[EXHIBIT 10.1]
STOCK PURCHASE AGREEMENT
BETWEEN
VISION OPPORTUNITY MASTER FUND, LTD.
AND
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇ AND ▇▇▇▇ ▇▇▇▇▇▇
AND
▇▇▇▇▇ ▇▇▇▇▇▇ AS MAJORITY STOCKHOLDER AND CHIEF EXECUTIVE OFFICER
OF ▇▇▇▇▇▇▇▇▇▇.▇▇▇
December 15, 2006
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THIS STOCK PURCHASE AGREEMENT, ("Agreement"), dated as of
December 15, 2006, is entered into by Vision Opportunity Master
Fund, Ltd., a Cayman Islands limited liability corporation,
(hereinafter "Buyer"), ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇
▇▇▇▇▇▇, Sellers, (each hereinafter "Seller" and collectively
"Sellers") and ▇▇▇▇▇ ▇▇▇▇▇▇, in his capacity as majority
stockholder and Chief Executive Officer of ▇▇▇▇▇▇▇▇▇▇.▇▇▇
(hereinafter "CEO").
WHEREAS, Buyer desires to purchase an aggregate of 5,016,150
shares (the "Shares") of the common stock, par value $.001 per
share (the "Common Stock"), of ▇▇▇▇▇▇▇▇▇▇.▇▇▇, a Nevada cor
poration (the "Company"), from the Sellers, and the Sellers
severally desire to sell the Shares to the Buyer; and
WHEREAS, ▇▇▇▇▇ ▇▇▇▇▇▇ is the majority stockholder and Chief
Executive Officer of the Company and is willing to enter into
this Agreement in that capacity in order to effect the
transaction contemplated hereunder;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants, representations and warranties contained
herein, the parties hereto do hereby agree as follows:
1. TRANSFER OF SHARES, CONSIDERATION AND OTHER MATTERS
1.1 Transfer of Shares. Subject to the terms and conditions
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of this Agreement, Sellers hereby sell, assign, transfer, convey
and deliver to Buyer, and Buyer hereby purchases and acquires
from Sellers, good and marketable title to the Shares, free and
clear of all mortgages, liens, encumbrances, claims, equities and
obligations to other persons of every kind and character except
that the Shares are restricted securities as set forth in Section
4.4 hereof. The Shares constitute approximately 90% of the total
issued and outstanding capital stock of the Company on the date
hereof. Simultaneously herewith, Sellers are delivering to Buyer
certificates duly endorsed for transfer or accompanied by duly
executed stock powers in blank, together with such other
documents or instruments, if any, as may be necessary to convey
the Shares to Buyer as provided herein.
1.2 Consideration. The purchase price for the Shares
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purchased by Buyer is Six Hundred Fifty Thousand Dollars
($650,000) payable to Sellers according to the amounts set forth
on Schedule 1.2 annexed hereto on the date hereof by wire
transfer or bank certified or cashier's check(s). Schedule 1.2
also contains the name of each Seller, the number of each stock
certificate to be transferred by each Seller and the number of
Shares represented thereby.
2. REPRESENTATIONS AND WARRANTIES OF SELLERS
Each Seller, severally but not jointly and with respect to
such Seller only (and not with respect to any other Seller)
represents and warrants to Buyer as follows:
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2.1 Authorization of Agreement. Each Seller is fully able,
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authorized and empowered to execute and deliver this Agreement
and any other agreement or instrument contemplated by this
Agreement and to perform his, her or its covenants and agreements
hereunder and thereunder. This Agreement and any such other
agreement or instrument, upon execution and delivery by each
Seller (and assuming due execution and delivery hereof and
thereof by the other parties hereto and thereto), will constitute
a valid and legally binding obligation of such Seller, in each
case enforceable against him, her or it in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, moratorium, reorganization or similar
laws from time to time in effect which affect creditors' rights
generally and by legal and equitable limitations on the
availability of specific performance and other equitable remedies
against such Seller under or by virtue of this Agreement or such
other agreement or instrument.
