Exhibit 10.1
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made as of
the date on the signature page hereto, by and between Bioscience Technologies,
Inc., a New Jersey corporation, ("Purchaser"), Integrated BioPharma, Inc., a
Delaware corporation ("Parent"), BevSpec, Inc., a Texas corporation ("Seller"),
and, for limited purposes, the shareholders of Seller identified on the
signature page hereto (the "Shareholders"), and the Finders, as defined in
Section 4.2(p) below (the Finders, together with the Shareholders, being
referred to herein as the "Seller Parties"). Purchaser, Parent and Seller are
sometimes referred to herein individually as a "Party," and, collectively, as
the "Parties."
RECITALS
WHEREAS, Purchaser is a wholly owned subsidiary of Parent;
WHEREAS, Seller is the owner of various assets related to the
Syzmo energy drink and low glycemic soda product lines (the "Product Lines");
WHEREAS, the assets specifically and directly related to the
Product Lines include, but are not limited to, the following: trademarks, art
work, formula for the products, customer list, goodwill and inventory;
WHEREAS, the Parties desire to evidence an agreement for
Purchaser to purchase all of the assets related to the Product Lines from
Seller, on the terms and conditions set forth herein;
WHEREAS, the Parties intend for the transactions contemplated
by this Agreement to qualify as a "reorganization" within the meaning of section
368(a) of the Internal Revenue Code of 1986, as amended (the "Code"), and the
Shareholders have concurrently entered into a plan of reorganization (the "Plan
of Reorganization") to accomplish the intent to conduct such reorganization;
WHEREAS, the Plan of Reorganization requires that shares
transferred to Seller immediately be distributed to the Shareholders;
WHEREAS, the shares to be transferred to Seller (and from
Seller to the Shareholders) as part of the purchase price will be held in escrow
and will remain subject to Purchaser's claims under the indemnification
provisions of this Agreement; and
WHEREAS, Purchaser, Parent and Seller intend to enter into the
transactions as of the date hereof (the "Effective Date");
NOW, THEREFORE, in consideration of the premises and the
mutual covenants, agreements and representations herein contained, Purchaser and
Seller agree as follows:
ARTICLE I
PURCHASE AND SALE
1.1 Purchase and Sale of Transferred Assets. On the terms and subject to the
conditions herein expressed, Seller agrees to sell, convey, transfer, assign and
deliver to Purchaser and Purchaser agrees to purchase, good and marketable title
to all of the assets, properties, and business of Seller of every nature, and
description, whether tangible or intangible, contingent or otherwise, wherever
so located and whether or not reflected on the books and records of Seller
related to the Product Lines, including, without limitation, all copyrights,
trademarks, and trade names and associated goodwill, inventories, product
formulas, product labels, customer lists and books and records (collectively
hereinafter referred to as the "Transferred Assets"). Without limiting the
generality of the foregoing, it is agreed that the Transferred Assets shall
include, without limitation, all of the assets listed on Schedule 1.1 to this
Agreement and shall be deemed transferred to Purchaser in their respective
amounts existing on the Effective Date. No assets of Seller, other than the
Transferred Assets, are being transferred hereunder.
1.2 Assumed Liabilities. Purchaser shall assume the liabilities set forth on
Schedule 1.2 (the "Assumed Obligations") and the payment obligations set forth
on Schedule 1.2.1 (the "Payment Obligations") up to the total amount of
$307,609.31. The Assumed Obligations and the Payment Obligations shall be
referred to herein as the "Assumed Liabilities". As to the Payment Obligations,
Seller and Seller Parties shall be responsible for any and all liabilities
related to the Payment Obligations that exceed $307,609.31. Other than the
Assumed Liabilities, in no event shall Purchaser be deemed to have assumed or be
responsible for any liabilities, liens, security interests, claims, obligations
or encumbrances of Seller, contingent or otherwise, and the Transferred Assets
shall be sold and conveyed to Purchaser free and clear of all liabilities,
liens, security interests, claims, obligations and encumbrances and arising out
of the conduct of the business relating to the Transferred Assets by Seller
prior to the Closing (as defined herein). Without limiting the generality of the
foregoing, in no event shall Purchaser assume or be responsible for: (i) any
income, property, franchise, sales, use or other tax of Seller or any filing
requirements or obligations with respect thereto arising out of or resulting
from the sale of the Transferred Assets hereunder (all such taxes to be paid by
Seller) or any transaction of Seller prior to or subsequent to the execution of
this Agreement; and (ii) any liabilities, obligations or costs resulting from
any claim or lawsuit or other proceeding relating to the Transferred Assets or
naming Seller or any successor thereof as a party and arising out of events,
transactions or circumstances occurring or existing prior to the Closing Date.
1.3 Assignment of Contracts. Seller does hereby assign to Purchaser all of
Seller's right, title and interest in and to the contracts and agreements listed
on Schedule 1.3 attached hereto (the "Assigned Contracts"), free and clear of
all claims, liens, pledges, encumbrances, mortgages, taxes and equities of any
kind whatsoever.
