EXHIBIT 99.1
AFFILIATE STOCK PURCHASE AGREEMENT
THIS AFFILIATE STOCK PURCHASE AGREEMENT ("Agreement") is made as of the 1st
day of December, 2010, by and between Shan Qiang (the "Seller") and Farm Lands
of Guinea Limited, an entity duly formed and existing under the laws of the
British Virgin Islands (the "Purchaser") as to 4,500,000 shares, of Kryptic
Entertainment Inc. The Purchaser and the Seller may collectively be referred to
herein as the "Parties."
RECITALS
WHEREAS, the Seller is the owner of Four Million Five Hundred Thousand
(4,500,000) restricted shares of common stock of Kryptic Entertainment Inc., a
corporation duly formed and existing under the laws of the State of Nevada,
United States of America (the "Company");
WHEREAS, the Seller is the owner of Twenty-seven Thousand Five Hundred U.S.
Dollars ($27,500) of non-interest bearing debt (the "$27,500 Debt"), payable and
made by the Company to Seller; and
WHEREAS, the Seller proposes to sell to the Purchaser the Four Million Five
Hundred Thousand (4,500,000) restricted shares of common stock of the Company
currently owned by the Seller (the "Purchased Shares"), on the terms set forth
herein.
In consideration of the premises, representations, warranties and covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Purchase and Sale; Pre-purchase Fees; Closing.
1.1 The Seller hereby agrees to sell, assign, transfer and deliver to the
Purchaser, and the Purchaser hereby agrees to purchase from the Seller, the
Purchased Shares and the $27,500 Debt for the aggregate purchase price of
Eighty-six Thousand Five Hundred U.S. Dollars ($86,500) if Closing occurs on or
before December 31, 2010 and One Hundred and Six Thousand, Five Hundred U.S.
Dollars ($106,500) if Closing occurs subsequent to December 31, 2010 but on or
before January 31, 2011 (the "Purchase Price"). The full amount of the Purchase
Price shall be delivered in U.S. Dollars, by wire transfer to the IOLTA/client
trust account established with the Law Offices of Xxxxxx X. Xxxxx, PLLC, as
follows:
Account Holder Name: Law Offices of Xxxxxx X. Xxxxx, PLLC, IOLTA account
Bank: XX Xxxxxx Xxxxx Bank, N.A.
Bank Branch Address: 0000 00xx Xxx. XX, Xxxxxxx, XX 00000, XXX
Account #:
ABA#:
SWIFT code:
Bank Telephone: x0 (000) 000-0000, option 3 (Xxxxx Xxxx - Xxxxx Manager)
1.2 Non-refundable $50,000 fee; Refundable $20,000 fee.
(a) Within two (2) business days of the execution of this Agreement by the
Parties, the Purchaser shall pay to the Seller a non-refundable fee of Fifty
Thousand U.S. Dollars ($50,000), delivered by wire transfer to Law Offices of
Xxxxxx X. Xxxxx, PLLC, pursuant to the wire transfer instructions in Section
1.1. The non-refundable $50,000 fee shall be credited towards the Purchase
Price. If the Closing in Section 1.3 does not occur by December 31, 2010, Seller
may keep the non-refundable $50,000 fee without any obligation to the Purchaser
and this Agreement shall terminate; provided, however, if the Seller has caused
Closing not to timely occur by the failure to deliver to the Purchaser those
items in Sections 1.3(a) and (b), in which case such $50,000 shall be returned
to Seller not later than January 7, 2011, and this Agreement shall terminate on
January 31, 2011.
(b) In the event that Closing does not occur by December 31, 2010,
Purchaser may extend the term of this Agreement to January 31, 2011, by paying
the Seller, on or before December 31, 2010, a refundable fee of Twenty Thousand
U.S. Dollars ($20,000), delivered by wire transfer to Law Offices of Xxxxxx X.
