AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER is made as of the 6th day of June 2003
AMONG:
ACHIEVEMENT TEC HOLDINGS, INC., a corporation formed pursuant to the laws
of the State of Delaware and having an office for business located at 0000
Xxxxxxx 000, Xxxxx 000-X, Xxxxx Xxxxxxx, Xxxxx 00000
("Achievement")
AND:
CLICKABLEOIL ACQUISITION CORP., a body corporate formed pursuant to the
laws of the State of Delaware and a wholly owned subsidiary of Achievement
(the "Acquirer")
AND:
XXXXXXXXXXXX.XXX, INC., a body corporate formed pursuant to the laws of the
State of Delaware and having an office for business located at 000 Xxxxx
Xxxxxxxx Xxxxxx, Xx. Xxxxxx, XX 00000
("Clickable")
AND:
The Clickable Shareholders on the attached signature page
(the "Clickable Shareholders")
WHEREAS:
A. Clickable is a Delaware corporation engaged in the business of selling
heating oil and related services to residential and commercial customers in the
NY metropolitan area;
B. The Clickable Shareholders owns 100 shares of common stock of Clickable, such
shares represent 100% of the presently issued and outstanding shares of
Clickable ("Clickable Shares");
C. Achievement is a reporting company whose common stock is quoted on the pink
sheets and is in the business of developing online testing software;
D. The respective Boards of Directors of Achievement, Clickable and the Acquirer
deem it advisable and in the best interests of Achievement, Clickable and the
Acquirer that the Acquirer merge with and into Clickable (the "Merger") pursuant
to this Agreement and the Certificate of Merger, and the applicable provisions
of the laws of the State of Delaware; and
E. It is intended that the Merger shall qualify for United States federal income
tax purposes as a reorganization within the meaning of Section 368 of the
Internal Revenue Code of 1986, as amended.
NOW THEREFORE THIS AGREEMENT WITNESSETH THAT in consideration of the premises
and the mutual covenants, agreements, representations and warranties contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE 1
DEFINITIONS AND INTERPRETATION
Definitions
1.1 In this Agreement the following terms will have the following meanings:
(a) "Acquisition Shares" means the 43,000,00 Achievement Common Shares to
be issued to the Clickable Shareholders. 38,000,000 to be issued at
Closing and 5,000,000 to be issued with 5 days of closing pursuant to
the terms of the Merger;
(b) "Agreement" means this agreement and plan of merger among Achievement,
the Acquirer, Clickable, and the Clickable Shareholders;
(c) "Achievement Accounts Payable and Liabilities" means all accounts
payable and liabilities of Achievement, on a consolidated basis, due
and owing or otherwise constituting a binding obligation of
Achievement and its subsidiaries (other than a Achievement Material
Contract) as of May 15, 2003 as set forth is Schedule "B" hereto;
(d) "Achievement Accounts Receivable" means all accounts receivable and
other debts owing to Achievement , on a consolidated basis, as of May
15, 2003;
(e) "Achievement Assets" means the undertaking and all the property and
assets of the Achievement Business of every kind and description
wheresoever situated including, without limitation, Achievement
Equipment, Achievement Inventory, Achievement Material Contracts,
Achievement Accounts Receivable, Achievement Cash, Achievement
Intangible Assets and Achievement Goodwill, and all credit cards,
charge cards and banking cards issued to Achievement ;
(f) "Achievement Bank Accounts" means all of the bank accounts, lock boxes
and safety deposit boxes of Achievement and its subsidiaries or
relating to the Achievement Business as set forth in Schedule "D"
hereto;
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(g) "Achievement Business" means all aspects of any business conducted by
Achievement and its subsidiaries;
(h) "Achievement Cash" means all cash on hand or on deposit to the credit
of Achievement and its subsidiaries on the Closing Date;
(i) "Achievement Common Shares" means the shares of common stock in the
capital of Achievement ;
(j) "Achievement Debt to Related Parties" means the debts owed by
Achievement and its subsidiaries to any affiliate, director or officer
of Achievement as described in Schedule "E" hereto;
(k) "Achievement Equipment" means all machinery, equipment, furniture, and
furnishings used in the Achievement Business;
(l) "Achievement Financial Statements" means, collectively, the audited
consolidated financial statements of Achievement for the fiscal year
ended December 31, 2001, and the unaudited financial statement for the
period ending June 30, 2002;
(m) "Achievement Goodwill" means the goodwill of the Achievement Business
including the right to all corporate, operating and trade names
associated with the Achievement Business, or any variations of such
names as part of or in connection with the Achievement Business, all
books and records and other information relating to the Achievement
Business, all necessary licenses and authorizations and any other
rights used in connection with the Achievement Business;
(n) "Achievement Insurance Policies" means the public liability insurance
and insurance against loss or damage to the Achievement Assets and the
Achievement Business as described in Schedule "G" hereto;
(o) "Achievement Intangible Assets" means all of the intangible assets of
Achievement and its subsidiaries, including, without limitation,
Achievement Goodwill, all trademarks, logos, copyrights, designs, and
other intellectual and industrial property of Achievement and its
subsidiaries;
(p) "Achievement Inventory" means all inventory and supplies of the
Achievement Business as of May 15, 2003;
(q) "Achievement Material Contracts" means the burden and benefit of and
the right, title and interest of Achievement and its subsidiaries in,
to and under all trade and non-trade contracts, engagements or
commitments, whether written or oral, to which Achievement or its
subsidiaries are entitled whereunder Achievement or its subsidiaries
are obligated to pay or entitled to receive the sum of $10,000 or more
including, without limitation, any pension plans, profit sharing
plans, bonus plans, loan agreements, security agreements, indemnities
and guarantees, any agreements with employees, lessees, licensees,
managers, accountants, suppliers, agents, distributors, officers,
directors, attorneys or others which cannot be terminated without
liability on not more than one month's notice, and those contracts
listed in Schedule "I" hereto;
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(r) "Closing" means the completion, on the Closing Date, of the
transactions contemplated hereby in accordance with Article 9 hereof;
(s) "Closing Date" means the day on which all conditions precedent to the
completion of the transaction as contemplated hereby have been
satisfied or waived;
(t) "Effective Time" means the date of the filing of an appropriate
Certificate of Merger in the form required by the State of Delaware,
which certificate shall provide that the Merger shall become effective
upon such filing;
(u) "Merger" means the merger, at the Effective Time, of Clickable and the
Acquirer pursuant to this Agreement and Plan of Merger;
(v) "Merger Consideration" means the Acquisition Shares;
(w) "Place of Closing" means the offices of Sichenzia Xxxx Xxxxxxxx
Xxxxxxx LLP, or such other place as Achievement and Clickable may
mutually agree upon;
(x) "State Corporation Law" means the General Corporation Law of the State
of Delaware;
(y) "Surviving Company" means Clickable following the merger with the
Acquirer;
(z) "Clickable Accounts Payable and Liabilities" means all accounts
payable and liabilities of Clickable, due and owing or otherwise
constituting a binding obligation of Clickable (other than a Clickable
Material Contract);
(aa) "Clickable Accounts Receivable" means all accounts receivable and
other debts owing to Clickable;
(bb) "Clickable Assets" means the undertaking and all the property and
assets of the Clickable Business of every kind and description
wheresoever situated including, without limitation, Clickable
Equipment, Clickable Inventory, Clickable Material Contracts,
Clickable Accounts Receivable, Clickable Cash, Clickable Intangible
Assets and Clickable Goodwill, and all credit cards, charge cards and
banking cards issued to Clickable;
(cc) "Clickable Bank Accounts" means all of the bank accounts, lock boxes
and safety deposit boxes of Clickable or relating to the Clickable
Business;
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(dd) "Clickable Business" means all aspects of the business conducted by
Clickable;
(ee) "Clickable Cash" means all cash on hand or on deposit to the credit of
Clickable on the Closing Date;
(ff) "Clickable Debt to Related Parties" means the debts owed by Clickable
and its subsidiaries to the Clickable Shareholders or to any family
member thereof, or to any affiliate, director or officer of Clickable
or the Clickable Shareholders;
(gg) "Clickable Equipment" means all machinery, equipment, furniture, and
furnishings used in the Clickable Business;
(hh) "Clickable Financial Statements" means collectively, the consolidated
financial statements of Clickable;
(ii) "Clickable Goodwill" means the goodwill of the Clickable Business
together with the exclusive right of Achievement to represent itself
as carrying on the Clickable Business in succession of Clickable
subject to the terms hereof, and the right to use any words indicating
that the Clickable Business is so carried on including the right to
use the name "Clickable" or "Clickable International" or any variation
thereof as part of the name of or in connection with the Clickable
Business or any part thereof carried on or to be carried on by
Clickable, the right to all corporate, operating and trade names
associated with the Clickable Business, or any variations of such
names as part of or in connection with the Clickable Business, all
telephone listings and telephone advertising contracts, all lists of
customers, books and records and other information relating to the
Clickable Business, all necessary licenses and authorizations and any
other rights used in connection with the Clickable Business;
(jj) "Clickable Insurance Policies" means the public liability insurance
and insurance against loss or damage to Clickable Assets and the
Clickable Business as described in Schedule "P" hereto;
(kk) "Clickable Intangible Assets" means all of the intangible assets of
Clickable, including, without limitation, Clickable Goodwill, all
trademarks, logos, copyrights, designs, and other intellectual and
industrial property of Clickable and its subsidiaries;
(ll) "Clickable Inventory" means all inventory and supplies of the
Clickable Business;
(mm) "Clickable Material Contracts" means the burden and benefit of and the
right, title and interest of Clickable in, to and under all trade and
non-trade contracts, engagements or commitments, whether written or
oral, to which Clickable is entitled in connection with the Clickable
Business whereunder Clickable is obligated to pay or entitled to
receive the sum of $10,000 or more including, without limitation, any
pension plans, profit sharing plans, bonus plans, loan
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agreements, security agreements, indemnities and guarantees, any
agreements with employees, lessees, licensees, managers, accountants,
suppliers, agents, distributors, officers, directors, attorneys or
others which cannot be terminated without liability on not more than
one month's notice; and
(nn) "Clickable Shares" means all of the issued and outstanding shares of
Clickable's equity stock.
