PURCHASE AND SALE AGREEMENT
THIS AGREEMENT made the 21st day of April, 2003
GLOBAL WI FI CORP.
(hereinafter called the "Purchaser")
GLOBAL WEB TV, INC.
(hereinafter collectively called the "Seller")
WHEREAS the Purchaser desires to purchase and the Seller desires to sell
certain of its property, assets and rights, all upon and subject to the terms
and conditions herein contained;
NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other valuable and good consideration, (the receipt
and sufficiency of which is hereby acknowledged), the parties hereto agree as
1. DEFINED TERMS
1.1 "DEFINED TERMS" Where used herein or in any amendments hereto, the following
terms shall have the following meanings except as defined otherwise in this
1.2 "ASSETS" means those assets to be conveyed hereunder as more fully set forth
in the attached Schedule A.
1.3 "BUSINESS" means the business operations presently and heretofore carried on
by Seller at its current place of business located at
1.4 "BUSINESS DAY" means any day except Saturday, Sunday, or any statutory
holiday in the State of Florida.
1.5 "CLOSING DATE" means the 30th day of April 2003 or such other date as may be
mutually agreed upon in writing by the parties hereto.
1.6 "PURCHASE DOCUMENTS" means this Agreement and all other agreements,
documents or instruments to be executed in connection with this Agreement.
2. PURCHASE OF ASSETS AND PURCHASE PRICE
A. The Purchaser shall purchase from the Seller those Assets set forth on
the attached Schedule A. All assets to be in good working condition.
The Purchaser will also assume those liabilities set forth on the attached
B. Purchaser shall pay Seller for those items set forth on Schedule "A" and
the assumption of those liabilities set forth on Schedule B the following
Seller shall receive 5 million shares of the Classs A Preferred Stock. (the
"Shares") of HOJO HOLDINGS, INC., the holder of all of the issued and
outstanding shares of common stock of the Purchaser. Said class of preferred
shares to be authorized by HOJO prior to Closing. The Class A preferred Shares
shall contain such rights and preferences as contained in the attached Schedule
C. The Shares to be issued under this agreement shall be restricted shares of
common stock as that term is defined under Section 144 of the Securities Act of
1933, as amended.
Subject to the Seller's compliance with the requirements of paragraph 5(j)
of this Agreement, all Shares to be issued to the Seller shall be held in escrow
with the law firm of Xxxxxx, Xxxxxxx & Xxxxx. Upon satisfaction of the audit
requirement, on notice from the Purchaser, Xxxxxx, Xxxxxxx and Xxxxx shall
deliver the escrowed shares to the Seller. If Seller is not able to deliver the
required financial statements, Purchaser may, in its sole and absolute
discretion, rescind this Agreement, and instruct escrow agent, to deliver the
Shares to the Purchaser and HOJO shall be entitled to cancel the preferred
3. ALLOCATION OF THE PURCHASE PRICE.
The purchase price shall be allocated amongst the Assets as provided in
Schedule A attached hereto, and each party shall file in a manner consistent
therewith (i) the reports required under Section 1060 of the Internal Revenue
Code of 1986, as amended, and (ii) their respective Federal, state and local tax
Except as agreed otherwise by the parties, the closing of the transactions
contemplated hereunder will take place on the latter of April 30, 2003 or the
date that the Purchaser files with the Delaware Secretary of State an amendment
to its articles of incorporation authorizing the issuance of the preferred
stock. At the Closing, Seller shall deliver to Purchaser a duly executed xxxx of
sale or bills of sale and such other instruments of transfer, in form and
substance, satisfactory to the attorney for Purchaser with respect to the sale
of the Assets as reasonably requested by Purchaser.
At the Closing there shall also be delivered to the parties certified
copies of resolutions of the board of directors and shareholders of Seller
authorizing the transactions contemplated hereunder.
