STOCK FOR ASSETS AGREEMENT
This Agreement (the “
Agreement ”) is made and entered into
effective as of November 1, 2007 by and among Freestone
Resources, Inc., a Nevada corporation (the “ Corporation
” or “ Purchaser ”) and 426
Trust, a Trust of which Nora Pickens is the Trustee, (the
“ Seller ”).
RECITALS
A.
WHEREAS, Corporation has at least 30,000,000
shares of common stock (the “ Stock ”)
in its treasury and desires to issue it to Seller for certain
assets and assumption of certain liabilities; and
B.
WHEREAS, Seller desires to sell to the
Corporation, and the Corporation desires to purchase from
Seller, certain assets and liabilities as listed in Section 1.1,
subject to the terms and conditions set forth herein;
AGREEMENT
For and in consideration of the premises and of
the mutual representations, warranties, covenants and agreements
contained herein, and of other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,
and upon the terms and subject to the conditions hereinafter set
forth, the parties do hereby agree as follows:
ARTICLE I
PURCHASE AND SALE
1.1
Purchase of the Stock . Upon execution of this
Agreement, the Corporation shall purchase from Seller, and Seller
shall sell to the Corporation, the following assets and assume the
following liabilities on the terms and conditions set forth herein.
Upon execution of this Agreement, the Corporation shall pay
Seller 30,000,000 shares of common stock of the Corporation (the
“ Purchase Price ”).
Assets Purchased:
Petrozene contract
Intangible – value not determined
Petrozene trademark
Intangible – value not determined
Mineral lease A
8,000.00
Mineral lease B
51,962.86
Building
62,500.00
Computers
2,992.03
Pipeline
20,952.07
Well (capitalized costs)
184,581.99
Liabilities assumed:
Dell (computer)
2,300.02
Due to B Bonner
25,000.00
Due to Lloyd Lane
70,592.80
Due to officer
8,000.00
Due to Lynnie Lane
50,000.00
Due to T Bonner
20,000.00
Due to FNB (Building)
54,177.78
1.2 Assignment . Upon execution
of this Agreement, the Seller shall execute and deliver to the
Purchaser any and all Assignments necessary for complete
transfer of the assets listed above effective as of the date of
this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to the Purchaser
the following:
2.1
Authorization. This Agreement has been
duly executed and delivered by Seller and constitutes the valid
and binding obligation of the Seller, enforceable in accordance
with its terms, except that (a) such enforcement may be subject
to bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting creditors’ rights generally, (b) the remedy
of specific performance and injunctive relief are subject to
certain equitable defenses and to the discretion of the court
before which any proceedings may be brought and (c) rights to
indemnification hereunder may be limited under applicable
securities laws (the “ Equitable Exceptions
”).
2.2 No Violations . The
execution and delivery of this Agreement and the other agreements
and documents contemplated hereby by Seller and the consummation by
Seller of the transactions contemplated hereby will not (a) violate
any statute, rule, regulation, order or decree of any public body
or authority by which the Seller or its properties or assets are
bound, or (b) result in a violation or breach of, or constitute a
default under or result in the creation of any encumbrance upon, or
create any rights of termination, cancellation or acceleration in
any person or entity with respect to any agreement, contract,
indenture, mortgage or instrument to which the Seller is a party or
any of its properties or assets is bound.
2.3
Consents . Except for consents, if any, required by
the Shareholders’ Agreement of the Corporation (the “
Shareholders’
Agreement ”),
no consent, approval or other authorization of any governmental
authority or under any contract or other agreement or commitment to
which the Seller is a party is required as a result of or in
connection with the execution or delivery of this Agreement and the
other agreements and documents to be executed by the Seller or the
consummation by the Seller of the transactions contemplated
hereby.
2.4
Interest of Seller . Seller (a) owns of record and
beneficially good and marketable title to all of the Stock, free
and clear of any and all liens, mortgages, security interests,
encumbrances, pledges, charges, adverse claims, options, rights or
restrictions of any character whatsoever other than standard state
and federal securities law private offering legends and
restrictions (collectively, “ Liens ”)
other than the transfer restrictions in the articles of
incorporation or the Shareholders’ Agreement of the Purchaser
(collectively, the “ Purchaser’s Constituent
Documents ”), (b) has the right to vote the Stock on
any matters as to which the Stock entitles the Purchaser to vote
under the Purchaser’s Constituent Documents, free of any
right of any other person or entity, and (c) the Stock represents
all of Seller’s interest in the Corporation.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
THE
PURCHASER
The Purchaser and the Shareholders jointly and
severally represent and warrant to Seller the following:
3.1
Organization and Authorization . The Purchaser is, as
applicable, a corporation duly formed and validly existing under
the laws of the state of its organization with all requisite
corporate power and authority to own, lease and operate its
properties and to carry on its business as now being conducted.
The Purchaser has all requisite corporate power to execute
and deliver this Agreement and all other agreements and documents
contemplated hereby. The execution and delivery of this
Agreement and such other agreements and documents by the Purchaser
and the consummation by the Purchaser of the transactions
contemplated hereby have been duly authorized by the Purchaser and
all other corporate action, as applicable, on the part of the
Purchaser that is necessary to authorize the transactions
contemplated hereby. This Agreement has been duly executed
and delivered by the Purchaser and constitutes the valid and
binding obligation of the Purchaser, enforceable in accordance with
its terms, subject to the Equitable Exceptions.
2
3.2 No Violations . The
execution and delivery of this Agreement and the other
agreements and documents contemplated hereby by the Purchaser
and the consummation by the Purchaser of the transactions
contemplated hereby will not (a) violate any provision of the
Purchaser’s Constituent Documents, (b) violate any
statute, rule, regulation, order or decree of any public body or
authority by which the Purchaser or its properties or assets are
bound, or (c) result in a violation or breach of, or constitute
a default under or result in the creation of any encumbrance
upon, or create any rights of termination, cancellation or
acceleration in any person with respect to any agreement,
contract, indenture, mortgage or instrument to which the
Purchaser is a party or any of its properties or assets is
bound.
3.3
Consents. Except
for consents, if any, required by the Shareholders’
Agreement, no consent, approval or other authorization of any
governmental authority or under any contract or other agreement or
commitment to which the Corporation is a party is required as a
result of or in connection with the execution or delivery of this
Agreement and the other agreements and documents to be executed by
the Corporation or the consummation by the Corporation of the
transactions contemplated hereby.
ARTICLE IV
INDEMNIFICATION
4.1
Purchasers’ Losses .
(a) Seller agrees to
indemnify, defend (as described below) and hold harmless the
Purchaser and its officers, managers, members, partners (other
than for Seller), employees, representatives, agents and
attorneys from, against and in respect of any and all Purchaser
Losses (as defined below) suffered, sustained, incurred or
required to be paid by any of them by reason
