NATURADE, INC.
NATURADE,
INC.
__________________________________________________________________________________________
0000
X.
Xxxxx Xxxxxxx Xxxx., Xxx.000, Xxxxxxx, XX 00000 714-860-7600
000-000-0000(fax)
xxx.xxxxxxxx.xxx
This
MEMORANDUM
OF UNDERSTANDING
is made
and entered into this 19th day of March, 2008, by and between
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“PARTY”
#1:
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Naturade,
Inc. and/or Assigns
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(a
Delaware corporation)
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0000
X. Xxxxx Xxxxxxx Xxxx., Xxxxx 000
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Anaheim,
California 92806
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Phone:
(000) 000-0000
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Fax:
(000) 000-0000
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hereinafter
referred to as“NATURADE”)
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“PARTY”
#2:
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Redux
Holdings, Inc. and/or Assigns
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(a
Nevada corporation)
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0000
X. Xxxxx Xxxxxxx Xxxx., Xxxxx 000
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Anaheim,
California 92806
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Phone:
000-000-0000
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Fax:
000-000-0000
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| (hereinafter referred to as“Redux”) | |
| (hereinafter collectively referred to as the “PARTY(S)”). | |
By
executing this Memorandum of Understanding, the PARTY(S) hereby confirm their
intent to enter, in good faith, a corporate reorganization, as defined under
Section 368 of the Internal Revenue Code, in which the PARTY(S) will enter
into
a definitive Asset Purchase Agreement for Naturade to acquire most of the assets
and all of the liabilities of Redux for common stock in Naturade. The PARTY(S)
will proceed promptly and in good faith in their preparation, and execution
of
the documentation necessary to consummate the transactions herein contemplated,
all subject to the terms and conditions herein contained. It is understood
by
the PARTY(S) that their legal counsel is in the process of preparing the
definitive Asset Purchase Agreement (the “Agreement”) and related documents; and
that the signing of the Agreement and the transfer of the Redux assets and
liabilities contemplated above will be conditioned on the completion of the
6 to
1 reverse stock split of Naturade, a fair and complete valuation and listing
of
the Redux assets and liabilities and approval of the relevant terms and
conditions by the boards of directors of Natured and Redux. Exclusive
of the provisions of Paragraphs 4, 5, 8, 9, 10, 13, and 14 hereof, which are
intended to be binding and enforceable,
this
Memorandum of Understanding is not intended to constitute a contract or an
offer
to enter into a contract, be binding upon the PARTY(S), or create legal
obligations or rights.
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1. Terms
of Performance:
| 1.1 |
Target
date for the definitive Agreement signing no later than April15, 2008;
and
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| 1.2 |
Time
is of the essence and the PARTIES shall designate an individual or
individuals who will be responsible for the exchange and review of
all the
information necessary to consummate a Definitive
Agreement.
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| 1.3 | Release of public information by the filing of Form 8-K and press release shall be made upon the signing of this Memorandum and again upon the signing of the definitive agreement. |
2.
Due
Diligence. The
PARTY
(S) shall proceed under and within the principal terms and conditions hereto
defined as it pertains to the PARTY(S) respective due diligence investigations
and the negotiation of a definitive Agreement.
3. Definitive
Asset Purchase Agreement. The
PARTY(S) will use their best efforts to execute a definitive Agreement on or
before April 15, 2008, which agreement will incorporate the terms of this
Memorandum of Understanding and such other terms as are satisfactory in form
and
content to the PARTY(S). The definitive Agreement shall contain standard and
reasonable representations, warranties, indemnifications and conditions by
the
PARTY(S) as are mutually acceptable to the PARTY(S).
4. Confidentiality.
At the
Closing (as hereinafter defined in section 8), the Parties will execute and
deliver standard and reasonable confidentiality and non-disclosure agreements
with respect to all trade secrets and other proprietary information of the
PARTY(S). A standard and reasonable Non-disclosure and Non-circumvention
Agreement shall be attached to the definitive Agreement.
5. Exclusive
Dealing.
In
consideration of the expenses incurred and to be incurred by the PARTY(S) in
connection with this Memorandum of Understanding and the activities contemplated
hereunder, from the date hereof continuing for ninety (90) days following
execution of this Agreement, or such later date as the PARTY(S) may mutually
agree, none of the PARTY(S) shall negotiate with third parties regarding the
subject matter of this Agreement. This provision is intended to be binding
and
enforceable against the PARTY(S) hereto.
6. Access
to Information.
Subject
to the Confidentiality Agreements of the PARTY(S), each PARTY(S) shall give
the
other PARTY(S) and its representatives and agents access to its properties,
books, records, contracts, consulting reports, market research, competition
analysis, backlog of closed orders and purchase commitments, and shall furnish
all such information and documents relating thereto, which pertain to this
Memorandum of Understanding, as such PARTY(S) may reasonably request for the
purpose of conducting its financial and other due diligence review. The PARTY(S)
will treat as confidential all information with respect to each other made
available herein and will return to the other all documents containing any
such
information delivered to them or their representatives and all copies thereof
in
the event the transactions contemplated herein are not consummated. In addition
if the transaction is not consummated then each PARTY(S) shall stipulate, in
writing, that all confidential information obtained from the other PARTY(S)
has
been returned to the owner or destroyed as requested by the other
PARTY(S).
