STOCK PURCHASE AND SALE AGREEMENT
Exhibit
10.1
This STOCK
PURCHASE AND SALE AGREEMENT
(this
“Agreement”) is entered into as of this 27th day of March, 2007, by and among
Benacquista’s Galleries Inc., a Nevada corporation, with its principal place of
business at 0000 Xx Xxxxx Xxxxxxxx Xxxxxx, Xxxxx Xx, Xxxxxxxxxx 00000 (the
“Company”), YNOT Eduk8, Inc., a Nevada corporation, with its principal place of
business at 0000 Xx Xxxxx Xxxxxxxx Xxxxxx, Xxxxx Xx, Xxxxxxxxxx 00000 (“YNOT”),
and Xxx
Xxxxxx, an individual, having his principal place of business at Xxxxx Xxx
Xxxxx
Xxxx Xxxxx, Xxxx Xxxx, Xxxx 00000 (the “Buyer”) (each, individually, a “Party”
and, collectively, the “Parties”).
WHEREAS,
on
September 29, 2005 the Company and YNOT Education, Inc., a Nevada corporation
(“YNOT Education”), entered into a certain asset acquisition agreement (the
“Asset Acquisition Agreement”), whereby the Company acquired all of the rights,
title and interest in certain website assets, including the domain name and
website xxx.xxxxxxxx0.xxx, in consideration of a one hundred fifty thousand
dollar ($150,000) unsecured promissory note bearing interest at a rate of
five
percent (5%) per annum and payable upon demand, with no prior periodic payments
due (the “Note”);
WHEREAS,
on
October 10, 2005, the Company incorporated YNOT as its wholly owned subsidiary
under the laws of the State of Nevada, in order to pursue certain
educationally-related business opportunities;
WHEREAS,
on March
9, 2007, the Company, YNOT and YNOT Education entered into a certain assignment
agreement (the “Assignment Agreement”), whereby the Company assigned,
transferred, conveyed and delivered all of its rights, title, obligations
and
interests in, to and under the Asset Acquisition Agreement to YNOT;
WHEREAS,
on March
13, 2007, the board of directors of the Company declared a common stock dividend
of the shares of YNOT, wherein each holder of record as of the date thereof
received one share of YNOT common stock, par value $0.001 per share, for
each
share of the Company’s common stock then held;
WHEREAS,
as of
the date hereof, the Company owns eight million nine hundred two thousand
two
hundred eighty-seven (8,902,287) shares of YNOT’s common stock (the “Shares”),
with such Shares constituting eighty-nine and one fiftieth percent (89.02%)
of
the issued and outstanding capital stock of YNOT;
WHEREAS,
subject
to the terms and conditions hereof, the Company desires to sell, and the
Buyer
desires to acquire, all of the Shares for the consideration set forth herein;
and
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 Parties do hereby covenant and agree as
follows:
ARTICLE
I
PURCHASE
AND SALE OF SHARES
1.1 Purchase
and Sale of Shares. Subject
to and upon the terms and conditions hereinafter set forth, the Company agrees
to sell, transfer, convey, assign and deliver to the Buyer, and the Buyer
agrees
to acquire from the Company, in a private resale transaction, all of the
Company’s rights, title and interest in, to and under the Shares, free and clear
of all known title defects, objections, liens, pledges, claims, options,
charges, security interests or encumbrances of any nature
whatsoever.
1
1.2 Consideration.
In
full
consideration for the Shares the Buyer agrees to assume all of the Company’s
rights, obligations and interests in, to and under the terms of the Note,
including all interest accrued thereon through the date hereof.
ARTICLE
II
THE
CLOSING
2.1 Closing
Date. The
closing of the sale and purchase of the Shares shall take place on the date
that
all conditions to the Company’s obligations to sell and all conditions to the
Buyer’s obligation to purchase have been satisfied (the “Closing
Date”).
ARTICLE
III
LIABILITIES
3.1 Assumption
of Liabilities.