2.2 Ownership of the Shares. Each Seller is the sole record
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and beneficial owner of that portion of the Shares set forth
opposite such Sellers name on Schedule 1.2 annexed hereto. Each
Seller holds his respective Shares free and clear of any lien,
pledge, encumbrance, charge, security interest, claim or right of
another and has the absolute right to sell and transfer such
Shares to the Buyer without the consent of any other person or
entity. Upon transfer of such Shares to Buyer hereunder, Buyer
will acquire good and marketable title to such Shares free and
clear of any lien, pledge, encumbrance, charge, security
interest, claim or right of another.
2.3 No Sellers' Defaults. To the knowledge of each Seller,
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neither the execution and delivery of this Agreement, nor the
consummation of the transaction contemplated hereby, violates any
statute, ordinance, regulation, order, judgment or decree of any
court or governmental agency, or conflicts with, or will result
in any breach of, any of the terms of, or constitute a default
under or result in the termination of, or the creation of, any
lien upon the Shares to be sold by such Seller pursuant to the
terms of any contract or agreement to which such Seller is a
party or by which such Seller or any of his, her or its
respective assets is bound.
2.4 Obligations; Authorizations. None of the Sellers is (i)
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in violation of any judgment, order, injunction, award or decree
which is binding on him, her or it, or any of his, her or its
assets, properties, operations or business which violation, by
itself or in conjunction with any other such violation, would
materially and adversely affect the consummation of the
transaction contemplated hereby; or (ii) in violation of any law
or regulation or any other requirement of any governmental body,
court or arbitrator relating to him, her or it, or to his, her or
its assets, operations or businesses which violation, by itself
or in conjunction with other violations of any other law,
regulation or other requirement, would materially adversely
affect the consummation of the transaction contemplated hereby.
2.5 Consents. To the knowledge of each Seller, all
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requisite consents of third parties, including, but not limited
to, governmental or other regulatory agencies, Federal, state or
municipal, required to be received by or on the part of such
Seller for the execution and delivery of this Agreement and the
performance of such Sellers obligations hereunder have been
obtained and are in full force and effect. Each Seller has fully
complied with all conditions of such consents.
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2.6 No Shareholder Loans or Other Company Debt to Sellers.
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Each Seller, if applicable, has cancelled any loans made by such
Seller to the Company otherwise unrepaid on the date of this
Agreement. In addition, each Seller confirms hereby that nothing
is owed to such Seller by the Company on the date of this
Agreement for loans made or otherwise.
3. REPRESENTATIONS AND WARRANTIES OF CEO
CEO represents, warrants and covenants to and with Buyer as
follows:
3.1 SEC Reports. CEO has caused the Company to deliver to
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Buyer, a true and correct copy of each of the following documents
(the "SEC Reports") relating to the Company: (i) Annual Report on
Form 10-KSB for the fiscal year ended December 31, 2005, (ii)
Quarterly Report on Form 10-QSB or 10-QSB/A for the quarter ended
September 30, 2006. The Company has been subject to the
requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act") since at least July
21, 2006 and, except for Current Reports on Form 8-K, the SEC
Reports constitute all of the documents and reports that the
Company was required to file with the Securities and Exchange
Commission (the "SEC") since becoming a reporting issuer under
the Exchange Act. As of their respective dates, the SEC Reports
comply in all material respects with the requirements of the
Exchange Act and the rules and regulations promulgated thereunder
and none of the SEC Reports contained an untrue statement of a
material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading.
3.2 Financial Statements. The financial statements of the
---------------------
Company included in the SEC Reports (including in each case the
related notes thereto) (i) are in accordance with the books and
records of the Company, (ii) are correct and complete in all
material respects, (iii) present fairly the financial position
and results of operations of the Company as of the respective
dates indicated (subject, in the case of unaudited statements, to
normal, recurring adjustments, none of which were material), and
(iv) have been prepared in accordance with generally accepted
accounting principles applied on a consistent basis.
3.3 Organization. The Company is a corporation duly or
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ganized, validly existing and in good standing under the laws of
Nevada and has full power and authority to own, lease and operate
its properties and to carry on its business as now being and as
heretofore conducted. The Company is duly qualified as a foreign
corporation in the State of Washington under the dba name
"▇▇▇▇▇▇▇▇▇▇.▇▇▇, Inc.". The Company is not qualified or licensed
to do business as a foreign corporation in any other jurisdiction
and neither the location of its assets nor the nature of its
business requires it to be so qualified.
