Exhibit 2.5
AGREEMENT
This Agreement (the "Agreement") is entered into this December 29, 1999 by
Affinity International Travel Systems, Inc. ("Affinity"), Prestige Travel
Services II, Inc., a Florida corporation ("Prestige"), Xxxxx XxXxxxx, Xxx
XxXxxxx, and Xxxxxxxx XxXxxxx (collectively the "LaScalas") and Prestige Travel
Systems, Inc. (" Prestige Systems").
RECITALS
A. Affinity is engaged in the retail and wholesale travel agency business.
B. Prestige is a wholly owned subsidiary of Affinity and is engage in the
retail travel agency business.
C. The LaScalas are the former owners of Prestige who sold their ownership
interest in Prestige to Affinity in a prior business transaction.
D. Affinity is desirous of selling Prestige and the LaScalas are desirous of
reacquiring Prestige.
F. Prestige Systems is a corporation formed in 1999 and owned by the LaScalas
which joins in this agreement for purposes of the indemnity, document
inspection, and document return provisions of this Agreement.
NOW THEREFORE the parties stipulate and agree that each has received good and
valuable consideration for the entry into this Agreement and agree as follows:
1. RECITALS ARE TRUE AND CORRECT. The parties agree that the recitals are
true and correct.
2. PAYMENT AND STOCK TRANSFER TO AFFINITY. The LaScalas shall pay Affinity
the sum of $75,000 in certified funds and shall transfer 1,497,076 shares of
stock in Affinity owned by the LaScalas as follows:
A. To Affinity from Xxxxx XxXxxxx, Stock Certificate No 2312,
evidencing her ownership of 598,830 shares; and
B. To Affinity from Xxx XxXxxxx, Stock Certificate No 2311,
evidencing his ownership of 598,830 shares; and
C. To Affinity from Xxxxxxxx XxXxxxx, Stock Certificate No 2313,
evidencing her ownership of 299,416 shares;
all of which shall be delivered together with the fully executed stock
subscription agreements (delivered to Xxxxxxx Xxxxxxx, Esq. on October 4,1999)
to the offices. Xxxxxxx X. Xxxxx, Esq. on or before 5:00 p.m. December 30, 1999.
3. STOCK TRANSFER TO THE LASCALAS. Affinity shall transfer 500 shares of
stock in Prestige, (representing all of the outstanding shares of stock in
Prestige) to the LaScalas all of which shall be delivered to the offices of
Xxxxxxx Xxxxxx, Esq. on or before 5:00 p.m. December 30, 1999.
4. MUTUAL RELEASES. Affinity hereby forever waives, discharges,
terminates, extinguishes, and otherwise releases all Claims (as hereinafter
defined) that it now has, has had or may hereafter have against the LaScalas and
their respective officers, directors, shareholders, employees, attorneys,
agents, contractors, insurers, successors or assigns, past or present, or any of
them.
The LaScalas and Prestige hereby forever waive, discharge terminate,
extinguish, and otherwise release all Claims (as hereinafter defined) that they
now have, have had or may hereafter have against Affinity, its subsidiaries and
affiliates and their respective officers, directors, shareholders, employees,
attorneys, agents, contractors, insurers, successors or assigns, past or
present, or any of them.
The term "Claims" as used above includes any promises,
representations, causes of action, rights and other claims and defenses of any
kind (in the broadest sense of those words), whether presently known or unknown,
whether matured or not yet ripe, and whether discovered or undiscovered prior to
the execution hereof, in law or in equity, arising or whole or in part out of or
otherwise relating to anything that has or has not occurred, in whole or in
part, prior to the effective date of this Mutual Release, including, but not
limited to:
(A) all Claims made or which have been made to date by or
against the parties to this Agreement; and
(B) all Claims made or which could have been made to date by
or against the parties to this Agreement arising from any action
which predates the effective date of this Agreement; and
(C) all Claims arising out of or relating to any breach of any
contract, if any, and
(D) all intentional tort claims, including fraud, libel and
slander, conversion malicious prosecution, abuse of process or other
tort Claims arising out any action which predates the effective date
of this Agreement; and
(E) all Claims arising from any and all allege violations of
any federal, state or local statutes, ordinances, rules
administrative orders, or other forms of regulations, as well as any
other claims based on constitutional, statutory, common law or
regulatory grounds; and
(F) all Claims, any portion or element of which began to
accrue prior to the date of this Agreement, even though other
portions or elements of which do not occur or accrue until after the
date of this Agreement; and
(G) all Claims arising from any and all alleged violations of
any federal or state securities laws; and
(H) all claims arising under any employment agreement among
the LaScalas and Affinity, including any claims for unpaid wages or
expenses; and
(I) all claims arising under any prior acquisition agreement
or any agreement or commitment related thereto.
The term "Claims," however, shall not include and specifically excludes (1) any
and all promises, agreements, representations, warranties contained in this
Agreement, (2, any and all causes, causes of action, rights and other claims and
defenses of any kind which Affinity may have against the company commonly
referred to as Amadeus, (3) any and all causes, causes of action, rights and
other claims and defenses of any kind arising out of the future performance or
non-performance of the terms and conditions of this Agreement.