Any other terms defined within the text of this Agreement will have the
meanings so ascribed to them.
Captions and Section Numbers
1.2 The headings and section references in this Agreement are for convenience of
reference only and do not form a part of this Agreement and are not intended to
interpret, define or limit the scope, extent or intent of this Agreement or any
provision thereof.
Section References and Schedules
1.3 Any reference to a particular "Article", "section", "paragraph", "clause" or
other subdivision is to the particular Article, section, clause or other
subdivision of this Agreement and any reference to a Schedule by letter will
mean the appropriate Schedule attached to this Agreement and by such reference
the appropriate Schedule is incorporated into and made part of this Agreement.
The Schedules to this Agreement are as follows:
Information concerning Achievement
Schedule "A" Achievement Pending Litigation
Schedule "B" Achievement Accounts Payable and Liabilities
Schedule "D" Achievement Bank Accounts
Schedule "E" Achievement Debts to Related Parties
Schedule "G" Achievement Insurance Policies
Schedule "I" Achievement Material Contracts
Severability of Clauses
1.4 If any part of this Agreement is declared or held to be invalid for any
reason, such invalidity will not affect the validity of the remainder which will
continue in full force and effect and be construed as if this Agreement had been
executed without the invalid portion, and it is hereby declared the intention of
the parties that this Agreement would have been executed without reference to
any portion which may, for any reason, be hereafter declared or held to be
invalid.
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ARTICLE 2
THE MERGER
The Merger
2.1 At Closing, the Acquirer shall be merged with and into Clickable pursuant to
this Agreement and Plan of Merger and the separate corporate existence of the
Acquirer shall cease and Clickable, as it exists from and after the Closing,
shall be the Surviving Company.
Effect of the Merger
2.2 The Merger shall have the effect provided therefor by the State Corporation
Law. Without limiting the generality of the foregoing, and subject thereto, at
Closing (i) all the rights, privileges, immunities, powers and franchises, of a
public as well as of a private nature, and all property, real, personal and
mixed, and all debts due on whatever account, including without limitation
subscriptions to shares, and all other choses in action, and all and every other
interest of or belonging to or due to Clickable or the Acquirer, as a group,
subject to the terms hereof, shall be taken and deemed to be transferred to, and
vested in, the Surviving Company without further act or deed; and all property,
rights and privileges, immunities, powers and franchises and all and every other
interest shall be thereafter as effectually the property of the Surviving
Company, as they were of Clickable and the Acquirer, as a group, and (ii) all
debts, liabilities, duties and obligations of Clickable and the Acquirer, as a
group, subject to the terms hereof, shall become the debts, liabilities and
duties of the Surviving Company and the Surviving Company shall thenceforth be
responsible and liable for all debts, liabilities, duties and obligations of
Clickable and the Acquirer, as a group, and neither the rights of creditors nor
any liens upon the property of Clickable or the Acquirer, as a group, shall be
impaired by the Merger, and may be enforced against the Surviving Company.
Certificate of Incorporation; Bylaws; Directors and Officers
2.3 The Certificate of Incorporation of the Surviving Company from and after the
Closing shall be the Certificate of Incorporation of Clickable until thereafter
amended in accordance with the provisions therein and as provided by the
applicable provisions of the State Corporation Law. The Bylaws of the Surviving
Company from and after the Closing shall be the Bylaws of Clickable as in effect
immediately prior to the Closing, continuing until thereafter amended in
accordance with their terms, the Certificate of Incorporation of the Surviving
Company and as provided by the State Corporation Law. The Directors and Officers
of Clickable at the Effective Time shall continue to be the Directors and
Officers of Clickable.
Conversion of Securities
2.4 At the Effective Time, by virtue of the Merger and without any action on the
part of the Acquirer, Clickable or the Clickable Shareholders, the shares of
capital stock of each of Clickable and the Acquirer shall be converted as
follows:
(a) Capital Stock of the Acquirer. Each issued and outstanding share of
the Acquirer's capital stock shall continue to be issued and
outstanding and shall be converted into one share of validly issued,
fully paid, and non-assessable common stock of
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the Surviving Company. Each stock certificate of the Acquirer
evidencing ownership of any such shares shall continue to evidence
ownership of such shares of capital stock of the Surviving Company.
(b) Conversion of Clickable Shares. Each Clickable Share that is issued
and outstanding at the Effective Time shall automatically be cancelled
and extinguished and converted, without any action on the part of the
holder thereof, into the right to receive at the time and in the
amounts described in this Agreement an amount of Acquisition Shares
equal to the number of Acquisition Shares divided by the number of
Clickable Shares outstanding immediately prior to Closing. The
Acquisition Shares will represent approximately 91.7% of approximately
46,891,966 shares outstanding. All such Clickable Shares, when so
converted, shall no longer be outstanding and shall automatically be
cancelled and retired and shall cease to exist, and each holder of a
certificate representing any such shares shall cease to have any
rights with respect thereto, except the right to receive the
Acquisition Shares paid in consideration therefor upon the surrender
of such certificate in accordance with this Agreement.
Adherence with Applicable Securities Laws
2.5 The Clickable Shareholders agrees that he is acquiring the Acquisition
Shares for investment purposes and will not offer, sell or otherwise transfer,
pledge or hypothecate any of the Acquisition Shares issued to them (other than
pursuant to an effective Registration Statement under the Securities Act of
1933, as amended) directly or indirectly unless:
(a) the sale is to Achievement;
(b) the sale is made pursuant to the exemption from registration under the
Securities Act of 1933,as amended, provided by Rule 144 thereunder; or
(c) the Acquisition Shares are sold in a transaction that does not require
registration under the Securities Act of 1933, as amended, or any
applicable United States state laws and regulations governing the
offer and sale of securities, and the vendor has furnished to
Achievement an opinion of counsel to that effect or such other written
opinion as may be reasonably required by Achievement .
The Clickable Shareholders acknowledges that the certificates representing
the Acquisition Shares shall bear the following legend:
NO SALE, OFFER TO SELL, OR TRANSFER OF THE SHARES REPRESENTED BY THIS
CERTIFICATE SHALL BE MADE UNLESS A REGISTRATION STATEMENT UNDER THE FEDERAL
SECURITIES ACT OF 1933, AS AMENDED, IN RESPECT OF SUCH SHARES IS THEN IN EFFECT
OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SAID ACT IS THEN IN FACT
APPLICABLE TO SAID SHARES.