Subject
to and upon the terms and conditions set forth in this Agreement, the Buyer
shall be responsible for any and all contracts, debts, warranties, obligations,
undertakings, claims, liabilities and accounts payable arising out of the
operation of YNOT, whether known or unknown, asserted or unasserted, absolute
or
contingent, accrued or unaccrued, liquidated or unliquidated and whether
due or
to become due, prior to, at or after the Closing Date.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES OF THE COMPANY
The
Company hereby represents and warrants to the Buyer that, as of the date
hereof:
4.1 Authority.
The
Company has all requisite power and authority to enter into this Agreement
and
to consummate the transactions contemplated hereby, including the right to
sell,
transfer, convey, assign and deliver the Shares. The execution and delivery
of
this Agreement and the consummation of the transactions contemplated hereby
have
been duly authorized by all necessary action on the part of the Company and,
upon due execution and delivery by the Company, this Agreement shall constitute
the valid and binding obligation of the Company, enforceable in accordance
with
its terms, except to the extent that enforceability may be limited by applicable
law or general principles of equity.
4.2 No
Violation.
Neither
the execution, delivery nor consummation of this Agreement by the Company,
will,
with the passage of time, giving of notice or otherwise, result in a violation
or breach of, or constitute a default under, any term or provision of any
law,
rule, regulation, order, decree, judgment, indenture, mortgage, deed of trust,
lease, instrument, contract, agreement or other restriction to which the
Company
is a party or to which the Company, or its property, is subject or bound,
nor
will it result in the creation of any lien or other charge or encumbrance
on any
of the Shares.
4.3 Litigation. Except
as
set forth in Schedule 4.3 of this Agreement, there is no action, suit,
proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body pending against or
affecting the Company, wherein an unfavorable decision, ruling or finding
would
(i) have a material adverse effect on the transactions contemplated hereby,
or
(ii) adversely affect the validity or enforceability of, or the authority
or
ability of the Company to perform its obligations under this
Agreement.
2
4.4 No
General Solicitation.
Neither
the Company, nor any of its affiliates, nor any person acting on its or their
behalf, has engaged in any form of general solicitation or general advertising
(within the meaning of Regulation D promulgated under the Securities Act
of
1933, as amended (the “Securities Act”)) in connection with the offer or sale of
the Shares.
4.5 Disclaimer. EXCEPT
AS EXPLICITLY SET FORTH IN THIS SECTION 4, THE COMPANY MAKES NO REPRESENTATION
OR WARRANTY, EXPRESSLY OR IMPLIEDLY, AT LAW OR IN EQUITY, IN RESPECT OF THE
SHARES, AND THE BUYER HEREBY ACKNOWLEDGES AND AGREES THAT, EXCEPT TO THE
EXTENT
SPECIFICALLY SET FORTH IN THIS SECTION 4, THE BUYER IS ACQUIRING THE SHARES
AND
ASSUMING THE LIABILITIES ASSOCIATED THEREWITH AS-IS.
ARTICLE
V
REPRESENTATIONS
AND WARRANTIES OF YNOT
YNOT
hereby represents and warrants to the Buyer that, as of the date
hereof:
5.1 Authority.
YNOT
has the requisite corporate power and authority to enter into and perform
its
obligations under this Agreement and any related agreements. The execution
and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of YNOT
and, upon due execution and delivery by YNOT, this Agreement shall constitute
the valid and binding obligation of YNOT, enforceable in accordance with
its
terms, except to the extent that enforceability may be limited by applicable
law
or general principles of equity.
5.2 No
Violation.
Neither
the execution, delivery nor consummation of this Agreement by YNOT, will,
with
the passage of time, giving of notice or otherwise, result in a violation
or
breach of, or constitute a default under, any term or provision of any law,
rule, regulation, order, decree, judgment, indenture, mortgage, deed of trust,
lease, instrument, contract, agreement or other restriction to which YNOT
is a
party or to which YNOT, or its property, is subject or bound, nor will it
result
in the creation of any lien or other charge or encumbrance on any of the
Shares.
5.3 Capitalization.
Immediately following the consummation of this transaction YNOT will have
no
preferred shares and ten million (10,000,000) common share issued and
outstanding, all of which have been duly authorized, validly issued and are
fully paid and non-assessable. Except as otherwise set forth in this Agreement,
as of the date hereof, (i) no common shares are subject to preemptive rights
or
any other similar rights or any liens or encumbrances, (ii) there are no
outstanding debt securities, (iii) there are no outstanding options, warrants,
scrip, rights to subscribe to, calls or commitments of any character whatsoever
relating to, or securities or rights convertible into, any common or preferred
shares, and no contracts, commitments, understandings or arrangements by
which
YNOT is or may become bound to issue additional common or preferred shares,
and
(iv) there are no agreements or arrangements under which YNOT is obligated
to
register the sale of any of its securities under United States federal or
state
securities laws.