3.4 Capitalization. The total authorized capital stock of
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the Company is 100,000,000 shares of common stock of which
5,573,500 shares are issued and outstanding. There are no
subscriptions, options or other agreements or commitments
obligating the Company to issue any shares of its capital stock
or securities convertible into its capital stock.
3.5 Certificate of Incorporation and By-laws. Annexed
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hereto as Schedule 3.5 is a true and complete copy of the
Articles of Incorporation and By-laws of the Company as in effect
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on the date hereof, certified by the Secretary of the Company in
the case of the By-laws and by the Secretary of State of Nevada
in the case of the Articles of Incorporation.
3.6 Officers and Directors. Attached hereto as Schedule 3.6
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is a list of the names and titles of all officers and directors
of the Company, the resignations of such officers and directors
and the appointment of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ to
fill the resulting vacancies subject to the consummation of the
transaction contemplated hereby.
3.7 Liabilities, etc.
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(a) Since December 15, 1999 (inception), the Company has
filed all Federal, state and local tax returns which are required
to be filed by it and all taxes shown to be due thereon (together
with any applicable penalties and interest) have been paid. Since
December 15, 1999, the Company has not incurred any liability for
taxes except in the ordinary course of business. The Company has
paid or provided adequate reserves for all taxes which have
become due for all periods prior to the date of this Agreement or
pursuant to any assessments received by it or which the Company
is obligated to withhold from amounts owing to any employee,
creditor or other third party as at, or with respect to, any
period prior to the date of this Agreement. To the best knowledge
of CEO, the Federal income tax returns of the Company have never
been audited by the Internal Revenue Service. The Company has not
waived any statute of limitations in respect of taxes, nor agreed
to any extension of time with respect to a tax assessment or
deficiency.
(b) On the date hereof, there are no liabilities, debts or
obligations of the Company, whether accrued, absolute, contingent
or otherwise not otherwise disclosed in the financial statements
of the Company ("Liabilities").
3.8 Absence of Certain Events. Other than as disclosed in
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its SEC Reports and in Current Reports on Form 8-K, the Company
has been conducted solely in the usual and ordinary course.
Without limiting the generality of the foregoing, the Company has
not:
(a) waived any right or rights of substantial value or
paid, directly or indirectly, any Liability before such Liability
became due in accordance with its terms; or
(b) other than in the ordinary and usual course of
business, created any Liability (whether absolute or contingent
and whether or not currently due and payable), or entered into or
assumed any contract, agreement, arrangement, lease (as lessor or
lessee), license or other commitment otherwise than in the
ordinary and usual course of business; or
(c) purchased, sold or transferred any assets other than in
the ordinary and usual course of the operations of the Company;
granted any security interest or other lien or encumbrance
affecting any of its assets or properties other than in the
ordinary and usual course of business and in amounts not
material; or amended any agreement or contract to which the
Company is a party or by which its assets and properties are
bound.
3.9 Adverse Developments. Except as disclosed in its SEC
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Reports, and particularly, in its Current Reports on Form 8-K,
since January 1, 2006, there has been no material adverse change
in the business, operations or condition (financial or otherwise)
of the Company; nor has there been since such date, any damage,
destruction or loss, whether covered by insurance or not,
materially or adversely affecting the business, properties or
operations of the Company.
3.10 Actions and Proceedings. The Company is not subject to
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any outstanding orders, writs, injunctions or decrees of any
court or arbitration tribunal or any governmental department,
commission, board, agency or instrumentality, domestic or
foreign, against, involving or affecting the business, properties
or employees of the Company or the Company's right to enter into
and execute this Agreement. There are no actions, suits, claims
or legal, administrative or arbitration proceedings or
investigations, including any warranty or product liability
claims (whether or not the defense thereof or liabilities in
respect thereof are covered by policies of insurance) relating to
or arising out of the business, properties or employees of the
Company pending or, to the best knowledge of the CEO, threatened
against or affecting the Company.
3.11. Compliance with Laws. Since December 15, 2005, the
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Company has complied in all material respects with all laws,
ordinances, regulations and orders applicable to the conduct of
its business, including all laws relating to environmental
matters, employees and working conditions.