5. REPRESENTATIONS AND WARRANTIES BY SELLER AND XXXXXXX.
(i) Seller represents and warrants to Purchaser as follows:
(a) Seller is a corporation duly organized and validly existing under the
laws of the State of Florida. Seller has full power and authority to own the
Assets and conduct its business and that the Assets are owned free and clear of
all liabilities of any kind or nature without any liens or encumbrances.
(b) The execution, delivery and performance of the Purchase Documents by
Seller, and the consummation of the transactions contemplated hereby, will not
with or without the giving of notice or the lapse of time or both:
(i) violate any provision of law, statute, rule or regulation to which
Seller is subject,
(ii) violate any judgment, order, writ or decree to which Seller is a
party or by which it is or may be bound; or
(iii) to the knowledge of Seller, result in the breach of or conflict
with any term, covenant, condition or provision of, or result in the
modification or termination of, or constitute a default under or result in
the creation or imposition of any lien, security interest, charge or
encumbrance upon any of the Assets being purchased hereunder, under the
corporate charter or by-laws or any other agreement, understanding or
instrument to which Seller is a party or by which it is or may be bound or
(c) All necessary corporate action has been taken by Seller to authorize
the execution, delivery and performance of the Purchase Documents. The Purchase
Documents have been duly and validly authorized, executed and delivered by
Seller and constitute the valid and binding obligation of Seller enforceable
against it in accordance with their respective terms.
(d) All consents and approval required for transferring the Assets to
Purchaser hereunder and for assigning the agreements, including without
limitation all amendments, modifications, and supplements, whether written or
oral ("Agreements") and for performing Seller's obligations under the Purchase
Documents have been obtained or will be obtained. No consent of any court,
governmental agency or other public authority is required as a condition to the
enforceability of the Purchase Documents.
(e) Seller acknowledges that the Assets being transferred per Schedule "A"
are not encumbered by any liens or the subject matter of any known or
anticipated litigation Seller further acknowledges and agrees that the
consideration paid by Buyer for Sellers' assets is fair and adequate
(f) To the best of Seller's knowledge, Seller has conducted its business in
compliance with all applicable federal, state and local laws, regulations and
(g) Seller has not received any notice that it is infringing upon the
research, development, processes, methods, techniques, inventions, know how
patents, patent rights, trade name, trademarks and service marks of any other
(h) Seller is not a party to any written or oral employment, agency or
commission agreement with any of its employees that cannot be terminated upon
the closing date of this transaction without penalty. No employee, director,
officer or stockholder (or any current or former family member thereof) of
Seller, either individually or in any other capacity, has a claim of any kind
against the Seller, and Seller has no obligation with respect to such person or
entity, except the right to current salary or wages, accrued vacation pay, and
reimbursable expenses arising in the ordinary course of business. Seller does
not contribute to or sponsor any employee welfare or benefit plans, and is not
subject to any collective bargaining agreement, for employees. its business and
that the Assets are owned free and clear without any liens or encumbrances. exce
(i) Seller is a sophisticated investor and understands the risks and
uncertainties involved with the receipt of the Purchaser's restricted preferred
stock. Seller has had an opportunity to discuss the operations of Buyer's
business with management and has been provided with any requested information.
Seller has also reviewed the Buyer's filings on the SEC XXXXX database.
(j) Seller shall provide Buyer with such financial information as may be
necessary to complete an audit in accordance with those rules and regulations
prescribed by the Securities and Exchange Commission. In the event that Seller
is unable to supply the requested information and Purchaser is unable to
conclude an audit of the Seller's business within 60 days of closing as
prescribed by the Securities and Exchange Commission, then in that event,
Purchaser may rescind this Agreement and all assets transferred in conjunction
therewith shall be returned to the respective parties.
(k) Seller has paid all personal and intangible property taxes due as a
result of the ownership of the assets and there are no amounts due and owing for
personal property or intangible property taxes.
6. REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to Seller as follows:
(a) Purchaser is a corporation duly organized and validly existing under
the laws of the State of Florida has full power and authority to own its
property and conduct its business.
