ASSET TRANSFER AGREEMENT AND PLAN OF LIQUIDATION AND DISSOLUTION
THIS ASSET TRANSFER AGREEMENT AND PLAN OF LIQUIDATION AND DISSOLUTION
("Agreement") is entered into as of June ___, 1997, by and among HARRIER, INC.,
a Delaware corporation ("Harrier"), NATURADE, INC., a Delaware corporation
("Naturade") and DERMARAY INTERNATIONAL, L.L.C., a California limited liability
company (the "Company"). Harrier and Naturade are hereinafter referred to
individually as a "Member" and collectively as the "Members."
R E C I T A L S
A. Harrier and Naturade previously organized the Company pursuant to that
certain limited Liability Company Agreement ("LLC Agreement") dated November 29,
1994.
B. Harrier and Naturade are the sole Members of the Company, with Harrier
owning a 50% Membership Interest (as that term is defined at Section 1.6(q) of
the LLC Agreement) and Naturade owning a 50% Membership Interest.
C. The Members desire to liquidate and dissolve the Company pursuant to
the laws of the State of California and this Agreement.
D. The Members have duly authorized and approved the transactions
contemplated by this Agreement.
A G R E E M E N T
It is agreed as follows:
1. SALE AND PURCHASE OF ASSETS.
1.1 TRANSFER. Subject to and upon the terms and conditions set forth
herein, Harrier agrees to sell, assign, convey, transfer and deliver
("Transfer") to the Company, and the Company agrees to purchase from Harrier,
the following assets ("Assets"):
(a) Harrier's entire Membership Interest in the Company; and
(b) Harrier's bioptron lamp inventory, as identified and
described in the Schedule of Assets attached as Schedule 1 hereto ("Inventory").
1.2 CONSIDERATION. The consideration to be paid by the Company to
Harrier for the Assets on or before the Initial Closing Date (as defined below)
shall be $175,000. Harrier acknowledges its prior receipt of $20,000 of such
amount. The Company shall deliver the balance of the consideration on the
Initial Closing Date pursuant to an unsecured promissory note ("Note") in the
original principal amount of $155,000 in the favor of the Note attached hereto
as Exhibit A.
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1.3 CLOSING. The initial closing ("Closing") of the transactions
under this Agreement shall take place on June ___, 1997 (the "Initial Closing
Date"). On the Initial Closing Date, Harrier shall transfer all of its right,
title and interest in and to the Inventory to the Company pursuant to the xxxx
of sale attached hereto as Exhibit B, and the Company shall deliver the
originally executed Note to Harrier. Upon each payment by the Company of a
portion of the principal amount outstanding under the Note, the Company shall be
deemed to have redeemed a proportional amount of Harrier's Membership Interest.
For example, upon Naturade's payment of $15,500 of the principal amount under
the Note (representing 10% of the original principal amount) the Company shall
be deemed to have redeemed 5% of Harrier's Membership Interest (representing
10% of Harrier's original Membership Interest). The redemptions hereunder shall
take place upon, and concurrent with, each payment of principal under the Note,
without the need for any further action on the part of any party, and each such
redemption shall be referred to as a "Closing."
1.4 INSTRUMENTS OF TRANSFER, ETC. Harrier shall deliver to the
Company at each Closing and thereafter upon the Company's request such
additional bills of sale, assignments and other good and sufficient instruments
of Transfer in form and substance satisfactory to Buyer and its counsel as are
necessary to effectively Transfer all of Harrier's right, title and interest in
the Assets to the Company. At any time after each Closing, Harrier shall
execute, acknowledge and deliver to the Company any further documents,
assurances or other matters, and will take any other action consistent with the
terms of this Agreement that may reasonably be requested by the Company and as
are necessary or desirable to carry out the purpose of this Agreement.