3.12 Bank Accounts and Credit Cards. As of the date hereof,
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the Company does not have any bank account, safe deposit box or
credit or charge cards other than as annexed hereto as Schedule
3.12.
3.13 Delivery of Books and Records. At or as soon after
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closing of the transaction contemplated herein, the Company's
books and records shall be delivered to the Buyer or its designee
as kept and maintained in the ordinary course by the Company.
Such delivery of the Company's books and records is a material
aspect of completion of the transaction contemplated by the Stock
Purchase Agreement for which time is of the essence. The books
and records will permit ▇▇▇▇▇▇▇▇▇▇.▇▇▇ to prepare and have
audited its financial statements for the years ended December 31,
2005 and 2006 and CEO will cooperate in the preparation of
financial statements and the Company's Annual Report for the year
ended December 31, 2006 (Form 10-KSB) upon the Company's
reasonable request and will execute any required certifications
to be included in the Form 10-KSB. All costs associated with the
preparation of the Company's Form 10-KSB for the year ended
December 31, 2006 will be the responsibility of Buyer.
3.14 Prior Operations. The Company has had a limited
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operating history and no revenues or earnings from operations
since inception. The Company was formed in Delaware in 1999 to
develop and supply to customers of the dental profession
integrated software packages for office administration and
management systems. All of the Company's operations since
inception have been development stage operations toward
realization of a software prototype suitable for testing and
subsequent commercial exploitation.
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4. REPRESENTATIONS AND WARRANTIES OF BUYERS
Buyer represents and warrants to Sellers and CEO as follows:
4.1 Organization. Power and Authority. The Buyer is
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authorized to execute and deliver this Agreement, and any other
agreement or instrument contemplated by this Agreement, and to
consummate the transaction and to perform such Buyer's
obligations contemplated hereby and thereby. Buyer confirms that
it has appointed ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq. as their
representative to receive the SEC Reports and the Company's Form
8-K reports and that copies thereof have been received by them.
4.2 Legal and Authorized Transaction; Authority: No Breach.
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The execution and delivery by the Buyer of this Agreement and any
other agreement or instrument contemplated by this Agreement, and
the consummation of the transaction contemplated hereby and
thereby, requires no specific consent or authority conferred by
any third party. This Agreement, and any such other agreement or
instrument, upon execution and delivery by the Buyer (and
assuming due execution and delivery hereof and thereof by the
other parties hereto and thereto), will constitute the legal,
valid and binding obligation of the Buyer, in each case
enforceable against the Buyer in accordance with its terms,
except as such enforceability may be limited by applicable
bankruptcy, insolvency, moratorium, reorganization or similar
laws from time to time in effect which affect creditors' rights
generally and by legal and equitable limitations on the
availability of specific performance and other equitable remedies
against the Buyer under or by virtue of this Agreement or such
other agreement or instrument. Neither the execution and delivery
of this Agreement, or any such other agreement or instrument by
the Buyer, nor the consummation of the transaction contemplated
hereby or thereby, will (i) violate, conflict with or result in
the breach or termination of, or otherwise give any other
contracting party the right to terminate, or constitute a default
under the terms of, any mortgage, bond, indenture or material
agreement to which the Buyer is a party or by which the Buyer or
any of its property or assets may be bound or materially
affected, (ii) violate any judgment, order, injunction, decree or
award of any court, administrative agency or governmental body
against, or binding upon, the Buyer or upon the securities,
property or business of the Buyer, or (iii) constitute a
violation by such Buyer of any applicable law or regulation of
any jurisdiction as such law or regulation relates to the Buyer
or to the property or business of the Buyer.
4.3 No Litigation, Etc. There is no material suit, action,
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or legal, administrative, arbitration or other proceeding or
governmental investigation pending or, to the Buyer's best
knowledge, threatened against, materially affecting, or which
will materially affect, the property of the Buyers, or to the
Buyer's best knowledge does there exist any basis therefor.