1.4 Delivery of Know-How. At Closing, Seller shall furnish to Purchaser copies
of the documents listed on Schedule 1.4 attached hereto that relate to the
Product Line intellectual property.
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1.5 Excluded Assets. Notwithstanding anything herein to the contrary, the
following assets related to the Product Lines are being retained by Seller and
are not being assigned, transferred or sold to Purchaser:
(a) all bank accounts, demand accounts, deposit accounts, cash on hand;
provided, however, the Seller shall use any funds in such accounts or
any cash on hand to extinguish any debts of the Seller due and payable
prior to Closing (as defined below); and
(b) all other assets of Seller not used in connection with the Product
Lines that are specifically listed on Schedule 1.5.
ARTICLE II
PURCHASE PRICE
2.1 Purchase Price. The purchase price for the Transferred Assets shall
be payable as follows:
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(a) Stock Issuance. Purchaser shall cause to be issued to Seller 185,000
shares of unregistered common stock of Parent (the "Transferred
Shares") and assume the liabilities and payment obligations in Section
1.2. As part of the Plan of Reorganization, Seller shall be dissolved
and the Transferred Shares shall be distributed to the Shareholders.
(b) Escrow. The Transferred Shares shall be held in escrow
(the "Escrow") for a period of one (1) year from the Closing Date and
released pursuant to the terms of an Escrow Agreement (the
"Escrow Agreement") between and among Purchaser, Seller and
Xxxxxxxxx Xxxxxxx, LLP (the "Escrow Agent") in the form of
Exhibit A attached hereto. Purchaser will cause its transfer agent to
deliver certificates representing such shares in the name of each
Seller Party to the Escrow Agent as soon as practicable after the
Closing Date. Such shares shall be restricted stock and shall bear
the restrictive legend set forth in Section 4.2(o) herein. The
Seller and each of the Seller Parties hereby appoint Xxxxxxx
Xxxxxxxx, Xxxx X'Xxxx and Xxxxxxxx Xxxxxxxxxxx to act as their
representative in giving any notices or otherwise acting on behalf of
the Seller under the Escrow Agreement.
ARTICLE III
CLOSING
3.1 Time and Place of Closing. The transactions contemplated by this Agreement
shall be consummated (the "Closing") on the date hereof at 11:00 a.m. (New York
time), simultaneously with the execution of this Agreement by the Parties, at
the offices of Xxxxxxxxx Traurig, LLP, New York, New York or on such other date,
or at such other time or place, as shall be mutually agreed upon by the Parties
hereto (the "Closing Date").
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 General Statement. No specific representation and warranty shall l
imit the generality or applicability of a more general representation
or warranty.
4.2 Representations and Warranties of Seller. Seller and each Seller
Party hereby represent and warrant to
Purchaser that:
(a) Organization; Authorization. Seller is a corporation duly
organized, validly existing and in good standing under the
laws of the State of Texas. Seller has all requisite corporate
power and authority to own or lease and operate its properties
and to carry on its business and is qualified or licensed to
do business and is in good standing in every jurisdiction
where the nature of its business or the properties owned,
leased or operated by it requires qualification or licensure,
except where the failure to be so qualified or licensed would
not have a material adverse effect on the ability of Seller to
perform its obligations under this Agreement.
(b) Authority. Seller has full power and authority to execute and
deliver this Agreement, the other agreements contemplated
herein, and to consummate the transactions contemplated
hereby.
(c) Enforceability. This Agreement has been duly executed and
delivered by Seller and constitutes Seller's legal, valid and
binding obligation, enforceable in accordance with its terms,
except as limited by applicable bankruptcy, insolvency or
other similar laws relating to creditors' rights generally,
now or hereafter in effect, and general principles of equity.
Seller need not give any notice to, make any filing with, or
obtain any authorization, consent, or approval of any court,
government or governmental agency, or third person in order to
consummate the transactions contemplated by this Agreement.
(d) Ownership; Title. Seller is the owner of, and has good, valid
and marketable title to, the Transferred Assets, free and
clear of all encumbrances including any taxes, security
interests, purchase rights, contracts, commitments, equities,
claims, demands, liens, encumbrances or other restrictions
whatsoever in law or in equity (the "Encumbrances"). Except
for this Agreement, Seller is not a party to any purchase
right, or other contract or commitment that could require
Seller to sell, transfer, or otherwise dispose of the
Transferred Assets. The trademarks conveyed hereunder are not
registered trademarks.
(e) Capacity. Seller has full legal power, right and authority and
all authorizations and approvals required by law to enter into
and perform this Agreement and to sell, transfer and deliver
good, valid and marketable title to the Transferred Assets
free and clear of any and all liens, claims, encumbrances, or
rights of third parties whatsoever in accordance with the
terms of this Agreement.