(b) The execution, delivery and performance of this Agreement, and the
consummation of the transactions contemplated hereby, will not with or without
the giving of notice or the lapse of time or both:
(i) violate any provision of law, statute, rule or regulation to which
Purchaser is subject;
(ii) violate any judgment, order, writ or decree to which Purchaser is
a party or by which Purchaser is bound; or
(iii) result in the modification or termination of, or constitute a
default under the corporate charter or by-laws or any other agreement, understanding
or instrument to which Purchaser is a party or by which Purchaser is or may be bound
(c) All necessary corporate action has been taken by Purchaser to authorize
the execution, delivery and performance of this Agreement, and the consummation
of the transaction contemplated hereby. This Agreement, has been duly and
validly authorized and is a binding obligation of Purchaser enforceable against
it in accordance with its terms.
7. CONDITIONS TO THE OBLIGATIONS OF SELLER TO CLOSE
The obligations of Seller under this Agreement are, at the option of
Seller, subject to the fulfillment of the following conditions at, or prior to,
the Closing Date:
7.01 Representations, Warranties and Covenants: All representations and
warranties of Purchaser contained in this Agreement and in any statement,
certificate, schedule or other document delivered pursuant hereto, on in
connection herewith, shall have been true and accurate in all respects as of the
date when made and as of the Closing Date.
7.02 Covenants etc. Purchaser shall have substantially performed and
complied with each and every covenant, agreement and condition required by this
Agreement to be performed or complied with prior to or at the Closing.
8. CONDITIONS TO THE OBLIGATIONS OF PURCHASER TO CLOSE AND POST CLOSING OBLIGATIONS
The obligations of Purchaser under this Agreement are, at the option of
Purchaser, subject to the fulfillment of the following conditions at, or prior
to, the Closing Date:
8.01 Representations, Warranties and Covenants. All representations and
warranties of Seller contained in this Agreement and in any statement,
certificate, schedule or other document delivered pursuant hereto, or in
connection herewith, shall have been true and accurate in all respects as of the
date when made and as of the Closing Date.
8.02 Covenants, Etc. Seller shall have substantially performed and complied
with each and every covenant, agreement and condition required by this Agreement
to be performed or complied with prior to Closing.
8.03 Audit. Within 60 days of Closing, Seller shall deliver its audited
financial statements to Purchaser. Said audit to be in conformity with the audit
requirements as promulgated by the Securities and Exchange Commission. In the
event that the audited financial statements differ materially from those
financial statements which are attached hereto as exhibit 8.03, then in that
event the number of shares issuable to the Seller shall be adjusted
proportionately. A material change is defined as a difference of greater than
10% in the assets, net worth, revenues or net income of the Seller. For purposes
of example only, in the event that total assets are represented to be $1
million, and total assets are $500,000, then the number of preferred shares
issuable to the Seller shall be reduced by 45.55% calculated as follows:
x = valuation number
x - 1/10(x) permissable adjustment to the valuation
If the valuation number was $1 million and the actual number per the
audited statements was $500,000 then the adjustment shall be calculated as the
x- 1/10x = $1 million - $100,000 = $900,000
The percentage adjustment is calculated as 1- (500,000/900,000) = 45.55%
In the event of an adjustment in the number of shares due the Seller
pursuant to this paragraph, then in that event the Purchaser shall instruct the
Escrow Agent to deliver the Shares to HOJO and HOJO will cancel those shares
previously issued to the Seller and issue the Seller a new certificate
reflecting the correct number of preferred shares to be issued under this
9.01 Seller and Xxxxxxx agrees to indemnify and hold harmless Purchaser from:
a. Any and all damages or deficiencies resulting from any
misrepresentation, breach of warranty or non-fulfillment of any covenants on the
part of Seller under this Agreement.
b. Any and all actions, suits, proceedings, demands, assessments,
judgments, costs, reasonable attorneys fees, expenses incident to any of the
c. Any and all liabilities as they relate to the personal property being
transferred under this Purchase and Sale Agreement which are not specifically
9.02 Purchaser agrees to indemnify and hold Seller harmless from:
a. Any and all damages or deficiencies resulting from any
misrepresentation, breach of warranty or non- fulfillment of any covenant on the
part of Purchaser under this Agreement
b. Any and all actions, suits, proceeding, demands, assessments, judgments,
costs, reasonable attorney's fees and expenses incident to any of the foregoing.
