U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 31, 1999
eConnect
(Exact name of registrant as specified in its charter)
Nevada
(State or jurisdiction of incorporation
or organization)
33-68570
(Commission File Number
43-1239043
(I.R.S. Employer Identification Number
2500 Via Cabrillo Marina, Suite 112, San Pedro, California 90731
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (310) 514-9482
(Former name or former address, if changed since last report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
The Registrant has acquired a significant amount of assets,
other than in the ordinary course of business, as follows:
(a) Stock Exchange Agreement.
La Empresa Ranco Plasticos Limitada, a Costa Rica corporation
("Holder"), was the owner of record of 58.33% of the issued and
outstanding stock of Isla Escondida, S.A., a Costa Rica
Corporation ("IE") ("Stock"). Nevertheless, pursuant to an
agreement between Holder, Jamie Ligator and Michael Lanes, one-
half (1/2) of the Stock is actually being held in the name of
Holder for the benefit of Lanes and the other one-half (1/2) of
the Stock is actually being held in the name of Holder for the
benefit of Ligator. Effective on August 31, 1999, the
Registrant purchased the Stock under a Stock Exchange Agreement.
Under this agreement the Registrant agreed to the pay the
following for the Stock: Seven Million 7,000,000 shares of free
trading common stock of the Registrant, to be deposited into an
escrow account with Bank One, N.A. or such other independent
third party FDIC insured institution as mutually agreed to by
the parties in writing. The Stock is to be held in the escrow
account until released as set forth under the provisions of the
Stock Exchange Agreement.
Subsequently, the Registrant acquired the remaining 41.67% of
the stock of IE directly from the shareholders of that company
in a straight stock swap. This entire acquisition was made in
connection with the transfer of ownership of the 777WINS.com
gaming website to the Registrant.
(b) Acquisition Agreement.
Effective on September 7, 1999, the Registrant acquired the
website known as "artauction.com" from PowerClick, a Nevada
corporation, through an Acquisition Agreement. Under this
agreement, Registrant paid the following: (a) 1,000,000 shares
of free trading common stock of the Registrant; (b) 1,000,000
shares of restricted common stock of the Registrant; and (c) all
of the issued and outstanding common stock of eBet.com, Inc., a
Nevada corporation, which is owned by the Registrant.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the Registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
eConnect
Dated: November 12, 1999 By: /s/ Thomas S. Hughes
Thomas S. Hughes, President
EXHIBIT INDEX
Exhibit No. Description
2.1 Stock Exchange Agreement between the Company, La
Empresa Ranco Plasticos Limitada, Michael Lanes,
and Jamie Ligator, dated August 31, 1999 (see
below).
2.2 Acquisition Agreement between the Company and
PowerClick, dated September 7, 1999 (see below).
STOCK EXCHANGE AGREEMENT
THIS STOCK EXCHANGE AGREEMENT (the "Agreement") is made and
entered into this 31st day of August, 1999 by and between La
Empresa Ranco Plasticos Limitada, a Costa Rica corporation (the
"Holder"), Michael Lanes ("Lanes"), Jamie Ligator ("Ligator"),
and eConnect, a Nevada corporation (the "Purchaser").
RECITALS:
A. Holder is the owner of record of 58.33% of the issued and
outstanding stock of Isla Escondida, S.A., a Costa Rica
Corporation ("EE") (the "Stock"). Nevertheless, pursuant to an
agreement between Holder, Ligator and Lanes, one-half (1/2) of
the Stock is actually being held in the name of Holder for the
benefit of Lanes and the other one-half (1/2) of the Stock is
actually being held in the name of Holder for the benefit of
Ligator.
B. Purchaser desires to purchase and Holder, Lanes and Ligator
are willing to sell all of their right, title and interest in
the Stock in exchange for the "Purchaser Stock" defined below,
pursuant to and subject to the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, in consideration of the promises and mutual
undertakings set forth herein, and for other good and valuable
consideration, the sufficiency of which is hereby acknowledged,
the parties hereby agree as follows:
ARTICLE I
Purchase and Sale of Stock
1.1 Purchase and Sale. Subject to the terms and conditions of
this Agreement, Purchaser shall purchase from Holder, Lanes and
Ligator; and Holder, Lanes and Ligator shall sell to Purchaser
all of their right, title and interest in the Stock.
1.2 Closing. Subject to the terms and conditions of this
Agreement, the purchase and sale shall take place upon execution
of this Agreement by all parties listed above ("Closing").
ARTICLE II
Purchase Price
2.1 Purchase Price. The purchase price for the Stock shall be
in the form of the Purchaser Stock as set forth below (the
"Purchase Price"). Purchaser acknowledges that certain shares
of the Purchaser Stock are to be issued to Empresas Horizontas
Lejanos., S.A., a Costa Rica corporation for the benefit of Gary
Hayes and Richard Adams in exchange for their execution of that
certain Indemnification and Release Agreement on or about even
date herewith.
