EXHIBIT 2.1
ACQUISITION AGREEMENT
BY AND BETWEEN
DUNHILL VACATIONS, INC.,
AS DVI,
AND
ALL OF THE HOLDERS OF DVI INTERESTS,
AS HOLDERS,
AND
ONLINE VACATION CENTER HOLDINGS CORP.,
AS ONVC.
DATED AS OF JANUARY 5, 2007.
ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT (the "Agreement"), dated as of January 5,
2007, is made by ONLINE VACATION CENTER HOLDINGS CORP., a Florida corporation
("ONVC"), DUNHILL VACATIONS, INC., a Florida corporation ("DVI"), and each of
the undersigned persons or entities as owners of the number of ownership
interests of DVI set forth on their Acceptance and Transfer Powers attached
hereto (collectively, the "Holders").
FOR GOOD AND VALAUBLE CONSIDERATION, the receipt and adequacy of which
is hereby acknowledged, Holders desire to sell, and ONVC desires to acquire, all
of the issued and outstanding ownership interests of DVI (the "DVI Interests")
for the consideration and on the terms set forth in this Agreement and the
parties, intending to be legally bound, hereby agree as follows:
1. SALE AND TRANSFER OF DVI INTERESTS; CLOSING
1.1 DVI INTERESTS.
Subject to the terms and conditions of this Agreement, at the Closing,
Holders will sell and transfer the DVI Interests to ONVC, and ONVC will acquire
the DVI Interests from Holders.
1.2 CONSIDERATION.
(a) The total consideration (the "Consideration") to be paid by ONVC to the
Holders for the DVI Interests will be paid as follows:
(A) $ 250,000 Cash (the "Cash Consideration") payable by
wire transfer or cashiers check at closing;
(B) 50,000 restricted shares of ONVC common stock, par
value $0.0001 per share, (the "Restricted Shares") to
be issued at closing. In the unlikely event that the
stock value of ONVC is trading below $2.00 per share
at the time of closing, additional shares will be
issued to the Holders so that the shares received by
the Holders will be equal to a minimum of $100,000 in
stock.
(b) The Consideration shall be adjusted, if necessary, as required pursuant
to Section 3.1(d) hereof.
1.3 CLOSING
The acquisition and sale (the "Closing") provided for in this Agreement
will take place at the offices of Xxxxx Xxxxx, P.A., 110 Southeast 6th Street,
15th Floor, Xxxx Xxxxxxxxxx, XX 00000, at 10:00 a.m. (local time) on January 5,
2007, or at such other time and place as the parties may agree.
1.4 CLOSING OBLIGATIONS
Each of Holders has indicated their acceptance of this Agreement by
their execution hereof. At the Closing, ONVC will have received the Closing
Deliverables as described in Exhibit A attached hereto, including each of
Holders' ownership certificate and transfer power, all in form and substance
reasonably satisfactory to ONVC.
1.5 TAX MATTERS
Holders and DVI further represent and warrant that all (a) tax returns
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due to be filed on or before Closing have been accurately and timely filed, (b)
all taxes due and payable on or before Closing have been paid, and (c) for any
"short-periods" for which tax returns are not yet due, or for which all taxes
have not yet been paid, DVI has accurately and properly accrued on the books,
records and financial statements of DVI liabilities or reserves reflecting the
taxes due from DVI for such "short-periods", except as follows:
(1) Holders and DVI represent and warrant that DVI has elected to file
its federal income tax returns as a "Subchapter S Corporation" and
therefore no federal or state income taxes are payable by DVI nor
are any federal or state income tax accruals, reserve or payments
reflected on the books, records or financial statements of DVI.
(2) Holders will prepare and timely file "short-period" federal and
state income tax returns for the "short-period" ended as of the
date of Closing and Holders will be responsible for, and will pay
when due, any and all taxes, interest, penalties preparation,
audit or other expenses or costs in connection therewith. Holders
shall provide a copy of these "short-period" tax returns to ONVC
together with the work papers and schedules utilized in their
preparation.
(3) For clarification, all expenses incurred by DVI prior to the date
of Closing, including, but not limited to, expenses associated
with (A) the transactions contemplated by this Agreement, and (B)
payments of compensation to employees and other service providers,
shall be paid by Holders and, to the extent so paid, shall be
expenses of DVI reflected on the "short-period" tax returns.
