ONLINE VACATION CENTER HOLDINGS CORP.
MARCH 31, 2008
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PHOENIX INTERNATIONAL PUBLISHING, LLC ACQUISITION AGREEMENT
DOC
#456656 V8
EXHIBIT 2.1
ACQUISITION AGREEMENT
BY AND AMONG
SIMON TODD,
AS TODD,
AND
ONLINE VACATION CENTER HOLDINGS CORP.,
AS ONVC AND/OR THE HOLDER,
AND
PHOENIX INTERNATIONAL PUBLISHING, LLC,
AS PIP.
DATED AS OF MARCH 31, 2008
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<PAGE>
ACQUISITION AGREEMENT
THIS ACQUISITION AGREEMENT (this "Agreement"), dated as of March
31,
2008, is made by and among ONLINE VACATION CENTER HOLDINGS CORP., a
Florida
corporation (as "ONVC" and/or the "Holder"), PHOENIX INTERNATIONAL
PUBLISHING,
LLC, a Delaware limited liability company ("PIP"), and Simon Todd,
an individual
residing in Trophy Club, Texas ("Todd").
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and adequacy of
which
is hereby acknowledged, the Holder desires to sell, transfer and
deliver to
Todd, and Todd desires to purchase and acquire from the Holder, all
of the
issued and outstanding ownership interests of PIP (the "PIP
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 PIP INTERESTS; CLOSING
1.1 PIP
INTERESTS
Subject to the terms and conditions of this Agreement, at the
Closing
(defined below), the Holder will sell and transfer the PIP
Interests to Todd,
and Todd will purchase and acquire the PIP Interests from the
Holder.
1.2
CONSIDERATION
(a) The total consideration (the "Consideration") to be paid at
the
Closing by Todd to the Holder for the PIP Interests will be
1,250,000 restricted
shares of ONVC common stock, par value $0.0001 per share, (the
"Restricted
Shares").
(b) In the event certain conditions are met, the Consideration
shall be
adjusted as set forth in the Contingent Payment Agreement, included
in the
Closing Deliverables.
1.3 CLOSING
The acquisition and sale (the "Closing") provided for in this
Agreement
will take place at the offices of Haynes and Boone, LLP, 901 Main
Street, Suite
3100, Dallas, Texas 75202, by 11:00 p.m. (local time) on March 31,
2008, or at
such other time and place as the parties may agree (the "Closing
Date").
1.4 CLOSING
OBLIGATIONS
At the Closing, ONVC and Todd shall receive their respective
Closing
Deliverables as described on Exhibit A attached hereto, each in
form and
substance reasonably satisfactory to ONVC and Todd.
1.5 TAX
TREATMENT
It is the intent of the parties that the exchange of stock
contemplated
by this Agreement qualifies as a tax-free split-off under section
355 of the
Internal Revenue Code.
1.6
ADMINISTRATION OF TAX MATTERS
(a) Tax Returns.
(i) The Holder shall prepare and timely file, or cause to be
timely
filed, for PIP, the federal income Tax Return (defined below) and
other Tax
Returns, if any (the "Short Period Tax Returns"), that are required
by law to be
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filed for the taxable period of PIP that ends on or before the
Closing Date and
the Holder shall be responsible for and shall pay as and when due
any and all
Taxes (defined below), preparation, audit or other expenses or
costs in
connection therewith. The Holder shall provide a copy of these
Short Period Tax
Returns to Todd together with the work papers and schedules
utilized in their
preparation. Todd, ONVC and PIP shall cooperate fully, as and to
the extent
reasonably requested, in connection with the filing of the Short
Period Tax
Returns and any audit, litigation or other proceeding with respect
to the Short
Period Tax Returns. For clarification, all expenses incurred by PIP
prior to the
Closing Date, 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 the Holder
and, to the
extent so paid, shall be expenses of PIP reflected on the Short
Period Tax
Returns.
(ii) Neither Todd, ONVC nor PIP shall file an amended Tax Return
with
respect to any and all taxable periods, or portions thereof, ending
on or before
the Closing Date (the "Pre-Closing Tax Periods"), without the prior
written
consent of Todd, ONVC and PIP; 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 (defined below) of the Tax Return to
which the
amendment relates. The Holder shall indemnify Todd and PIP for any
liability,
cost or expense Todd or PIP incurs as a result of any such
amendment filed in
accordance with the terms of this Section 1.6(a)(ii).