2.2 Payment of Purchase Price. Payment of the Purchase Price
will be made as follows:
2.2.1. At Closing, Purchaser shall deposit into an escrow
account with Bank One, N.A. or such other independent third
party FDIC insured institution as mutually agreed to by the
parties in writing (the "Escrow Agent"), Seven Million
(7,000,000) shares of common stock of Purchaser to be held
pursuant to the terms of this Section 2.2 (collectively the
"Purchaser Stock"), which Purchaser Stock shall be issued in the
names as set forth on the "Exhibit A" which is attached hereto
and incorporated herein by this reference.
2.2.2 One Million Eight Hundred Seventy Five Thousand
(1,875,000) shares of Purchaser Stock (the "Registered Purchaser
Stock") will be, at Closing, registered with the U.S. Securities
and Exchange Commission ("SEC") pursuant to Section 5 of the
Securities Act of 1933 (the "Act") and registered to trade on
the NASDAQ OTC (Bulletin Board) stock exchange (the "Exchange")
without any trading or resale restrictions and therefore, the
certificates for such shares will contain no restrictive
legends. The Escrow Agent shall deliver the Registered
Purchaser Stock to the respective parties on Exhibit A at
Closing without restriction of any kind. The balance of the
Purchaser Stock, when delivered to Escrow Agent at Closing, will
not be registered with the SEC pursuant to the Act nor
registered to trade on the Exchange but rather will be issued
pursuant to exemptions from such registration requirements and
therefore, the certificates evidencing such shares will contain
a restrictive legend that such shares must be re-sold in
compliance with Rule 144 of the Act (the "Escrowed Shares").
The certificates evidencing both the Escrowed Shares and the
Stock (as well as the Assignments) will be held by the Escrow
Agent pursuant to this Section 2.2 and a separate Escrow
Agreement between the parties hereto and the Escrow Agent in the
form attached hereto as Exhibit "B" (the "Escrow Agreement").
2.2.3 Purchaser represents and warrants that Purchaser has
filed with the SEC a SB-2 registration statement requesting the
registration under the Act and the Exchange of certain
additional shares of stock of Purchaser, including without
limitation the Escrowed Shares (the "Registration Statement").
Within two (2) business days of the approval by the SEC of the
Registration Statement, Purchaser shall deposit with Escrow
Agent, new certificates evidencing the Escrowed Shares as
registered under the Act and on the Exchange without any trading
or resale restrictions and therefore, the certificates for such
shares will contain no restrictive legends (such shares shall
hereinafter be referred to as the "Registered Escrowed Shares").
Upon the occurrence of the condition set forth in the prior
sentence, the Escrow Agent shall release (a) to Purchaser the
certificates evidencing the Stock (the "Stock Certificates") and
the assignments separate from certificate transfer-ring the
Stock to Purchaser (the "Assignments"), and (b) the certificates
evidencing the Registered Escrowed Shares as follows:
2.2.3.1 One Hundred Twenty Five Thousand (125,000) shares of
the Registered Escrow Shares shall be immediately released to
those persons referenced on "Exhibit A".
2.2.3.2 In the event that the per share closing price of
eConnect stock on the Exchange, as reported in the Wall Street
Journal, does not equal or exceed $.75 per share for any period
consisting of ten (10) consecutive trading days at any time
during the period commencing the Closing and ending September
30, 1999, the Escrow Agent shall release Two Million (2,000,000)
of the Registered Escrowed Shares to those persons referenced on
"Exhibit A". If by September 30, 1999 the per share closing
price of eConnect stock for any consecutive ten day period does
exceed $.75 per share, then on September 30, 1999 the Escrow
Agent shall release such certificates to Purchaser, who shall
cancel them.
2.2.3.3 In the event that the per share closing price of
eConnect stock on the Exchange, as reported in the Wall Street
Journal, does not equal or exceed $ 1.00 per share for any
period consisting of ten (10) consecutive trading days at any
time during the period commencing the Closing and ending
December 31, 1999, the Escrow Agent shall release an additional
Three Million (3,000,000) of the Registered Escrowed Shares to
those persons referenced on "Exhibit A" (such shares not
inclusive of the Registered Escrow Shares described in Section
2.2.3.2 above). If by December 31, 1999 the per share closing
price of eConnect stock for any consecutive ten day period does
not exceed $1.00 per share, then on December 31, 1999 the Escrow
Agent shall release such certificates to Purchaser, who shall
cancel them.
2.2.3.4 In the event that Purchaser declares a stock split
during the period commencing the Closing and ending December 31,
1999, upon the occurrence of either events set forth in Section
2.2.3.2 or 2.2.3.3 entitling the persons described on Exhibit A
to distributions of the Registered Escrow Shares, each of the
persons referenced on Exhibit A shall be entitled to receive (in
addition to the shares of stock to set forth above) such
additional shares of stock that each person would have receive
pursuant to the stock split if they were a shareholder at the
time of the stock split. In the event of any such stock split
(or a reverse stock split) the respective $.75 per share and $
1.00 per share benchmarks shall be adjusted accordingly such
that if there was a 2 for I stock split, the references to $.75
per share and $1.00 per share would be $.37 and $.50 per share
respectively.