(4) Neither any Holder, ONVC nor DVI shall file an amended tax return
with respect to any and all taxable periods, or portions thereof
(including the "short-period"), ending on or before the Closing
Date, without the prior written consent of Holder, ONVC and DVI;
except that such consents shall not be required for any amendment
filed in connection with any requirement or finding of any audit
by a governmental entity of the tax return to which the amendment
relates. Holders shall indemnify ONVC and DVI for any liability,
cost or expense ONVC or DVI incurs as a result of any such
amendment filed in accordance with the terms hereof.
For purposes hereof, "taxes" shall mean all federal, state, local, foreign and
other governmental net income, gross income, gross receipts, sales, use, ad
valorem, transfer, franchise, profits, withholding, payroll, employment,
unemployment, excise, severance, stamp, occupation, premium, property, windfall
profits, customs, duties or other taxes, fees, assessments or charges of any
kind whatever, together with any interest and any penalties, additions to tax or
additional amounts with respect thereto.
2. REPRESENTATIONS AND WARRANTIES
2.1 REPRESENTATIONS AND WARRANTIES OF HOLDER AND DVI
Each of the Holders and DVI hereby represents and warrants to ONVC as
follows:
(a) Ownership. Holders are and will be on the Closing Date the record and
beneficial owners and holders of the DVI Interests, free and clear of
any and all liens or encumbrances. There are no agreements, rights,
claims or obligations relating to the issuance, sale, or transfer of
any equity or other securities of DVI. DVI has no subsidiaries.
(b) Authorization. Each of Holders is an individual. DVI is duly organized
and in good standing under the laws of the State in which it was formed
and is duly qualified and in good standing in each jurisdiction in
which such registration is required. Each of Holders and DVI has full
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right, power and authority to execute and deliver the Holder Documents
(as defined below), to perform its obligations therein and to
consummate all of the transactions contemplated thereby.
(c) Documents. Each of Holders and DVI has, or before Closing will have,
approved the sale of the DVI Interests, this Acquisition Agreement and
the transactions contemplated hereby, and approved, executed and
delivered this Acquisition Agreement and certain agreements,
instruments to be executed and delivered by each of Holders and DVI in
connection herewith (collectively, the "Holder Documents") and each of
the Holder Documents, when executed by Holders or DVI, shall be the
legal valid and binding obligation of each of Holders and DVI in
accordance with their terms.
(d) No Default. Neither any Holder nor DVI, nor any vendor or party in
contract with Holders or DVI , is in violation of any provision of, or
in default under, DVI's articles of incorporation, by-laws, articles of
organization, operating agreement or partnership agreement or any
indenture, mortgagee, deed of trust, indebtedness, agreement, judgment,
decree, order, statute, rule or regulation to which any of the Holders
or DVI is a party or by which any of them or their property is subject
or bound and further, the execution and delivery of the Holder
Documents, the performance of the obligations therein and the
consummation of the transactions contemplated thereby will not result
in a violation thereof, or a default thereunder.
(e) No Approvals. Neither any Holder nor DVI is required to obtain the
approval, authorization, consent or any other order of any public or
private entity, person, board or body in connection with the
transactions contemplated by the Holder Documents, except as set forth
in Section 3.1(e) hereof.
(f) Financial Statements. The financial statements and other information of
DVI, copies of which have been, or prior to Closing will have been,
provided to ONVC, are true and correct in all material respects and
fairly present the assets, liabilities, financial condition, results of
operations, changes in stockholders' equity, and cash flow of DVI (and
of any person or entity required by sound accounting principles to be
consolidated or included therein) at their respective dates and for
their respective periods, all in accordance with sound accounting
principles applied on a consistent basis, subject only to normal
recurring year-end adjustments and footnotes (the effect and the
content of either of which will not, individually or in the aggregate,
be materially adverse).
(g) No Material Adverse Change. From the date of the last audited financial
statements to the date hereof, there has not been, and through the date
of Closing, there will not have been, any change that would materially
and adversely affect the financial position or results of operation of
DVI, or the ability of any of Holders or DVI to consummate the
transactions contemplated hereby.