1.5 TITLE TO ASSETS. Harrier has and will Transfer to the Company
good and marketable title to the Assets, free and clear of all mortgages,
pledges, security interests, liens, claims, charges, restrictions and
encumbrances. No financing statements under the Uniform Commercial Code or
similar laws naming Harrier as debtor have been filed in any jurisdiction with
respect to the Assets.
2. DISSOLUTION AND WINDING UP.
2.1 REDEMPTION OF MEMBERSHIP INTEREST. Upon the Company's final
payment of the outstanding principal amount under the Note ("Dissolution Date"),
the Company shall be deemed to have redeemed Harrier's entire Membership
Interest and the Company shall be deemed to have dissolved in accordance with
Article XII of the LLC Agreement.
2.2 NOTIFICATION OF CREDITORS. On the Dissolution Date, Naturade, as
the sole Member, the Company, shall give written notice of commencement of
winding up to the Company in substantially the form of Exhibit C, indicating
that the assets of the Company are to be distributed in liquidation to the
remaining Member.
2.3 SECRETARY OF STATE FILINGS. As soon as practicable after the
Dissolution Date, and after receiving tax clearance certificates from the
California Franchise Tax Board as required by law, Naturade shall execute a
Certificate of Dissolution on Form LLC-3 and a Certificate of Cancellation on
Form LLC-4/7 in accordance with the provisions of the California Corporations
Code, and cause such Certificates to be filed in the office of the Secretary of
State of California.
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3. MUTUAL REPRESENTATIONS, WARRANTIES AND COVENANTS. Each party
represents, warrants and covenants to the other as of the date hereof and as of
each Closing as follows:
3.1 ORGANIZATION. Each party is duly organized, validly existing and
in good standing under the laws of the state of its organization.
3.2 POWER AND AUTHORITY. Each party has all requisite power and
authority to enter into and to carry out all of the terms of this Agreement and
all other documents executed and delivered in connection herewith. All action
on the part of the party, its officers, directors, shareholders and members
necessary for the authorization, execution, delivery and performance of this
Agreement by the party has been taken and no further authorization on the part
of the party is required to consummate the transactions provided for in this
Agreement. When executed and delivered by the party, this Agreement shall
constitute the valid and legally binding obligations of the party enforceable in
accordance with its terms. Neither the execution, delivery nor performance of
this Agreement by the party shall (i) violate or result in a breach of any
provisions of the party's charter documents, (ii) constitute a default or result
in a breach of any contract or agreement to which it is a party or its assets or
properties are bound, or (iii) violate any order, writ, injunction, decree,
judgment or other restriction of any court, administrative agency or
governmental body.
3.3 AGREEMENT TO PERFORM NECESSARY ACTS. Each party agrees to
perform any further acts and execute and deliver any documents which may be
reasonably necessary to carry out the provisions and purposes of this Agreement.
4. MISCELLANEOUS.
4.1 CUMULATIVE REMEDIES. Any person having any rights under any
provision of this Agreement will be entitled to enforce such rights
specifically, to recover damages by reason of any breach of any provision of
this Agreement, and to exercise all other rights granted by law, which rights
may be exercised cumulative and not alternatively.
4.2 SUCCESSORS AND ASSIGNS. The rights and obligations of the
parties under this Agreement shall not be assignable without the written consent
of the other parties, provided, however, that nothing herein shall restrict
Harrier's right to assign its interests under the Note. Except as otherwise
expressly provided herein, all covenants and agreements contained in this
Agreement by or on behalf of any of the parties hereto will bind and inure to
the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not.
4.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement or the other documents.
4.4 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts when taken together will constitute one and the
same agreement.
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4.5 NOTICES. Any approvals, consents or notices required or
permitted to be sent or given shall be delivered in writing personally or
mailed, certified mail, return receipt requested, to the following addresses and
shall be deemed to have been received within five days after such mailing:
If to the Company: DermaRay International, L.L.C.
0000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxxxxxx, President
If to Naturade: Naturade, Inc.