Xxxxx, PLLC, pursuant to the wire transfer instructions in Section 1.1. The
refundable $20,000 fee shall be credited towards the Purchase Price. If the
Closing in Section 1.3 does not occur by January 31, 2011, Seller shall return
the refundable $20,000 fee to Buyer not later than February 7, 2011, and this
Agreement shall terminate.
1.3 Closing. The closing ("Closing") of the transactions contemplated
hereby will occur on or about the December 31, 2010 (the "Closing Date"). At the
Closing:
(a) The Seller shall deliver a certificate(s) representing the Purchased
Shares (together with stock powers containing a guaranteed signatures acceptable
to the Company's transfer agent to transfer the Purchased Shares) to Buyer,
pursuant to written instructions provided by Buyer to Seller;
(b) The Seller shall tender a written resignation from all offices as an
officer and director of the Company, in a form to the satisfaction of Buyer in
its sole discretion, and Seller shall have appointed a new director(s) nominated
by the Purchaser prior to such resignation;
(c) The Seller shall tender a non-interest bearing demand note evidencing
the $27,500 Debt, payable from the Company to the Seller, and duly endorsed to
the Purchaser;
(d) The Purchaser shall transfer the Purchase Price to the Seller;
(e) The Purchaser shall have raised not less than Three Million U.S.
Dollars ($3,000,000) for the purpose of commencing its business operations,
pursuant to that certain Private Placement Memorandum (the "PPM") provided by
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the Purchaser to Seller on November 12, 2010, and provide evidence that such
funds have been received pursuant to subscription or other agreements that have
been agreed to in writing by the seller of the securities, as disclosed in the
PPM;
(f) The Purchaser shall have prepared a United States Securities and
Exchange Commission (the "Commission") Form 8-K for filing with the Commission
by the Company, disclosing the consummation of a merger, share exchange, asset
purchase or other business combination transaction whereby the business of
Purchaser, as disclosed in the PPM, has been acquired and otherwise transferred
to the Company, pursuant to an agreement prepared by the Purchaser. Such Form
8-K shall meet the requirements of the federal securities laws, rules and
regulations; and
(h) The Seller shall deliver all books of account, minute books, agreements
and other records of the Company in a complete and correct form. The minute
books of the Company shall contain accurate and complete records of all meetings
held and corporate action taken by, the shareholders, the board of directors,
and committees of the board of directors of the Company with respect to the
ownership and operation of the Company.
2. Representations and Warranties of the Seller.
2.1 The Seller warrants, covenants and represents to the Purchaser with the
intention of inducing the Purchaser to enter into this Agreement that:
(a) immediately prior to and at the Closing, the Seller shall be the legal
and beneficial owner of the Purchased Shares and the $27,500 Debt, and on the
Closing Date, the Seller shall transfer to the Purchaser the Purchased Shares
free and clear of all liens, security interests, restrictions, covenants,
adverse claims or encumbrances of any kind or character;
(b) the Seller has the legal power and authority to execute and deliver
this Agreement and all other documents required to be executed and delivered by
the Seller hereunder and to consummate the transactions contemplated hereby;
(c) the Seller is, or has been during the past ninety (90) days, an
officer, director, 10% or greater shareholder or "affiliate" of the Company, as
that term is defined in Rule 405, promulgated under the United States Securities
Act of 1933, as amended (the "Securities Act");
(d) to the best of the knowledge, information and belief of the Seller
there are no circumstances that may result in any material adverse effect to the
Company or the value of the Purchased Shares that are now in existence or may
hereafter arise;
(e) as of the Closing Date the Seller shall not be indebted to the Company
and the Company shall not be indebted to the Seller;
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(f) the Seller does not now, nor will it prior to or on the Closing Date,
own, either directly or indirectly, or exercise direction or control over any
shares of common stock of the Company other than the Purchased Shares;
(g) the authorized capital of the Company consists of 75,000,000 shares of
common stock, par value $0.001, of which a total of 5,499,000 shares of common
stock have been validly issued, are outstanding and are fully paid and
non-assessable;
(h) no person, firm or corporation has any right, agreement, warrant or
option, present or future, contingent or absolute, or any right capable of
becoming a right, agreement or option to require the Company to issue any shares
in its capital or to convert any securities of the Company or of any other
company into shares in the capital of the Company;
