COMMON STOCK AND WARRANT PURCHASE
AGREEMENT
THIS COMON
STOCK AND WARRANT PURCHASE AGREEMENT is made as of the 29 th day of January, 2009, by and between Flint
Telecom Group, Inc. (the “Company”), a corporation
organized under the laws of the state of Nevada, with its executive
offices at 3390 Peachtree Rd. NE, Suite 1000, Atlanta, GA 30326,
and Redquartz Atlanta, LLC, an entity incorporated in the state of
___________ and whose address is set forth on the signature page
hereof (the “Investor”).
IN
CONSIDERATION of the
mutual covenants contained in this Agreement, the Company and the
Investor agree as follows:
SECTION
1. Authorization of Sale of the Shares
. Subject to the terms
and conditions of this Agreement, the Company has authorized the
sale to the Investor five million four hundred fifty four thousand,
four hundred fifty four (5,454,545) shares of common stock, $0.01
par value, of the Company (the “Shares”) and three
million, seven hundred fifty thousand (3,750,000) warrants to
purchase shares of common stock at $0.40 per share, having a three
year term and a cashless exercise provision, as set forth in more
detail in the Warrant Certificate, attached hereto as Exhibit A
(the “Warrants”) as set forth on the signature page
hereof.
SECTION
2. Agreement to Sell and Purchase the Shares
. At the
Closing (as defined in Section 3), the Company will sell the Shares
and Warrants (together, the “Securities”) to the
Investor, and the Investor will buy the Shares from the Company,
upon the terms and conditions hereinafter set forth, at a price of
twenty seven and one half cents ($0.275) per Share for an aggregate
purchase price set forth on the signature page
hereof. The Investor acknowledges that the Closing price
of its common shares on the OTC Bulletin Board on January 13, 2009
was $0.26.
SECTION
3. Delivery of Shares at the Closing
. The
completion of the purchase and sale of the Shares and the Warrants
(the “Closing”) shall occur simultaneously with the
execution of stock purchase agreements for the purchase of Shares
and Warrants (the “Closing Date”). At the
Closing, the Company will issue to the Investor one or more stock
certificates representing the Shares and the Warrants registered in
the name of the Investor, or in such nominee name(s) as designated
by the Investor in writing. The name(s) in which the
stock certificates are to be registered are set forth in the Stock
Certificate Questionnaire attached hereto as Appendix
I . The Company’s obligation to complete
the purchase and sale of the Shares being purchased hereunder and
deliver such certificates to the Investor at the Closing shall be
subject to the following conditions, any one or more of which may
be waived by the Company: (a) receipt by the Company of same-day
funds in the full amount of the purchase price for the Shares being
purchased hereunder; (b) the accuracy in all material respects of
the representations and warranties made by the Investor and the
fulfillment of those undertakings of the Investor to be fulfilled
prior to or at the Closing, and (c) the Company agreeing to accept
the Investor’s subscription prior to or at the
Closing. The Investor’s obligation to accept
delivery of such certificates and to pay for the Shares and
Warrants evidenced thereby shall be subject to the accuracy in all
material respects of the representations and warranties made by the
Company herein and the fulfillment of those undertakings of the
Company to be fulfilled prior to or at the Closing.
SECTION
4. Representations, Warranties and Covenants of the
Company . The Company hereby represents and
warrants to, and covenants with, the Investor as
follows:
4.1
Organization and Qualification . The
Company is a corporation duly organized, validly existing and in
good standing under the laws of the state of
Nevada. Each of the Company and its subsidiaries is duly
qualified to do business as a foreign corporation and is in good
standing in each jurisdiction in which the conduct of its business
or its ownership or leasing of property makes such qualification or
leasing necessary unless the failure to so qualify has not and
could not reasonably be expected to have a material adverse
effect.
4.2
Authorized Capital Stock . The authorized
capital stock of the Company consists of 100,000,000 common
shares. The number of common shares and all
subscriptions, warrants, options, convertible securities, and other
rights to purchase or otherwise acquire equity securities of the
Company issued and outstanding as at September 30, 2008, are as set
forth in the unaudited financial statements of the Company for the
quarter ended September 30, 2008 as provided to the Investor in the
Information Documents. The Company has reserved from its
duly authorized capital stock the maximum number of shares of
common stock issuable pursuant to this Agreement.
4.3
Issuance, Sale and Delivery of the Shares .
The Shares and Warrants being purchased hereunder have
been duly authorized, and when issued, delivered and paid for in
the manner set forth in this Agreement, will be duly authorized,
validly issued, fully paid and non-assessable.