0000 Xxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxxx Xxxxxxxxx, President
If to Harrier: Harrier, Inc.
0000 Xxxxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx XxXxxx, President
4.6 GOVERNING LAW; ARBITRATION. The validity, meaning and effect of
this Agreement shall be determined in accordance with the laws of the State of
California, applicable to contracts made and to be performed in that state,
without regard to its conflicts of laws rules; provided however that the Federal
Arbitration Act of the United States shall govern issues as to arbitrability.
If a dispute arises in connection with or relating to this Agreement and the
parties are unable to resolve it within forty-five (45) days through direct
negotiations, the dispute shall be referred to final and binding arbitration to
be held in Los Angeles, California in accordance with the rules of the American
Arbitration Association for Commercial Arbitration (as they may be amended from
time to time). The award of the arbitrator(s) shall be final and binding upon
the parties hereto and may be enforced by any court of competent jurisdiction.
4.7 LITIGATION COSTS. If any legal action or any arbitration or
other proceeding is brought for the enforcement of this Agreement, or because of
an alleged dispute, breach, default, or misrepresentation in connection with any
of the provisions thereof, the successful or prevailing party or parties shall
be entitled to recover reasonable attorneys' fees and other costs incurred in
that action or proceeding, in addition to any other relief to which it or they
may be entitled.
4.8 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement and understanding of the parties with respect to the subject matter
thereof, and supersedes all prior and contemporaneous agreements and
understandings.
IN WITNESS WHEREOF, each of the parties to this Agreement has executed or
caused this Agreement to be executed as of the date first above written.
"HARRIER"
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Harrier, Inc.,
a Delaware corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------------
Xxxxx XxXxxx, President
"NATURADE"
Naturade, Inc.,
a Delaware corporation
By: /s/ Xxxxxxx Xxxxxxxxx
-------------------------------------
Xxxxxxx Xxxxxxxxx, President
"DERMARAY"
DermaRay International, L.L.C.,
a California limited liability company
By: /s/ Xxxxxxx Xxxxxxxxx
-------------------------------------
Xxxxxxx Xxxxxxxxx, President
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SCHEDULE 1
INVENTORY LIST
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EXHIBIT A
UNSECURED PROMISSORY NOTE
PARAMOUNT, CALIFORNIA $155,000
JUNE __, 1997
FOR VALUE RECEIVED, DERMARAY INTERNATIONAL, L.L.C., a California limited
liability company (the "Company"), promises to pay on or before March 31, 1998
to the order of Harrier, Inc. or assigns ("Holder"), at the address designated
by Holder, the principal amount of One Hundred Fifty-Five Thousand Dollars
($155,000). The outstanding principal amount under this Note shall not bear
interest and shall be due and payable no later than March 31, 1998; provided,
however, the Company shall apply at least __% of the gross proceeds from its
sale of bioptron lamps towards the payment of the outstanding principal amount
of this Note and otherwise use its best efforts to pay the outstanding principal
amount under this Note as soon as possible.
Upon the happening of any Event of Default as set forth below and the
giving of notice by the Holder as provided herein, this Note shall become
immediately due and payable in full, without presentment or protest, both of
which are hereby waived by the Company. In such case, Holder may proceed to
protect and enforce its rights by a suit in equity, action at law, or other
appropriate proceedings. In case of any Event of Default, the Company will
reimburse Holder for its reasonable costs and expenses, including attorney's
fees, incurred in connection with the enforcement of its rights under this Note.
"Event of Default" whenever used herein means any one of the following
events:
(a) Default in the payment of principal under this Note when it
becomes due;
(b) The entry of a decree or order by the court having jurisdiction
in the premises adjudging the Company bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under applicable bankruptcy laws, or
appointing a receiver, liquidator, assignee, trustee (or similar official) of
the Company or any substantial part of its property, and the continuance of such
decree or order in effect for a period of thirty (30) consecutive days; or
(c) The institution by the Company of proceedings to be adjudicated
as a bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a
petition or answer to consent seeking reorganization or relief under applicable
bankruptcy laws, or the consent by it to the filing of any such petition or to
the appointment of any receiver, liquidator, assignee, trustee (or similar
official) the Company or any substantial part of its property, or the making by
it of any assignment for the benefit of creditors.