2.2.4 However, if (a) the Escrowed Shares are not registered
under the Act and on the Exchange without any restrictions
within thirty (30) days from Closing and/or (b) new certificates
have not been deposited with Escrow Agent within two (2)
business days of the approval by the SEC of the Registration
Statement, Holder, Lanes and Ligator may elect, in their sole
discretion to notify the Escrow Agent to release (a) the Stock
Certificates and the Assignments to Holder, Lanes and Ligator,
who shall destroy the Assignments, whereupon Purchaser shall
have no rights therein and (b) the certificates evidencing the
Registered Escrowed Shares to Purchaser, who shall cancel them.
Alternatively, if Holder, Lanes and Ligator do not make the
election in the prior sentence, they can elect to notify the
Holder to release the One Hundred Twenty Five Thousand (125,000)
shares of the Registered Escrow Shares to them and have the
right to receive the other Registered Escrowed shares as set
forth above subject to the restrictive legend. However, in
either event, the parties set forth on Exhibit A shall be
entitled to retain the Registered Purchaser Stock.
ARTICLE III
Representations and Warranties of Holder, Lanes and Ligator
Acknowledging that Purchaser is materially relying on each of
the following representations, warranties and covenants, Holder,
Lanes and Ligator hereby represent and warrant as follows. For
purpose of this Article III, if any representation or warranty
is qualified by someone's "knowledge", the term knowledge shall
mean the actual knowledge of such person without further
inquiry.
3.1 Formation of IE. To the best of their knowledge, IE is a
corporation duly organized and validly existing under the laws
of Costa Rica.
3.2 Power and Authorization of Holder and MA. The sale of
Stock contemplated by this Agreement is not in violation of any
provision of EE's articles or bylaws, or any agreement or
instrument to which Holder, Lanes or Ligator is a party or to
which the Stock is subject, will not result in any such
violation or be in conflict with or constitute a default under
any such provision or agreement, and will not accelerate the
performance provided by the terms of any agreement or instrument
to which Holder, Lanes or Ligator is a party, or constitute a
default thereunder, or an event which, with the lapse of time or
action by a third party, could result in a default thereof, or
result in the creation of any lien, charge or encumbrance upon
the Stock. Such sale of Stock will not violate any provision of
any judgment, writ, decree, order, statute, rule or governmental
regulation applicable to Holder, Lanes or Ligator.
3.3 Title. Lanes and Ligator are the owners of the Stock,
which constitutes 58.33% of the total issued and outstanding
shares of IE. The Stock transferred pursuant to the terms of
this Agreement is free and clear of all restrictions, liens,
encumbrances and security interests and is validly issued.
Other than by this Agreement, there are no outstanding options,
warrants, preemption rights, rights of first refusal or other
rights to subscribe for or purchase or contracts, agreements or
other arrangements with respect to the Stock or any other
investment exercisable or convertible into the Stock.
3.4 Indemnification. Holder, Lanes and Ligator, and their
respective successors and assigns agree to indemnify and hold
Purchaser harmless from and against any and all claims, losses,
liabilities or obligations, including reasonable attorneys'
fees, for any claim arising out of or resulting from any breach
of warranty or a misrepresentation by Holder or the
nonperformance of any covenant hereunder. Should any claims
occur for any period prior to Closing, the Purchaser shall
advise Holder, Lanes and Ligator within ten (10) days of
becoming aware of any asserted claim and Holder, Lanes and
Ligator will pay for all costs incurred, including but not
limited to, audit accounting, legal, penalties and interests.
If Holder is not advised by Purchaser within the ten (10) day
period, Holder, Lanes and Ligator shall have no liability for
the payment of any costs incurred in defending any asserted
claim or cause of action which is the subject of this Section
3.4.
ARTICLE IV
Representations and Warranties of Purchaser
Acknowledging that Holder, Lanes and Ligator are materially
relying on each of the following representations, warranties and
covenants, Purchaser hereby represents and warrants as follows:
4.1 Formation of Purchaser. Purchaser is a corporation duly
organized and validly existing under the laws of Nevada.
4.2 Capital Stock of Purchaser. The authorized capital stock
of Purchaser consists solely of (a) 200,000,000 shares of common
stock, par value $.001 per share, of which 60,523,775 shares
were issued and outstanding as of August 13, 1999 and (b) no
shares of preferred stock. Such common and preferred stock of
constitute all of the issued and outstanding shares of stock of
Purchaser. All of such stock of Purchaser have been duly
authorized and validly issued and were offered, issued, sold and
delivered by Purchaser in compliance with all applicable state
and federal laws concerning the issuance of securities. None of
the shareholders of Purchaser have any preemptive or similar
rights with respect to the shares of Purchaser.
