COMMON STOCK PURCHASE AGREEMENT
EXHIBIT 10.1
THIS
COMMON STOCK PURCHASE AGREEMENT (this "Agreement") is dated
as of December 14, 2009 (the “Effective Date”) by
and between CoConnect, Inc., a Nevada corporation (the “Company”) and
Turnaround Advisors, L.C., a Utah limited liability company (the "Investor").
RECITALS
WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to
Section 4(2) of the Securities Act (as defined below), the Company desires to
issue and sell to the Investor, and the Investor desires to purchase from the
Company certain securities of the Company, as more fully described in this
Agreement.
WHEREAS, the Company is offering up to
166,666 shares of its common stock, par value $0.001 per share (the “Common Stock” and,
the shares being offered herein, the “Shares”) to the
Investor at a purchase price of $0.45 per share (the “Price Per Share”) for
total offering amount of $75,000.
AGREEMENT
NOW,
THEREFORE, in consideration of the mutual covenants contained in this Agreement,
and for other good and valuable consideration the receipt and adequacy of which
are hereby acknowledged, the Company and the Investors agree as
follows:
1. Agreement to
Purchase.
1.1 Closing. The
Investor hereby agrees to purchase, and the Company hereby agrees to sell,
166,666 shares of the Company’s common stock, par value $.001 per share (the
“Shares”)
pursuant to the conditions set forth herein. The aggregate purchase
price of the Shares being sold to the Investor hereunder is $75,000 (the “Total Purchase
Price”) at the Price Per Share. The Investor shall initially deliver to
the Company’s escrow agent $5,000 of the Total Purchase Price (the “Initial Payment”)
according to instructions provided by the Company. The remaining $70,000 of the
Total Purchase Price (the “Final Payment”) shall
be delivered to the Company on or before the one year anniversary of the
Effective Date herein. The Company’s escrow agent will hold the Initial Payment
in escrow pending execution of the Agreement, at which time the Agreement will
be deemed complete and the Shares will be issued to the Investor for accepted
subscriptions therefor.
1.2 Closing
Deliveries.
(a) Following
the execution of this Agreement, the Company shall deliver or cause to be
delivered to the Investor a certificate evidencing the Shares, registered in the
name of the Investor (provided that originals of the same are delivered to the
address provided by the Investor) and a signed copy of this
Agreement.
(b) Following
the execution of this Agreement, the Investor shall deliver or cause to be
delivered to the Company or the Company’s escrow agent the Initial Payment, in
United States Dollars and in immediately available funds, by wire transfer to
the account or accounts designated by the Company for such purpose and, for
avoidance of doubt, any funds held in escrow by the Company or its escrow agent,
representing funds for accepted subscriptions shall be released to the Company
and Shares subsequently delivered to the Investor or its/his designee. The Final
Payment shall be delivered on or before the one year anniversary of the
Effective Date herein and shall not in any way affect the closing of this
Agreement.
2. Representations,
Warranties and Covenants of the Investor. The Investor
represents and warrants to the Company, and covenants for the benefit of the
Company, as follows:
(a) Organization and
Qualification. The Investor is duly incorporated or otherwise
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, with the requisite power and authority to own
and use its properties and assets and to carry on its business as currently
conducted. The Investor is not in any material violation of any of
the provisions of its certificate of incorporation, bylaws or other
organizational or charter documents.