(b)
General Administration of Tax Matters. ONVC, PIP and Todd shall
cooperate fully, as and to the extent reasonably requested, in
connection with
any audit, litigation or other proceeding with respect to Taxes and
Tax Returns
(which the Holder shall control with respect to the Pre-Closing Tax
Periods).
Such cooperation shall include the retention, and (upon the other
party's
request) the provision, of records and information which are
reasonably relevant
to any such audit, litigation or other proceeding and making
employees available
on a mutually convenient basis to provide additional information
and explanation
of any material provided hereunder; provided, however, the Holder,
with respect
to Pre-Closing Tax Periods, and Todd and PIP, with respect to all
subsequent Tax
Periods, shall pay the reasonable out-of-pocket expenses incurred
by the party
providing such assistance; provided, further, no party shall be
required to
provide assistance at times or in amounts that would interfere
unreasonably with
the business and operations of such party. ONVC agrees to retain,
and to make
available to Todd and PIP upon their request, all books and records
with respect
to Tax matters pertinent to PIP relating to the Pre-Closing Tax
Periods, until
the expiration of any applicable statute of limitations or
extensions thereof.
As used in this Agreement, the term "Tax Return" shall mean all
reports, returns, information returns, declarations, statements and
other
documents required to be filed in respect of Taxes.
As used in this Agreement, the term "Tax" shall mean all
federal,
state, local, foreign and other governmental net income, gross
income, gross
receipts, sales, use, ad valorem, transfer, franchise, profits,
license, lease,
service, service use, 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, and the term "Tax" means any one of
the foregoing
Taxes.
As used in this Agreement, the term "Governmental Entities" shall
mean
any court, tribunal, governmental or regulatory authority, agency,
department,
commission, instrumentality, body or other governmental entity of
the United
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States of America or any state or political subdivision thereof or
any court or
arbitrator, and the term "Governmental Entity" means any one of the
foregoing
Governmental Entities.
1.7 REPAYMENT
OF INTER-COMPANY LOAN.
PIP shall, and Todd shall cause PIP to, repay the inter-company
loan
owed by PIP to ONVC as of the date hereof in the principal amount
of $100,000,
which shall be paid in full by January 1, 2012, with no interest
due, in equal
monthly payments of $2,500 beginning October 1, 2008 and continuing
for a total
of forty (40) months.
2. REPRESENTATIONS AND WARRANTIES
2.1
REPRESENTATIONS AND WARRANTIES OF THE HOLDER AND PIP
The Holder and PIP hereby represent and warrant to Todd that all of
the
following representations and warranties set forth in this Section
2.1 are, to
the actual Knowledge of Holder and PIP (as defined herein), true,
correct and
complete as of the date of this Agreement and will be, to the
actual Knowledge
of Holder and PIP, true, correct and complete at and as of the
Closing Date as
though restated on and as of such date.
(a) Ownership.
The Holder is the record and beneficial owner and holder of
the PIP Interests, free and clear of any and all liens,
encumbrances,
charges, claims, conditions, interests, options, security
interests,
pledges, rights of first refusal or restrictions of any kind
(collectively, "Liens"). The Holder owns 100% of the outstanding
equity
and other securities of PIP. PIP does not own, control, or have
voting
rights with respect to, directly or indirectly, any interest in
any
other corporation, partnership, association or other business
entity
and PIP is not a party to any agreement relating to the acquisition
of
such an interest. There are no agreements, rights, claims or
obligations relating to the issuance, sale, or transfer of any
equity
or other securities of PIP.
(b)
Authorization. The Holder is duly incorporated and in good
standing
under the laws of the State of Florida and is duly qualified and
in
good standing in each jurisdiction in which it conducts business
or
owns property, except where the failure to be so qualified could
not
reasonably be expected to have a material adverse effect on its
financial condition or business operations. PIP is duly organized
and
in good standing under the laws of the State of Delaware and is
duly
qualified and in good standing in each jurisdiction in which it
conducts business or owns property, except where the failure to be
so
qualified could not reasonably be expected to have a material
adverse
effect on its financial condition or business operations. Each of
the
Holder and PIP has full right, power and authority to execute
and
deliver this Agreement and the other Holder Documents (defined
below),
to perform its obligations set forth herein and therein and to
consummate all of the transactions contemplated hereby and
thereby.
(c) Documents.