(f) Nonviolation. The execution and delivery of this Agreement
and the consummation of the transactions contemplated
thereby by Seller do not and will not (a) violate or conflict
with the provisions of the Articles of Incorporation or
Bylaws, or other charter documents, of Seller,
(b) constitute a default under, violate, conflict with,
or result in the termination of, any contract, agreement,
judgment, order, injunction or decree to which any Seller
is a party, or by which Seller is bound or to which Seller,
or any of the Transferred Assets is subject, (c) to Seller's
knowledge, conflict with or violate any law, rule or
regulation of any governmental authority having jurisdiction
over Seller or any of the Transferred Assets, or
(d) result in the creation or imposition of any Encumbrance
on the Transferred Assets.
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(g) Litigation. Except as set forth in Schedule 4.2(g), there is
no pending or, to Seller's knowledge, threatened, litigation
or judicial, administrative or arbitration claim, action or
proceeding with respect to the Transferred Assets, nor are
there any judgments, orders, writs, injunctions or decrees
currently in effect involving or affecting any of the
Transferred Assets.
(h) Inventory. Except as set forth in Schedule 4.2(h), all the
inventory including finished goods, goods under open purchase
orders or invoices on the Closing Date, work-in-process and
raw materials is in good condition, not obsolete or defective,
and is usable and saleable in the ordinary course of Seller's
business as presently conducted and does not have an
expiration date that expires within six (6) months from
Closing.
(i) Warranty or Product Liability Claims. Except as set forth in
Schedule 4.2(i), there are no pending or, to Seller's
knowledge, threatened warranty or product liability claims
against Seller with respect to Seller's finished goods.
(j) Return Policy. Seller has no written return policy with
respect to the finished goods.
(k) Compliance with Laws. To Seller's knowledge, Seller is in
material compliance with all federal, state, local, municipal
and foreign laws, rules, regulations, statutes and ordinances
applicable to Seller as they relate to the Transferred Assets.
(l) Purchase Orders. Schedule 4.2(l) attached hereto contains a
list of open purchase orders and invoices ("Purchase Orders")
specifically identifying the goods and quantities under such
open orders. To Seller's actual knowledge, such Purchase
Orders and the goods that are the subject of such orders are
being transferred to Purchaser herewith free of any
Encumbrances or third party claims and are for the benefit of
Purchaser.
(m) Permits and Licenses. Schedule 4.2(m) sets forth a list of all
permits, licenses or authorizations held by Seller
(collectively, the "Permits") required for sale of the
Products. To Seller's knowledge, each such Permit is in
full force and effect and Seller is in material compliance
with such Permit. To Seller's knowledge, such listed Permits
are the only Permits required for Purchaser to utilize the
Transferred Assets. To Seller's knowledge, no suspension
or cancellation of a Permit is threatened. Seller has no
basis for believing that such Permit will not be assignable
to Purchaser or renewable upon expiration, as the case may
be. Each such Permit will continue in full force and
effect immediately following the Closing.
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(n) Intellectual Property. Schedule 4.2(n) lists (a) all
trademarks, trade names, logos, patents, if any,
service marks, designs and specifications, copyrights, data,
formulas, processes, inventions and other intellectual
property and all applications therefor materially related to
the Transferred Assets (collectively, "Intellectual
Property"), owned, licensed or used by Seller (and discloses
whether such Intellectual Property is owned by Seller and
any agreements that license such Intellectual Property to
Seller or otherwise allows Seller to use such Intellectual
Property) and (b) all licenses granted by Seller, if any,
with regard to Intellectual Property. Seller owns or has the
right to use all Intellectual Property owned, licensed or
used by it, and such rights will be owned, licensed or made
available for use by Purchaser after the Closing on terms
and conditions substantially identical to those under which
Seller owned, licensed or used such rights prior to the
Closing. To Seller's knowledge, no Intellectual Property
owned by Seller violates or infringes on any rights of any
third parties. To Seller's actual knowledge, no Intellectual
Property licensed or used by Seller violates or infringes on
any rights of any third parties. There is no pending or, to
Seller's knowledge, threatened, claim or litigation
contesting the right of Seller to own, license or use such
Intellectual Property. To Seller's knowledge, no third party
is presently infringing any Intellectual Property owned by
Seller. To Seller's actual knowledge, no third party is
presently infringing any Intellectual Property licensed or
used by Seller.
(o) Investment Representations.
(i) Seller is acquiring the Transferred Shares for its own account
for investment only, and not with a view to, or for sale in
connection with, any distribution of such shares in violation
of the Securities Act of 1933, as amended (the "Securities
Act"), or any rule or regulation under the Securities Act.
(ii) Seller has had adequate opportunity to obtain from
representatives of Purchaser such information, in addition to
the representations set forth in this Agreement, as is
necessary to evaluate the merits and risks of such Seller's
acquisition of the Transferred Shares.
(iii) Seller has sufficient experience in business, financial and
investment matters to be able to evaluate the risks involved
in the acquisition of the Transferred Shares and to make an
informed investment decision with respect to such acquisition.
(iv) Seller understands that the shares representing the
Transferred Shares have not been registered under the
Securities Act and are "restricted securities" within the
meaning of Rule 144 under the Securities Act; and that until
such shares are so registered, the shares representing the
Transferred Shares cannot be sold, transferred or otherwise
disposed of unless they are subsequently registered under the
Securities Act or an exemption from registration is then
available.