5.4 Litigation. Except
as
set forth in Schedule 4.3 of this Agreement, there is no action, suit,
proceeding, inquiry or investigation before or by any court, public board,
government agency, self-regulatory organization or body pending against or
affecting YNOT, wherein an unfavorable decision, ruling or finding would
(i)
have a material adverse effect on the transactions contemplated hereby, or
(ii)
adversely affect the validity or enforceability of, or the authority or ability
of YNOT to perform its obligations under this Agreement.
3
5.5 No
General Solicitation.
Neither
YNOT, nor any of its affiliates, nor any person acting on its or their behalf,
has engaged in any form of general solicitation or general advertising (within
the meaning of Regulation D promulgated under the Securities Act) in connection
with the offer or sale of the Shares.
5.6 Intellectual
Property Rights.
YNOT
owns or possesses adequate rights or licenses to use all trademarks, trade
names, service marks, service xxxx registrations, service names, patents,
patent
rights, copyrights, inventions, licenses, approvals, governmental
authorizations, trade secrets and rights necessary to conduct its business
as
now conducted.
ARTICLE
VI
REPRESENTATIONS
AND WARRANTIES OF THE BUYER
The
Buyer
hereby represents and warrants to the Company and YNOT as follows:
6.1 Authority.
The
Buyer has all requisite power and authority to enter into this Agreement
and to
consummate the transactions contemplated hereby, and upon due execution and
delivery by the Buyer, this Agreement shall constitute the valid and binding
obligation of the Buyer, enforceable in accordance with its terms, except
to the
extent that enforceability may be limited by applicable law or general
principles of equity
6.2 Investment
Purpose.
The
Shares to be acquired by the Buyer will be acquired for investment for the
Buyer’s own account, not as a nominee or agent, and not with a view to the
resale or distribution of any part thereof, and the Buyer has no present
intention of selling, granting any participation in, or otherwise distributing
the same, except pursuant to sales registered under the Securities Act, or
exempt therefrom. The Buyer further represents that he does not presently
have
any contract, undertaking, agreement or arrangement with any person to sell,
transfer or grant participation to such person or to any third person, with
respect to any of the Shares.
6.3 Investment
Experience.
The
Buyer
is an “accredited investor” as that term is defined in Rule 501(a)(3) of
Regulation D under the Securities Act. The Buyer is aware of the Company
and
YNOT’s business affairs and financial condition and has had access to and
opportunity to acquire sufficient information about the Company and YNOT
to
reach an informed and knowledgeable decision to acquire the Shares. The Buyer
has such business and financial experience as is required to give him the
capacity to protect his own interests in connection with the purchase of
the
Shares.
6.4 Reliance
on Exemptions.
The
Buyer understands that the Shares are being offered and sold to him in reliance
on specific exemptions from the registration requirements of United States
federal and state securities laws and that the Company is relying in part
upon
the truth and accuracy of, and such Buyer’s compliance with, the
representations, warranties, agreements, acknowledgments and understandings
of
such Buyer set forth herein in order to determine the availability of such
exemptions and the eligibility of such Buyer to acquire such
securities
6.5 Restricted
Securities.
The
Buyer understands that the Shares are characterized as “restricted securities”
under applicable United States federal and state securities laws inasmuch
as
they are being acquired from Company in a transaction not involving a public
offering and that, pursuant to these laws and applicable regulations, the
Buyer
must hold the Shares indefinitely until they are registered under the Securities
Act and qualified by state authorities or an exemption from such registration
and qualification requirements is available. The Buyer further acknowledges
that
if an exemption from registration or qualification is available, it may be
conditioned on various requirements including, but not limited to, the time
and
manner of sale, the holding period for the Shares, and other such requirements
that are outside of the Buyer’s control.