9.03 Any party having an indemnification claim hereunder (Indemnitee")
shall give the other party ("Indemnitor") prompt notice in writing of any claim
by any third party which gives rise to a claim for indemnification hereunder,
and of any alleged breach of any of the representations and warranties contained
in this Agreement. As to any alleged breach of the representations or
warranties, written notice shall contain a statement setting forth the nature of
the alleged breach or breaches. The Indemnitor shall have thirty (30) days after
the delivery of such notice to cure or contest any such claim by a third party
or any such alleged breach or breaches. At its option, to be exercised within
thirty (30) days of such notice, the Indemnitor may defend against any such
action or proceeding with counsel of its choice, at the Indemnitor's expense, it
being understood, however, that the Indemnitor's designation of counsel shall be
subject to the approval of the indemnitee, which approval shall not be
unreasonably withhold. Additionally, at its own expense the Indemnitee may
participate in any such defense with counsel of its choice. As long as the
defense is being handled by the Indemnitor, the Indemnitee shall not settle any
such claim, action or proceeding without prior written consent of the
Indemnitor, except that if the Indemnitee does elect to settle the matter
without such consent, the Indemnitor shall be released from the terms of this
indemnification. Notwithstanding the foregoing, in the event the Indemnitor
elects not to defend any such claim, action, or proceeding, the Indemnitee may
do so, in which event the Indemnitor shall continue to indemnify the Indemnitee
for any liabilities, losses and damages incurred by the Indemnitee, including
any settlement payments and for the reasonable costs and expenses of this
9.04 All indemnifications made herein by Purchaser and Seller shall survive
the closing of this transaction and shall enure to the benefit of the
Purchaser's and Seller's heirs, assigns, agents, principals, members and/or
10. CONTINUING OBLIGATIONS OF THE PARTIES FOLLOWING CLOSING
10.01 Additional Documentation: The parties agree that without the payment
of additional consideration, each party will provide the other with such
information as may be necessary to carry out the terms and conditions of this
10.02 Employment Agreements: Purchaser shall enter into employment
agreements with Xxxxxxx Xxxxxxx, Xx. mutually agreeable to the Purchaser and the
respective parties and the said parties shall work on a full time basis and
devote their full attention to the business of the Purchaser.
11. BREACH OR DEFAULT.
11.01 In the event of any breach of the terms and conditions of this
Agreement by either party, the non breaching party shall put the breaching party
on Notice thereof. Notice shall be in writing. Upon receipt of such notice, the
breaching party will have ten (10) days to cure. In the event that the breach is
not cured after notice and the expiration of any curative period, the breaching
party shall be deemed in default under this Agreement.
12.01 This Agreement may not be assigned by Purchaser without the prior
written consent of Seller whose consent cannot be unreasonably withheld.
12.02 Survival or Representations. The representations and warranties set
forth herein shall survive the execution of this Agreement.
12.03 Entire Agreement. This Agreement constitutes the entire agreement
between the parties with respect to the subject matter and shall not be change
or amended without the prior written consent of all the parties hereto.
12.04 Governing Law and Disputes. This agreement shall be governed by and
construed in accordance with the laws of the state of Florida. By entering into
this Agreement, the parties agree to the jurisdiction of the courts in Palm
Beach County, Florida.
12.05 Captions. The captions herein are for the convenience of the parties
and are not to be constructed as part of the terms of this Agreement.
12.06 Waiver. Any waiver by either party of any breach of this Agreement
shall not be considered a waiver of any subsequent breach.