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(v) Seller agrees and understands that until the shares
representing the Transferred Shares are sold under an
effective registration statement pursuant or sold pursuant to
Rule 144 under the Securities Act, a legend substantially in
the following form may be placed on the certificate
representing the Transferred Shares:
"THE SHARES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AND MAY NOT BE SOLD,
PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
ACCORDANCE WITH THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OF 1933
OR AN EXEMPTION THEREFROM AND, IN EACH CASE,
IN COMPLIANCE WITH APPLICABLE STATE
SECURITIES LAWS.
THE SHARES REPRESENTED BY THIS CERTIFICATE
ARE SUBJECT TO CERTAIN RESTRICTIONS ON
TRANSFER AS SET FORTH IN AN ASSET PURCHASE
AGREEMENT DATED AS OF FEBRUARY 28, 2007, AS
IT MAY BE AMENDED FROM TIME TO TIME, A COPY
OF WHICH IS ON FILE AT THE PRINCIPAL
EXECUTIVE OFFICES OF THE ISSUER. NO
REGISTRATION OR TRANSFER OF THESE SHARES
WILL BE MADE ON THE BOOKS OF THE ISSUER
UNLESS AND UNTIL SUCH RESTRICTIONS SHALL
HAVE BEEN COMPLIED WITH."
(vi) Seller represents that each of its shareholders
has certified in writing that they have received and reviewed
copies of the following documents filed by the Parent with the
Securities and Exchange Commission ("SEC") prior to the date
of this Agreement: (i) Annual Report on Form 10-K for the year
ended June 30, 2006; (ii) Quarterly Reports on Form 10-Q for
the quarters ended September 30, 2006 and December 31, 2006;
(iii) Proxy Statement on Schedule 14A filed on November 6,
2006; (iv) Current Reports on Form 8-K filed on October 19,
2006, November 7, 2006, January 24, 2007 and February 5, 2005;
and (v) the description of the Parent's common stock contained
in the Parent's registration statement on Form SB-2 filed with
the Securities and Exchange Commission on July 5, 1996.
(p) Brokers or Finders Fees. Except with respect to the fees, commissions
or expenses payable to GuidCap, LLC, Xxxxxxx Xxxxx and Xxxxx Xxxxxx
("Finders") (whose fees, commissions or expenses shall be paid through
the issuance by Purchaser of shares at the direction of Seller, with
the effect of reducing the number of shares issued directly to the
Seller and ultimately distributed to the Shareholders pursuant to the
Plan of Reorganization), no agent, broker, investment banker or other
firm, entity or individual is entitled to any broker's or finder's fee
or any other commission or similar fee from Seller or any of its
affiliates in connection with the transactions contemplated pursuant to
this Agreement.
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(q) Disclosure of Material Facts. None of the representations and
warranties contained in this Agreement or the attached Schedules
contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements contained herein or
therein, taken as a whole and in light of the circumstances under which
they were made or furnished, not false or misleading.
(r) Financial Statements. Attached hereto as Schedule 4.2(r) is a true
and correct copy of the following financial statements of Seller
(collectively, the "Financial Statements"): a balance sheet as of
December 31, 2004, 2005 and 2006 and the related statement of
income and retained earnings for the twelve (12) months then
ended, along with a balance sheet as of February 28, 2007. The
Financial Statements fairly present, in all material respects, the
financial condition, assets and liabilities, results of operations
and related costs and expenses of Seller as of the dates or for
the periods presented in the Financial Statements, as applicable,
in each case (except as disclosed on Schedule 4.2(r)), in conformity
with generally accepted accounting principles, applied on a
consistent basis during the period involved, subject in the case of
the Interim Statements, to normal year-end and audit adjustments.
The Financial Statements are in accordance with Seller's books and
records.
(s) Validity of Sale. The sale of the Transferred Assets by Seller to
Purchaser is a sale made for fair and valid consideration and the sale
and the transactions contemplated pursuant to this Agreement have not
been entered into by Seller with an intent to hinder, delay or defraud
its creditors.
(t) Sales. Except as set forth in Schedule 4.2(t), Seller's sales in 2004,
2005 and 2006 for the Product Lines are set forth on Schedule 4.2(t)
attached hereto, and Seller represents that Schedule 4.2(t) accurately
represents the sales of such products during those periods.
(u) Taxes.
(i) Definitions. "Tax" or "Taxes" means any federal,
state, local, or foreign income, gross receipts, license,
payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes
under Section 59A of the Code), customs duties, capital stock,
franchise, profits, withholding, social security (or similar),
unemployment, disability, real property, personal property,
sales, use, transfer, registration, value added, alternative
or add-on minimum, estimated, or other tax of any kind
whatsoever, including any interest, penalty, or addition
thereto, whether disputed or not. "Tax Return" means any
return, declaration, report, claim for refund, or information
return or statement relating to Taxes, including any schedule
or attachment thereto, and including any amendment thereof.