4.3 Power and Authorization. Purchaser has the power to enter
into this Agreement. This Agreement has been duly authorized by
and validly executed on behalf of Purchaser and when delivered
will constitute the valid and binding obligation of Purchaser.
The sale and issuance of the Purchaser Stock contemplated by
this Agreement is not in violation of any provision of
Purchaser's articles or bylaws, or any agreement or instrument
to which Purchaser is a party or to which the Purchaser Stock is
subject, will not result in any such violation or be in conflict
with or constitute a default under any such provision or
agreement, and will not accelerate the performance provided by
the terms of any agreement or instrument to which Purchaser is a
party, or constitute a default thereunder, or an event which,
with the lapse of time or action by a third party, could result
in a default thereof, or result in the creation of any lien,
charge or encumbrance upon the Purchaser Stock. Such sale of
Purchaser Stock will not violate any provision of any judgment,
writ, decree, order, statute, rule or governmental regulation
applicable to Purchaser.
4.4 Business of Purchaser. Purchaser has the corporate power
to own property and to carry on its business as now being
conducted. Purchaser is duly qualified to do business and is in
good standing in each jurisdiction in which the nature of its
business or the ownership or leasing of its properties makes
such qualification necessary. Purchaser holds all licenses,
permits and other governmental authorizations required in
connection with the conduct of Purchaser's business and
Purchaser has conducted and is conducting its business in
compliance with the requirements, standards, criteria and
conditions of any such licenses, pen-nits and other governmental
authorizations.
4.5 No Violations. Purchaser has complied with and is in
compliance with all foreign, federal, state, local, city, county
or other (civil and criminal) laws or order with respect to its
operations.
4.6 Litigation. There are no suits, actions, proceedings and
investigations or claims of any nature pending or threatened
against or affecting Purchaser or which may result, either
individually or in the aggregate, in any change in the assets,
conditions, affairs and prospects of the Purchaser's business.
Purchaser is not in violation of any order of any court or
foreign, federal, state, local, city, county or other
governmental department, commission, board, bureau, agency or
instrumentality having jurisdiction over them.
4.7 Approvals. No order, authorization, approval or consent
from or filing with any federal or state governmental body or
other authority having jurisdiction over Purchaser is required
for the execution, delivery and performance of this Agreement by
Purchaser or is necessary in order to ensure the legality,
validity, binding effect or enforceability of this Agreement.
The purchase of Stock contemplated by this Agreement is not in
violation of any provision of Purchaser's articles or bylaws or
any agreement or instrument to which Purchaser is a party or to
which it is subject, will not result in any such violation or be
in conflict with or constitute a default under any such
provision or agreement, and will not accelerate the performance
provided by the terms of any agreement or instrument to which
Purchaser is a party, or constitute a default thereunder, or an
event which, with the lapse of time or action by a third party,
could result in a default thereof Such purchase of Stock will
not violate any provision of any judgment, writ, decree, order,
statute, rule or governmental regulation applicable to
Purchaser.
4.8 Title. The Purchaser Stock transferred pursuant to the
terms of this Agreement is free and clear of all restrictions,
liens, encumbrances and security interests and is validly issued
and authorized.
4.9 Securities Regulations Relating to the Stock of Purchaser.
The Registered Purchaser Stock and the Registered Escrow Shares
will be, when issued, registered with the SEC pursuant to
Section 5 of the Act and will be, when issued, registered to
trade on the Exchange. Moreover, the Purchaser Stock will be
issued in compliance with the Act, the 34 Act, the Exchange
rules and any other applicable state, federal or foreign
securities laws. Purchaser has made all necessary filings with
the SEC, the Act and the Securities and Exchange Act of 1934
(the "34 Act") and no such filings, including without limitation
the Registration Statement, contain any material
misrepresentations of fact or omitted any material information.
Purchaser agrees to make all necessary filings with the SEC, the
Act and the 34 Act necessary with respect to the issuance of the
Purchaser Stock. In addition, neither the Registered Purchaser
Stock nor the Registered Escrow Shares contain any restrictive
legends nor is it otherwise subject to any restrictions relating
to its resale. Other than by this Agreement, Purchaser is not a
party to or bound by any contact, agreement or arrangement to
issue or sell any the Purchaser Stock and there are no
outstanding options, warrants, preemption rights, rights of
first refusal or other rights to subscribe for or purchase or
contracts, agreements or other arrangements with respect to the
Purchaser or other investment exercisable or convertible into
the Purchaser Stock.
4.10 Disclosure. Purchaser has provided Holder, Lanes and
Ligator with all material information relating to this Agreement
relating to Purchaser and Purchaser Stock. None of the
information so provided nor any representation or warranty of
Purchaser contained in this Agreement contains any untrue
statement or omits to state a material fact necessary in order
to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading.