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES
OF ACHIEVEMENT
Representations and Warranties
3.1 Achievement represents and warrants in all material respects to Clickable,
with the intent that Clickable will rely thereon in entering into this Agreement
and in approving and completing the transactions contemplated hereby, that:
Achievement - Corporate Status and Capacity
(a) Incorporation. Achievement is a corporation duly incorporated and
validly subsisting under the laws of the State of Delaware, and is in
good standing with the office of the Secretary of State for the State
of Delaware;
(b) Carrying on Business. Achievement does not currently conduct business,
except for the actual operations of the corporation which are carried
on in Grand Prairie, Texas, and does carry on any other material
business activity in any other jurisdictions. Achievement is duly
authorized to carry on such business in Texas. The nature of the
Achievement Business does not require Achievement to register or
otherwise be qualified to carry on business in any other
jurisdictions;
(c) Corporate Capacity. Achievement has the corporate power, capacity and
authority to own the Achievement Assets and to enter into and complete
this Agreement;
(d) Reporting Status; Listing. Achievement is required to file current
reports with the Securities and Exchange Commission pursuant to
section 12(g) of the Securities Exchange Act of 1934, the Achievement
Common Shares are quoted on the Pink Sheets and all reports required
to be filed by Achievement with the Securities and Exchange Commission
or NASD have been timely filed with the exception for the following:
i. Form 10QSB for the period ending September 30, 2002;
ii. Form 10KSB for the period ending December 31, 2002;
iii. Form 10QSB for the period ending March 31, 2003; and
iv. Form 8-K regarding a change in accountants
Acquirer - Corporate Status and Capacity
(e) Incorporation. The Acquirer is a corporation duly incorporated and
validly subsisting under the laws of the State of Delaware, and is in
good standing with the office of the Secretary of State for the State
of Delaware;
(f) Carrying on Business. Other than corporate formation and organization,
the Acquirer has not carried on business activities to date.
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(g) Corporate Capacity. The Acquirer has the corporate power, capacity and
authority to enter into and complete this Agreement;
Achievement - Capitalization
(h) Authorized Capital. The authorized capital of Achievement consists of
50,000,000 Achievement Common Shares, $0.001 par value and 10,000,000
shares of preferred stock. $0.001 par value, of which 10,320,039
Achievement Common Shares, and 0 shares of Preferred Stock are
presently issued and outstanding;
(i) No Option. Except as disclosed on the attached schedules, no person,
firm or corporation has any agreement or option or any right capable
of becoming an agreement or option for the acquisition of Achievement
Common Shares or for the purchase, subscription or issuance of any of
the unissued shares in the capital of Achievement;
(j) Capacity. Achievement has the full right, power and authority to enter
into this Agreement on the terms and conditions contained herein;
Acquirer Capitalization
(k) Authorized Capital. The authorized capital of the Acquirer consists of
200 shares of common stock, $0.001 par value, of which one share of
common stock is presently issued and outstanding;
(l) No Option. No person, firm or corporation has any agreement or option
or any right capable of becoming an agreement or option for the
acquisition of any common or preferred shares in Acquirer or for the
purchase, subscription or issuance of any of the unissued shares in
the capital of Acquirer;
(m) Capacity. The Acquirer has the full right, power and authority to
enter into this Agreement on the terms and conditions contained
herein;
Achievement - Records and Financial Statements
(n) Charter Documents. The charter documents of Achievement and the
Acquirer have not been altered since the incorporation of each,
respectively, except as filed in the record books of Achievement or
the Acquirer, as the case may be;
(o) Corporate Minute Books. The corporate minute books of Achievement and
its subsidiaries are complete and each of the minutes contained
therein accurately reflect the actions that were taken at a duly
called and held meeting or by consent without a meeting. All actions
by Achievement and its subsidiaries which required director or
shareholder approval are reflected on the corporate minute books of
Achievement and its subsidiaries. Achievement and its subsidiaries are
not in violation or breach of, or in default with respect to, any term
of their respective Certificates of Incorporation (or other charter
documents) or by-laws.
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(p) Achievement Financial Statements. The Achievement Financial Statements
present fairly, in all material respects, the assets and liabilities
(whether accrued, absolute, contingent or otherwise) of Achievement ,
on a consolidated basis, as of the respective dates thereof, and the
sales and earnings of the Achievement Business during the periods
covered thereby, in all material respects and have been prepared in
substantial accordance with generally accepted accounting principles
consistently applied;
(q) Internal Accounting Controls. Achievement and its subsidiaries
maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in
accordance with management's general or specific authorizations, (ii)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management's general or
specific authorization, and (iv) the recorded accountability for
assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences. There
are no disagreements of any kind presently existing, or reasonably
anticipated by Achievement to arise, between the accountants and
lawyers formerly or presently employed by Achievement, which could
reasonably be expected to delay the transactions contemplated hereby,
including the filing of Form 8-K following the Effective Date, and
Achievement will be current with respect to any fees owed to its
accountants and lawyers upon Closing. Achievement has established
disclosure controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) for Achievement and designed such disclosure
controls and procedures to ensure that material information relating
to Achievement, including its subsidiaries, is made known to the
certifying officers by others within those entities, particularly
during the period in which Achievement's Form 10-K (or 10-KSB) or 10-Q
(or 10-QSB), as the case may be, is being prepared. The Achievement's
certifying officers have evaluated the effectiveness of Achievement's
controls and procedures as of a date within 90 days prior to the
filing date of the Form 10-QSB for the quarter ended June 30, 2002
(such date, the "Evaluation Date"). Achievement presented in the Form
10-QSB for the quarter ended June 30, 2002 the conclusions of the
certifying officers about the effectiveness of the disclosure controls
and procedures based on their evaluations as of the Evaluation Date.
Since the Evaluation Date, there have been no significant changes in
Achievement's internal controls (as such term is defined in Item
307(b) of Regulation S-K under the Exchange Act) or, to Achievement's
knowledge, in other factors that could significantly affect the
Achievement's internal controls.
(r) Achievement Accounts Payable and Liabilities. There are no material
liabilities, contingent or otherwise, of Achievement or its
subsidiaries which are not disclosed in Schedule "B" hereto or
reflected in the Achievement Financial Statements except those
incurred in the ordinary course of business since the date of the said
schedule and the Achievement Financial Statements, and neither
Achievement nor its subsidiaries have guaranteed or agreed to
guarantee any
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debt, liability or other obligation of any person, firm or
corporation. Without limiting the generality of the foregoing, all
accounts payable and liabilities of Achievement and its subsidiaries
as of May 15, 2003 are described in Schedule "B" hereto;
(s) Achievement Accounts Receivable. All the Achievement Accounts
Receivable result from bona fide business transactions and services
actually rendered without, to the knowledge and belief of Achievement
, any claim by the obligor for set-off or counterclaim;
(t) Achievement Bank Accounts. All of the Achievement Bank Accounts, their
location, numbers and the authorized signatories thereto are as set
forth in Schedule "D" hereto;
(u) No Debt to Related Parties. Except as disclosed in Schedule "E"
hereto, neither Achievement nor its subsidiaries are, and on Closing
will not be, materially indebted to any affiliate, director or officer
of Achievement except accounts payable on account of bona fide
business transactions of Achievement incurred in normal course of the
Achievement Business, including employment agreements, none of which
are more than 30 days in arrears;
(v) No Related Party Debt to Achievement . No director or officer or
affiliate of Achievement is now indebted to or under any financial
obligation to Achievement or its subsidiaries on any account
whatsoever, except for advances on account of travel and other
expenses not exceeding $5,000 in total;
(w) No Dividends. No dividends or other distributions on any shares in the
capital of Achievement have been made, declared or authorized since
the date of Achievement Financial Statements;
(x) No Payments. No payments of any kind have been made or authorized
since the date of the Achievement Financial Statements to or on behalf
of officers, directors, shareholders or employees of Achievement or
its subsidiaries or under any management agreements with Achievement
or its subsidiaries, except payments made in the ordinary course of
business and at the regular rates of salary or other remuneration
payable to them;
(y) No Pension Plans. There are no pension, profit sharing, group
insurance or similar plans or other deferred compensation plans
affecting Achievement or its subsidiaries;
(z) No Adverse Events. Since the date of the Achievement Financial
Statements
(i) there has not been any material adverse change in the financial
position or condition of Achievement , its subsidiaries, its
liabilities or the Achievement Assets or any damage, loss or
other change in circumstances materially affecting Achievement ,
the Achievement Business or the Achievement Assets or Achievement
' right to carry on the Achievement Business, other than changes
in the ordinary course of business,
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(ii) there has not been any damage, destruction, loss or other event
(whether or not covered by insurance) materially and adversely
affecting Achievement, its subsidiaries, the Achievement Business
or the Achievement Assets,
(iii)there has not been any material increase in the compensation
payable or to become payable by Achievement to any of Achievement
' officers, employees or agents or any bonus, payment or
arrangement made to or with any of them,
(iv) the Achievement Business has been and continues to be carried on
in the ordinary course,
(v) Achievement has not waived or surrendered any right of material
value,
(vi) Neither Achievement nor its subsidiaries have discharged or
satisfied or paid any lien or encumbrance or obligation or
liability other than current liabilities in the ordinary course
of business, and
(vii)no capital expenditures in excess of $10,000 individually or
$30,000 in total have been authorized or made.