12.07 Notices. Any notice or other communication required or permitted to
be given hereunder shall be in writing and mailed by registered or certified
mail, postage prepaid return receipt requested, to the party to whom it is to be
12.08 Severability: In the event that any part of this Agreement is held to
be unenforceable, then such provision shall in no way affect the other terms and
provisions of this Agreement which shall remain in full force and effect.
12.09 Expenses. Each of the parties hereto shall bear its own expenses in
connection with the transactions contemplated.
IN WITNESS WHEREOF, the parties hereto have signed this Agreement under
seal on the day and year first above written.
ATTEST: GLOBAL WEB TV, INC.
ATTEST: GLOBAL WI FI CORP.
As to paragraph 5 and 9 only
Xxxxxxx Xxxxxxx, Xx.
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND
RIGHTS OF SERIES A CONVERTIBLE PREFERRED STOCK
HOJO HOLDINGS, INC.
HOJO HOLDINGS,. INC. (the "Company"), a corporation organized and existing
under the General Corporation Law of the State of Delaware, does hereby certify
that, pursuant to authority conferred upon the Board of Directors of the Company
by the Certificate of Incorporation, as amended, of the Company, and pursuant to
the General Corporation Law of the State of Delaware, the Board of Directors of
the Company at a meeting duly held, adopted resolutions (i) authorizing the
issuance of a total of a total of 10 million shares of preferred stock, par
value $.001 per share, and (ii) providing for the designations, preferences and
relative, participating, optional or other rights, and the qualifications,
limitations or restrictions thereof, of five million shares of Series A
Preferred Stock of the Company, as follows:
RESOLVED, that the Company is authorized to issue five million shares
of Series A Preferred Stock (the "Preferred Shares"), par value $.001
per share, which shall have the following powers, designations,
preferences and other special rights:
Dividends. The Holders of the Series A preferred stock shall have no
right to receive any dividend distributions or to participate in any
dividends declared by the Company to or for the benefit of the holders
of the common stock.
Conversion of Preferred Shares. Series A Preferred Shares shall be
convertible into shares of the Company's common stock, par value $.001
per share (the "Common Stock"), at a conversion ration of two shares
of preferred stock for every one share of common stock, 2:1. The
holder of any preferred shares shall be required to hold the preferred
shares for a period of two years prior to exercising any conversion
Mechanics of Conversion. The conversion of Preferred Shares shall be
conducted in the following manner:
Holder's Delivery Requirements. To convert Preferred Shares into
shares of Common Stock on any date (the "Conversion Date"), the Holder
shall (A) transmit by facsimile (or otherwise deliver), for receipt on
or prior to 11:59 p.m., Eastern Standard Time on December 31, 2010, a
copy of a fully executed notice of conversion (the "Conversion
Notice") to the Company's designated transfer agent (the "Transfer
Agent") with a copy thereof to the Company and (B) surrender to a
common carrier for delivery to the Transfer Agent as soon as
practicable following such date the original certificates representing
the Preferred Shares being converted (or an indemnification
undertaking with respect to such shares in the case of their loss,
theft or destruction) (the "Preferred Stock Certificates").
Company's Response. Upon receipt by the Company of a copy of a
Conversion Notice, the Company shall immediately send, via facsimile,
a confirmation of receipt of such Conversion Notice to such Holder and
the Transfer Agent, which confirmation shall constitute an instruction
to the Transfer Agent to process such Conversion Notice in accordance
with the terms herein. Upon receipt by the Transfer Agent of the
Preferred Stock Certificates to be converted pursuant to a Conversion
Notice, the Transfer Agent shall, on the next business day following
the date of receipt (or the second business day following the date of
receipt if received after 11:00 a.m. local time of the Transfer
Agent), (A) issue and surrender to a common carrier for overnight
delivery to the address as specified in the Conversion Notice, a
certificate, registered in the name of the Holder or its designee, for
the number of shares of Common Stock to which the Holder shall be
entitled. If the number of Preferred Shares represented by the
Preferred Stock Certificate(s) submitted for conversion is greater
than the number of Preferred Shares being converted, then the Transfer
Agent shall, as soon as practicable and in no event later than three
(3) Business Days after receipt of the Preferred Stock Certificate(s)
and at its own expense, issue and deliver to the Holder a new
Preferred Stock Certificate representing the number of Preferred
Shares not converted.