4.11 Securities Regulations Relating to the Stock. Purchaser
understand that the Stock is not registered under the Act, the
34 Act or any state or other countries securities regulations,
to the extent applicable to this Agreement, and that the
purchase and sale of the Stock pursuant to this Agreement is
being made pursuant to exemptions from such registration
requirements, and Purchaser warrants that the Stock being
purchased hereby is for investment and not with a view to resale
of the Stock.
4.12 Indemnification. Purchaser, its officers and directors,
and their successors and assigns agree to indemnify and hold
Holder, Lanes and Ligator harmless from and against any and all
claims, losses, liabilities or obligations, including reasonable
attorneys' fees, for any claim arising out of or resulting from
any breach of warranty or a misrepresentation by Purchaser or
the nonperformance of any covenant hereunder which relates to
any matter hereunder.
ARTICLE V
Closing Documents
5.1 Holder, Lanes and Ligator's Obligations. At Closing,
Holder, Lanes and Ligator shall execute, if applicable, and
deliver to the Escrow Agent the following:
5.1.1 Documentation evidencing the Stock as originally issued
to Holder (the "Stock Certificates");
5.1.2 Documentation evidencing the transfer of the Stock to
Purchaser (the "Assignments"); and
5.1.3 The Escrow Agreement.
5.2 Purchaser's Obligations. At Closing, Purchaser shall
execute and deliver (or cause to be executed and delivered) to
MA (or the Escrow Agent, as applicable) the following:
5.2.1 Stock certificates evidencing the Purchaser Stock, issued
as set forth on
Exhibit A to the Escrow Agent;
5.2.2 The Escrow Agreement; and
5.2.3 A copy of the Registration Statement to Holder, Lanes and
Ligator.
ARTICLE VI
Miscellaneous Provisions
6.1 Tax-Free Exchange. The parties are entering into this
Agreement with the intention that the transaction contemplated
herein is intended to be a tax-free reorganization, within the
meaning of Section 2205 of the United States Internal Revenue
Code, for federal tax purposes, except to the extent of any
"boot" received and neither party will take any actions that
disqualify the transaction for such treatment.
6.2 Entire Agreement/Prior Agreements. This Agreement and the
other documents delivered pursuant hereto and specifically
referenced herein constitute the entire contract between the
parties hereto with respect to this transaction, and no party
shall be liable or bound to the other in any manner by any
warranties, representations or covenants except as specifically
set forth herein and therein. This Agreement supersedes all
prior agreements and understanding between the parties hereto
with respect to its subject matter. Any revision or
modification of this Agreement shall be effective only if in
writing and signed by the parties.
6.3 Waiver. Failure to enforce any provision of this Agreement
by a party shall not bar subsequent enforcement of such
provision or any other provision of this Agreement by such
party.
6.4 Governing Law. This Agreement and all other agreements
contemplated hereunder shall be governed by and construed under
the laws of the State of Arizona. The parties agree that
service of process may be made upon them by certified or
registered mail as provided in Section 6.6 below.
6.5 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same
instrument.
6.6 Notices. All notices provided for by this Agreement shall
be made in writing and shall be deemed received by the intended
recipient: (i) on the business day that such notice is sent by
telecopy or facsimile to the intended recipient provided that
such notice is also sent by United States Mail, by certified
mail, return receipt requested and postage paid thereon; (ii)
the third business day after the date placed in United States
Mail, certified mail, return receipt requested and postage paid
thereon; and (iii) the first business day after notice is sent
by express mail or other overnight mail service. All notices
shall be delivered to the address indicated below, unless the
party giving any such notice has been notified, in writing, of a
change of such address:
To Holder and Ligator: P.O. Box 025216
Dept 729
Miami, Florida 33102-5216
To Lanes: 6720 East Stallion Road
Paradise Valley, Arizona 89253
With a copy to: Gary R. Zwillinger, Esq.
Morrison & Hecker, L.L.P.
2800 North Central Avenue
Suite 1600
Phoenix, Arizona 85004-1047
To Purchaser: eConnect
2500 Via Cabrillo Marina
Suite 112
San Pedro, California 90731
Attn.: Thomas Hughes
With a copy to: Brian Faulkner, Esq.
Law Offices of Shawn F. Hackman
3360 West Sahara, Suite 200
Las Vegas, Nevada 89102
6.7 Headings. The headings in this Agreement are for
convenience only, are not part of the agreement of the parties
and shall not be deemed parts hereof or in any way affect the
meaning or interpretation of this Agreement.
6.8 Survival of Warranties. Unless otherwise expressly
provided, all indemnifications, covenants, warranties and
representations of Purchaser, Holder, Lanes and Ligator
contained herein or made pursuant to this Agreement shall
survive the delivery of this Agreement and Closing hereunder.
No investigation by the parties hereto in connection with this
Agreement or otherwise shall affect the representations and
warranties of the parties contained herein or in any certificate
or other document delivered in connection herewith and each such
representations and warranty shall survive such investigation.