Achievement - Income Tax Matters
(aa) Tax Returns. Except for the 2002 IRS form 1120, and Texas Franchise
Tax, all tax returns and reports of Achievement and its subsidiaries
required by law to be filed have been filed and are true, complete and
correct, and any taxes payable in accordance with any return filed by
Achievement and its subsidiaries or in accordance with any notice of
assessment or reassessment issued by any taxing authority have been so
paid;
(bb) Current Taxes. Adequate provisions have been made for taxes payable
for the current period for which tax returns are not yet required to
be filed and there are no agreements, waivers, or other arrangements
providing for an extension of time with respect to the filing of any
tax return by, or payment of, any tax, governmental charge or
deficiency by Achievement or its subsidiaries. Achievement is not
aware of any contingent tax liabilities or any grounds which would
prompt a reassessment including aggressive treatment of income and
expenses in filing earlier tax returns;
Achievement - Applicable Laws and Legal Matters
(cc) Licenses. Achievement and its subsidiaries hold all licenses and
permits as may be requisite for carrying on the Achievement Business
in the manner in which it has heretofore been carried on, which
licenses and permits have been maintained
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and continue to be in good standing except where the failure to obtain
or maintain such licenses or permits would not have a material adverse
effect on the Achievement Business;
(dd) Applicable Laws. Neither Achievement nor its subsidiaries have been
charged with or received notice of breach of any laws, ordinances,
statutes, regulations, by-laws, orders or decrees to which they are
subject or which apply to them the violation of which would have a
material adverse effect on the Achievement Business, and to
Achievement ' knowledge, neither Achievement nor its subsidiaries are
in breach of any laws, ordinances, statutes, regulations, bylaws,
orders or decrees the contravention of which would result in a
material adverse impact on the Achievement Business;
(ee) Pending or Threatened Litigation. Except as set forth on Schedule A,
there is no material litigation or administrative or governmental
proceeding pending or threatened against or relating to Achievement,
its subsidiaries, the Achievement Business, or any of the Achievement
Assets nor does Achievement have any knowledge of any deliberate act
or omission of Achievement or its subsidiaries that would form any
material basis for any such action or proceeding;
(ff) No Bankruptcy. Neither Achievement nor its subsidiaries have made any
voluntary assignment or proposal under applicable laws relating to
insolvency and bankruptcy and no bankruptcy petition has been filed or
presented against Achievement or its subsidiaries and no order has
been made or a resolution passed for the winding-up, dissolution or
liquidation of Achievement or its subsidiaries;
(gg) Labor Matters. Neither Achievement nor its subsidiaries are party to
any collective agreement relating to the Achievement Business with any
labor union or other association of employees and no part of the
Achievement Business has been certified as a unit appropriate for
collective bargaining or, to the knowledge of Achievement, has made
any attempt in that regard;
(hh) Finder's Fees. Neither Achievement nor its subsidiaries are party to
any agreement which provides for the payment of finder's fees,
brokerage fees, commissions or other fees or amounts which are or may
become payable to any third party in connection with the execution and
delivery of this Agreement and the transactions contemplated herein;
Execution and Performance of Agreement
(ii) Authorization and Enforceability. The execution and delivery of this
Agreement, and the completion of the transactions contemplated hereby,
have been duly and validly authorized by all necessary corporate
action on the part of Achievement and the Acquirer;
(jj) No Violation or Breach. The execution and performance of this
Agreement will not:
14
(i) violate the charter documents of Achievement or the Acquirer
or result in any breach of, or default under, any loan
agreement, mortgage, deed of trust, or any other agreement
to which Achievement or its subsidiaries are party,
(ii) give any person any right to terminate or cancel any
agreement including, without limitation, the Achievement
Material Contracts, or any right or rights enjoyed by
Achievement or its subsidiaries,
(iii) result in any alteration of Achievement ' or its
subsidiaries' obligations under any agreement to which
Achievement or its subsidiaries are party including, without
limitation, the Achievement Material Contracts,
(iv) result in the creation or imposition of any lien,
encumbrance or restriction of any nature whatsoever in favor
of a third party upon or against the Achievement Assets,
(v) result in the imposition of any tax liability to Achievement
or its subsidiaries relating to the Achievement Assets, or
(vi) violate any court order or decree to which either
Achievement or its subsidiaries are subject;
The Achievement Assets - Ownership and Condition
(kk) Business Assets. The Achievement Assets comprise all of the property
and assets of the Achievement Business, and no other person, firm or
corporation owns any assets used by Achievement or its subsidiaries in
operating the Achievement Business, whether under a lease, rental
agreement or other arrangement;
(ll) Title. Achievement or its subsidiaries are the legal and beneficial
owner of the Achievement Assets, free and clear of all mortgages,
liens, charges, pledges, security interests, encumbrances or other
claims whatsoever;
(mm) No Option. No person, firm or corporation has any agreement or option
or a right capable of becoming an agreement for the purchase of any of
the Achievement Assets;
(nn) Achievement Insurance Policies. Achievement and its subsidiaries
maintain the public liability insurance and insurance against loss or
damage to the Achievement Assets and the Achievement Business as
described in Schedule "G" hereto;
(oo) Achievement Material Contracts. The Achievement Material Contracts
listed in Schedule "I" constitute all of the material contracts of
Achievement and its subsidiaries;
(pp) No Default. There has not been any default in any material obligation
of
15
Achievement or any other party to be performed under any of the
Achievement Material Contracts, each of which is in good standing and
in full force and effect and unamended (except as disclosed in
Schedule "I" hereto), and Achievement is not aware of any default in
the obligations of any other party to any of the Achievement Material
Contracts;
(qq) No Compensation on Termination. There are no agreements, commitments
or understandings relating to severance pay or separation allowances
on termination of employment of any employee of Achievement or its
subsidiaries. Neither Achievement nor its subsidiaries are obliged to
pay benefits or share profits with any employee after termination of
employment except as required by law;
Achievement Assets - Achievement Equipment
(rr) Achievement Equipment. The Achievement Equipment has been maintained
in a manner consistent with that of a reasonably prudent owner and
such equipment is in good working condition;
Achievement Assets - Achievement Goodwill and Other Assets
(ss) Achievement Goodwill. Achievement and its subsidiaries does not carry
on the Achievement Business under any other business or trade names.
Achievement does not have any knowledge of any infringement by
Achievement or its subsidiaries of any patent, trademarks, copyright
or trade secret;
The Achievement Business
(tt) Maintenance of Business. Since the date of the Achievement Financial
Statements, Achievement and its subsidiaries have not entered into any
material agreement or commitment except in the ordinary course and
except as disclosed herein;
(uu) Subsidiaries. Except for the Acquirer, Achievement does not own any
subsidiaries and does not otherwise own, directly or indirectly, any
shares or interest in any other corporation, partnership, joint
venture or firm; and
Achievement - Acquisition Shares
(vv) Acquisition Shares. The Acquisition Shares when delivered to the
holders of Clickable Shares pursuant to the Merger shall be validly
issued and outstanding as fully paid and non-assessable shares and the
Acquisition Shares shall be transferable upon the books of Achievement
, in all cases subject to the provisions and restrictions of all
applicable securities laws.
Non-Merger and Survival
3.2 The representations and warranties of Achievement contained herein will be
true at and as of Closing in all material respects as though such
representations and warranties were made as of such time. Notwithstanding the
completion of the transactions contemplated hereby, the waiver of any condition
contained herein (unless such waiver expressly releases a party from any such
representation or warranty) or any investigation made by Clickable or the
Clickable Shareholders, the representations and warranties of Achievement shall
survive the Closing.
16
Indemnity
3.3 Achievement agrees to indemnify and save harmless Clickable and the
Clickable Shareholders from and against any and all claims, demands, actions,
suits, proceedings, assessments, judgments, damages, costs, losses and expenses,
including any payment made in good faith in settlement of any claim (subject to
the right of Achievement to defend any such claim), resulting from the breach by
it of any representation or warranty made under this Agreement or from any
misrepresentation in or omission from any certificate or other instrument
furnished or to be furnished by Achievement to Clickable or the Clickable
Shareholders hereunder.
3.4 Achievement Tec, Inc. agrees, to indemnify and hold harmless Achievement
from any and all claims, demands, actions, suits, proceedings, assessments,
judgments, damages, costs, losses and expenses, including any payment made in
good faith in settlement of any claim, including reasonable attorneys fees in
connection with, or arising from litigation with Xxx and Xxxxx Xxxx including a
claim amounting to $206,000; and an action permitting the Loyds to be released
from restrictive covenants.
