I need to paint my kitchen walls but they are a mess...Need help please?

There are so many things wrong with my kitchen walls which is why I'm going to paint them. There are soft places where the wall has broken in a little, at the bottom the walls are broken in and have a hole and I need to know how to repair this. It is also the originial wall and it was never wallpapered or painted. Plus, there are random nails and other dents that we need to sand out before we paint. How would we paint this? Are there certain steps like first sand then paint? All help is appreciated.
 
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