4.4 Accredited Investors; Investment Intent. The Buyer is
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an accredited investor as that term is defined in applicable
rules and regulations and is acquiring the Shares for his, her or
its own account for investment purposes and not with a view to
distribution or resale, nor with the intention of selling,
transferring or otherwise disposing of all or any part of the
Shares except in compliance with all applicable provisions of the
Securities Act of 1933, as amended (the "Act"), the rules and
regulations promulgated thereunder, and applicable state
securities laws. The Shares acquired by Buyer from Sellers are
"restricted securities" as that term is defined under Rule 144 of
Page 7 of 19
the Act, and any sales of the Shares made in reliance upon Rule
144 can be made, among other things, only in limited amounts in
accordance with the terms and conditions of that Rule and will
require an opinion of counsel satisfactory to the Company and the
Company's counsel that registration is not required under the Act
or state securities laws.
4.5 Restrictive Legend. The Buyer understands that any and
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all certificates representing the Shares and any and all Shares
issued in replacement thereof or in exchange therefor shall bear
the following legend, or one substantially similar thereto;
"The shares represented by this certificate
have not been registered under the Securities
Act of 1933. The shares have been acquired for
investment and may not be sold, transferred or
assigned in the absence of an effective
registration statement for these shares under
the Securities Act of 1933 or an opinion
satisfactory to the Company's counsel that
registration is not required under said Act."
4.6 During the past five (5) years, neither the Buyer nor
any of its executive officers has been:
(1) Subject of a petition under the Federal bankruptcy laws
or any state insolvency law filed by or against it, or by a
receiver, fiscal agent or similar officer appointed by a court
for their business or property, or any partnership in which the
Buyer or any of its executive officers was a general partner at
or within two (2) years before the time of such filing or any
corporation or business association of which any of its executive
officers was an executive officer at or within two (2) years
before the time of such filing;
(2) Convicted in a criminal proceeding or a named subject
of a pending criminal proceeding (excluding traffic violations
and other minor offenses);
(3) The subject of any order, judgment, or decree not
subsequently reversed, suspended or vacated, of any court of
competent jurisdiction, permanently or temporarily enjoining any
of them for, or otherwise limiting, any of the following
activities:
(i) acting as a futures commission merchant, introducing
broker, commodity trading advisor, commodity pool operator, floor
broker, leverage transaction merchant, any other person regulated
by the Commodity Futures Trading Commission, or an associated
person of any of the foregoing, or as an investment adviser,
underwriter, broker or dealer in securities, or as an affiliated
person, director or employee of any investment company, bank,
savings and loan association or insurance company, or engaging in
or continuing any conduct or practice in connection with any such
activity;
(ii) engaging in any type of business practice; and
(iii) engaging in any activity in connection with the
purchase or sale of any security or commodity or in connection
with any violation of Federal or State securities law or Federal
Commodity laws.
Page 8 of 19
(4) The subject of any order, judgment or decree, not
subsequently reversed, suspended or vacated of any Federal or
State authority barring, suspending or otherwise limiting for
more than sixty (60) days either of their right to engage in any
activity described in paragraph (3) (i) above, or be associated
with persons engaged in any such activity.
(5) Found by any court of competent jurisdiction in a civil
action or by the Securities and Exchange Commission to have
violated any Federal or state securities law, and the judgment in
such civil action or finding by the Commission has not been
subsequently reversed, suspended or vacated; or
(6) Found by a court of competent jurisdiction in a civil
action or by the Commodity Futures Trading Commission to have
violated any Federal Commodities Law, and the judgment in such
civil action or finding by the Commodity Futures Trading
Commission has not been subsequently reversed, suspended or
vacated.
5. COVENANTS AND AGREEMENTS OF THE PARTIES
5.1 Finders. The Buyer represents and warrants to the
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Sellers that it has not employed any broker, finder or similar
agent and no person or entity with which the Buyer has had any
dealings or communications of any kind is entitled to any
finder's fee or any similar compensation from the Buyer in
connection with this Agreement or the transaction contemplated
hereby. Any Finder(s) or similar agent employed by the Sellers in
connection with the transaction contemplated herein shall be
compensated by Sellers. The Buyer has and shall have no liability
or responsibility whatsoever for any such or similar compensation
claimed.
5.2 Expenses. Each of the parties hereto agrees to bear
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his, her or its own expenses in connection with the negotiation,
preparation, execution and delivery of this Agreement and the
consummation of the transaction contemplated hereby.