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(ii) Seller has filed all Tax Returns that it was
required to file. All such Tax Returns were correct and
complete in all respects. All Taxes owed by Seller (whether or
not shown on any Tax Return) have been paid. Seller is not
currently the beneficiary of any extension of time within
which to file any Tax Return. No claim has ever been made by
an authority in a jurisdiction where Seller does not file a
Tax Return that it is or may be subject to taxation by that
jurisdiction. There are no Encumbrances on any of the assets
of Seller that arose in connection with any failure (or
alleged failure) to pay any Tax.
(v) Net Operating Loss. As of the Effective Date, the Seller has a net
operating loss carryforward of not less than $720,036, and such net
operating loss will be available for income tax purposes to Purchaser
under section 381(a) of the Code (subject to the limitations of section
382 of the Code).
4.3 Purchaser's Representations and Warranties. Purchaser and Parent
represent and warrant to Seller that:
(a) Organization. Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the state of New
Jersey. Parent is a corporation duly organized, validly existing and in
good standing under the laws of the state of Delaware.
(b) Authority.
i. Purchaser has full power and authority to execute
and deliver this Agreement and other agreements contemplated
herein and to consummate the transactions contemplated hereby.
ii. Parent has full power and authority to execute
and deliver this Agreement and other agreements contemplated
herein, to issue the Transferred Shares and to consummate the
transactions contemplated hereby.
(c) Authorization; Enforceability.
i. The execution and delivery by Purchaser of this
Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by
the Board of Directors of Purchaser and no other corporate
proceedings on the part of Purchaser or its stockholders are
necessary to authorize the execution and delivery by Purchaser
of this Agreement or the consummation of the transactions
contemplated hereby. This Agreement has been duly executed and
delivered by Purchaser and constitutes Purchaser's legal,
valid and binding obligation, enforceable in accordance with
its terms, except as limited by applicable bankruptcy,
insolvency or other similar laws relating to creditors' rights
generally, now or hereafter in effect, and general principles
of equity. Purchaser need not give any notice to, make any
filing with, or obtain any authorization, consent, or approval
of any court, government or governmental agency or third
person in order to consummate the transactions contemplated by
this Agreement.
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iii. The execution and delivery by Parent of this
Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by
the Board of Directors of Parent and no other corporate
proceedings on the part of Parent or its stockholders are
necessary to authorize the execution and delivery by Parent of
this Agreement or the consummation of the transactions
contemplated hereby. This Agreement has been duly executed and
delivered by Parent and constitutes Parent's legal, valid and
binding obligation, enforceable in accordance with its terms,
except as limited by applicable bankruptcy, insolvency or
other similar laws relating to creditors' rights generally,
now or hereafter in effect, and general principles of equity.
Parent need not give any notice to, make any filing with, or
obtain any authorization, consent, or approval of any court,
government or governmental agency or third person in order to
consummate the transactions contemplated by this Agreement.
(d) Capitalization. The authorized capital stock of Parent consists of
25,000,000 shares of common stock, with a par value of $.002 per share
(the "Common Stock") and 1,250 shares of preferred stock, with a par
value of $.002 per share (the "Preferred Stock"). As of January
30, 2007, there were issued and outstanding 13,582,781 shares of
Common Stock and 25 shares of Preferred Stock. All outstanding shares
of Common Stock that make up the Transferred Shares, when issued, will
be validly issued, fully paid and non-assessable. Other than this
Agreement or the Escrow Agreement, there is no subscription, option,
warrant, call, right, agreement or commitment relating to the
issuance, sale, delivery or transfer by Purchaser (including any
right of conversion or exchange under any outstanding security
or other instrument) of the shares of Common Stock that make up the
Transferred Shares. Upon consummation of the transactions
contemplated hereby, Seller shall acquire good title to the shares of
the Common Stock that make up the Transferred Shares, free and clear
of all pledges, security interests, liens, charges, encumbrances,
equities, claims and options of whatever nature arising prior to
the deliver of the Transferred Shares to Seller, subject to the
provisions of this Agreement.
(e) Nonviolation.
i. The execution and delivery of this Agreement and
the consummation of the transactions contemplated herein by
Purchaser do not and will not (a) violate or conflict with the
provisions of the Articles of Incorporation or Bylaws, or
other charter documents, of Purchaser, (b) constitute a
default under, violate, conflict with, or result in the
termination of, any contract, agreement, judgment, order,
injunction or decree to which Purchaser is a party, or by
which Purchaser is bound, or (c) conflict with or violate any
law, rule or regulation of any governmental authority having
jurisdiction over Purchaser.
ii. The execution and delivery of this Agreement and
the consummation of the transactions contemplated herein by
Parent do not and will not (a) violate or conflict with the
provisions of the Articles of Incorporation or Bylaws, or
other charter documents, of Parent, (b) constitute a default
under, violate, conflict with, or result in the termination
of, any contract, agreement, judgment, order, injunction or
decree to which Parent is a party, or by which Parent is
bound, or (c) conflict with or violate any law, rule or
regulation of any governmental authority having jurisdiction
over Parent.
