STOCK TRANSFER AGREEMENT
Exhibit
10.1
This
Stock Transfer Agreement ("Agreement") is entered into this 1st
day of
April, 2008 by and between Nexia Holdings, Inc., a Nevada corporation (“NEXIA”)
and Diversified Holdings I, Inc. (“DHI”), with their offices located at 59 West
000 Xxxxx, Xxxxxx Xxxxx, Xxxx Xxxx Xxxx, Xxxx 00000, and Green Endeavors Ltd.
(“GEL”), a Delaware corporation
WHEREAS,
GEL desires to acquire 100% ownership of Xxxxx Salons L.L.C. from
NEXIA and 85% ownership of Xxxxxx Salons, Inc. from DHI in exchange for the
issuance of a convertible debenture in the sum of Three Million dollars
($3,000,000); and
WHEREAS,
NEXIA and DHI desire
to transfer to GEL the ownership interests of Xxxxx Salons LLC and Xxxxxx
Salons, Inc. as set forth above, in exchange for the delivery to DHI of a
convertible debenture in the amount of Three Million dollars
($3,000,000).
NOW,
THEREFORE with the above
being incorporated into and made a part hereof for the mutual consideration
set
out herein and, the receipt and sufficiency of which is hereby acknowledged,
the
parties agree as follows:
1.
Exchange. The
parties will exchange shares as follows:
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A.
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NEXIA will
transfer 100% ownership of Xxxxx Salons L.L.C. to GEL and DHI will
transfer 85,000 shares of the common stock of Xxxxxx Salons, Inc.
to GEL
on or before April 30, 2008 (the “Closing Date”) and each corporation will
deliver to GEL the necessary shares with all the necessary paperwork
to
establish ownership in GEL of the Xxxxx Salons L.L.C. membership
and the
Xxxxxx Salon, Inc. shares; and
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B.
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GEL
will deliver to DHI the convertible debenture in the face amount
of Three
Million dollars ($3,000,000) as full compensation for the transfers
by
NEXIA and DHI.
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2.
Termination. This
Agreement may be terminated at any time prior to the Closing Date:
A.
By GEL, DHI or
NEXA:
(1)
If there shall be any actual or threatened action or proceeding by or before
any
court or any other governmental body which shall seek to restrain, prohibit,
or
invalidate the transactions contemplated by this Agreement and which, in the
judgment of such Board of Directors made in good faith and based upon the advice
of legal counsel, makes it inadvisable to proceed with the transactions
contemplated by this Agreement; or
(2)
If the Closing shall have not occurred prior to April 30, 2008, or such later
date as shall have been approved by parties hereto, other than for reasons
set
forth herein.
B.
By NEXIA or
DHI:
(1)
If GEL shall fail to comply in any material respect with any of its covenants
or
agreements contained in this Agreement or if any of the representations or
warranties of GEL contained herein shall be inaccurate in any material respect;
or
C.
By GEL:
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(1)
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If
NEXIA or DHI shall fail to comply in any material respect with any
of
their covenants or agreements contained in this Agreement or if any
of the
representations or warranties of NEXIA or DHI contained herein shall
be
inaccurate in any material respect;
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(2)
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If
NEXIA, Xxxxx Salons, L.L.C. or Xxxxxx Salons, Inc. file for bankruptcy
protection prior to the closing hereof GEL may rescind this
exchange.
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In
the
event this Agreement is terminated pursuant to this Paragraph, this Agreement
shall be of no further force or effect, no obligation, right, or liability
shall
arise hereunder, and each party shall bear its own costs as well as the legal,
accounting, printing, and other costs incurred in connection with negotiation,
preparation and execution of the Agreement and the transactions herein
contemplated.
3.
Representations
and
Warranties of DHI. DHI hereby represents and warrants that
effective this date and the Closing Date, the following representations are
true
and correct:
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A.
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Authority. DHI
has the full power and authority to enter this Agreement and to carry
out
the transactions contemplated by this Agreement.
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B.
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No
Conflict With Other
Instruments. The execution of this Agreement will not
violate or breach any document, instrument, agreement, contract,
or
commitment material to the business of DHI to which DHI is separately
or
jointly a party and has been duly authorized by all appropriate and
necessary action.
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C.
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Deliverance
of
Shares. As of the Closing Date, the shares or ownership
interest to be delivered to GEL are valid and legally issued shares
or
ownership interest of Xxxxxx Salons, Inc., fully paid and non-assessable
and equivalent in all respects to all other issued and outstanding
shares
or ownership interest of Xxxxxx Salons, Inc.
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D.
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No
Conflict with Other
Instrument. The execution of this agreement will not
violate or breach any document, instrument, agreement, contract,
or
commitment material to Xxxxxx Salons, Inc. or DHI.