6.9 Successors and Assigns. Holder's, Lanes' and Ligator's
rights and obligations hereunder shall not be assignable. The
terms and conditions of this Agreement shall inure to the
benefit of and be binding upon each party, its successors and
representatives.
6.10 Attorneys' Fees and Costs. If any party determines that
it is necessary to seek enforcement of any of the terms and
provisions hereunder by a court of law, the prevailing party, in
addition to any relief granted by the court of law, shall be
entitled to recover all costs and expenses thereof including
reasonable attorneys' fees and costs.
6.11 Expenses. Except as provided herein, each of the parties
shall be solely responsible for all of their own costs and
expenses, including but not limited to broker's agents or other
commission relating to the transactions contemplated herein as
well as accounting and legal expenses, incurred in connection
with this Agreement and the transactions contemplated herein.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement to be effective on the day and year first written
above.
PURCHASER:
eConnect
By: /s/ Thomas S. Hughes
Thomas S, Hughes, President
HOLDER:
La Empresa Ranco Plasticos Limitada
By: /s/ Jamie Ligator
Jamie Ligator, President
LANES:
/s/ Michael Lanes
Michael Lanes
LIGATOR:
/s/ Jamie Ligator
Jamie Ligator
ACQUISITION AGREEMENT
This Acquisition Agreement ("Agreement") by and between eConnect
a Nevada corporation ("Company"), and PowerClick, a Nevada
corporation ("PowerClick"), is made this 7th day of September,
1999.
WHEREAS, PowerClick if the owner of certain website known as
"artauction.com" ("Website"); and
WHEREAS, the Company desires to acquire all right, title, and
interest in the Website from PowerClick on the terms and
conditions set forth in this agreement.
NOW, THEREFORE, in consideration of the promises and mutual
agreements, provisions and covenants herein contained, the
undersigned parties agree as follows:
1. Purchase of Website.
The Company shall purchase the Website from PowerClick on the
following payment terms and conditions: (a) one million
(1,000,000) restricted shares of the Company; and (b) one
million (1,000,000) free trading shares of the Company; and (c)
all of the issued and outstanding shares of eBet.com, Inc., a
Nevada corporation, which are owned by the Company.
2. Representations and Warranties of PowerClick.
PowerClick covenants, represents and warrants to the Company
that:
(a) Ownership of Website. PowerClick owns all right, title,
and interest in the Website, and owns and holds all necessary
trademarks, service marks, trade names, copyrights, patents,
domain names and proprietary information, and other rights
necessary to do its business as now conducted or proposed to be
conducted.
(b) Information. It is understood by the parties that neither
PowerClick nor any of his agents, servants or employees are
making any representation with respect to any activity of any
other firm, person, or corporation. PowerClick does however
represent and warrant that the information furnished by
PowerClick, its agents, servants or employees for and on behalf
of the Company by is true, correct and accurate.
(c) Compliance with Laws. PowerClick has complied with, and is
not in violation of any applicable Federal, State, or local
statutes, laws, and regulations affecting its properties or the
operation of its business.
(d) Litigation. PowerClick is not involved as a defendant or
plaintiff in any suit, action, arbitration, or legal,
administrative or other proceeding, which to the best knowledge
of PowerClick would affect PowerClick or its business, assets,
or financial condition in a negative manner; or, governmental
investigation which is pending; or, to the best of the knowledge
of PowerClick, threatened against or affecting PowerClick or its
business assets or financial condition. PowerClick is not in
default with respect to any order, writ, injunction or decree of
any Federal, State, local/foreign court, department, agency, or
instrumentality applicable to it.
(e) Authority. PowerClick has full power and authority to
execute, deliver, and perform this agreement, and this agreement
is a legal, valid, and binding obligation of PowerClick, and is
enforceable in accordance with its terms and conditions.
(f) Ability to Carry Out Obligations. The execution and
delivery of this agreement by PowerClick and the performance by
PowerClick of its obligations hereunder in the time and manner
contemplated will not cause, constitute, or conflict with, or
result in any of the following: (a) a breach or violation of any
provisions of or constitute a default under any license,
indenture, mortgage instrument, article of incorporation, bylaw,
other agreement or instrument to which PowerClick is a party, or
by which it may be bound, nor will any consents or
authorizations of any party other than those required, (b) any
event that would permit any party to any agreement or instrument
to terminate it or to accelerate the maturity of any
indebtedness or other obligation of PowerClick, or, (c) an event
that would result in the creation or imposition of any lien,
charge, encumbrance on the asset of PowerClick.
(g) Full Disclosure. None of the representations and
warranties made by PowerClick herein, or any exhibit,
certificate or memorandum furnished or to be furnished by
PowerClick on behalf of PowerClick, contains or will contain any
untrue statement of material fact, or omit any material fact,
the omission of which would be misleading.