(i) as of the closing, the liabilities of the Company whether accrued,
contingent or otherwise, shall be less than $1,000; and the Seller will pay any
outstanding liability of the Company with the Purchase Price
(j) the Company does not beneficially own, directly or indirectly, shares
in any other corporate entity;
(k) the Company has no substantial assets. The Company's sole asset, aside
from its business, is cash in the amount of approximately Six Thousand Seven
Hundred Sixty-six Dollars ($6,766), though it is anticipated that any cash in
the Company's bank accounts will be depleted by Closing. Said asset is free and
clear of any financial encumbrances not disclosed in the financial statements of
the Company included in the SEC Reports (as defined below) (the "Financial
Statements");
(l) the Company has filed all reports required to be filed by it under the
Securities Act and the United States Securities Exchange Act of 1934, as amended
(the "Exchange Act"), including pursuant to Section 13(a) or 15(d) of the
Exchange Act, (the "SEC Reports") on a timely basis or has received 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. The Financial
Statements 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;
(m) the Company is not a party to or bound by any agreement or
understanding granting registration or anti-dilution rights to any person with
respect to any of its equity or debt securities; no person has a right to
purchase or acquire or receive any equity or debt security of the Company;
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(n) the Company is in compliance with the applicable provisions of the
Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations promulgated thereunder;
(o) the Seller agrees to execute and deliver such other documents and to
perform such other acts as shall be necessary to effectuate the purposes of this
Agreement;
(p) there are no claims threatened or against or affecting the Seller or
the Company nor are there any actions, suits, judgments, proceedings or
investigations pending or, threatened against or affecting the Seller or the
Company, at law or in equity, before or by any Court, administrative agency or
other tribunal or any governmental authority or any legal basis for same.
(q) the Seller is aware of the Company's business affairs and financial
condition and has reached an informed and knowledgeable decision to sell the
Purchased Shares.
(r) the Seller is not aware of any material non-public information about
the Company;
(s) the Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Nevada and duly qualified to
conduct business under the laws each jurisdiction where such qualification is
necessary, except where the failure to be so qualified would not have a material
adverse effect;
(t) the Seller was the sole officer and director of the Company at the time
the Company issued the Purchased Shares to the Seller, and the Purchased Shares
are validly issued, fully paid and non-assessable;
(u) no person is entitled to receive a broker's fee from the Seller in
connection with or as a result of any action taken by the Seller pursuant to
this Agreement;
(v) the Company has filed or caused to be filed (on a timely basis since
its inception) all tax returns that are or were required to be filed by it
pursuant to applicable all laws, rules and regulations. The Seller has made
available to Purchaser copies of all such tax returns relating to taxes filed
since inception. The Company has paid all taxes that have or may have become due
pursuant to such tax returns or otherwise, or pursuant to any assessment
received by the Company; and
(w) Since the date of the audited financial statements in the Commission
Form 10-K of the Company filed with the Commission, there has not been any
material adverse change in the business, operations, properties, prospects,
assets, or condition of the Company, and to the knowledge of the Seller no event
has occurred or circumstance exist that may result in such a material adverse
change.
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3. Representations and Warranties of the Purchaser.
3.1 The Purchaser represents and warrants to the Seller that the Purchaser:
(a) has the legal power and authority to execute and deliver this Agreement
and to consummate the transactions hereby contemplated;
(b) understands and agrees that offers and sales of any of the Purchased
Shares as contemplated in this Agreement shall only be made in compliance with
the safe harbor provisions set forth in Rule 144, or pursuant to the
registration provisions of the Securities Act or pursuant to an exemption
therefrom, and that all offers and sales after the applicable restricted period
shall be made only in compliance with the registration provisions of the
Securities Act or an exemption therefrom; and
(c) is acquiring the Purchased Shares as principal for the Purchaser's own
account, for investment purposes only, and not with a view to, or for, resale,
distribution or fractionalisation thereof, in whole or in part, and no other
person has a direct or indirect beneficial interest in the Purchased Shares.