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E.
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Assets
and Liabilities
of Xxxxxx Salons, Inc.. As of the date of closing,
Xxxxxx Salons, Inc. shall have no more than $
in
liabilities and $
of
assets.
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F.
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Accounting
and
Financial Reporting. All accounting and financial
reporting and record keeping of Xxxxxx Salons, Inc. are kept in compliance
with GAAP procedures and accounting requirements of the Securities
and
Exchange Commission, such that GEL will not be hindered in its efforts
to
file reports and information as required by SEC reporting
requirements. Financial statements through the end of the month
immediately proceeding closing shall be provided to GEL at closing.
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4.
Representations
and
Warranties of NEXIA.
NEXIA
hereby represents and warrants that, effective this date and the Closing Date,
the representations and warranties listed below are true and correct.
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A.
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Corporate
Authority. NEXIA has the full corporate power and
authority to enter this Agreement and to carry out the transactions
contemplated by this Agreement. The Board of Directors of NEXIA
has duly authorized the execution, delivery, and performance of this
Agreement.
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B.
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No
Conflict With Other
Instruments. The execution of this Agreement will not
violate or breach any document, instrument, agreement, contract,
or
commitment material to the business of NEXIA to which NEXIA is a
party and
has been duly authorized by all appropriate and necessary action.
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C.
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No
Conflict with Other
Instrument. The execution of this agreement will not
violate or breach any document, instrument, agreement, contract,
or
commitment material to NEXIA.
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5.
Closing. The
Closing as herein referred to shall occur upon such date as the parties hereto
may mutually agree upon, but is expected to be on or before April 30,
2008.
6.
Conditions Precedent
of NEXIA and DHI to Effect Closing. All obligations of NEXIA
or DHI under this Agreement are subject to fulfillment prior to or as of the
Closing Date, as follows:
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A.
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The
representations and warranties by or on behalf of GEL contained in
this
Agreement or in any certificate or documents delivered to NEXIA or
DHI
pursuant to the provisions hereof shall be true in all material respects
as of the time of Closing as though such representations and warranties
were made at and as of such time.
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B.
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GEL
shall have performed and complied with all covenants, agreements
and
conditions required by this Agreement to be performed or complied
with by
GEL prior to or at the Closing.
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C.
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All
instruments and documents
delivered to NEXIA and DHI pursuant to the provisions hereof shall
be
reasonably satisfactory to NEXIA's legal
counsel.
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7.
Conditions Precedent
of GEL to Effect Closing. All obligations of GEL under this
Agreement are subject to fulfillment prior to or as of the date of Closing,
as
follows:
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A.
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The
representations and warranties by or on behalf of NEXIA and DHI contained
in this Agreement or in any certificate or documents delivered to
GEL
pursuant to the provisions hereof shall be true in all material respects
as of the time of Closing as though such representations and warranties
were made at and as of such time.
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B.
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NEXIA
and DHI shall have performed and complied with all covenants, agreements
and conditions required by this Agreement to be performed or complied
with
by it prior to or at the Closing.
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8.
Damages and Limit
of
Liability. Each party shall be liable, for any material breach
of the representations, warranties, and covenants contained herein which results
in a failure to perform any obligation under this Agreement, only to the extent
of the expenses incurred in connection with such breach or failure to perform
Agreement.
9.
Nature and Survival
of
Representations and Warranties. All representations,
warranties and covenants made by any party in this Agreement shall survive
the
Closing hereunder. All of the parties hereto are executing and
carrying out the provisions of this Agreement in reliance solely on the
representations, warranties and covenants and agreements contained in this
Agreement or at the Closing of the transactions herein provided for and not
upon
any investigation upon which it might have made or any representations,
warranty, agreement, promise, or information, written or oral, made by the
other
party or any other person other than as specifically set forth herein.
10.
Indemnification
Procedures. If any claim is made by a party which would give
rise to a right of indemnification under this paragraph, the party seeking
indemnification (Indemnified Party) will promptly cause notice thereof to be
delivered to the party from whom indemnification is sought (Indemnifying
Party). The Indemnified Party will permit the Indemnifying Party to
assume the defense of any such claim or any litigation resulting from the
claims. Counsel for the Indemnifying Party which will conduct the
defense must be approved by the Indemnified Party (whose approval will not
be
unreasonably withheld), and the Indemnified Party may participate in such
defense at the expense of the Indemnified Party. The Indemnifying
Party will not in the defense of any such claim or litigation, consent to entry
of any judgment or enter into any settlement without the written consent of
the
Indemnified Party (which consent will not be unreasonably
withheld). The Indemnified Party will not, in connection with any
such claim or litigation, consent to entry of any judgment or enter into any
settlement without the written consent of the Indemnifying Party (which consent
will not be unreasonably withheld). The Indemnified Party will
cooperate fully with the Indemnifying Party and make available to the
Indemnifying Party all pertinent information under its control relating to
any
such claim or litigation. If the Indemnifying Party refuses or fails
to conduct the defense as required in this Section, then the Indemnified Party
may conduct such defense at the expense of the Indemnifying Party and the
approval of the Indemnifying Party will not be required for any settlement
or
consent or entry of judgment.