4
6.6 Legends.
The
Buyer acknowledges and understands that the Shares, and any securities issued
in
respect thereof or exchange therefor, may bear the following or a similar
such
legend:
THESE
SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED
(THE “ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED, ASSIGNED OR
TRANSFERRED EXCEPT (i) PURSUANT TO A REGISTRATION STATEMENT UNDER THE ACT
WHICH
HAS BECOME EFFECTIVE AND IS CURRENT WITH RESPECT TO THESE SECURITIES, OR
(ii)
PURSUANT TO A SPECIFIC EXEMPTION FROM REGISTRATION UNDER THE ACT BUT ONLY
UPON A
HOLDER HEREOF FIRST HAVING OBTAINED THE WRITTEN OPINION OF COUNSEL TO THE
COMPANY, OR OTHER COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY, THAT THE
PROPOSED DISPOSITION IS CONSISTENT WITH ALL APPLICABLE PROVISIONS OF THE
ACT AS
WELL AS ANY APPLICABLE “BLUE SKY” OR SIMILAR STATE SECURITIES
LAWS.
6.7 Receipt
of Documents.
The
Buyer and his counsel, if any, has received and read in their entirety: (i)
this
Agreement and each representation, warranty and covenant set forth herein;
(ii)
all due diligence and other information necessary to verify the accuracy
and
completeness of such representations, warranties and covenants; and (iii)
answers to all questions the Buyer submitted to the Company regarding the
Shares; and the Buyer has relied on the information contained therein and
has
not been furnished any other documents, literature, memorandum or
prospectus.
6.8 No
Legal Advice From the Company.
The
Buyer acknowledges, that he had the opportunity to review this Agreement
and the
transactions contemplated by this Agreement with his own legal counsel and
investment and tax advisors. The Buyer is relying solely on such counsel
and
advisors and not on any statements or representations of the Company or any
of
its representatives or agents for legal, tax or investment advice with respect
to this investment, the transactions contemplated by this Agreement or the
securities laws of any jurisdiction.
ARTICLE
VII
CONVENTS
7.1 Reasonable
Efforts. Each
Party hereby agrees to use its reasonable efforts to take or cause to be
taken
all actions necessary, proper or advisable under applicable law and regulations
to consummate and carry out the transactions contemplated by this
Agreement.
7.2 Costs
and Expenses. Each
of
the Company and the Buyer shall pay all costs and expenses incurred by such
party in connection with the negotiation, investigation, preparation, execution
and delivery of this Agreement.
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ARTICLE
VIII
INDEMNIFICATION
8.1 Company
Indemnification of Buyer.
In
consideration of the Buyer’s execution and delivery of this Agreement and
acquiring the Shares hereunder, and in addition to all of the Company’s other
obligations under this Agreement, the Company shall defend, protect, indemnify
and hold harmless the Buyer from and against any and all actions, causes
of
action, suits, claims, losses, costs, penalties, fees, liabilities and damages,
and expenses in connection therewith, and including reasonable attorneys’ fees
and disbursements (collectively the “Indemnified Liabilities” or “Indemnified
Loss(es)”), incurred by the Buyer as a result of, or arising out of, or relating
to (i) any misrepresentation or breach of any representation or warranty
made by
the Company in this Agreement or any other certificate, instrument or document
contemplated hereby or thereby, (ii) any breach of any covenant, agreement
or
obligation of the Company contained in this Agreement or any other certificate,
instrument or document contemplated hereby or thereby executed by the Company,
or (iii) to the extent caused by the negligent or wrongful conduct of the
Company, any cause of action, suit or claim brought or made against the Buyer
and arising out of or resulting from the execution, delivery, performance
or
enforcement of this Agreement or any other instrument, document or agreement
executed pursuant hereto by any the Buyer.
8.2 Buyer
Indemnification of Company.