Except as otherwise provided in this Note, the Company:
(a) Waives demand, presentment for payment, notice of non-payment,
grace,
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protest, notice of protest, notice of acceleration of the indebtedness
due hereunder and all other notice in collecting this Note;
(b) Consents to all extensions or rearrangements or postponements of
time or payment of this Note, whether or not for a term or terms in excess of
the original term hereof, and to any other indulgence with respect hereto
without notice, consent or consideration to any of them; and
(c) Waives any right it may have to require Holder to exercise the
remedies available on default in any particular order.
WITNESS the signature of a duly authorized officer of the Company.
DERMARAY INTERNATIONAL, L.L.C.,
a California limited liability company
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------------
Xxxxxxx Xxxxxxxxx, President
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EXHIBIT B
XXXX OF SALE
This Xxxx of Sale is made this ___ day of June 1997 by and between HARRIER,
INC., a Delaware corporation (hereinafter referred to as "Seller"), and DERMARAY
INTERNATIONAL, L.L.C., a California limited liability company (hereinafter
referred to as "Purchaser").
For good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, Seller does hereby sell, assign, grant, convey, set
over, confirm and deliver to Purchaser and its successors and assigns forever,
all of Seller's right title and interest in and to those "Assets" set forth on
Exhibit "A" attached hereto, free and clear of any and all liens, claims and
encumbrances of any kind.
Simultaneously with the execution and delivery hereof and from time to time
thereafter, Seller will execute and deliver to Purchaser such additional
documents of transfer with respect to the Assets as Purchaser may reasonably
require in order to effectuate this transaction.
IN WITNESS WHEREOF, the Sellers have caused this instrument to be executed
on the date above-written.
"SELLER"
HARRIER, INC.,
a Delaware corporation
/s/ Xxxxx XxXxxx
--------------------------------------------
Xxxxx XxXxxx, President
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EXHIBIT C
NOTICE OF COMMENCEMENT OF VOLUNTARY PROCEEDINGS
TO WIND UP, LIQUIDATE AND DISSOLVE
TO: ALL CREDITORS AND CLAIMANTS
NOTICE IS HEREBY GIVEN pursuant to Section 17352(a) of the California
Corporations Code that DERMARAY INTERNATIONAL, L.L.C., a California limited
liability company (the "Company"), whose principal office is located at 0000
Xxxx Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxx 00000, has voluntarily elected to
wind up its affairs, liquidate and dissolve.
Proceedings for the winding up of the Company commenced on_______________,
199__, on which date all of the members of the Company consented to the
winding up, liquidation and dissolution of the Company.
Dated: ___________, 199__ DERMARAY INTERNATIONAL, L.L.C.
a California limited liability company
By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Xxxxxxx Xxxxxxxxx, President
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CERTIFICATE OF MAILING OF
NOTICE OF COMMENCEMENT OF VOLUNTARY PROCEEDINGS
TO WIND UP, LIQUIDATE AND DISSOLVE
The undersigned hereby certifies that he is the President of DERMARAY
INTERNATIONAL, L.L.C., a California limited liability company (the "Company");
and that on ___________, 199__, he mailed to all known creditors and claimants
whose addresses appear on the books of the Company, a notice of election to wind
up, liquidate and dissolve the Company, a copy of such notice being attached
hereto as Exhibit A, by depositing a copy of such notice in the United States
mail at Paramount, California, in a sealed envelope with postage prepaid and
addressed to each of such persons at the addresses appearing on the books of the
Company.
Executed on _____________, 199__, at ___________________, Los Angeles
County, California.
/s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Xxxxxxx Xxxxxxxxx, President
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