11.
Default at
Closing. Notwithstanding the provisions hereof, if either
party shall fail or refuse to deliver any of the Shares, or shall fail or refuse
to consummate the transaction described in this Agreement prior to the Closing
Date, such failure or refusal shall constitute a default by that party and
the
other party at its option and without prejudice to its rights against such
defaulting party, may either (a) invoke any equitable remedies to enforce
performance hereunder including, without limitation, an action or suit for
specific performance, or (b) terminate all of its obligations hereunder with
respect to the defaulting party.
12.
Costs and
Expenses. NEXIA, DHI and GEL shall bear their own costs and
expenses in the proposed exchange and transfer described in this
Agreement. NEXIA, DHI and GEL are all related parties that share
management and officers and have been represented by counsel retained by and
employed by NEXIA.
13.
Notices. Any
notice under this Agreement shall be deemed to have been sufficiently given
if
sent by registered or certified mail, postage prepaid, addressed as
follows:
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To
GEL:
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To
NEXIA/DHI:
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Green
Endeavors, Ltd.
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Nexia
Holdings, Inc.
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59
West 100 South, Second Floor
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59
West 000 Xxxxx, Xxxxxx Xxxxx
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Xxxx
Xxxx Xxxx, Xxxx 00000
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Xxxx
Xxxx Xxxx, Xxxx 00000
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14.
Miscellaneous.
A.
Further
Assurances. At any time and from time to time, after the
effective date, each party will execute such additional instruments and take
such additional steps as may be reasonably requested by the other party to
confirm or perfect title to any property transferred hereunder or otherwise
to
carry out the intent and purposes of this Agreement.
B.
Waiver. Any
failure on the part of any party hereto to comply with any of its obligations,
agreements, or conditions hereunder may be waived in writing by the party to
whom such compliance is owed.
C.
Brokers. Neither
party has employed any brokers or finders with regard to this Agreement not
disclosed herein.
D.
Headings. The
section and subsection headings in this Agreement are inserted for convenience
only and shall not affect in any way the meaning or interpretation of this
Agreement.
E.
Counterparts. This
Agreement may be executed simultaneously in two or more counterparts, each
of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
F.
Governing
Law. This Agreement was negotiated and is being contracted for
in the State of Utah, and shall be governed by the laws of the State of Utah,
notwithstanding any conflict-of-law provision to the contrary. Any
suit, action or legal proceeding arising from or related to this Agreement
shall
be submitted for binding arbitration resolution to the American Arbitration
Association, in Salt Lake City, Utah, pursuant to their Rules of Procedure
or
any other mutually agreed upon arbitrator. The parties agree to abide
by decisions rendered as final and binding, and each party irrevocably and
unconditionally consents to the jurisdiction of such arbitrator and waives
any
objection to the laying of venue in, or the jurisdiction of, said
Arbitrator.
G.
Binding
Effect. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective heirs,
administrators, executors, successors, and assigns.
H.
Entire
Agreement. The Agreement contains the entire agreement between
the parties hereto and supersedes any and all prior agreements, arrangements
or
understandings between the parties relating to the subject matter
hereof. No oral understandings, statements, promises or inducements
contrary to the terms of this Agreement exist. No representations,
warranties covenants, or conditions express or implied, other than as set forth
herein, have been made by any party.
I.
Severability. If
any part of this Agreement is deemed to be unenforceable the balance of the
Agreement shall remain in full force and effect.
IN
WITNESS WHEREOF, the parties have executed this Agreement the day and year
first
above written.
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Green
Endeavors, Ltd.
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Nexia
Holdings, Inc.,
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A
Delaware
corporation
A Nevada corporation
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By: _/s/
Xxxxxxx
Xxxxxx
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By:
_/s/ Xxxxxx
Xxxxxxx
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Name: Xxxxxxx
Xxxxxx, President
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Name:
Xxxxxx Xxxxxxx
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Its: Secretary
Diversified
Holding I, Inc.
A
Nevada corporation
By:
/s/ Xxxxxx
Xxxxxxx .
Name: Xxxxxx
Xxxxxxx
Title: Vice
President