(h) No Undisclosed Liabilities. There is no account, note, lease, tax,
environmental liability, fine, penalty, civil or criminal action,
filing, liability, obligation, lien, encumbrance, restriction or other
duty affecting any of Holders or DVI (nor is there any basis,
circumstance or fact that might give rise thereto), whether realized or
contingent, pending or threatened, or known, as of the date hereof or
as of the date of Closing, which has not been, or prior to Closing,
will not have been, disclosed in writing to ONVC.
(i) No Litigation. There is no action, suit, proceeding or investigation at
law or in equity, before or by any court, public board or body,
realized or contingent, pending or threatened, known or unknown,
against or affecting any of Holders or DVI (nor is there any basis,
circumstance or fact therefor) as of the date hereof or as of the date
of Closing, which has not been, or prior to Closing, will not have
been, disclosed in writing to ONVC.
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(j) Ordinary Course of Business. Neither any Holder nor DVI have, nor prior
to Closing will they have, taken, or failed or chosen not to take, any
action in contemplation of the transactions contemplated hereby other
than in the ordinary course of business consistent with the past
practices of any of Holders or DVI, which has not been, or prior to
Closing, will not have been, disclosed in writing to ONVC.
(k) Brokers or Finders. Neither any Holder nor DVI or their officers or
agents have incurred any obligation or liability, contingent or
otherwise, for brokerage or finders' fees or agents' commissions or
other similar payment in connection with this Agreement, except
Innovative Travel Acquisitions, Inc. whose fees and expenses shall be
paid directly by Holders. Each of Holders will indemnify and hold ONVC
and DVI harmless from any such payment alleged to be due by or through
any of Holders or DVI as a result of the action of any of Holders or
DVI or their officers or agents.
(l) Securities Representations. Each of Holders hereby represent and
warrant to ONVC as follows: (1) each of Holders may not qualify as an
"Accredited Investor", as such term is defined in Rule 501(a) to the
Securities Act of 1933, as amended (the "Securities Act") but each of
Holders is acquiring the Restricted Shares for their own account
without any view to or for their resale or distribution, all as et
forth herein; (2) each of Holders' address as set forth on the Transfer
Power is each of Holders' true and correct residence and each of
Holders has no present intention of becoming a resident of any other
state or jurisdiction; (3) the Restricted Shares are being acquired
solely for each of Holders' own account, for investment, and are not
being purchased with a view to or for the resale, distribution,
subdivision, or fractionalization thereof and each of Holders has no
present plans to enter into any contract, undertaking, agreement, or
arrangement relating thereto; (4) each of Holders understands that none
of the Restricted Shares have been or will be registered under the
Securities Act, that each of Holders has no rights to require that the
Restricted Shares be registered under the Securities Act or any state
securities or blue sky laws; that each of Holders may have to hold the
Restricted Shares for a substantial period of time and that it may not
be possible for each of Holders to liquidate each of Holders'
investment in ONVC; and that in any event the Restricted Shares may not
be assigned, transferred, pledged, or otherwise sold or offered for
sale except pursuant to an effective registration statement under the
Securities Act or pursuant to an exemption from registration under the
Securities Act, the availability of which must be established by each
of Holders to the satisfaction of ONVC; and in replacement or exchange
therefore, are to bear a restrictive legend to this effect; (5) each of
Holders is acquiring the Restricted Shares without being furnished any
offering literature or prospectus, but each of Holders has been
granted, and is relying upon, each of Holders' personal discussions,
investigations and due diligence of ONVC and its officers; (6) each of
Holders has such knowledge and experience in business and financial
matters that each of Holders is capable of evaluating the business and
financial matters of ONVC and the risks and merits relating thereto;
(7) that there has never been any representation, guarantee, or
warranty made to each of Holders by any broker, ONVC, its agents or
employees, or any other person, expressly or by implication, as to any
gain or profit to be derived from, or the approximate or exact length
of time that each of Holders may be required to remain an owner of, the
Restricted Shares, or as to any other matter not expressly contained
herein.