Record Holder. The person or persons entitled to receive the shares of
Common Stock issuable upon a conversion of Preferred Shares shall be
treated for all purposes as the record holder or holders of such
shares of Common Stock on the Conversion Date.
Taxes. The Company shall pay any and all taxes that may be payable
with respect to the issuance and delivery of Common Stock upon the
conversion of Preferred Shares.
Adjustments to Conversion Ratio. If the Company at any time subdivides
(by any stock split, stock dividend, recapitalization or otherwise)
one or more classes of its outstanding shares of Common Stock the
Conversion Ratio shall be adjusted proportionately.
Redemption of Preferred Shares.
Redemption of Preferred Shares. The Company shall have the right, but
not the obligation to redeem all or a portion of such Holder's
Preferred Shares . The consideration to be paid shall be either cash
or the Company's common stock. If common stock, the number of shares
to be issued shall be be equal to the total number of preferred shares
to be redeemed multiplied by the Conversion Ratio then in effect. If
cash, the total number of preferred shares multiplied by the trading
price of the Company's common stock on the record date for conversion.
The foregoing right of redemption may only be exercised upon the vote
of the holders of the common stock owning a majority of the Company's
issued and outstanding shares of common stock, without regard to any
voting rights the holders of the Series A preferred Shares may own.
(a) Voting Rights of Series A Holders. The Holders shall be granted one
vote for each 100 shares of preferred stock owned by the Holder or any portion
thereof. Said right shall be exercisable by the Holder with respect to any
matter which may come before a vote of the holders of the Company's common
(b) Reorganization or Reclassification, In the event of any
recapitalization, reorganization or reclassification, the number of votes which
attach to each preferred shares shall be adjusted accordingly.
Reservation of Shares.
(a) Authorized and Reserved Amount. The Company shall, at all times so
long as any of the Preferred Shares are outstanding, reserve and keep
available out of its authorized and unissued Common Stock, solely for
the purpose of effecting the conversion of the Preferred Shares, such
number of shares (the "Reserved Amount") of Common Stock as shall from
time to time be sufficient to effect the conversion of all of the
Preferred Shares then outstanding.
Liquidation, Dissolution, Winding-Up. Holders shall have no
liquidation or dissolution preferences.
Lost or Stolen Certificates. Upon receipt by the Company of evidence
reasonably satisfactory to the Company of the loss, theft, destruction
or mutilation of any Preferred Stock Certificates representing the
Preferred Shares, and, in the case of loss, theft or destruction, of
any indemnification undertaking by the Holder to the Company in
customary form and, in the case of mutilation, upon surrender and
cancellation of the Preferred Stock Certificate(s), the Company shall
execute and deliver new preferred stock certificate(s) of like tenor
and date; provided, however, the Company shall not be obligated to
re-issue preferred stock certificates if the Holder contemporaneously
requests the Company to convert such Preferred Shares into Common
Remedies, Characterizations, Other Obligations, Breaches and
Injunctive Relief. The remedies provided in this Certificate of
Designations shall be cumulative and in addition to all other remedies
available under this Certificate of Designations, at law or in equity
(including a decree of specific performance and/or other injunctive
relief), no remedy contained herein shall be deemed a waiver of
compliance with the provisions giving rise to such remedy and nothing
herein shall limit a Holder's right to pursue actual damages for any
failure by the Company to comply with the terms of this Certificate of
IN WITNESS WHEREOF, the Company has caused this Certificate of
Designations to be signed by Xxxx Xxxxxxx, its president, this 21st
day of April 2003.
HOJO HOLDINGS, INC.
Name: Xxxx Xxxxxxx