ARTICLE 4
COVENANTS OF ACHIEVEMENT
Covenants
4.1 Achievement covenants and agrees with Clickable that it will:
(a) Conduct of Business. Until the Closing, conduct its business
diligently and in the ordinary course consistent with the manner in
which it generally has been operated up to the date of execution of
this Agreement;
(b) Preservation of Business. Until the Closing, use its best efforts to
preserve the Achievement Business and the Achievement Assets and,
without limitation, preserve for Clickable Achievement ' and its
subsidiaries' relationships with any third party having business
relations with them;
(c) Access. Until the Closing, give Clickable, the Clickable Shareholders,
and their representatives full access to all of the properties, books,
contracts, commitments and records of Achievement , and furnish to
Clickable, the Clickable Shareholders and their representatives all
such information as they may reasonably request;
(d) Procure Consents. Until the Closing, take all reasonable steps
required to obtain, prior to Closing, any and all third party consents
required to permit the Merger
17
and to preserve and maintain the Achievement Assets notwithstanding
the change in control of Clickable arising from the Merger; and
Authorization
4.2 Achievement hereby agrees to authorize and direct any and all federal,
state, municipal, foreign and international governments and regulatory
authorities having jurisdiction respecting Achievement and its subsidiaries to
release any and all information in their possession respecting Achievement and
its subsidiaries to Clickable. Achievement shall promptly execute and deliver to
Clickable any and all consents to the release of information and specific
authorizations which Clickable reasonably requires to gain access to any and all
such information.
Survival
4.3 The covenants set forth in this Article shall survive the Closing for the
benefit of Clickable and the Clickable Shareholders.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF
CLICKABLE AND THE CLICKABLE SHAREHOLDERS
Representations and Warranties
5.1 Clickable and the Clickable Shareholders jointly and severally represent and
warrant in all material respects to Achievement, with the intent that it will
rely thereon in entering into this Agreement and in approving and completing the
transactions contemplated hereby, that:
Clickable - Corporate Status and Capacity
(a) Incorporation. Clickable is a corporation duly incorporated and
validly subsisting under the laws of the State of Delaware, and is in
good standing with the office of the Secretary of State for the State
of Delaware;
(b) Carrying on Business. Clickable carries on business primarily in New
York and does not carry on any material business activity in any other
jurisdiction. Clickable has an office in New York and in no other
locations. The nature of the Clickable Business does not require
Clickable to register or otherwise be qualified to carry on business
in any other jurisdiction;
(c) Corporate Capacity. Clickable has the corporate power, capacity and
authority to own Clickable Assets, to carry on the Business of
Clickable and to enter into and complete this Agreement;
Clickable - Capitalization
18
(d) Authorized Capital. The authorized capital of Clickable consists of
100 shares of common stock, $.001 par value per share;
(e) Ownership of Clickable Shares. The issued and outstanding share
capital of Clickable will on Closing consist of 100 common shares
(being the Clickable Shares), which shares on Closing shall be validly
issued and outstanding as fully paid and non-assessable shares. The
Clickable Shareholders will be at Closing the registered and
beneficial owner of 100 Clickable Shares. The Clickable Shares owned
by the Clickable Shareholders will on Closing be free and clear of any
and all liens, charges, pledges, encumbrances, restrictions on
transfer and adverse claims whatsoever;
(f) No Option. No person, firm or corporation has any agreement, option,
warrant, preemptive right or any other right capable of becoming an
agreement or option for the acquisition of Clickable Shares held by
the Clickable Shareholders or for the purchase, subscription or
issuance of any of the unissued shares in the capital of Clickable;
(g) No Restrictions. There are no restrictions on the transfer, sale or
other disposition of Clickable Shares contained in the charter
documents of Clickable or under any agreement;
Clickable - Records and Financial Statements
(h) Charter Documents. The charter documents of Clickable have not been
altered since its incorporation date, except as filed in the record
books of Clickable;
(i) Corporate Minute Books. The corporate minute books of Clickable are
complete and each of the minutes contained therein accurately reflect
the actions that were taken at a duly called and held meeting or by
consent without a meeting. All actions by Clickable which required
director or shareholder approval are reflected on the corporate minute
books of Clickable. Clickable is not in violation or breach of, or in
default with respect to, any term of its Certificates of Incorporation
(or other charter documents) or by-laws.
(j) Clickable Financial Statements. The Clickable Financial Statements
present fairly, in all material respects, the assets and liabilities
(whether accrued, absolute, contingent or otherwise) of Clickable, on
consolidated basis, as of the respective dates thereof, and the sales
and earnings of the Clickable Business during the periods covered
thereby, in all material respects, and have been prepared in
substantial accordance with generally accepted accounting principles
consistently applied;
(k) Clickable Accounts Payable and Liabilities. There are no material
liabilities, contingent or otherwise, of Clickable which are not
disclosed in Schedule "K" hereto or reflected in the Clickable
Financial Statements except those incurred in the ordinary course of
business since the date of the said schedule and the Clickable
Financial Statements, and Clickable has not guaranteed or agreed to
19
guarantee any debt, liability or other obligation of any person, firm
or corporation. Without limiting the generality of the foregoing, all
accounts payable and liabilities of Clickable as of May 15, 2003;
(l) Clickable Accounts Receivable. All Clickable Accounts Receivable
result from bona fide business transactions and services actually
rendered without, to the knowledge and belief of Clickable, any claim
by the obligor for set-off or counterclaim;
(m) INTENTIONALLY OMITTED;
(n) No Debt to Related Parties. Except as disclosed in Schedule "N"
hereto, Clickable is not, and on Closing will not be, materially
indebted to the Clickable Shareholders nor to any family member
thereof, nor to any affiliate, director or officer of Clickable or the
Clickable Shareholders except accounts payable on account of bona fide
business transactions of Clickable incurred in normal course of
Clickable Business, including employment agreements with the Clickable
Shareholders, none of which are more than 30 days in arrears;
(o) No Related Party Debt to Clickable. Neither the Clickable Shareholders
nor any director, officer or affiliate of Clickable are now indebted
to or under any financial obligation to Clickable on any account
whatsoever, except for advances on account of travel and other
expenses not exceeding $5,000 in total;
(p) No Dividends. No dividends or other distributions on any shares in the
capital of Clickable have been made, declared or authorized since the
date of the Clickable Financial Statements;
(q) No Payments. No payments of any kind have been made or authorized
since the date of the Clickable Financial Statements to or on behalf
of the Clickable Shareholders or to or on behalf of officers,
directors, shareholders or employees of Clickable or under any
management agreements with Clickable, except payments made in the
ordinary course of business and at the regular rates of salary or
other remuneration payable to them;
(r) No Pension Plans. There are no pension, profit sharing, group
insurance or similar plans or other deferred compensation plans
affecting Clickable;
(s) No Adverse Events. Since the date of the Clickable Financial
Statements:
(i) there has not been any material adverse change in the
consolidated financial position or condition of Clickable,
its liabilities or the Clickable Assets or any damage, loss
or other change in circumstances materially affecting
Clickable, the Clickable Business or the Clickable Assets or
Clickable's right to carry on the Clickable Business, other
than changes in the ordinary course of business,
(ii) there has not been any damage, destruction, loss or other
event (whether or
20
not covered by insurance) materially and adversely affecting
Clickable, the Clickable Business or the Clickable Assets,
(iii) there has not been any material increase in the compensation
payable or to become payable by Clickable to the Clickable
Shareholders or to any of Clickable's officers, employees or
agents or any bonus, payment or arrangement made to or with
any of them,
(iv) the Clickable Business has been and continues to be carried
on in the ordinary course,
(v) Clickable has not waived or surrendered any right of
material value,
(vi) Clickable has not discharged or satisfied or paid any lien
or encumbrance or obligation or liability other than current
liabilities in the ordinary course of business, and
(vii) no capital expenditures in excess of $10,000 individually or
$30,000 in total have been authorized or made;
Clickable - Income Tax Matters
(t) Tax Returns. All tax returns and reports of Clickable required by law
to be filed have been filed and are true, complete and correct, and
any taxes payable in accordance with any return filed by Clickable or
in accordance with any notice of assessment or reassessment issued by
any taxing authority have been so paid;
(u) Current Taxes. Adequate provisions have been made for taxes payable
for the current period for which tax returns are not yet required to
be filed and there are no agreements, waivers, or other arrangements
providing for an extension of time with respect to the filing of any
tax return by, or payment of, any tax, governmental charge or
deficiency by Clickable. Clickable is not aware of any contingent tax
liabilities or any grounds which would prompt a reassessment including
aggressive treatment of income and expenses in filing earlier tax
returns;
Clickable - Applicable Laws and Legal Matters
(v) Licenses. Clickable holds all licenses and permits as may be requisite
for carrying on the Clickable Business in the manner in which it has
heretofore been carried on, which licenses and permits have been
maintained and continue to be in good standing except where the
failure to obtain or maintain such licenses or permits would not have
a material adverse effect on the Clickable Business;
(w) Applicable Laws. Clickable has not been charged with or received
notice of breach of any laws, ordinances, statutes, regulations,
by-laws, orders or decrees to which it is subject or which applies to
it the violation of which would have a material adverse effect on the
Clickable Business, and, to Clickable's knowledge,
21
Clickable is not in breach of any laws, ordinances, statutes,
regulations, by-laws, orders or decrees the contravention of which
would result in a material adverse impact on the Clickable Business;
(x) Pending or Threatened Litigation. There is no material litigation or
administrative or governmental proceeding pending or threatened
against or relating to Clickable, the Clickable Business, or any of
the Clickable Assets, nor does Clickable have any knowledge of any
deliberate act or omission of Clickable that would form any material
basis for any such action or proceeding;
(y) No Bankruptcy. Clickable has not made any voluntary assignment or
proposal under applicable laws relating to insolvency and bankruptcy
and no bankruptcy petition has been filed or presented against
Clickable and no order has been made or a resolution passed for the
winding-up, dissolution or liquidation of Clickable;
(z) Labor Matters. Clickable is not a party to any collective agreement
relating to the Clickable Business with any labor union or other
association of employees and no part of the Clickable Business has
been certified as a unit appropriate for collective bargaining or, to
the knowledge of Clickable, has made any attempt in that regard and
Clickable has no reason to believe that any current employees will
leave Clickable's employ as a result of this Merger.