2.2 REPRESENTATIONS AND WARRANTIES OF ONVC
ONVC hereby represents and warrants Holders as follows:
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(a) Authorization. ONVC is duly organized, validly existing, and in good
standing under the laws of the State in which it was formed. ONVC has
full right, power and authority to execute and deliver the ONVC
Documents (as defined below), to perform its obligations therein and to
consummate all of the transactions contemplated thereby.
(b) Documents. ONVC has, or before Closing will have, approved the sale of
the DVI Interests, this Acquisition Agreement and the transactions
contemplated hereby, and approved, executed and delivered this
Acquisition Agreement and certain agreements, instruments to be
executed and delivered by ONVC in connection herewith (collectively,
the "ONVC Documents") and each of the ONVC Documents, when executed by
ONVC, shall be the legal valid and binding obligation of ONVC in
accordance with their terms.
(c) No Default. ONVC is not in violation of any provision of, or in default
under, and the execution and delivery of the ONVC Documents, the
performance of the obligations therein and the consummation of the
transactions contemplated thereby will not result in a violation of, or
default under, any of ONVC's articles of incorporation, by-laws or any
indenture, mortgagee, deed of trust, indebtedness, agreement, judgment,
decree, order, statute, rule or regulation to which ONVC is a party or
by which ONVC or its property is subject or bound.
(d) No Approvals. ONVC is not required to obtain the approval,
authorization, consent or any other order of any public or private
entity, person, board or body in connection with the transactions
contemplated by the ONVC Documents, except as set forth in Section
3.2(a) hereof.
(e) SEC Reports. ONVC has filed, on a timely basis, all forms, reports and
documents (collectively, the "SEC Reports") required to be filed with
the Securities Exchange Commission in accordance with the Securities
Exchange Act of 1934, as amended (the "Exchange Act") since August 31,
2003. As of their respective dates, each of the SEC Documents complied
in all material respects with all applicable requirements of the
Securities Act of 1933, as amended and the Exchange Act.
(f) Investment Intent. ONVC is acquiring the DVI Interests for its own
account and not with a view to their distribution within the meaning of
Section 2(11) of the Securities Act of 1933.
(g) Brokers or Finders. Neither ONVC nor its officers or agents have
incurred any obligation or liability, contingent or otherwise, for
brokerage or finders' fees or agents' commissions or other similar
payment in connection with this Agreement and ONVC will indemnify and
hold Holders harmless from any such payment alleged to be due by or
through ONVC as a result of the action of ONVC or its officers or
agents.
3. COVENANTS PRIOR TO CLOSING
3.1 COVENANTS OF HOLDER AND DVI
(a) Access and Investigation. Each of Holders and DVI each will (1) afford
ONVC and its representatives reasonable access to its personnel,
properties (including subsurface testing), contracts, books and
records, and other documents and data, (2) furnish ONVC with copies of
all such contracts, books and records, and other existing documents and
data as ONVC may reasonably request, and (3) furnish ONVC with such
additional financial, operating, and other data and information as ONVC
may reasonably request.
(b) Due Diligence. Each of Holders and DVI each shall cooperate with ONVC
in the conduct of its due diligence and shall furnish, at a minimum,
the information, documents and other items set forth in Exhibit B
attached hereto. Each of Holders, DVI and ONVC herby acknowledge that
all items required under Exhibit B have been provided by Holders to
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ONVC and that each of Holders make no representations or warranties
with respect to such due diligence materials, except as set forth in
Section 2.1 hereof.
(c) Audit. DVI acknowledges that ONVC, as a publicly traded company, may
need audited financial statements of DVI. ONVC, at its expense, will
cause its accountants to conduct an audit of DVI and to issue audited
financial statements as diligently possible. Holders and DVI each will
assist and provide ONVC and its auditors access to conduct such audit
and such further due diligence in connection therewith as ONVC may
require. Holders, DVI and ONVC each acknowledge and agree that such
audit may be completed after the Closing.
(d) Operation of DVI. Holders and DVI each will: (1) conduct its business
only in the ordinary course of business and not take, or fail or choose
not to take, any action in contemplation of the transactions
contemplated hereby or other than in the ordinary course of business
consistent with its past practices; (b) use its best efforts to
preserve intact its current business organization, keep available the
services of its current officers, employees, and agents, and maintain
the relations and good will with suppliers, customers, landlords,
creditors, employees, agents, and others having business relationships
with it; (3) confer with ONVC concerning operational or any other
matters of a material nature; and (4) otherwise report periodically to
ONVC concerning the status of its business, operations, and finances.