5.3 SEC Filings. Buyer agrees (i) to exercise its best
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efforts: (a) to cause the Company to remain a reporting company
under either Section 12(g) or 15(d) of the Exchange Act, and (b)
to file all necessary reports with the SEC and any other
regulatory body as required to maintain the Company as a current
reporting Company under the Exchange Act and any other applicable
rules and regulations; (ii) to cause the Company to file with the
SEC a Report on Form 8-K relating to the consummation of the
transaction contemplated hereunder; (iii) to cause the Company to
file with the SEC a Information Statement on Schedule14F-1 and
(iv) to provide each of the Sellers with one copy of such
Information Statement on Schedule 14F-1 as filed pursuant to
clause (iii) above.
6. NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES
6.1 Nature of Statements. All statements contained in any
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schedule, certificate or other instruments delivered by or on
behalf of any party hereto pursuant to this Agreement, shall be
deemed representations and warranties by such party.
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6.2 Survival of Representations and Warranties. Regardless
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of any investigation at any time made by or on behalf of any
party hereto or of any information any party may have in respect
thereof, all covenants, agreements, representations and
warranties made hereunder or pursuant hereto or in connection
with the transaction contemplated hereby shall survive the
execution and delivery of this Agreement and continue in effect
through the first anniversary of this Agreement except that the
representations and warranties set forth in Sections 2.2 shall
continue in effect until the expiration of the applicable statute
of limitations, and the agreements of indemnity for claims set
forth in Sections 7, 8 and 9 shall survive the execution and
delivery of this Agreement and continue in effect for the period
during which such claims are enforceable.
7. INDEMNIFICATION BY CEO
7.1 Claims Against the Company. CEO shall indemnify and
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hold Buyer harmless from and against any loss, damage or expense
(including reasonable attorneys' fees) caused by or arising out
of any claim made against the Company:
(i) for any foreign, Federal, state or local tax of any
kind arising out of or by reason of the existence or operations
of the Company, since January 1, 2005 and prior to the date of
this Agreement, including, without limitation, any payroll taxes
owed by the Company on account of compensation paid to any
employee of the Company prior to such date;
(ii) since January 1, 2005, in respect of transactions
occurring prior to the date of this Agreement arising under the
Act, the Exchange Act, or any state blue sky or securities law;
(iii) in respect of any salary, bonus, wages or other
compensation of any kind owed by the Company to its employees for
services rendered on or prior to the date of this Agreement;
(iv) for any damages to the environment caused by or arising
out of any pollution resulting from or otherwise attributable to
the operation of the business of the Company prior to the date of
this Agreement;
(v) in respect of any payable of the Company to the Sellers
incurred prior to the date of this Agreement;
(vi) in respect of any liability or indebtedness for
borrowed money or otherwise incurred on or before the date of
this Agreement except as provided in Section 3.7 hereof.
7.2 Other Matters. CEO shall also indemnify and hold Buyers
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harmless from and against any loss, damage or expense (including
reasonable attorneys' fees) caused by or arising out of (i) any
breach or default in the performance by CEO of any covenant or
agreement of CEO contained in this Agreement, (ii) any breach of
warranty or inaccurate or erroneous representation made by CEO
herein or in any schedule, certificate or other instrument
delivered by or on behalf of CEO pursuant hereto, and (iii) any
and all actions, suits, proceedings, claims, demands, judgments,
costs and expenses (including reasonable legal and accounting
fees) incident to any of the foregoing.
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8. INDEMNIFICATION BY SELLERS
8.1 Claims Against Buyer. Each of the Sellers, severally,
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shall indemnify and hold Buyers harmless from and against any
loss, damage or expense (including reasonable attorneys' fees)
caused by or arising out of (i) any breach or default in
performance by such Seller of any covenant or agreement of him,
her or it contained in this agreement, (ii) any breach of
warranty or inaccurate or erroneous representation made by such
Seller herein or in any schedule, certificate or other instrument
delivered by or on behalf of him, her or it pursuant hereto, and
(iii) any and all actions, suits, proceedings, claims, demands,
judgments, costs and expenses (including reasonable legal and
accounting fees) incident to any of the foregoing.