5. STATEMENT TO THE MEDIA AND CONFIDENTIALITY. The parties recognize that
by this Agreement, Affinity admits no liability to the LaScalas The LaScalas
will initiate no contact with the news media or any persons (excluding any
professional advisers and those employed by Prestige or Prestige Systems who
have an express and direct "need to know") regarding this Agreement or any of
the facts, circumstances, issues or negotiations which relate to and predate
this Agreement. If contacted by the news media or any other third person, the
LaScalas agree to state that they have reached an amicable agreement with
Affinity and shall decline further comment. Affinity shall be entitled to issue
such press releases as it deems appropriate and will provide the LaScalas an
advance copy for their informational purposes.
6. REPRESENTATIONS AND WARRANTIES OF THE LASCALAS. The LaScalas represent
and warrant the following facts to be true:
A. As of the date of this Agreement the LaScalas were officers of
Prestige and employees of Affinity. In that capacity the LaScalas have had the
primary responsibility for all day to day business, financial and accounting
functions of Prestige since January 1, 1999. As such each of them are intimately
familiar with the business affairs of Prestige.
B. Prior to the acquisition of Prestige by Affinity the LaScalas
were the owners of Prestige and were likewise responsible for all day to day
business, financial and accounting functions of Prestige from its inception up
through the acquisition by Affinity prior to January 1, 1999. As such each of
them have been continuously intimately familiar with the business affairs of
Prestige.
C. As employees of Affinity the LaScalas have had the opportunity to
review the financials, business plans and other strategic business information
of Affinity. They have had the opportunity to ask questions and have done so
regarding the business affairs and plans of Affinity.
D. The LaScalas are knowledgeable about the business projections,
financial condition, and strategies of Affinity. They recognize and acknowledge
that Affinity intends to seek other business opportunities and that the Affinity
stock transferred pursuant to this Agreement may be subject to dramatic and
substantial changes in value. The LaScalas with full knowledge and appreciation
of these prospects and facts enter into this Agreement and commit to transfer
all of the outstanding shares which they own in Affinity. The LaScalas further
recognize that Affinity makes no warranties or representations of any kind
regarding this Agreement and the transaction contemplated herein.
E. The LaScalas have not assigned, pledged, hypothecated, or
otherwise encumbered the Affinity shares to be transferred pursuant to this
Agreement which shares shall be delivered free and clear of all claims, liens
and other forms of encumbrances of any and all kinds.
7. CANCELLATION OF CONTRACTUAL AGREEMENTS. All executory provisions of the
Employment Agreements among the LaScalas and Affinity; any prior acquisition and
related contracts; and any other contractual agreements in favor of the LaScalas
which may impose some obligation on Affinity or Prestige are hereby deemed
canceled and of no further force and effect.
8. INDEMNIFICATION. The LaScalas, Prestige and Prestige Systems hereby
unconditionally indemnify and hold harmless Affinity, its subsidiaries,
affiliates, and their respective officers, directors, shareholders, employees,
attorneys, agents, contractors, insurers, successors or assigns, past or
present, or any of them the ("Indemnitees") from and against any and all claims,
causes of action, losses, costs, expenses, awards, judgments, liabilities,
damages, fees and other charges or monetary obligations incurred by Indemnitees
that that arise out any act or omission or contractual undertaking of the
LaScalas, Prestige, and Prestige Systems including, but not limited to, any and
all attorneys' fees, costs and expenses incurred by Indemnitees in connection
with any or all of the foregoing.
9. DEFAULT. In the event of a default under this Agreement, the
non-defaulting party shall have available to it all fights described herein and
all fights available in law or equity. The prevailing party in any proceeding
arising out of or in connection with this Agreement shall be entitled to an
award of reasonable attorneys' fees and costs (including appellate attorneys'
fees and costs).
10. MISCELLANEOUS.
A. The parties have negotiated the terms and provisions of this
Agreement, have consulted with such legal, tax, accounting, financial and other
advisors retained by them of their personal choice as each considered necessary
or advisable with respect to this Agreement and the transactions contemplated
hereby, and this Agreement shall not be construed against any party as the
drafter hereof.
B. This Agreement shall be governed, construed and enforced
accordance with the internal laws of the State of Florida without reference to
its laws relating to the conflict of laws. Each party irrevocably consents to
personal jurisdiction over that party by the courts of the State of Florida and
the court in the Pending Action for all purposes of this Agreement. Venue shall
lie exclusively in the state courts of Pinellas County, Florida.
C. Time is of the essence under this Agreement.
D. Each of the Parties shall execute and deliver such other
documents, certificates, agreements and other writings and shall take such other
actions to as may be reasonably necessary to implement expeditiously or to
consummate this Agreement.