3. Representations and Warranties of The Company.
The Company covenants, represents and warrants to PowerClick
that:
(a) Information. It is understood by the parties that neither
the Company nor any of its agents, servants or employees are
making any representation with respect to any activity of any
other firm, person, or corporation. The Company does however
represent and warrant that the information furnished by the
Company, its agents, servants or employees for and on behalf of
the Company is true, correct and accurate.
(b) Compliance with Laws. The Company has complied with, and
is not in violation of any applicable federal, state, or local
statutes, laws, and regulations affecting its properties or the
operation of its business.
(c) Litigation. The Company is not involved as a defendant or
plaintiff in any suit, action, arbitration, or legal,
administrative or other proceeding, which to the best knowledge
of the Company would affect the Company or its business, assets,
or financial condition in a negative manner; or, governmental
investigation which is pending; or, to the best of the knowledge
of the Company, threatened against or affecting the Company or
its business assets or financial condition. The Company is not
in default with respect to any order, writ, injunction or decree
of any federal, state, local/foreign court, department, agency,
or instrumentality applicable to it.
(d) Authority. The Company has full power and authority to
execute, deliver, and perform this agreement, and this agreement
is a legal, valid, and binding obligation of the Company, and is
enforceable in accordance with its terms and conditions.
(e) Ability to Carry Out Obligations. The execution and
delivery of this agreement by the Company and the performance by
the Company of its obligations hereunder in the time and manner
contemplated will not cause, constitute, or conflict with, or
result in any of the following: (a) a breach or violation of any
provisions of or constitute a default under any license,
indenture, mortgage instrument, article of incorporation, bylaw,
other agreement or instrument to which the Company is a party,
or by which it may be bound, nor will any consents or
authorizations of any party other than those required, (b) any
event that would permit any party to any agreement or instrument
to terminate it or to accelerate the maturity of any
indebtedness or other obligation of the Company, or, (c) an
event that would result in the creation or imposition of any
lien, charge, encumbrance on the asset of the Company.
(f) Full Disclosure. None of the representations and
warranties made by the Company herein, or any exhibit,
certificate or memorandum furnished or to be furnished by the
Company on behalf of the Company, contains or will contain any
untrue statement of material fact, or omit any material fact,
the omission of which would be misleading, provided that the
auditor of the Company's financial statements shall be
ultimately responsible for certifying the truth and accuracy of
the Company's audited financial statement.
4. Covenants Prior to and Subsequent to Closing. It is agreed
between the parties hereto that representatives of the Company
may visit the offices of PowerClick to obtain copies of data
contained in all currently active files or current contracts and
agreements of any and all categories of business, with any
company or person, as related to the Website. Any and all such
data and documentation not previously released by PowerClick,
and being currently in the possession of PowerClick, shall be
delivered into hands of the officers of the Company. Such data
and documentation shall include all copies of files, documents,
shareholders and directors minutes, minute books/records, etc.,
at the earliest possible time, on or after the effective date
hereof.
5. Conditions Precedent to Performance by Parties.
(a) Conditions. The parties to this agreement and the
obligations hereunder shall be subject to the satisfaction at
closing of all the conditions set forth above.
(b) Accuracy of Representations. Except as otherwise permitted
by this agreement, all representations and warranties by either
party in agreement or in any other written statement delivered
to the other under this agreement shall be true and accurate on
and as of the effective date as though made at this time.
(c) Performance. The parties shall have performed, satisfied
and complied with all covenants, agreements and conditions
required by this agreement to be performed or complied with it
on or before the effective date.
(d) Absence of Litigation. No action, suit, or proceeding
before any court or any governmental body or authority,
pertaining to the transaction contemplated by this agreement or
its consummation, shall have been instituted or threatened
against either the Company or PowerClick on or before the
effective date. No action, suit, or other proceeding before any
court or other governmental body or authority that could
jeopardize or put at risk of loss, the current assets of
PowerClick or the Company, shall have been instituted or
threatened against either on or before the effective date of
this agreement. PowerClick and/or the Company shall resolve in
its favor any dispute, action, or threatened legal action, from
any court or any governmental body, prior to the effective date
of this agreement, in the event any such action or so threat of
action should currently exist. Any dispute in which PowerClick
or the Company may have a part, any action, suit or proceeding
by any person, entity, court or governmental body or authority
against PowerClick and/or the Company left unresolved on the
effective date of this agreement, shall immediately render this
Agreement, on that date forever null and void, without further
notice from either PowerClick or the Company.
6. Miscellaneous.
(a) Access to Books and Records.
To enable the Company to coordinate the activities of PowerClick
with those of the Company on and after the Effective Date,
PowerClick shall, before the Effective Date, afford to the
officers and authorized representatives of the Company free and
full access to the plants, properties, books and records of
PowerClick, and the officers of PowerClick will furnish the
Company with financial and operating data and other information
as to the business and properties of related to the Website as
the Company shall from time to time reasonably request. The
Company and PowerClick agree that, unless and until the
acquisition contemplated by this Agreement has been consummated,
the Company and PowerClick and their officers and
representatives will hold in strict confidence all data and
information obtained from one another as long as it is not in
the public domain, and if the merger provided for is not
consummated as contemplated, the Company and PowerClick will
each return to the other party all data as the other party may
reasonably request.