The Holder and PIP have, or before the Closing will have,
approved the sale of the PIP Interests, this Agreement and the
transactions contemplated hereby, and approved, executed and
delivered
this Agreement, the Contingent Payment Agreement, the Termination
of
Employment Agreement, the Acknowledgment of Inter-Company Debt
and
certain other agreements and instruments contemplated by this
Agreement
to be executed and delivered by the Holder and PIP in
connection
herewith (collectively, the "Holder Documents") and each of the
Holder
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Documents, when executed by the Holder or PIP, shall be the legal
valid
and binding obligation of the Holder and PIP in accordance with
their
terms, except as limited by (i) bankruptcy, insolvency,
reorganization,
moratorium and other similar laws of general application affecting
the
rights and remedies of creditors and (ii) general principles of
equity
(regardless of whether such enforcement is considered in a
proceeding
in equity or at law).
(d) No
Default. Neither the Holder or PIP, nor, to the knowledge of
the
Holder and PIP, any vendor or party in contract with the Holder or
PIP,
is in violation of any provision of, or in default under, any of
the
Holder's certificate of incorporation or bylaws, PIP's articles
of
association or operating agreement or any indenture, mortgage, deed
of
trust, indebtedness, agreement, judgment, decree, order, statute,
rule
or regulation to which the Holder or PIP 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
the Holder nor PIP is required to obtain the
approval, authorization, consent, waiver or any other order of
any
public or private entity (including any Governmental 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 (all of which are
unaudited) of PIP, copies of which have been, or prior to the
Closing
will have been, provided to Todd, 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 PIP (and of any person or entity required by generally
accepted accounting principles to be consolidated or included
therein)
at their respective dates and for their respective periods, all
in
accordance with generally accepted accounting principles applied on
a
consistent basis, subject in the case of unaudited statements 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 to the financial condition or business
operations
of PIP).
(g) No
Material Adverse Change. From the date of its last unaudited
financial statements dated December 31, 2007, there has not been
any
change that would materially and adversely affect the financial
position or results of operations of PIP, or its ability to
consummate
the transactions contemplated hereby, or that should be disclosed
to
Todd in order to make any statements or information furnished to
Todd,
in light of the circumstances under which they were made, not
misleading, which has not been disclosed in writing to Todd, as
set
forth in Schedule 2.1(g) to this Agreement.
(h) No
Undisclosed Liabilities. No officer, employee, agent or
representative of ONVC (other than Todd, or any agent or
representative
of Todd) has committed PIP to, or otherwise entered into any
agreement,
contract or instrument on behalf of PIP with respect to, any
liabilities or obligations of any nature (absolute, accrued,
contingent
or otherwise, whether due or to become due, known or unknown
and
whether pending or threatened), including, without limitation,
any
Indebtedness (defined below), account, note, lease, Tax,
environmental
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liability, fine, penalty, civil or criminal action, filing,
lien,
encumbrance, restriction or other duty affecting PIP or its assets
or
properties (nor, to the knowledge of the Holder and PIP, is there
any
basis, circumstance or fact that might give rise thereto), as of
the
date hereof or as of the date of the Closing, which has not
been
disclosed in writing to Todd, as set forth in Schedule 2.1(h) to
this
Agreement. "Indebtedness" means (i) indebtedness for borrowed
money,
whether secured or unsecured (including, without limitation,
inter-company loans), (ii) obligations under conditional or
installment
sale or other title retention Contracts or deferred purchase
price
obligations relating to purchased property, (iii) capitalized
lease
obligations, (iv) commitments under letters of credit, (v)
obligations
under non-cancelable operating leases, and (vi) guarantees of any
of
the foregoing of another person.
(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, to the knowledge of the Holder
and
PIP, threatened, against or affecting the Holder or PIP (nor, to
the
knowledge of the Holder and PIP, is there any basis, circumstance
or
fact therefore) as of the date hereof or as of the date of the
Closing,
which has not been disclosed in writing to Todd, as set forth
in
Schedule 2.1(i) to this Agreement.
(j) Ordinary
Course of Business. Since January 1, 2008, PIP has conducted
its business only in the ordinary course of business consistent
with
the past practice.
(k) Brokers or
Finders. Neither the Holder nor PIP or its officers or
agents has 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. The
Holder
will indemnify and hold Todd harmless from any such payment alleged
to
be due by or through the Holder or PIP as a result of the action of
the
Holder or PIP or its officers or agents.
(l) Tax
Treatment. Todd's transfer of PIP Interests to Holder, pursuant
to
the Acquisition Agreement dated August 31, 2006, was treated by
ONVC as
a tax-free reorganization under section 368 of the Internal
Revenue
Code.