(b) The
Investor is an "accredited investor" as defined under Rule 501 of Regulation D
promulgated under the Securities Act of 1933, as amended (the "Securities
Act");
(c) The
Investor is acquiring the Shares for its own account and not with a view to any
distribution of the Shares in violation of the Securities Act;
(d) The
Investor acknowledges that it has significant prior investment experience,
including investment in non-listed and non-registered securities, and that the
Investor recognizes the highly speculative nature of this
investment. In particular, and without limitation, the Investor
represents that it understands that the Company’s securities have suffered
significant illiquidity and decline in stock price and that other restricted
shareholders are eligible to sell securities pursuant to Rule 144 of the
Securities Act. The Investor represents that it has been furnished
with, and has reviewed, all of the Company’s securities filings and all
documents and other information regarding the Company that the Investor had
requested or desired to know and all other documents which could be reasonably
provided have been made available for the Investor’s inspection and
review;
(e) The
Investor acknowledges that the Shares have not been passed upon or reviewed by
the Securities and Exchange Commission. The Investor agrees that it
will not sell, transfer or otherwise dispose of any of the Shares until they are
registered under the Securities Act, or unless an exemption from such
registration is available and that a legend substantially in the form as
provided in Section 4 below will be placed on the certificate(s) representing
the shares to such effect;
(f) This
Agreement constitutes a valid and binding agreement and obligation of the
Investor enforceable against the Investor in accordance with its terms, subject
to limitations on enforcement by general principles of equity and bankruptcy or
other laws affecting the enforcement of creditors' rights
generally;
(g) Investor
is not acquiring the Shares as part of a group, as such term is defined in
Section 13 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), and
is not acting in concert with any person acting in such
manner. Investor makes its own voting and dispositive decisions and
has not agreed to grant any proxy or enter into any form of voting trust,
agreement or similar arrangement with respect to the Shares; and
(h) This
Agreement has been duly authorized, validly executed and delivered on behalf of
the Investor, and the Investor has full power and authority to execute and
deliver this Agreement and the other agreements and documents contemplated
hereby and to perform his obligations hereunder and thereunder; and
(i) The
Investor understands that Investor is investing in the Company which has nominal
revenues, operating history or assets and a limited trading history, is, or at
one time was a “shell company” as that term is defined in Rule 405 of the
Securities Act and that, the Company is a startup with limited assets and no
operating or revenue history. Additionally, limited information is
available to the Company or Investor, about the market generally and the
business prospects of the Company. Additionally, the Company will
need substantial additional cash in order to be effective with the execution of
its business plan, and no commitments for capital have been
obtained. Accordingly, an investment in the Shares entails an
extremely high degree of risk, uncertainty and illiquidity, including the risk
of loss of one’s entire investment.
3. Representations,
Warranties and Covenants of the Seller. The Company
represents and warrants to the Investor, and covenants for the benefit of the
Investor, as follows:
(a) Organization and
Qualification. The Company is duly incorporated or otherwise
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation, with the requisite power and authority to own
and use its properties and assets and to carry on its business as currently
conducted. The Company is not in any material violation of any of the
provisions of its certificate of incorporation, bylaws or other organizational
or charter documents.
(b) Authorization;
Enforcement. The Company has the requisite corporate power and
authority to enter into and to consummate the transactions contemplated herein
and otherwise to carry out its obligations hereunder, subject to consents and
waiver of anti dilution provisions of various existing
shareholders. The execution and delivery of this Agreement by the
Company and the consummation by it of the transactions contemplated thereby have
been duly authorized by all necessary corporate action on the part of the
Company and no further action is required by the Company in connection
therewith. This Agreement has been duly executed by the Company and,
when delivered in accordance with the terms hereof, will constitute the valid
and binding obligation of the Company enforceable against the Company in
accordance with its terms, except as such enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally the enforcement of, creditors’
rights and remedies, or (ii) laws relating to the availability of specific
performance, injunctive relief or other equitable principles of general
application.
(c) Issuance of the
Shares. The Shares have been duly authorized and, when issued
in accordance with this Agreement, will be duly and validly issued, fully paid
and nonassessable, free and clear of all liens. Any claims by the
Company against the Investor in connection with the delivery of the Final
Payment shall not affect the ownership rights of the Shares and shall represent
a wholly separate claim by the Company against the Investor limited to monetary
damages.
(d) SEC Reports; Financial
Statements. The Company has filed all reports required to be
filed by it under the Securities Act and the Exchange Act, including pursuant to
Section 13(a) or 15(d) thereof, for the twelve months preceding the date hereof
(or such shorter period as the Company was required by law to file such reports)
(the foregoing materials being collectively referred to herein as the "SEC Reports") on a
timely basis or has timely filed a valid extension of such time of filing and
has filed any such SEC Reports prior to the expiration of any such
extension. As of their respective dates, the SEC Reports complied in
all material respects with the requirements of the Securities Act and the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder, and none of the SEC Reports, when filed, contained any untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading, except to the
extent that such SEC Reports may have been subsequently amended or supplemented
to correct such misstatement or omission. The financial statements of
the Company included in the SEC Reports comply in all material respects with
applicable accounting requirements and the rules and regulations of the
Commission with respect thereto as in effect at the time of filing.