9. INDEMNIFICATION BY BUYER
9.1 Claims Against Sellers. The Buyer shall indemnify and
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hold harmless Sellers from and against all loss, damage or
expense (including reasonable attorneys' fees) caused by or
arising out of (i) any breach or default in the performance by
Buyer of any covenant or agreement of Buyer contained in this
Agreement, (ii) any breach of warranty or inaccurate or erroneous
representation made by Buyer herein or in any certificate or
other instrument delivered by or on behalf of Buyer pursuant
hereto and (iii) any and all actions, suits, proceedings, claims,
demands, judgments, costs and expenses (including reasonable
legal and accounting fees) incident to the foregoing.
10. NOTICE AND OPPORTUNITY TO DEFEND
10.1 Participation. Promptly after the receipt by Buyer,
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Sellers or CEO of notice of any action, proceeding, claim or
potential claim (any of which is hereinafter individually
referred to as a ("Circumstance") which could give rise to a
right to indemnification under this Agreement, such party (the
"Indemnified Party") shall give prompt written notice to the
party or parties who may become obligated to provide
indemnification hereunder (the "Indemnifying Party"). Such notice
shall specify in reasonable detail the basis and amount, if
ascertainable, of any claim that would be based upon the
Circumstance. The failure to give such notice promptly shall
relieve the Indemnifying Party of its indemnification obligations
under this Agreement, unless the Indemnified Party establishes
that the Indemnifying Party either had knowledge of the
Circumstance or was not prejudiced by the failure to give notice
of the Circumstance. The Indemnifying Party shall have the right,
at its option, to compromise or defend the claim, at its own
expense and by its own counsel, and otherwise control any such
matter involving the asserted liability of the Indemnified Party,
provided that any such compromise or control shall be subject to
obtaining the prior written consent of the Indemnified Party
which consent shall not be unreasonably withheld. An Indemnifying
Party shall not be liable for any costs of settlement incurred
without the written consent of the Indemnifying Party. If any
Indemnifying Party undertakes to compromise or defend any
asserted liability, it shall promptly notify the Indemnified
Party of its intention to do so, and the Indemnified Party agrees
to cooperate fully with the Indemnifying Party and its counsel in
the compromise of or defense against any such asserted liability.
All costs and expenses incurred in connection with such
cooperation shall be borne by the Indemnifying Party, provided
such costs and expenses have been previously approved by the
Indemnifying Party. In any event, the Indemnified Party shall
have the right at its own expense to participate in the defense
Page 11 of 19
of an asserted liability.
11. MISCELLANEOUS
11.1. Successors and Assigns. This Agreement shall be
-------------------------
binding upon and shall inure to the benefit of the parties hereto
and their respective heirs, successors and assigns. No assignment
of this Agreement or delegations of any rights hereunder shall
relieve the assigning or delegating party of any of its
obligations or liabilities hereunder.
11.2 Notices. All notices or other communications required
--------
or permitted to be given hereunder shall be in writing and shall
be deemed to have been duly given if delivered by hand, sent
prepaid overnight by Federal Express or the like, in writing, or
mailed first class, postage prepaid, by certified mail, return
receipt requested (mailed notices and notices sent by facsimile
shall be deemed to have been given on the date sent) as follows:
(a) If to Sellers, as follows:
▇/▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
with a copy to:
Venture Law Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
(b) If to Buyer
Vision Opportunity Master Fund, Ltd.
▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇, President
with a copy to:
Law Office of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, P.A.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
or in any case to such other address or addresses as hereafter
shall be furnished as provided in this Section 10.2 by either of
the parties hereto to the other party hereto.
11.3 Waiver; Remedies. No delay on the part of Sellers or
-----------------
Buyer in exercising any right, power or privilege hereunder shall
operate as a waiver thereof, nor shall any waiver on the part of
Sellers or Buyer of any right, power or privilege hereunder
operate as a waiver of any other right, power or privilege
hereunder, nor shall any single or partial exercise of any right,
power or privilege hereunder preclude any other or further
Page 12 of 19
exercise of any other right, power or privilege hereunder. The
rights and remedies herein provided are cumulative and are not
exclusive of any rights or remedies which the parties hereto may
otherwise have at law or in equity.
11.4 Entire Agreement. This Agreement constitutes the entire
-----------------
agreement between the parties with respect to the subject matter
hereof and supersedes all prior agreements or understandings of
the parties relating thereto.