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(f) Brokers or Finders Fees. No agent, broker, investment banker or other
firm, entity or individual is entitled to any broker's or finder's fee
or any other commission or similar fee from Purchaser or Parent in
connection with the transactions contemplated pursuant to this
Agreement.
4.4 Survival. The representations and warranties of Seller, Seller Parties,
Purchaser and Parent, respectively, contained in this Agreement shall survive
the Closing for a twelve (12) month period.
ARTICLE V
CLOSING AND CLOSING DELIVERIES
5.1 Form of Documents. At the Closing, the parties are delivering the documents,
and performing the acts, which are set forth in this Article V. All documents to
be delivered shall be in form and substance reasonably satisfactory to the party
to whom such documents are to be delivered.
5.2 Purchaser's Deliveries. Subject to the fulfillment or written waiver of the
conditions set forth herein, on the date hereof, Purchaser shall execute and/or
deliver to Seller all of the following:
(a) counterpart of this Agreement duly executed by Purchaser;
(b) counterpart of an Assignment and Assumption Agreement
substantially in the form of the Assignment and Assumption Agreement
attached hereto as Exhibit B;
(c) as soon as practicable after the Closing Date, Purchaser
shall cause its transfer agent to deliver a certificate representing
the Transferred Shares to the Escrow Agent pursuant to Section 2.1(b);
(d) counterpart of an Escrow Agreement by and between
Purchaser, Seller and Escrow Agent duly executed by Purchaser in the
form attached hereto as Exhibit A; and
(e) counterpart of an Employment Agreement duly executed by
each of Xxxx X'Xxxx and Xxxxxxx Xxxxxxxx in the form attached hereto as
Exhibit D.
5.3 Seller's Deliveries. Subject to the fulfillment or written waiver
of the conditions set forth in Section 5.2, Seller shall execute
and/or deliver to Purchaser all of the following:
(a) counterpart of this Agreement duly executed by Seller and
Seller Parties;
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(b) counterpart of an Escrow Agreement by and between
Purchaser, Seller and Escrow Agent duly executed by Seller in the form
attached hereto as Exhibit A;
(c) counterpart of an Assignment and Assumption Agreement
substantially in the form of the Assignment and Assumption Agreement
attached hereto as Exhibit B;
(d) a Proprietary Rights Assignment duly executed by Seller in
the form attached hereto as Exhibit C;
(e) any and all consents and/or approvals required in order
for Seller to transfer the Transferred Assets to Purchaser and to
complete the transactions contemplated by this Agreement;
(f) an Employment Agreement duly executed by each of Xxxx
X'Xxxx and Xxxxxxx Xxxxxxxx in the form attached hereto as Exhibit D;
and
(g) any other instruments that Purchaser may reasonably deem
necessary or desirable to effect or evidence the transactions
contemplated hereby, including, but not limited to, the following:
(i) Certificate of Good Standing in Seller's jurisdiction of
organization;
(ii) Certificates as to the incumbency of Seller's officers;
(iii) Certificate setting forth the aggregate balance of the
Seller's bank accounts, demand accounts, deposit accounts and
cash on had as of the Closing Date; and
(iv) Shareholder and board resolutions approving this Agreement and
the transactions contemplated herein.
ARTICLE VI
POST-CLOSING COVENANTS
6.1 Licenses and Permits. Seller shall cooperate with Purchaser in all
commercially reasonable respects in connection with Purchaser's application or
the transfer, renewal, or issuance of any Permit.
6.2 Assistance with Preparation of Financial Statements. In the event Purchaser
is required to prepare financial statements including information relating to
the Transferred Assets in accordance with applicable laws, Seller shall use
commercially reasonable efforts to assist Purchaser and make available such
information deemed necessary by Purchaser to prepare such statements, at
Purchaser's expense.
6.3 Remittance of Receipts. Any receipts collected by or paid to Seller after
the Closing Date with regard to sale of Products after the Closing Date will be
duly endorsed or assigned by Seller to Purchaser and promptly remitted to
Purchaser in the same form as received by Seller.
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6.4 Returned Goods. Seller acknowledges and agrees that the following category
of goods returned by customers to Purchaser after the Closing Date shall remain
the responsibility of Seller and Purchaser shall have no obligations thereby for
defective goods which were sold by Seller prior to the Closing Date. Seller
shall reimburse Purchaser for any such amounts within five (5) business days
upon receipt of reasonably acceptable documentation of Purchaser's costs and
expenses incurred to replace such customer's returned goods.
6.5 Confidentiality. Seller will keep confidential and will not directly or
indirectly disseminate, disclose, use, communicate, divulge or otherwise
appropriate any of the Confidential Information (as defined below). Seller will
take all steps necessary or requested by Purchaser to ensure that all of the
Confidential Information is kept secret and confidential for the sole use and
benefit of Purchaser. All Confidential Information will be the exclusive
property of Purchaser, and Seller will promptly deliver to Purchaser all
Confidential Information, including all copies thereof, which is in Seller's
possession or under Seller's control, without making or retaining any copies or
extracts thereof. As used in this Agreement, "Confidential Information" means
the information set forth on Schedule 6.5 attached hereto.