(aa) Finder's Fees. Except for an agreement with Danson Partners, LLC,
Clickable is not a party to any agreement which provides for the
payment of finder's fees, brokerage fees, commissions or other fees or
amounts which are or may become payable to any third party in
connection with the execution and delivery of this Agreement and the
transactions contemplated herein;
Execution and Performance of Agreement
(bb) Authorization and Enforceability. The execution and delivery of this
Agreement, and the completion of the transactions contemplated hereby,
have been duly and validly authorized by all necessary corporate
action on the part of Clickable;
(cc) No Violation or Breach. The execution and performance of this
Agreement will not
(i) violate the charter documents of Clickable or result in any
breach of, or default under, any loan agreement, mortgage,
deed of trust, or any other agreement to which Clickable is
a party,
(ii) give any person any right to terminate or cancel any
agreement including, without limitation, Clickable Material
Contracts, or any right or rights enjoyed by Clickable,
(iii) result in any alteration of Clickable's obligations under
any agreement to which Clickable is a party including,
without limitation, the Clickable Material Contracts,
22
(iv) result in the creation or imposition of any lien,
encumbrance or restriction of any nature whatsoever in favor
of a third party upon or against the Clickable Assets,
(v) result in the imposition of any tax liability to Clickable
relating to Clickable Assets or the Clickable Shares, or
(vi) violate any court order or decree to which either Clickable
is subject;
Clickable Assets - Ownership and Condition
(dd) Business Assets. The Clickable Assets comprise all of the property and
assets of the Clickable Business, and neither the Clickable
Shareholders nor any other person, firm or corporation owns any assets
used by Clickable in operating the Clickable Business;
(ee) Title. Clickable is the legal and beneficial owner of the Clickable
Assets, free and clear of all mortgages, liens, charges, pledges,
security interests, encumbrances or other claims whatsoever;
(ff) No Option. No person, firm or corporation has any agreement or option
or a right capable of becoming an agreement for the purchase of any of
the Clickable Assets;
(gg) Clickable Insurance Policies. Clickable maintains the public liability
insurance and insurance against loss or damage to the Clickable Assets
and the Clickable Business;
(hh) INTENTIONALLY OMITTED;
(ii) No Default. There has not been any default in any material obligation
of Clickable or any other party to be performed under any of Clickable
Material Contracts, each of which is in good standing and in full
force and effect and unamended, and Clickable is not aware of any
default in the obligations of any other party to any of the Clickable
Material Contracts;
(jj) No Compensation on Termination. There are no agreements, commitments
or understandings relating to severance pay or separation allowances
on termination of employment of any employee of Clickable. Clickable
is not obliged to pay benefits or share profits with any employee
after termination of employment except as required by law;
Clickable Assets - Clickable Equipment
(kk) Clickable Equipment. The Clickable Equipment has been maintained in a
manner consistent with that of a reasonably prudent owner and such
equipment is in good working condition;
23
Clickable Assets - Clickable Goodwill and Other Assets
(ll) Clickable Goodwill. Clickable carries on the Clickable Business only
under the name "Clickable Incorporated" and variations thereof and
under no other business or trade names. Clickable does not have any
knowledge of any infringement by Clickable of any patent, trademark,
copyright or trade secret;
The Business of Clickable
(mm) Maintenance of Business. Since the date of the Clickable Financial
Statements, the Clickable Business has been carried on in the ordinary
course and Clickable has not entered into any material agreement or
commitment except in the ordinary course; and
(nn) Subsidiaries. Clickable does not own any subsidiaries and does not
otherwise own, directly or indirectly, any shares or interest in any
other corporation, partnership, joint venture or firm and Clickable
does not own any subsidiary and does not otherwise own, directly or
indirectly, any shares or interest in any other corporation,
partnership, joint venture or firm.
Non-Merger and Survival
5.2 The representations and warranties of Clickable and the Clickable
Shareholders contained herein will be true at and as of Closing in all material
respects as though such representations and warranties were made as of such
time. Notwithstanding the completion of the transactions contemplated hereby,
the waiver of any condition contained herein (unless such waiver expressly
releases a party from any such representation or warranty) or any investigation
made by Achievement , the representations and warranties of Clickable and the
Clickable Shareholders shall survive the Closing.
Indemnity
5.3 Clickable and the Clickable Shareholders jointly and severally agree to
indemnify and save harmless Achievement from and against any and all claims,
demands, actions, suits, proceedings, assessments, judgments, damages, costs,
losses and expenses, including any payment made in good faith in settlement of
any claim (subject to the right of Clickable and the Clickable Shareholders to
defend any such claim), resulting from the breach by any of them of any
representation or warranty of such party made under this Agreement or from any
misrepresentation in or omission from any certificate or other instrument
furnished or to be furnished by Clickable or the Clickable Shareholders to
Achievement hereunder.
24
ARTICLE 6
COVENANTS OF CLICKABLE AND
THE CLICKABLE SHAREHOLDERS
Covenants
6.1 Clickable and the Clickable Shareholders covenant and agree with Achievement
that they will:
(a) Conduct of Business. Until the Closing, conduct the Clickable Business
diligently and in the ordinary course consistent with the manner in
which the Clickable Business generally has been operated up to the
date of execution of this Agreement;
(b) Preservation of Business. Until the Closing, use their best efforts to
preserve the Clickable Business and the Clickable Assets and, without
limitation, preserve for Achievement Clickable's relationships with
their suppliers, customers and others having business relations with
them;
(c) Access. Until the Closing, give Achievement and its representatives
full access to all of the properties, books, contracts, commitments
and records of Clickable relating to Clickable, the Clickable Business
and the Clickable Assets, and furnish to Achievement and its
representatives all such information as they may reasonably request;
(d) Procure Consents. Until the Closing, take all reasonable steps
required to obtain, prior to Closing, any and all third party consents
required to permit the Merger and to preserve and maintain the
Clickable Assets, including the Clickable Material Contracts,
notwithstanding the change in control of Clickable arising from the
Merger;
(e) Reporting and Internal Controls. From and after the Effective Time,
the Clickable Shareholders shall forthwith take all required actions
to implement internal controls on the business of the Surviving
Company to ensure that the Surviving Company and Achievement comply
with Section 13(b)(2) of the Securities and Exchange Act of 1934;
Authorization
6.2 Clickable hereby agrees to authorize and direct any and all federal, state,
municipal, foreign and international governments and regulatory authorities
having jurisdiction respecting Clickable to release any and all information in
their possession respecting Clickable to Achievement . Clickable shall promptly
execute and deliver to Achievement any and all consents to the release of
information and specific authorizations which Achievement reasonably require to
gain access to any and all such information.
25
Survival
6.3 The covenants set forth in this Article shall survive the Closing for the
benefit of Achievement .