In
consideration of the Company’s execution and delivery of this Agreement, and in
addition to all of the Buyer’s other obligations under this Agreement, the Buyer
shall defend, protect, indemnify and hold harmless the Company and all of
its
officers, directors, employees and agents (including, without limitation,
those
retained in connection with the transactions contemplated by this Agreement)
(collectively, the “Company Indemnitees”) from and against any and all
Indemnified Liabilities incurred by the Company Indemnitees or any of them
as a
result of, or arising out of, or relating to (i) any misrepresentation or
breach
of any representation or warranty made by the Buyer in this Agreement,
instrument or document contemplated hereby or thereby executed by the Buyer,
(ii) any breach of any covenant, agreement or obligation of the Buyer contained
in this Agreement, or any other certificate, instrument or document contemplated
hereby or thereby executed by the Buyer, or (iii) to the extent caused by
the
negligent or wrongful conduct of the Buyer, any cause of action, suit or
claim
brought or made against such Company Indemnitees based on material
misrepresentations or due to a material breach and arising out of or resulting
from the execution, delivery, performance or enforcement of this Agreement
or
any other instrument, document or agreement executed pursuant hereto by any
of
the Company Indemnities.
ARTICLE
IX
MISCELLANEOUS
9.1 Survival.
The
representations, warranties, covenants and agreements made herein shall survive
the Closing Date of the transactions contemplated by this Agreement for a
period
of six (6) months.
9.2 Successors
and Assigns.
Except
as otherwise expressly provided herein, the provisions of this Agreement
shall
inure to the benefit of, and be binding upon, the successors, assigns, heirs,
executors and administrators of the Parties hereto.
6
9.3 Entire
Agreement.
This
Agreement constitutes the full and entire Agreement by and between the Parties
with regard to the subject matter hereof and thereof and supersedes all prior
agreements between the parties, whether written or verbal. The failure by
either
Party to enforce any rights under this Agreement shall not be construed as
a
waiver of any rights of such Party. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived, generally
or in
a particular instance, and either retroactively or prospectively, only with
the
written consent of the Parties hereto.
9.4 Schedules.
All
Schedules annexed hereto or referred to herein are hereby incorporated in
and
made a part of this Agreement as if set forth in full herein.
9.5 Notices.
Any
notice or other communication required or permitted by this Agreement shall
be
given in writing and shall be deemed sufficient when delivered personally,
or on
the first attempted date of delivery after being mailed by certified or
registered mail, return receipt requested, to the Parties at the addresses
first
set forth at the beginning of this Agreement or at such other address as
shall
be specified by the Parties by like notice.
9.6 Counterparts.
This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed an original, but all of which taken together shall constitute one
instrument.
9.7 Severability.
If one
or more provisions of this Agreement are held to be unenforceable under
applicable law, the validity of this Agreement shall not be affected thereby
and
the remaining provisions shall continue in full force and effect, construed
as
if such unenforceable provision was not a part of this Agreement.
9.8 Headings.
The
headings and captions contained in this Agreement are for reference purposes
only and shall not affect, in any way, the meaning or interpretation of this
Agreement.
9.9 Governing
Law; Jurisdiction; Jury Trial.
This
Agreement shall be governed in all respects by the laws of the State of Nevada,
without giving effect to any choice of law or conflict of law provision or
rule
(whether of the State of Nevada or any other jurisdictions) that would cause
the
application of the laws of any jurisdictions other than the State of Nevada.
Each Party hereby irrevocably submits to the exclusive jurisdiction of the
state
and federal courts sitting in the City of Reno, Nevada, for the adjudication
of
any dispute hereunder or in connection herewith, and hereby irrevocably waives,
and agrees not to assert in any suit, action or proceeding, any claim that
it is
not personally subject to the jurisdiction of any such court, that such suit,
action or proceeding is brought in an inconvenient forum or that the venue
of
such suit, action or proceeding is improper. Each Party hereby irrevocably
waives personal service of process and consents to process being served in
any
such suit, action or proceeding by mailing a copy thereof to such Party at
the
address for such notices to it under this Agreement and agrees that such
service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to
serve
process in any manner permitted by law. EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.
[SIGNATURES
APPEAR ON THE FOLLOWING PAGE]
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IN
WITNESS WHEREOF,
the
Parties have executed, or have caused to be executed, this Agreement as of
the
date first above written.
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BENACQUISTA
GALLERIES, INC.
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By:
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/s/Xxxxx
Xxxxx
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Xxxxx
Xxxxx
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Chief
Executive Officer
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YNOT
EDUK8, INC.
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By:
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/s/
Xxx
Xxxxxx
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Xxx
Xxxxxx
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President
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By:
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/s/
Xxx
Xxxxxx
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Xxx
Xxxxxx
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