Further, Holders and DVI each will NOT: (1) enter into, amend, modify,
extend, terminate or permit to expire (a) any agreement that involves
more than $25,000 or exceeds one year or (b) any compensation
agreements, benefit plans or insurance policies, or (2) dispose of any
assets, issue any securities or rights with respect to securities, or
declare or pay any bonuses, dividends or distributions;
EXCEPT Holders and DVI each may distribute or dividend cash to
Holders, shall pay or satisfy all shareholder loans and, if
necessary, shall pay or satisfy other liabilities, all in
aggregate amounts sufficient to cause, immediately thereafter and
at closing, the book value of current assets of DVI to equal or
exceed the book value of liabilities of DVI, all as determined in
accordance with generally accepted accounting principles
consistently applied (if not, the Consideration shall be reduced
by any deficiency therein). DVI, ONVC and Holders each acknowledge
and agree that any deficiency determined at or prior to Closing
shall be deducted from the Cash Consideration first and any
deficiency determined after the Closing as a result of the
conclusion of the audit shall be deducted from the Restricted
Shares by reducing the number of issued shares by an amount equal
to the dollar amount of any such deficiency divided by $2.00
(representing the negotiated value per share for purposes hereof).
Any excess of current assets over liabilities determined after
Closing as a result of the conclusion of the audit shall be paid
in cash to Holder within 15 days after conclusion of the audit.
(e) Required Approvals. As promptly as practicable after the date of this
Agreement, Holders and DVI each will:
(1) seek and obtain the approval of these transactions by each of Holders
and DVI's Board of Director(s) and shareholders,
(2) make all filings, if any, required by applicable law to be made by them
in connection with these transactions, and
(3) cooperate with ONVC with respect to all filings, if any, that ONVC
elects, or is required by any applicable law, to make in connection
with these transactions.
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(f) Notifications. Holders and DVI each will promptly notify ONVC in
writing if any of Holders or DVI becomes aware of (1) any fact or
condition that causes or constitutes a breach of any of Holders' or
DVI's representations, warranties or covenants as of the date of this
Agreement or as of the date of Closing as if made as of the date of
Closing, or (2) any fact or condition that should be disclosed to ONVC
in order to make any statements or information furnished to ONVC, in
light of the circumstances under which they were made, not misleading.
(g) Exclusive Negotiation. Until such time, if any, as this Agreement is
terminated pursuant to Section 5.1 hereof, neither any of Holders nor
DVI will directly or indirectly solicit, initiate, or encourage any
inquiries or proposals from, discuss or negotiate with, provide any
non-public information to, or consider the merits of any unsolicited
inquiries or proposals from, any person or entity (other than ONVC)
relating to any transaction involving any sale of the DVI Interests,
any sale of any of the businesses, assets or equity or other securities
of DVI, or any merger, consolidation, business combination, or similar
transaction involving DVI.
(h) Efforts. Holders and DVI each will use their reasonable commercial
efforts to cause the conditions in Article 4 hereof to be satisfied.
3.2 COVENANTS OF ONVC
(a) Required Approvals. As promptly as practicable after the date of this
Agreement, ONVC will:
(1) seek and obtain the approval of these transactions by ONVC's Board of
Directors and, if required, shareholders,
(2) make all filings, if any, required by applicable law to be made by it
in connection with these transactions, and
(3) cooperate with Holders and DVI with respect to all filings, if any,
that any of Holders or DVI is required by any applicable law to make in
connection with these transactions;
provided that this Agreement will not require ONVC to dispose of or
make any change in any portion of its business or to incur any other
burden to obtain any approval or governmental authorization.
(b) Notifications. ONVC will promptly notify Holders and DVI in writing if
ONVC becomes aware of any fact or condition that causes or constitutes
a breach of ONVC's representations, warranties or covenants as of the
date of this Agreement or as of the date of Closing as if made as of
the date of Closing.
(c) Efforts. ONVC will use its reasonable commercial efforts to cause the
conditions in Article 4 hereof to be satisfied.