ARTICLE 7
CONDITIONS PRECEDENT
Conditions Precedent in favor of Achievement
7.1 Achievement's obligations to carry out the transactions contemplated hereby
are subject to the fulfillment of each of the following conditions precedent on
or before the Closing:
(a) all documents or copies of documents required to be executed and
delivered to Achievement hereunder will have been so executed and
delivered;
(b) all of the terms, covenants and conditions of this Agreement to be
complied with are performed by Clickable or the Clickable Shareholders
at or prior to the Closing will have been complied with or performed;
(c) Achievement shall have completed its review and inspection of the
books and records of Clickable and shall be satisfied with same in all
material respects;
(d) title to the Clickable Shares held by the Clickable Shareholders and
to the Clickable Assets will be free and clear of all mortgages,
liens, charges, pledges, security interests, encumbrances or other
claims whatsoever, save and except as disclosed herein;
(e) the Certificate of Merger shall be executed by Clickable in form
acceptable for filing with the Delaware Secretary of State;
(f) subject to Article 8 hereof, there will not have occurred
(i) any material adverse change in the financial position or
condition of Clickable, its liabilities or the Clickable
Assets or any damage, loss or other change in circumstances
materially and adversely affecting the Clickable Business or
the Clickable Assets or Clickable's right to carry on the
Clickable Business, other than changes in the ordinary
course of business, none of which has been materially
adverse, or
(ii) any damage, destruction, loss or other event, including
changes to any laws or statutes applicable to Clickable or
the Clickable Business (whether or not covered by insurance)
materially and adversely affecting Clickable, the Clickable
Business or the Clickable Assets; and
(g) the transactions contemplated hereby shall have been approved by all
other regulatory authorities having jurisdiction over the subject
matter hereof, if any; an
26
Waiver by Achievement
7.2 The conditions precedent set out in the preceding section are inserted for
the exclusive benefit of Achievement and any such condition may be waived in
whole or in part by Achievement at or prior to Closing by delivering to
Clickable a written waiver to that effect signed by Achievement. In the event
that the conditions precedent set out in the preceding section are not satisfied
on or before the Closing, Achievement shall be released from all obligations
under this Agreement.
Conditions Precedent in Favor of Clickable and the Clickable Shareholders
7.3 The obligation of Clickable and the Clickable Shareholders to carry out the
transactions contemplated hereby is subject to the fulfillment of each of the
following conditions precedent on or before the Closing:
(a) all documents or copies of documents required to be executed and
delivered to Clickable hereunder will have been so executed and
delivered;
(b) all of the terms, covenants and conditions of this Agreement to be
complied with or performed by Achievement at or prior to the Closing
will have been complied with or performed;
(c) Clickable shall have completed its review and inspection of the books
and records of Achievement and its subsidiaries and shall be satisfied
with same in all material respects;
(d) Achievement will have delivered the Acquisition Shares to be issued
pursuant to the terms of the Merger to Clickable at the Closing and
the Acquisition Shares will be registered on the books of Achievement
in the name of the holder of Clickable Shares at the Effective Time;
(e) title to the Acquisition Shares will be free and clear of all
mortgages, liens, charges, pledges, security interests, encumbrances
or other claims whatsoever;
(f) the Certificate of Merger shall be executed by the Acquirer in form
acceptable for filing with the Delaware Secretary of State;
(g) subject to Article 8 hereof, there will not have occurred
(i) any material adverse change in the financial position or
condition of Achievement , its subsidiaries, their
liabilities or the Achievement Assets or any damage, loss or
other change in circumstances materially and adversely
affecting Achievement , the Achievement Business or the
Achievement Assets or Achievement ' right to carry on the
Achievement Business, other than changes in the ordinary
course of business, none of which has been materially
adverse, or
27
(ii) any damage, destruction, loss or other event, including
changes to any laws or statutes applicable to Achievement or
the Achievement Business (whether or not covered by
insurance) materially and adversely affecting Achievement ,
its subsidiaries, the Achievement Business or the
Achievement Assets;
(h) the transactions contemplated hereby shall have been approved by all
other regulatory authorities having jurisdiction over the subject
matter hereof, if any;
(i) the satisfaction of all liabilities of Achievement on or prior to the
Closing Date.
(j) The execution of a six month employment agreement with Xxxx or Xxxx
Xxxxxx in order to file and execute all outstanding 1934 Act reports
and certifications with the Securities and Exchange Commission.
Waiver by Clickable and the Clickable Shareholders
7.4 The conditions precedent set out in the preceding section are inserted for
the exclusive benefit of Clickable and the Clickable Shareholders and any such
condition may be waived in whole or in part by Clickable or the Clickable
Shareholders at or prior to the Closing by delivering to Achievement a written
waiver to that effect signed by Clickable and the Clickable Shareholders. In the
event that the conditions precedent set out in the preceding section are not
satisfied on or before the Closing Clickable and the Clickable Shareholders
shall be released from all obligations under this Agreement.
Nature of Conditions Precedent
7.5 The conditions precedent set forth in this Article are conditions of
completion of the transactions contemplated by this Agreement and are not
conditions precedent to the existence of a binding agreement. Each party
acknowledges receipt of the sum of $1.00 and other good and valuable
consideration as separate and distinct consideration for agreeing to the
conditions of precedent in favor of the other party or parties set forth in this
Article.
Termination
7.6 Notwithstanding any provision herein to the contrary, if the Closing does
not occur on or before June 10, 2003, this Agreement will be at an end and will
have no further force or effect, unless otherwise agreed upon by the parties in
writing.
Confidentiality
7.7 Notwithstanding any provision herein to the contrary, the parties hereto
agree that the existence and terms of this Agreement are confidential and that
if this Agreement is terminated pursuant to the preceding section the parties
agree to return to one another any and all financial, technical and business
documents delivered to the other party or parties in connection with the
28
negotiation and execution of this Agreement and shall keep the terms of this
Agreement and all information and documents received from Clickable and
Achievement and the contents thereof confidential and not utilize nor reveal or
release same, provided, however, that Achievement will be required to issue news
releases regarding the execution and consummation of this Agreement and file a
Current Report on Form 8-K with the Securities and Exchange Commission
respecting the proposed Merger contemplated hereby together with such other
documents as are required to maintain the currency of Achievement ' filings with
the Securities and Exchange Commission.
ARTICLE 8
RISK
Material Change in the Business of Clickable
8.1 If any material loss or damage to the Clickable Business occurs prior to
Closing and such loss or damage, in Achievement ' reasonable opinion, cannot be
substantially repaired or replaced within sixty (60) days, Achievement shall,
within two (2) days following any such loss or damage, by notice in writing to
Clickable, at its option, either:
(a) terminate this Agreement, in which case no party will be under any
further obligation to any other party; or
(b) elect to complete the Merger and the other transactions contemplated
hereby, in which case the proceeds and the rights to receive the
proceeds of all insurance covering such loss or damage will, as a
condition precedent to Achievement ' obligations to carry out the
transactions contemplated hereby, be vested in Clickable or otherwise
adequately secured to the satisfaction of Achievement on or before the
Closing Date.
Material Change in the Achievement Business
8.2 If any material loss or damage to the Achievement Business occurs prior to
Closing and such loss or damage, in Clickable's reasonable opinion, cannot be
substantially repaired or replaced within sixty (60) days, Clickable shall,
within two (2) days following any such loss or damage, by notice in writing to
Achievement , at its option, either:
(a) terminate this Agreement, in which case no party will be under any
further obligation to any other party; or
(b) elect to complete the Merger and the other transactions contemplated
hereby, in which case the proceeds and the rights to receive the
proceeds of all insurance covering such loss or damage will, as a
condition precedent to Clickable's obligations to carry out the
transactions contemplated hereby, be vested in Achievement or
otherwise adequately secured to the satisfaction of Clickable on or
before the Closing Date.
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ARTICLE 9
CLOSING
Closing
9.1 The Merger and the other transactions contemplated by this Agreement will be
closed at the Place of Closing in accordance with the closing procedure set out
in this Article.
Documents to be Delivered by Clickable
9.2 On or before the Closing, Clickable and the Clickable Shareholders will
deliver or cause to be delivered to Achievement :
(a) the original or certified copies of the charter documents of Clickable
and all corporate records documents and instruments of Clickable, the
corporate seal of Clickable and all books and accounts of Clickable;
(b) all reasonable consents or approvals required to be obtained by
Clickable for the purposes of completing the Merger and preserving and
maintaining the interests of Clickable under any and all Clickable
Material Contracts and in relation to Clickable Assets;
(c) resolutions of the shareholder and director of Clickable as are
required to be passed to authorize the execution, delivery and
implementation of this Agreement;
(d) an acknowledgement from Clickable and the Clickable Shareholders of
the satisfaction of the conditions precedent set forth in section 7.3
hereof;
(e) the Certificate of Merger, duly executed by Clickable; and
(f) such other documents as Achievement may reasonably require to give
effect to the terms and intention of this Agreement.