11.5 Amendment. This Agreement may be modified or amended
----------
only by written agreement of the parties hereto.
11.6 Counterparts. This Agreement may be executed in any
-------------
number of counterparts, each of which shall be deemed an original
but all of which together shall constitute a single instrument.
11.7 Governing Law. This Agreement shall be governed and
---------------
construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed entirely within
the State of New York.
11.8 Captions. All section titles or captions contained in
---------
this Agreement, in any schedule referred to herein or in any
Exhibit annexed hereto are for convenience only, shall not be
deemed a part of this Agreement and shall not affect the meaning
or interpretation of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed and delivered on the day and year first above
written.
SELLERS:
/s/▇▇▇▇▇ ▇▇▇▇▇▇ /s/▇▇▇▇▇ ▇▇▇▇▇▇▇
______________________________ __________________________
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/▇▇▇▇ ▇▇▇▇▇▇
______________________________
▇▇▇▇ ▇▇▇▇▇▇
Page 13 of 19
CEO OF ▇▇▇▇▇▇▇▇▇▇.▇▇▇:
/s/▇▇▇▇▇ ▇▇▇▇▇▇
______________________________
▇▇▇▇▇ ▇▇▇▇▇▇, in his personal
capacity as Majority
Stockholder and CEO of
▇▇▇▇▇▇▇▇▇▇.▇▇▇
BUYER:
VISION OPPORTUNITY MASTER FUND, LTD.
/s/▇▇▇▇ ▇▇▇▇▇▇▇▇
______________________________
▇▇▇▇ ▇▇▇▇▇▇▇▇, President
Page 14 of 19
Schedule 1.2
Shares Held by Sellers and Consideration to be Paid for Shares Sold
____________________________________________________________________________
Name Total Number Total Number Consideration
of Seller of Shares of of Shares to to be paid for
▇▇▇▇▇▇▇▇▇▇.▇▇▇ Held be Sold to Buyer Shares Sold to Buyer
____________________________________________________________________________
▇▇▇▇▇ ▇▇▇▇▇▇ 4,895,000 4,765,000 $570,000
____________________________________________________________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇ 445,000 206,150 $ 75,000
____________________________________________________________________________
▇▇▇▇ ▇▇▇▇▇▇ 50,000 45,000 $ 5,000
____________________________________________________________________________
Page 15 of 19
Schedule 3.5
Articles and Bylaws of the Company
ATTACHED
(Omitted from this Exhibit)
Page 16 of 19
Schedule 3.6
Directors and Officers of Company
Name of Director
----------------
▇▇▇▇▇ ▇▇▇▇▇▇
Executive Officers:
Name of Officer Office(s) Previously Held
--------------- -------------------------
▇▇▇▇▇ ▇▇▇▇▇▇ Chief Executive Officer, Chief
Financial Officer, President,
Secretary, and Treasurer
Page 17 of 19
RESIGNATION AS OFFICER & DIRECTOR
▇▇▇▇▇▇▇▇▇▇.▇▇▇.
TO: ▇▇▇▇▇▇▇▇▇▇.▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
I, ▇▇▇▇▇ ▇▇▇▇▇▇, hereby resign as Chief Executive Officer, Chief
Financial Officer, President, Secretary and Treasurer and from
any other office which I may currently hold in ▇▇▇▇▇▇▇▇▇▇.▇▇▇,
effective as of the close of the meeting of directors held on the
date below.
I further resign as director of ▇▇▇▇▇▇▇▇▇▇.▇▇▇ effective ten days
after ▇▇▇▇▇▇▇▇▇▇.▇▇▇ mails an Information Statement on Schedule
14F-1 pursuant to section 14(f) of the Securities Exchange Act of
1934, as amended, and Rule 14f-1.
Dated this 11th day of December, 2006, as of 5:00 p.m. PST.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
________________________________
By: ▇▇▇▇▇ ▇▇▇▇▇▇
Page 18 of 19
Schedule 3.12
Bank Accounts and Credit Cards
▇▇▇▇▇▇▇▇▇▇.▇▇▇ has a checking account at Bank of America,
Bellevue, Washington which will be closed within seven days of
closing this Agreement.
▇▇▇▇▇▇▇▇▇▇.▇▇▇ does not have any credit cards.
Page 19 of 19