4. CONDITIONS PRECEDENT TO CLOSING
4.1 CONDITIONS PRECEDENT TO ONVC'S OBLIGATION TO CLOSE
ONVC's obligation to acquire the DVI Interests and to take the other
actions required to be taken by ONVC at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by ONVC, in whole or in part):
(a) Representations. Each of the representations and warranties made by
each of Holders and DVI herein and in the Holder Documents is true and
correct in all material respects as of the date hereof and as of the
date of Closing as if made on the date of Closing.
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(b) Conditions. Each of the conditions required for the execution and
delivery of the Holder Documents, including, without limitation those
required herein, has been fulfilled in all material respects or waived
to the satisfaction of ONVC and all parties thereto.
(c) Holders' Performance. Each and every covenant and obligation of each of
Holders and DVI hereunder required to be performed or complied with at
or prior to the Closing (considered collectively), and each of these
covenants and obligations (considered individually), has been duly
performed and complied with in all material respects.
(d) Due Diligence. ONVC has concluded its due diligence except for the
audit of the DVI financial statements which each of Holders, DVI and
ONVC have agreed will be conducted post-closing and that the sole
remedy in connection with such post-closing audit shall be the
adjustments described in Section 3.1(d) hereof and indemnification as
described in Article VI hereof.
(e) Closing Deliverables. Each of the Closing Deliverables listed in
Exhibit A attached hereto has been delivered to the satisfaction of
ONVC, including the approvals required in Sections 3.1(e) and 3.2(a)
hereof.
(f) Ancillary Agreements. Xxx Xxxx and Xxxxx XxXxxxxxx shall have entered
into Consulting Agreements with ONVC in form and substance satisfactory
to ONVC.
5. TERMINATION
5.1 TERMINATION EVENTS
This Agreement may, by notice given prior to or at the Closing, be
terminated:
(a) by mutual consent of ONVC and Holders;
(b) by either ONVC or Holders if a material breach of any provision of this
Agreement has been committed by the other party and such breach has not
been waived or cured within 20 days after written notice to the party
in breach;
(c) by ONVC if any of the conditions in Section 4.1 has not been satisfied
as of the Closing Date or if satisfaction of such a condition is or
becomes impossible (other than through the failure of ONVC to comply
with its obligations under this Agreement) and ONVC has not waived such
condition on or before the Closing Date; or
(d) by either ONVC or Holders if the Closing has not occurred (other than
through the failure of any party seeking to terminate this Agreement to
comply fully with its obligations under this Agreement) on or before
January 5, 2007, or such later date as the parties may agree.
5.2 EFFECT OF TERMINATION
Each party's right of termination under Section 5.1 hereof is in
addition to any other rights it may have under this Agreement or otherwise, and
the exercise of a right of termination will not be an election of remedies. If
this Agreement is terminated pursuant to Section 5.1 hereof, all further
obligations of the parties under this Agreement will terminate, except that the
obligations in Article VI and Sections 7.1 and 7.3 will survive; provided,
however, that if this Agreement is terminated by a party because of the breach
of the Agreement by the other party or because one or more of the conditions to
the terminating party's obligations under this Agreement is not satisfied as a
result of the other party's failure to comply with its obligations under this
Agreement, the terminating party's right to pursue all legal remedies will
survive such termination unimpaired.
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6. INDEMNIFICATION; REMEDIES
6.1 SURVIVAL; INDEMNIFICATION NOT AFFECTED BY KNOWLEDGE
All representations, warranties, covenants, and obligations in this
Agreement, the Holder Documents and the ONVC Documents will survive the Closing
for a period of eighteen (18) months. The right to indemnification, payment of
damages or other remedy based on such representations, warranties, covenants,
and obligations will not be affected by any investigation conducted with respect
to, or any knowledge acquired (or capable of being acquired) at any time,
whether before or after the execution and delivery of this Agreement or the
Closing Date, with respect to the accuracy or inaccuracy of or compliance with,
any such representation, warranty, covenant, or obligation. The waiver of any
condition based on the accuracy of any representation or warranty, or on the
performance of or compliance with any covenant or obligation, will not affect
the right to indemnification, payment of damages, or other remedy based on such
representations, warranties, covenants, and obligations.