4.4
Due Execution, Delivery and Performance of the Agreements
. The Company has full legal right, corporate power
and authority to enter into this Agreement and perform the
transactions contemplated hereby. This Agreement has
been duly authorized, executed and delivered by the
Company. The consummation by the Company of the
transactions herein contemplated will not violate any provision of
the organizational documents of the Company. The
execution, delivery and performance of this Agreement by the
Company and the consummation by the Company of the transactions
herein contemplated will not result in the creation of any lien,
charge, security interest or encumbrance upon any assets of the
Company pursuant to the terms or provisions of, or conflict with,
result in the breach or violation of, or constitute, either by
itself or upon notice or the passage of time or both, a default
under any material agreement, mortgage, deed of trust, lease,
franchise, license, indenture, permit or other instrument to which
the Company is a party or by which the Company or any of its
properties may be bound or affected and in each case which
individually or in the aggregate would have a material adverse
effect on the condition (financial or otherwise), properties,
business, prospects, or results of operations of the Company and
its subsidiaries, taken as a whole (a “Material Adverse
Effect”), or any statute or any authorization, judgement,
decree, order, rule or regulation of any court or any regulatory
body, administrative agency or other governmental body applicable
to the Company or any of its respective properties. Upon
its execution and delivery, and assuming the valid execution
thereof by the Investor, this Agreement will constitute a valid and
binding obligation of the Company, enforceable against the Company
in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors’ and
contracting parties’ rights generally and except as
enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a
proceeding in equity or at law).
4.5.
Integration, etc. The Company has not in
the past nor will it hereafter take any action to sell, offer for
sale or solicit offers to buy any securities of the Company which
would bring the offer, issuance or sale of the Shares, as
contemplated by this Agreement, within the provisions of Section 5
of the Securities Act. Neither the Company nor any of
its Affiliates (as defined in Rule 501(b) of Regulation D under the
Securities Act) has directly, or through any agent, (i) sold,
offered for sale, solicited offers to buy or otherwise negotiated
in respect of, any “security” (as defined in the
Securities Act) which is or could be integrated with the sale of
the Shares in a manner that would require the registration under
the Securities Act of the Shares which form the Shares
or (ii) engaged in any form of general solicitation or general
advertising (as those terms are used in Regulation D
under the Securities Act) in connection with the offering of the
Shares or in any manner involving a public offering within the
meaning of Section 4(2) of the Securities Act.
4.6
Compliance with Securities Laws . Subject
to the accuracy of the representations and warranties of the
Investor contained herein, the issuance of the Shares and Warrants
to the Investor hereunder is exempt from the registration and
prospectus delivery requirements of the Securities Act.
4.7
Additional Information. The Company has
made available to the Investor a true and complete copy of each
report, schedule, and definitive proxy statement filed by the
Company with the Securities and Exchange Commission (the
“Commission) under the Securities Exchange Act of 1934 (the
“Exchange Act”) (as such documents have since the time
of their filing been amended).
4.9
Deliveries at Closing. The Company shall have
delivered to the Investor a Certificate, executed on behalf of the
Company by its Secretary, dated as of the Closing Date, certifying
the resolutions adopted by the Board of Directors of the Company
approving the transactions contemplated by this Agreement and the
issuance of the Shares and Warrants, certifying the current
versions of the articles of the Company and certifying as to the
signatures and authority of persons signing the Agreements and
related documents on behalf of the Company.
4.10 Most Favored Nations
. During the time period beginning from the
Closing Date and ending on the one (1) year anniversary of the
Closing Date, if the Company issues common stock or securities
convertible or exercisable into stock at a price (or conversion or
exercise right) that is less than twenty seven and one half cents
($0.275) per share (the “ Adjustment Price ”),
then, at the time of such issuance(s) the Company shall issue and
deliver to the Investor, in proportion to the amount of Shares such
Investor purchased, an additional number of shares of common stock
pursuant to the following formula: the quotient determined by
dividing (i) the Aggregate Amount by (ii) the Adjustment Price and
then subtracted by the Shares (the “Adjustment
Shares”). However, this provision shall not apply to (i) any
convertible or exercisable securities currently issued and
outstanding or which shall be issued and outstanding within the
following ninety days from the Closing Date, (ii) any new issuances
of common stock to executive officers or key employees of the
Company, or (iii) any new issuances of securities exercisable into
stock pursuant to the Company’s Stock Option
Plan(s).
SECTION
5. Representations, Warranties and Covenants of the
Investor . In order
to induce the Company to accept this Agreement, the Investor hereby
represents and warrants to, and covenants with, the Company as
follows:
5.1(a) The
Investor has received and had the opportunity to review the
Information Documents, and has been given access to full and
complete information regarding the Company and has utilized such
access to the Investor’s satisfaction for the purpose of
obtaining such information regarding the Company as the Investor
has reasonably requested; and, particularly, the Investor has been
given reasonable opportunity to ask questions of, and receive
answers from, representatives of the Company concerning the terms
and conditions of this Agreement and to obtain any additional
information, to the extent reasonably available;
(b) Except
for the Company information described in the Information Documents,
the Investor has not been furnished with any other materials or
literature relating to the offer and sale of the Securities; except
as set forth in this Agreement, no representations or warranties
have been made to the Investor by the Company, or any agent,
employee, or affiliate of the Company or such selling
agent.
(c) The
Investor believes that an investment in the Securities is suitable
for the Investor based upon the Investor investment objectives and
financial needs. The Investor (i) has adequate means for
providing for the Investor’s current financial needs and
personal contingencies; (ii) has no need for liquidity in this
investment; (iii) at the present time, can afford a complete loss
of such investment; and (iv) does not have an overall commitment to
investments which are not readily marketable that is
disproportionate to the Investor's net worth, and the Investor's
investment in the Securities will not cause such overall commitment
to become excessive.
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