6.6 Non-Compete. As a condition to Purchaser's willingness to enter into this
Agreement and consummate the transactions contemplated herein, for a period of
two (2) years following the Closing, Seller and its officers, directors and
Affiliates (as defined below) shall not directly or indirectly compete with,
participate in, render services for, or in any manner engage in any business
within the United States of America competing with the Product Lines. If, at the
time of enforcement of this Section 6.6, a court holds that the restrictions
stated herein are unreasonable under circumstances then existing, the Parties
hereto agree that the maximum period, scope or geographical area reasonable
under such circumstances shall be substituted for the stated period, scope or
area. For the purposes of this Agreement, "Affiliates" means any person, firm,
corporation, partnership, limited liability company, joint venture, business
trust, association or other entity that now or in the future, directly or
indirectly, controls, is controlled by or is under common control with Seller.
Any transactions with Purchaser or its Affiliates pursuant to this Agreement or
pursuant to their written approval or direction shall not be deemed in violation
of this Section 6.6.
6.7 Remedies. Seller acknowledges and agrees that its obligations under Section
6.5 and 6.6 above are of a special, unique and extraordinary character, that
they are reasonably related to the legitimate business interests of Purchaser,
and that a failure to perform any such obligation or a violation of such
obligations will cause irreparable injury to Purchaser, the amount of which
would be impossible to estimate or determine and for which adequate compensation
could not be fashioned. Therefore, Seller agrees that Purchaser will be
entitled, as a matter of right, and without the need to prove irreparable injury
or to post bond, to an injunction, restraining order, writ of mandamus or other
equitable relief (including specific performance) from any court of competent
jurisdiction, restraining any violation or threatened violation of any term of
such Section 6.5 or 6.6, or requiring compliance with or performance of any
obligation thereunder, by Seller and such other persons as the court will order.
The rights and remedies provided Purchaser hereunder are cumulative and will be
in addition to the rights and remedies otherwise available to Purchaser under
any other agreement or applicable law, including the right to require Seller to
account for and pay over to Purchaser all compensation, profits, moneys,
accruals, increments or other benefits derived or received as a result of any
transactions constituting a breach of the covenants contained therein.
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6.8 Bulk Transfer Laws. The Parties do not believe that any laws relating to
bulk sales or bulk transfers (including any such laws under the Uniform
Commercial Code) are applicable to any of the transactions contemplated under
this Agreement. Notwithstanding the foregoing, and in order to induce Purchaser
to execute this Agreement and consummate these transactions, Seller will
indemnify and defend Purchaser and its Affiliates and hold them harmless (in
accordance with Article VII below) from and against any claim or other expense
arising out of, resulting from or relating to, any determination of the
applicability to any of the transactions of, or failure to comply with in
connection with any of the transactions of, any of such laws.
6.9 Taxes. The Parties intend for the transactions contemplated by this
Agreement to qualify as a "reorganization" within the meaning of section 368(a)
of the Code and agree to report the transactions contemplated by this Agreement
in a manner consistent with section 368(a) of the Code.
ARTICLE VII
INDEMNIFICATION AGREEMENT
7.1 General. From and after the Closing, the parties shall indemnify each other
as provided in this Article VII. For the purposes of this Article VII, each
party shall be deemed to have remade all of its representations and warranties
contained in this Agreement at the Closing with the same effect as if originally
made at the Closing. As used in this Agreement, the term "Damages" shall mean
all liabilities, demands, claims, actions or causes of action, regulatory,
legislative or judicial proceedings or investigations, assessments, levies,
losses, fines, penalties, damages, costs and expenses, including, without
limitation reasonable attorneys', accountants', investigators', and experts'
fees and expenses, sustained or incurred in connection with the defense or
investigation of any such claim.
7.2 Seller's Indemnification Obligations. Seller and Seller Parties shall
defend, indemnify, save and keep harmless Purchaser, its Affiliates and their
respective representatives, officers, directors, shareholders, agents,
employees, successors and assigns against and from all Damages sustained or
incurred by any of them resulting from or arising out of:
(a) any material inaccuracy in or any material breach of any
representation and warranty made by Seller in this Agreement or in any
closing document delivered to Purchaser in connection with this
Agreement;
(b) any material failure by Seller to perform or observe any
material covenant or agreement to be performed or observed by it or on
its behalf under this Agreement or under any certificates or other
documents or agreements executed by Seller in connection with this
Agreement;
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(c) other than the Assumed Liabilities, any of Seller's debts,
liabilities, taxes, obligations, contracts or commitments of any nature
or kind whatsoever, whether existing as of the Closing or arising
thereafter, known or unknown, contingent or otherwise; or
(d) any agreements, contracts, negotiations or other dealings
by Seller or any of its shareholders with any person concerning the
sale of the Transferred Assets.