(e) Certain Registration
Matters. Assuming the accuracy of the Investor’s representations and
warranties, no registration under the Securities Act is required for the offer
and sale of the Shares by the Company to the Investor under this
Agreement.
4. Other
Agreements of the Parties.
(a) The
Company and the Investor agree that the Shares may only be disposed of in
compliance with state and federal securities laws. In connection with
any transfer of the Shares other than pursuant to an effective registration
statement, to the Company or to an affiliate of an Investor, the Company may
require the transferor thereof to provide to the Company with an opinion of
counsel selected by the transferor, the form and substance of which opinion
shall be reasonably satisfactory to the Company, to the effect that such
transfer does not require registration of such transferred Shares under the
Securities Act. As a condition of transfer, any such transferee shall
agree in writing to be bound by the terms of this Agreement.
(b) Certificates
evidencing the Shares will contain substantially the following legend, until
such time as they are not required under Section 4(c):
THESE
SECURITIES HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION
OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO
SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE
COMPANY’S COUNSEL. THESE SECURITIES MAY BE PLEDGED IN CONNECTION WITH
A BONA FIDE MARGIN ACCOUNT SECURED BY SUCH SECURITIES.
(c) Certificates
evidencing the Shares shall not contain any legend (including the legend set
forth in Section 4(b)) following a sale or transfer of such Shares pursuant to
Rule 144 (assuming the transferor is not, and does not become, an affiliate of
the Company). The Company may not make any notation on its records or
give instructions to any transfer agent of the Company that enlarge the
restrictions on transfer set forth in this Section. Notwithstanding
the foregoing, the Investor represents that it understands that the Company was
and is a shell company and, accordingly, its ability to utilize the resale
exemptions provided pursuant to Rule 144 in the event that the Company becomes
non compliant with its ongoing requirements to file all required SEC Reports, or
to request a legend removal without a sale, is accordingly limited.
5. Delivery
of Share Certificates. As soon as
practicable after the delivery of the Initial Payment, the Company agrees to
cause manually executed originals of a certificate evidencing the Shares,
registered in the name of such Investor to be delivered to such Investor at the
address specified by the Investor to the Company in writing, or otherwise
electronically delivered to the qualifying investment bank or custodian
requested by Investor.
6. Binding
Effect; Assignment. This Agreement is
not assignable by the Company or the Investor without the prior written consent
of the other party. This Agreement and the provisions hereof shall be
binding and shall inure to the benefit of the Company and its successors and
permitted assigns with respect to the obligations of the Investor under this
Agreement, and to the benefit of the Investor and its successors and permitted
assigns with respect to the obligations of the Company under this
Agreement.
7. Governing
Law; Jurisdiction. This Agreement
shall be governed by and interpreted in accordance with the laws of the State of
Nevada without giving effect to conflicts of law principles that would result in
the application of the substantive laws of another jurisdiction.
8. Entire
Agreement. This Agreement constitutes the entire understanding
and agreement of the parties with respect to the subject matter hereof and
supersedes all prior and/or contemporaneous oral or written proposals or
agreements relating thereto all of which are merged herein. This
Agreement may not be amended or any provision hereof waived in whole or in part,
except by a written amendment signed by both of the parties.
9. Survival. The
representations and warranties of the Company and the Investor shall survive the
closing hereunder.
***SIGNATURE
PAGE FOLLOWS***
SIGNATURE
PAGE
IN
WITNESS WHEREOF, this Agreement was duly executed on the date first written
above.
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COMPANY
CoConnect,
Inc.
/s/
Xxxx X. Xxxxxxx
_________________________
By:
Xxxx X. Xxxxxxx
Its:
Interim Chief Executive Officer
|
INVESTOR
Turnaround
Advisors, L.C.
/s/
Xxxxx Xxxx
_________________________
By:
Xxxxx Xxxx
Its:
Managing Member
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A FACSIMILE COPY OF THIS AGREEMENT
SHALL HAVE THE SAME LEGAL EFFECT AS AN ORIGINAL OF THE SAME.
