary.
The foregoing description of the agreements referred to above do not purport to
describe all of the terms and are qualified in their entirety by reference to
such agreements, which is filed as Exhibit 10.1 through 10.4 hereto and
incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
10.1 Stock purchase agreement between Ricks Investments, LLC and
Michael Rosen for 38,500,000 shares of Deseo common stock.
10.2 Form of $202,493 Ricks Investment installment note and pledge
agreement.
10.3 Contribution Agreement dated July 15, 2022, between Steven Ricks,
Cody Development Corp. and Deseo.
10.4 Consulting agreement with Jon Darmstadter
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
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