E. This Agreement contains the complete agreement of the Parties
concerning the settlement of the Pending Action and supersedes all prior
agreements, promises, representations and warranties that may have been made
between the parties concerning that subject, whether in connection with the
negotiation of this Agreement or otherwise.
F. The signatories to this Agreement represent and warrant that they
are authorized to sign for and bind the person or entity as to which they have
signed the Agreement.
G. No delay of or omission in the exercise of any right, power or
remedy accruing to any party as a result of any breach or default by any other
party under this Agreement shall impair any such right, power or remedy, nor
shall it be construed as a waiver of or acquiescence in any such breach or
default, or in any similar breach or default occurring later, nor shall any
waiver of any single breach or default be deemed a waiver of any other breach of
default occurring before or after that waiver.
H. The effective date of the transfers of stock and the closing of
this transaction for accounting purposes shall be December 31, 1999. The
LaScalas shall deliver to Affinity a preliminary 1999 year-end financial
statement for Prestige no later than January 20, 2000. The parties express their
general recognition and intent that Affinity shall be given full and complete
access to all business, contractual, accounting and financial records of
Prestige and Prestige Systems as are needed by the accountants for Affinity to
prepare interim and final financial reports and audits pertaining to Prestige in
accordance with GAAP and GAAS. The LaScalas, Prestige and Prestige Systems
recognize the commitments made in this paragraph are critical to Affinity and
recognize that substantial damages and irreparable harm will occur to Affinity
if timely, full, and complete access to the required information is prevented,
hindered or impaired. Therefore the LaScalas, Prestige and Prestige Systems more
particularly and expressly promise that on 24 hours telephonic notice they shall
make all requested business, contractual, accounting and financial information
available, shall provide adequate work space, and access to telefax machines,
copiers and such other office equipment as may be necessary for Affinity and its
representatives to conduct their needed inspections and reviews. Inspection and
copying shall be permitted and shall occur during business hours. The LaScalas,
Prestige and Prestige Systems promise to cooperate fully and not hinder, impair,
or delay to in any way inspection, review and copying described in this
paragraph. Any breach of this independent covenant may be remedied by emergency
injunctive relief without bond, but with telephonic notice to the offices of
Xxxxxxx Xxxxxx, Esq. at 727-894-4333. The amount of notice given shall not be
cause to delay an emergency injunction hearing or represent an independent
grounds for appeal of any injunction so entered. The LaScalas expressly
recognize that the benefits which inure to them under this Agreement would not
have occurred but for the promises and the actual performance of the promises
made in this paragraph.
I. The LaScalas, Prestige and Prestige Systems shall deliver to
Affinity within 3 business days the originals and all copies (whether preserved
electronically or not) all business and strategic plans, the Internet Strategy
Plan, dated November 10, 1999, and the June 30, 1999 year-end audit of Affinity.
The LaScalas, Prestige and Prestige Systems promise not to retain any copies or
any data or information derived from these documents and further agree not to
use them in any way for any purpose. The LaScalas, Prestige and Prestige Systems
agree that the document described in this paragraph are trade secrets of
Affinity and shall not contest their classification or status as trade secrets.
J. Affinity and Prestige affirmatively state that Prestige has
entered into no contracts of which the LaScalas are not aware.
K. This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original instrument, but all such counterparts
together shall constitute but one agreement. This Agreement shall become
effective and binding upon the parties to it
only if and when all parties to it have signed and exchanged with one another
counterparts of this Agreement. A telefax signature as to Xxxxxxxx XxXxxxx shall
suffice to bind the parties. Xxxxxxxx XxXxxxx shall deliver a telefax copy of
her Affinity stock reflecting its endorsement in blank. Xxxxxxxx XxXxxxx shall
deliver an original signature to tiffs Agreement, and shall deliver the original
stock certificate duly endorsed within 5 business days of the date of this
Agreement.
L. Affinity shall return to the LaScalas the manual which they
prepared and Affinity agrees not to use it.
AFFINITY INTERNATIONAL
TRAVEL SYSTEMS, INC. Approved as to form by Counsel for
Affinity International Travel Systems, Inc.
By: /s/ Xxxxxx X. Xxxxxxxx /s/ Xxxxxxx Xxxxx
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Its: Chief Executive Officer Xxxxxxx Xxxxx, Esq.
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PRESTIGE TRAVEL SERVICES II, INC.
By: /s/ Xxxxx XxXxxxx
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Its: President
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PRESTIGE TRAVEL SYSTEMS, INC. Approved as to form by Counsel for
Prestige Travel Systems, Inc.
By: /s/ Xxxxx XxXxxxx /s/ Xxxxxxx X. Xxxxxx
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Its: President Xxxxxxx X. Xxxxxx, Esq.
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/s/ Xxxxx XxXxxxx Xxx XxXxxxx
--------------------------------- --------------------------------------------
XXXXX XxXXXXX XXX XxXXXXX
/s/ Xxxxxxxx XxXxxxx
---------------------------------
XXXXXXXX XxXXXXX
Approved as to form by counsel for
The LaScalas
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, Esq.