(m) Contracts.
No officer, employee, agent or representative of ONVC (other
than Todd, or any agent or representative of Todd) has caused PIP
or
Holder (with respect to the business of PIP) to be or become a
party to
any contract, obligation, undertaking, arrangement, commitment,
note,
bond, mortgage, indenture, agreement, lease, license or other
instrument or agreement (each, a "Contract"), other than Contracts
that
have been counter-signed by Todd or disclosed to Todd in writing,
as
set forth in Schedule 2.1(m) to this Agreement.
(n) Account
Activity. Schedule 2.1(n) contains a true and complete listing
of all changes and adjustments made to any PIP accounts
(including,
without limitation, bank accounts) between March 1, 2008 and the
date
of this Agreement.
(o) As Is.
Except as expressly provided in this Agreement, Holder is
transferring its interests in PIP to Todd and Todd is taking
the
interests in PIP "as is". Except as expressly provided in this
Agreement, Holder makes no other representations or warranties
regarding PIP. Schedule 2.1(n) contains a complete and accurate
balance
sheet of PIP as of the date of this Agreement.
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"Knowledge of Holder and PIP" shall mean the actual, not
constructive, knowledge
of any employee of PIP or ONVC, other than Todd. Todd hereby
acknowledges and
agrees that certain information provided by Holder and PIP is based
upon
information provided or known by Todd in his capacity as President
of PIP and as
of Vice President of ONVC. Holder and PIP have not independently
verified or
confirmed such information and therefore make no representation or
warranty with
respect thereto, other than the representation and warranty that
Holder and PIP
and employees (other than Todd) of Holder and PIP have no actual
knowledge of
information that would lead them to believe the information
furnished by Holder
and PIP hereunder is not correct.
2.2
REPRESENTATIONS AND WARRANTIES OF TODD
Todd hereby represents and warrants to the Holder and PIP that all
of
the following representations and warranties set forth in this
Section 2.2 are
true, correct and complete as of the date of this Agreement and
will be true,
correct and complete at and as of the Closing Date as though
restated on and as
of such date:
(a)
Authorization. Todd has full right, power and authority to execute
and
deliver this Agreement and the other Todd Documents (defined
below), to
perform his obligations set forth herein and therein and to
consummate
all of the transactions contemplated hereby and thereby.
(b) Documents.
Todd has, or before Closing will have, approved the purchase
of the PIP Interests, this Agreement and the transactions
contemplated
hereby, and approved, executed and delivered this Agreement,
the
Contingent Payment Agreement, the Personal Guaranty of
Contingent
Payment Agreement, the Termination of Employment Agreement, the
Acknowledgment of Inter-Company Debt and certain other agreements
and
instruments contemplated by this Agreement to be executed and
delivered
by Todd in connection herewith (collectively, the "Todd Documents")
and
each of the Todd Documents, when executed by Todd, shall be the
legal,
valid and binding obligation of Todd in accordance with their
terms,
except as limited by (i) bankruptcy, insolvency,
reorganization,
moratorium and other similar laws of general application affecting
the
rights and remedies of creditors and (ii) general principles of
equity
(regardless of whether such enforcement is considered in a
proceeding
in equity or at law).
(c) No
Default. Todd is not in violation of any provision of, or in
default
under, and the execution and delivery of the Todd Documents,
the
performance of the obligations set forth therein and the
consummation
of the transactions contemplated thereby will not result in a
violation
of, or default under, any indenture, mortgage, deed of trust,
indebtedness, agreement, judgment, decree, order, statute, rule
or
regulation to which Todd is a party or by which Todd or his
property is
subject or bound.
(d) No
Approvals. Todd is not required to obtain the approval,
authorization, consent, waiver or any other order of any public
or
private entity (including any Governmental Entity), person, board
or
body in connection with the transactions contemplated by the
Todd
Documents, except as set forth in Section 3.2(a) hereof.
(e) Valid
Issuance. Reserved.
(f) Investment
Intent. Reserved.
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(g) Brokers or
Finders. Neither Todd nor his agents has 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. Todd will indemnify and hold the
Holder
harmless from any such payment alleged to be due by or through Todd
as
a result of the action of Todd or his agents.
(h) Tax
Treatment. Todd's transfer of PIP Interests to Holder, pursuant
to
the Acquisition Agreement dated August 31, 2006, was tr