(b) Non-Competition.
The signatory on behalf of PowerClick agrees that for a period
of two (2) years after the Effective Date of this Agreement, he
shall not, directly or indirectly, own, manage, operate,
control, be employed by, perform services for, consult with,
solicit business for, participate in, or be connected with the
ownership, management, operation, or control of any business
which performs services materially similar to or competitive
with those provided by the Website.
(c) Rights Cumulative; Waivers.
The rights of each of the parties under this Agreement are
cumulative. The rights of each of the parties hereunder shall
not be capable of being waived or varied other than by an
express waiver or variation in writing. Any failure to exercise
or any delay in exercising any of such rights shall not operate
as a waiver or variation of that or any other such right. Any
defective or partial exercise of any of such rights shall not
preclude any other or further exercise of that or any other such
right. No act or course of conduct or negotiation on the part
of any party shall in any way preclude such party from
exercising any such right or constitute a suspension or any
variation of any such right.
(d) Benefit; Successors Bound.
This Agreement and the terms, covenants, conditions, provisions,
obligations, undertakings, rights, and benefits hereof, shall be
binding upon, and shall inure to the benefit of, the undersigned
parties and their heirs, executors, administrators,
representatives, successors, and permitted assigns.
(e) Entire Agreement.
This Agreement contains the entire agreement between the parties
with respect to the subject matter hereof. There are no
promises, agreements, conditions, undertakings, understandings,
warranties, covenants or representations, oral or written,
express or implied, between them with respect to this Agreement
or the matters described in this Agreement, except as set forth
in this Agreement. Any such negotiations, promises, or
understandings shall not be used to interpret or constitute this
Agreement.
(f) Assignment.
Neither this Agreement nor any other benefit to accrue hereunder
shall be assigned or transferred by either party, either in
whole or in part, without the written consent of the other
party, and any purported assignment in violation hereof shall be
void.
(g) Amendment.
This Agreement may be amended only by an instrument in writing
executed by all the parties hereto.
(h) Severability.
Each part of this Agreement is intended to be severable. In the
event that any provision of this Agreement is found by any court
or other authority of competent jurisdiction to be illegal or
unenforceable, such provision shall be severed or modified to
the extent necessary to render it enforceable and as so severed
or modified, this Agreement shall continue in full force and
effect.
(i) Section Headings.
The Section headings in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(j) Construction.
Unless the context otherwise requires, when used herein, the
singular shall be deemed to include the plural, the plural shall
be deemed to include each of the singular, and pronouns of one
or no gender shall be deemed to include the equivalent pronoun
of the other or no gender.
(k) Further Assurances.
In addition to the instruments and documents to be made,
executed and delivered pursuant to this Agreement, the parties
hereto agree to make, execute and deliver or cause to be made,
executed and delivered, to the requesting party such other
instruments and to take such other actions as the requesting
party may reasonably require to carry out the terms of this
Agreement and the transactions contemplated hereby.
(l) Notices.
Any notice which is required or desired under this Agreement
shall be given in writing and may be sent by personal delivery
or by mail (either a. United States mail, postage prepaid, or b.
Federal Express or similar generally recognized overnight
carrier), addressed as follows (subject to the right to
designate a different address by notice similarly given):
To the Company:
Mr. Thomas S. Hughes
eConnect
2500 Via Cabrillo Marina, Suite 112
San Pedro, California 90731
To PowerClick:
Mr. Dominique Einhorn
101 North Luna Way, #261
Las Vegas, Nevada 89128
(m) Governing Law.
This Agreement shall be governed by the interpreted in
accordance with the laws of the State of California without
reference to its conflicts of laws rules or principles. Each of
the parties consents to the exclusive jurisdiction of the
federal courts of the State of Nevada in connection with any
dispute arising under this Agreement and hereby waives, to the
maximum extent permitted by law, any objection, including any
objection based on forum non coveniens, to the bringing of any
such proceeding in such jurisdictions.
(n) Consents.
The person signing this Agreement on behalf of each party hereby
represents and warrants that he has the necessary power, consent
and authority to execute and deliver this Agreement on behalf of
such party.
(o) Termination of Agreement.
This Agreement shall terminate on the Effective Date unless all
actions required under this Agreement have not been fully
performed.
(p) Survival of Provisions.
The representations and warranties contained in this Agreement
shall not expire with, and be terminated and extinguished by,
this Agreement on the Effective Date.
(q) Execution in Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original and all of which
together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered as of the date first above written.
eConnect
By: /s/ Thomas S. Hughes
Thomas S, Hughes, President
PowerClick
By: /s/ Dominique Einhorn
Dominique Einhorn, President