Documents to be Delivered by Achievement
9.3 On or before the Closing, Achievement shall deliver or cause to be delivered
to Clickable and the Clickable Shareholders:
(a) share certificates representing the Acquisition Shares duly registered
in the names of the holders of shares of Clickable Common Stock;
(b) resolutions of the directors of Achievement as are required to be
passed to authorize the execution, delivery and implementation of this
Agreement;
(c) resolution of the directors of Achievement dated as of the Closing
Date appointing the nominees of Clickable as officers of Clickable;
30
(d) an acknowledgement from Achievement of the satisfaction of the
conditions precedent set forth in section 7.1 hereof;
(e) the Certificate of Merger, duly executed by the Acquirer;
(f) such other documents as Clickable may reasonably require to give
effect to the terms and intention of this Agreement.
(g) a six month employment agreement with Xxxx or Xxxx Xxxxxx in order to
file and execute all outstanding 1934 Act reports and certifications
with the Securities and Exchange Commission.
ARTICLE 10
POST-CLOSING MATTERS
Forthwith after the Closing, Achievement, Achievement Shareholder, Clickable
and the Clickable Shareholders agree to use all their best efforts to:
(a) file the Certificate of Merger with Secretary of State of the State of
Delaware;
(b) issue a news release reporting the Closing;
(c) file with the Securities and Exchange Commission a report on Form 14f
disclosing the change in control of Achievement and, 10 days after
such filing;
(d) file a Form 8-K with the Securities and Exchange Commission disclosing
the terms of this Agreement and, not more than 60 days following the
filing of such Form 8-K, to file and amended Form 8-K which includes
audited financial statements of Clickable as well as pro forma
financial information of Clickable and Achievement as required by
Regulation SB as promulgated by the Securities and Exchange
Commission;
(e) take such steps that are required to (i) file a Form 8K regarding a
change in accountants; (ii) prepare and file a Form 10QSB for the
period ending September 30, 2002 containing the certifications
required under the Xxxxxxxx-Xxxxx Act of 2002 executed by the
Achievement Shareholders; (iii) prepare and file a Form 10KSB for the
fiscal year ending December 31, 2002 containing the certifications
required under the Xxxxxxxx-Xxxxx Act of 2002 executed by the
Achievement Shareholders; and (iv) prepare and file a Form 10QSB for
the period ending March 31, 2003 containing the certifications
required under the Xxxxxxxx-Xxxxx Act of 2002 executed by the
Achievement Shareholders.
(e) file reports on Forms 13D and 3 with the Securities and Exchange
Commission disclosing the acquisition of the Acquisition Shares by the
Clickable Shareholders.
31
ARTICLE 11
GENERAL PROVISIONS
Arbitration
11.1 The parties hereto shall attempt to resolve any dispute, controversy,
difference or claim arising out of or relating to this Agreement by negotiation
in good faith. If such good negotiation fails to resolve such dispute,
controversy, difference or claim within fifteen (15) days after any party
delivers to any other party a notice of its intent to submit such matter to
arbitration, then any party to such dispute, controversy, difference or claim
may submit such matter to arbitration in the City of New York, New York.
Notice
11.2 Any notice required or permitted to be given by any party will be deemed to
be given when in writing and delivered to the address for notice of the intended
recipient by personal delivery, prepaid single certified or registered mail, or
telecopier. Any notice delivered by mail shall be deemed to have been received
on the fourth business day after and excluding the date of mailing, except in
the event of a disruption in regular postal service in which event such notice
shall be deemed to be delivered on the actual date of receipt. Any notice
delivered personally or by telecopier shall be deemed to have been received on
the actual date of delivery.
Addresses for Service
11.3 The address for service of notice of each of the parties hereto is as
follows:
(a) Achievement or the Acquirer:
Achievement Tec Holdings, Inc.
Attn: Xxxxxx X. Xxxxxx
Phone: 000-000-0000
(b) Clickable or the Clickable Shareholders
Xxxxxxxxxxxx.xxx, Inc.
Attn: Xxxx Xxxxxxx
Phone: 000-000-0000
Change of Address
11.4 Any party may, by notice to the other parties change its address for notice
to some other address in North America and will so change its address for notice
whenever the existing address or notice ceases to be adequate for delivery by
hand. A post office box may not be used as an address for service.
Further Assurances
11.5 Each of the parties will execute and deliver such further and other
documents and do
32
and perform such further and other acts as any other party may reasonably
require to carry out and give effect to the terms and intention of this
Agreement.
Time of the Essence
11.6 Time is expressly declared to be the essence of this Agreement.
Entire Agreement
11.7 The provisions contained herein constitute the entire agreement among
Clickable, the Clickable Shareholders, the Acquirer and Achievement respecting
the subject matter hereof and supersede all previous communications,
representations and agreements, whether verbal or written, among Clickable, the
Clickable Shareholders, the Acquirer and Achievement with respect to the subject
matter hereof.
Enurement
11.8 This Agreement will enure to the benefit of and be binding upon the parties
hereto and their respective heirs, executors, administrators, successors and
permitted assigns.
Assignment
11.9 This Agreement is not assignable without the prior written consent of the
parties hereto.
Counterparts
11.10 This Agreement may be executed in counterparts, each of which when
executed by any party will be deemed to be an 11.11 original and all of which
counterparts will together constitute one and the same Agreement. Delivery of
executed copies of this Agreement by telecopier will constitute proper delivery,
provided that originally executed counterparts are delivered to the parties
within a reasonable time thereafter.
Applicable Law
11.11 This Agreement is subject to the laws of the State of New York.
[Remainder of page intentionally left blank.]
33
IN WITNESS WHEREOF the parties have executed this Agreement effective as of the
day and year first above written.
ACHIEVEMENT TEC HOLDINGS, INC.
By_____________________________________
CLICKABLEOIL ACQUISITION CORP.
By_____________________________________
CLICKABLE XXX.XXX, INC.
By_____________________________________
CLICKABLE SHAREHOLDERS:
_______________________________________
Xxxxxxx X. Xxxxxx
THE XXXXX GROUP
BY_______________________________________
DGN HOLDING LLC
BY_______________________________________
34
For purposes of Indemnity pursuant to Section 3.4
ACHIEVEMENT TEC, INC.
BY____________________________
Name:
Title:
______________
35
SCHEDULE A
Xxx Xxxx and Xxxxx Xxxx vs. Career Direction, Inc. and Achievement Tec, Inc.,
Cause No. 0000-00000-000 in the District Court of Xxxxxx County, Texas, 395th
Judicial District, filed in November, 2001, is a suit pending for declaratory
judgment that, if entered, would permit Xxx Xxxx and Xxxxx Xxxx, former
employees and officers of Career Direction, Inc., to compete in the career fair
business that was their former profession. They are presently contractually
bound by a covenant not to compete and confidentiality agreement to not enter a
competing business with Career Direction, Inc. It is anticipated that they make
a claim against Career Direction, Inc. for money damages, but this amount is
unknown at the present time. Career Direction, Inc. and Achievement Tec, Inc.
intend to file counterclaims against the Loyds that will be filed in the pending
suit.
36
SCHEDULE B
Liabilities
Merdinger, Fruchter, Xxxxx & Xxxxx $ 39,195.00
Xxxxxxxxx Xxxxxxx 8,981.26
Xxxxxxx Communications 9,695.30
Xxxxxxx Xxxxxx 1,576.00
Interstate Transfer Company 329.00
Corporation Service Company 224.00
10% Convertible Debentures
------------------------------------------------------ ------------------------- -----------------------
Date of Debenture Original Principal
Amount
Investor
------------------------------------------------------ ------------------------- -----------------------
AJW Partners, LLC June 29, 2001 $398,829.30
------------------------------------------------------ ------------------------- -----------------------
New Millennium Capital Partners II, LLC June 29, 2001 $794,119.79
------------------------------------------------------ ------------------------- -----------------------
AJW Partners, LLC August 13, 2001 $125,000
----------------------------------------------------- ------------------------- -----------------------
New Millennium Capital Partners II, LLC August 13, 2001 $125,000
------------------------------------------------------ ------------------------- -----------------------
AJW Partners, LLC May 8, 2002 $ 37,500
------------------------------------------------------ ------------------------- -----------------------
New Millennium Capital Partners II, LLC May 8, 2002 $ 37,500
------------------------------------------------------ ------------------------- -----------------------
AJW Offshore, Ltd. May 8, 2002 $112,500
------------------------------------------------------ ------------------------- -----------------------
AJW Qualified Partners, LLC May 8, 2002 $112,500
------------------------------------------------------ ------------------------- -----------------------
37
SCHEDULE D
Bank Accounts
None
38
SCHEDULE E
Debt to insiders and affiliates
None
39
SCHEDULE G
Public Liability Insurance
None
40
SCHEDULE I
Material Contracts
Agreements related to Debenture transactions dated June 29, 2001 and May 8, 2002
Agreement by and between the company and Xxx and Xxxxx Xxxx dated July 19, 2001
41