6.2 INDEMNIFICATION BY HOLDERS
Holders, jointly and severally, will indemnify and hold harmless ONVC,
DVI, and their respective representatives, stockholders, controlling persons,
and affiliates (collectively, the "Indemnified Persons") for, and will pay to
the Indemnified Persons the amount of, any loss, liability, claim, damage
(including incidental and consequential damages), expense (including costs of
investigation and defense and reasonable attorneys' fees) or diminution of
value, whether or not involving a third-party claim (collectively, "Damages"),
arising, directly or indirectly, from or in connection with: (a) any breach of
any representation, warranty or covenant made by Holders or DVI in this
Agreement or in any other Holder Document, whether such breach is as of the date
hereof or as of the date of Closing as if made on the date of Closing; or (b)
any action or omission by, or any product shipped or manufactured by, or any
services provided by, DVI prior to the date of Closing.
6.3 INDEMNIFICATION BY ONVC
ONVC will indemnify and hold harmless Holder, and will pay to Holder
the amount of any Damages arising, directly or indirectly, from or in connection
with (a) any breach of any representation or warranty made by ONVC in this
Agreement or in any ONVC Document, whether such breach is as of the date hereof
or as of the date of Closing as if made on the date of Closing; or (b) any
action or omission by, or any product shipped or manufactured by, or any
services provided by, DVI after the date of Closing.
6.4 PROCEDURE FOR INDEMNIFICATION
(a) Promptly after receipt by an indemnified party of notice of a potential
indemnified third-party claim, such indemnified party will give written
notice thereof to the indemnifying party, but the failure to notify the
indemnifying party will not relieve the indemnifying party of any
liability that it may have to any indemnified party, except to the
extent that the indemnifying party demonstrates that the defense of
such action is prejudiced by the indemnifying party's failure to give
such notice. The indemnifying party shall assume, and pay all fees and
costs incurred in, the defense of such action with counsel reasonably
satisfactory to the indemnified party (including separate
representation if the indemnifying party is also a party to such
action). No compromise or settlement of any claim may be effected
without the written consent of both the indemnifying and the
indemnified parties, which consents shall not be unreasonably withheld
or delayed.
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(b) A claim for indemnification for any matter not involving a third-party
claim may be asserted by notice to the party from whom indemnification
is sought.
6.5 RIGHT OF SET-OFF
Upon notice to Holders specifying in reasonable detail the basis for
such set-off, ONVC may (and, if so directed by Holder, shall) set off any amount
to which it may be entitled under this Article 6 against amounts otherwise due
and payable hereunder. ONVC and Holders each acknowledge that as of the date of
Closing there are no other amounts otherwise due and payable hereunder. The
exercise of such right of set-off by ONVC in good faith, whether or not
ultimately determined to be justified, will not constitute an event of default
hereunder or under any ONVC Document. Neither the exercise of nor the failure to
exercise such right of set-off or to give a notice of any claim hereunder will
constitute an election of remedies or limit ONVC in any manner in the
enforcement of any other remedies that may be available to it.
6.6 LIMITATIONS ON INDEMNITY OBLIGATIONS
(a) Neither any of Holders nor ONVC, respectively, shall have any
liability (for indemnification or otherwise) to the Indemnified Persons with
respect to any matters described in this Article 6 until the total amount of
Damages attributable to Holders or ONVC, respectively, with respect to such
matters exceeds $10,000 (the "Deductible"), and then only for the amount by
which such Damages exceed the Deductible.
(b) The maximum aggregate amount of Damages that any of Holders or
ONVC, respectively, shall be obligated to pay to the Indemnified Persons under
this Article 6 shall be limited to an amount equal to the value of the
Consideration.
6.7 SOLE REMEDY
Upon and after the Closing, the provisions of this Article 6 represent
the sole and exclusive remedy available to any party to this Agreement for any
misstatement or omission by any other party relating to any representation or
warranty contained herein or for any breach by any other party of any
representation, warranty, covenant or agreement contained herein and, except
with respect to fraudulent acts, each party hereby unconditionally waives any
other rights that it may have at law or in equity for any misstatement or
omission by any other party from any representation or warranty contained
herein, or any breach by any other party of any representation, warranty,
covenant or agreement contained herein.