3.2 The Purchaser agrees not to engage in hedging transactions with regard
to the Purchased Shares except in compliance with the Securities Act.
4. Indemnification.
4.1 The Seller hereby agrees to indemnify and hold harmless the Purchaser
and the Company against any losses, claims, damages or liabilities to which the
Seller or the Company may become subject insofar as such losses, claims, damages
or liabilities arise out of or are based upon taxes, real property leases or
equipment leases payable by or for which the Company has the primary liability;
and in particular, any misrepresentation or breach of representations and
warranties of the Seller as contained herein. Damages of the Purchaser are not
limited to the amount of the Seller received hereunder but will include the
Purchaser' or Company's actual cost of any claim and full costs of negotiations
and for defence.
5. Conditions to the Purchaser's Obligations At Closing. The obligations of
the Purchaser to purchase the Purchased Shares at the Closing are subject to the
fulfillment, on or before the Closing, of each of the following conditions,
unless otherwise waived:
5.1 The Seller's obligations under Section 1.3 shall be completed to the
satisfaction of the Buyer it its sole discretion;
5.2 The representations and warranties of the Seller contained in Section 3
shall be true and correct in all material respects as of the Closing, except
that any such representations and warranties shall be true and correct in all
respects where such representation and warranty is qualified with respect to
materiality; and
5.3 On or before December 21, 2010, the Seller shall have filed with the
Commission and mailed a Commission Schedule 14f-1, which Purchaser hereby agrees
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to prepare and provide. Purchaser agrees that such Schedule 14f-1 shall meet the
requirements of the federal securities laws, rules and regulations.
7. Miscellaneous.
7.1 The parties hereto acknowledge that they have obtained independent
legal advice with respect to this Agreement and acknowledge that they fully
understand the provisions of this Agreement.
7.2 Unless otherwise provided, all dollar amounts referred to in this
Agreement are in United States dollars.
7.3 There are no representations, warranties, collateral agreements, or
conditions concerning the subject matter of this Agreement except as herein
specified.
7.4 The representations and warranties of the parties contained in this
Agreement shall survive the closing of the purchase and sale of the Purchased
Shares.
7.5 This Agreement may be executed in several counterparts, each of which
will be deemed to be an original and all of which will together constitute one
and the same instrument.
7.6 Delivery of an executed copy of this Agreement by electronic facsimile
transmission or other means of electronic communication capable of producing a
printed copy will be deemed to be execution and delivery of this Agreement as of
the date set forth on page one of this Agreement.
7.7 Each of the parties to this Agreement shall be responsible and liable
for its own expenses incurred in connection with the preparation of this
Agreement, the consummation of the transactions contemplated by this Agreement
and related expenses.
7.8 This Agreement shall be binding upon the parties and their respective
heirs, executors, administrators, legal representatives, successors and assigns;
provided, however, that neither party may assign this Agreement or any of its
rights under this Agreement without the prior written consent of the other
party.
7.9 Each party to this Agreement agrees, without cost or expense to any
other party, to deliver or cause to be delivered such other documents and
instruments as may be reasonably requested by any other party to this Agreement
in order to carry out more fully the provisions of, and to consummate the
transaction contemplated by, this Agreement.
7.10 This Agreement may be executed by fax or scanned e-mail attachment and
said fax signatures and/or scanned e-mail attachments shall be deemed original
signatures.
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Each of the parties hereto has executed this Agreement to be effective as
of the day and year first above written.
SELLER:
Shan Qiang
/s/ Shan Qiang
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Shan Qiang
PURCHASER:
FARM LANDS OF GUINEA LIMITED
/s/ X. Xxxxxx Director
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