7. Closing.
The
transactions contemplated by this Memorandum of Understanding will close on
a
date not later than April 30, 2008, unless the PARTY(S) mutually extends such
date hereto.
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8. Waiver
of Conflict. The
PARTY(S) agree to waive any conflict of interest in using legal counsel Xxxx
Xxxxxx Xxxxxx, Attorney at Law, as the legal counsel for both parties in this
transaction, it being understood that he is also an officer and/or director
of
both PARTY(S), it also being understood that this transaction is a business
reorganization, that Xxxxx is currently the majority shareholder and control
person of Naturade, and that Xxxxx’s general counsel has also been acting as
general counsel for Naturade during the entire time that Xxxxx has been the
majority shareholder and control person of Naturade.
9. Compliance
with Securities Laws.
The
PARTY(S) warrant that since both Naturade and Redux are publicly held companies,
they are and will be in compliance with all federal and state securities law,
regulations and rules in the performance of this contemplated corporate
reorganization and asset purchase.
10. Termination.
Either
party upon written notice to the other PARTY(S) may terminate this Memorandum
of
Understanding at any time after execution hereof or prior to the execution
of
the Agreement. Upon termination of this Memorandum of Understanding for any
reason, neither PARTY(S) shall have any rights or remedies against the other,
except for the failure of a PARTY(S) to fulfill its obligations under Paragraphs
4, 5, 8, 9, 10, 13, and 14. Except as provided herein, nothing in this
Memorandum of Understanding shall constitute a binding agreement of the PARTY(S)
and none of the PARTY(S) shall have a right of action against the other PARTY(S)
for damages or equitable relief, including but not limited to the right of
specific performance, it being the specific understanding that upon such
termination the PARTY(S) shall be returned to their original positions without
liability to any other PARTY(S).
11. Execution
of Memorandum of Understanding.
To be
effective, this Memorandum of Understanding must be executed and delivered
by
all PARTY(S) on or before 5:00 p.m. Pacific Standard time on March 21,
2008.
12. Counterparts.
This
Agreement may be executed in several facsimile counterparts all of whom together
shall constitute one and the same instrument with the same force and effect
as
though each of the PARTY(S) had executed the same document. However, the parties
agree to execute triplicate originals in Blue Ink.
13. Governing
Law. This
Agreement is made and shall be governed by, and construed and enforced in
accordance with, the internal laws of the State of California, without regard
to
the conflict of laws principles thereof, as the same apply to agreements
executed solely by residents of California and wholly to be performed within
California.
14. Arbitration.
If
the
PARTY(S) are unable to resolve a dispute arising out of this agreement, the
parties shall submit to binding arbitration of the dispute. Arbitration
proceedings shall take place in San Diego, California and be conducted by or
its
successor, and in accordance with the AAA rules. The arbitration panel shall
consist of three members. Each PARTY(S) and shall appoint one (1) member of
the
arbitration panel members. The arbitration hearing shall last no longer than
(1)
day, and the panel's decision shall be final and shall bind the PARTY(S). The
time period for the entire arbitration proceeding from the date notice is given
to the date of final determination shall not exceed 60 days. The cost of
arbitration shall be borne by any or all of the PARTY(S), as the arbitration
panel may determine. A PARTY(S) shall enforce the arbitration Panel's award
by a
judgment obtained in the state of federal courts having jurisdiction. A PARTY(S)
may enforce a judgment, thus obtaining preliminary injunctive relief from a
court of law in any jurisdiction, pending the outcome of an arbitration
proceeding. The arbitrators shall not, however, in the case of a dispute between
the PARTY(S) not involving a third party claim, be empowered to award damages
in
excess of compensatory damages.
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If
the
foregoing terms are acceptable, please signify your acceptance by signing and
returning a copy of this Memorandum of Understanding to me.
| Very truly yours, | ||
| NATURADE, INC. | ||
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| /s/ Xxxx Xxxxxxxx | ||
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Sign Name |
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Xxxx Xxxxxxxx, Chief Executive Officer
Print Name/Title |
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March 19, 2008
Date
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The
undersigned hereby accepts and agrees to the terms and conditions of the
foregoing Memorandum of Understanding effective as of the date of the foregoing
Memorandum of Understanding.
| REDUX HOLDINGS, INC. | ||
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| /s/ Xxxx X Xxxxxxxx | ||
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Sign Name |
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Xxxx X Xxxxxxxx, Chief Executive Officer
Print Name/Title |
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March 19, 2008
Date
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