7. GENERAL PROVISIONS
7.1 EXPENSES
Except as otherwise expressly provided in this Agreement, each party to
this Agreement will bear its respective expenses incurred in connection with the
preparation, execution, and performance of this Agreement and these
transactions, including all fees and expenses of agents, representatives,
counsel, and accountants. In the event of termination of this Agreement, the
obligation of each party to pay its own expenses will be subject to any rights
of such party arising from a breach of this Agreement by another party.
7.2 PUBLIC ANNOUNCEMENTS
Any public announcement or similar publicity with respect to this
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Agreement or the contemplated transactions will be issued, if at all, at such
time and in such manner as ONVC determines. Unless consented to by ONVC in
advance, prior to the Closing Holders shall, and shall cause DVI to, keep this
Agreement strictly confidential and may not make any disclosure of this
Agreement to any person or entity. Holders and ONVC will consult with each other
concerning the means by which DVI's employees, customers, and suppliers and
others having dealings with DVI will be informed of these contemplated
transactions, and ONVC will have the right to be present for any such
communication.
7.3 CONFIDENTIALITY
ONVC and each of Holders and DVI will maintain in confidence, and will
cause the directors, officers, employees, agents, and advisors of each to
maintain in confidence, and not use to the detriment of another party any
written, oral, or other information obtained in confidence from another party in
connection with this Agreement or these transactions, unless (a) such
information is already known to such party or to others not bound by a duty of
confidentiality or such information becomes publicly available through no fault
of such party, (b) the use of such information is necessary or appropriate in
making any filing or obtaining any consent or approval required for the
consummation of these transactions, or (c) the furnishing or use of such
information is required by or necessary or appropriate in connection with legal
proceedings. If these transactions are not consummated, each party will return
or destroy as much of such written information as the other party may reasonably
request.
7.4 MISCELLANEOUS
All notices and communications hereunder will be deemed given upon
receipt by personal delivery, overnight courier, fax or e-mail or upon the 3rd
day following mailing by registered or certified mail, return receipt requested,
and either delivered or addressed to the addresses set forth herein. This
Agreement constitutes the entire agreement between the parties and supersedes
any prior understandings or agreements, written or verbal, between the parties.
This Agreement may be amended, supplemented, modified or discharged only in
writing executed by all parties. This Agreement may not be assigned by either
party. Any dispute hereunder shall be resolved by arbitration and all parties
waive any right to a trial by jury in connection therewith. Each party agrees
that remedies for any breach hereof include damages, specific performance,
injunctive relief and other equitable remedies, that no bond shall be required
in connection therewith and that the prevailing party shall be entitled to
recover attorney's fees and costs. This Agreement will be governed by the laws
of the State of Florida and venue and jurisdiction will lie in Broward County,
Florida.
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IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement as of the date first written above.
ONVC: ONLINE VACATION CENTER HOLDINGS CORP. DVI: DUNHILL VACATIONS, INC.
By: /s/ Xx Xxxxxx By: /s/ Xxx Xxxx
---------------- ------------
Name, Title: Xxxxxx X. Xxxxxx, President Name, Title: Xxx Xxxx, President
Address: 0000 XX 00xx Xxxxxx, Xxxxx 000 Address: 0000 Xxxx Xxx Xxxx Xxxx., Xxxxx 0000
Xxxxxxxxxx, Xxxxxxx 00000 Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Holder: XXX XXXX
By: /s/ Xxx Xxxx
----------------
Name, Title: Xxx Xxxx
Address: 0000 Xxxx Xxx Xxxx Xxxx., Xxxxx 0000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Holder: XXXXX XXXXXXXXX
By: /s/ Xxxxx XxXxxxxxx
-----------------------
Name, Title: Xxxxx XxXxxxxxx
Address: 000 Xxxx Xxxxx Xxxx
Xxxxxx, Xxxxxxx 00000
Holder: XXXXXX DUNHILL
By: /s/ Xxxxxx Dunhill
----------------------
Name, Title: Xxxxxx Dunhill
Address: 00000 Xxxxxxxx Xxxxxx
Xxxxxxx Xxxxx, Xxxxxxx 00000
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