7.3 Purchaser's Indemnification Obligations. Purchaser shall defend, indemnify,
save and keep harmless Seller, Seller Parties and their respective
representatives, officers, directors, agents, employees, successors and assigns
against and from all Damages sustained or incurred by any of them resulting from
or arising out of or by virtue of any inaccuracy in or breach of any
representation and warranty made by Purchaser in this Agreement or in any
closing document delivered to Seller in connection with this Agreement.
7.4 Deductible and Cap. Seller and Seller Parties shall be obligated to
indemnify Purchaser under this Agreement only if Purchaser's Damages exceed the
total of $35,000 and only for Purchaser's Damages in excess of (but not
including) such amount (the "Deductible") and then only up to an aggregate of
the value of the Transferred Shares then held in Escrow (the "Cap"), provided,
the Deductible and the Cap shall not apply to Purchaser's Damages arising from
fraud.
7.5 Exclusive Remedy. Seller, Seller Parties, Purchaser and Parent acknowledge
and agree that, from and after the Closing, notwithstanding any other provision
of this Agreement to the contrary, the sole and exclusive remedy of the
Purchaser, its Affiliates and their respective representatives, officers,
directors, shareholders, agents, employees, successors and assigns with respect
to claims for Damages or otherwise, in connection with, arising out of or
resulting from the subject matter of this Agreement and any related agreements
and the transactions contemplated hereby and thereby, shall be in accordance
with, and limited solely to indemnification under, the provisions of this
Article 7.
7.6 Sole Recourse. Except with regard to fraud, Purchaser's sole source of
recovery for a claim for indemnification under this Article 7 shall be by
offsetting such damages against the Transferred Shares then remaining in Escrow.
For purposes of determining the number of Transferred Shares to be transferred
to the Purchaser in the event of a claim for indemnification under this Article
7, each Transferred Share shall have a value equal to the average "Nasdaq
Official Closing Price," which shall equal the normalized price of the last
trade reported to Nasdaq's proprietary trade reporting system, of the Parent's
common stock for the five (5) day period ending on the Closing Date.
7.7 Expiration of Indemnification/Time and Manner of Claim. Any notice of a
claim by reason of any of the representations and warranties contained in this
Agreement shall state specifically the representation or warranty with respect
to which the claim is made, the facts giving rise to an alleged basis for the
claim, and the amount of liability asserted against the other party by reason of
the claim. Any claim made by Purchaser or Seller against the other for a default
or breach of any covenant or agreement contained in this Agreement must be made
by written notice, which shall state specifically the covenant or agreement with
respect to which the claim is made, the facts giving rise to an alleged basis
for such claim and the amount of liability asserted against the other party by
reason of such claim.
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ARTICLE VIII
MISCELLANEOUS
8.1 Expenses. Each party shall be responsible and pay for its respective
expenses, in connection with the authorization, preparation, execution and
performance of this Agreement, including without limitation, all fees and
expenses of agents, representatives, counsel, accountants and consultants.
8.2 Notices. Any notice required or permitted to be given under this Agreement
shall be made in writing, and shall be effective when mailed, by registered or
certified mail as follows:
Purchaser: Integrated BioPharma, Inc.
000 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: Chief Executive Officer
Copy to: Xxxxxxxxx Xxxxxxx, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxxx X. Xxxxxxxxxx, Esq.
Seller: BevSpec, Inc.
00000 Xxxxxx Xxxx, Xxxxx X
Xxxxxx, Xxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxxxx Xxxxxxxx
Copy to: XxXxxxxx, Xxxxxxxxx & Xxxxxxx, LLP
000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Phone: (000) 000-0000
Fax: (000) 000-0000
Attn: Xxxxx XxXxxxxx, Esq.
Any party may change said address by notice to the other parties in accordance
with the terms hereof.
8.3 Press Releases and Announcements. Neither Party shall issue any press
release or public announcement relating to the subject matter of this Agreement
without the prior written consent of the other Party; provided, however, that
either Party may make any public disclosure it believes in good faith is
required by applicable law, regulation or national exchange rule (in which case
the disclosing Party shall use reasonable efforts to advise the other Party and
provide it with a copy of the proposed disclosure prior to making such
disclosure).
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8.4 Representations as to Compliance with Law. Whenever a representation or
warranty is made herein with respect to compliance with any law, that
representation means the applicable subject matter is in material compliance
with applicable statutes, regulations and ordinances as in existence on the date
hereof and on the Closing Date and does not extend to any amendments or
revisions of such laws adopted subsequent to such dates.
8.5 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the Parties and their respective successors and assigns. Seller
may not assign its rights, interests or obligations hereunder.
8.6 Entire Agreement; Amendment. This Agreement, including the exhibits and
schedules hereto, shall constitute the entire agreement between the Parties with
respect to the subject matter hereof and shall supersede all previous
negotiations, commitments and writings. The Parties hereto may, by mutual
consent, amend or modify and supplement this Agreement in such manner as may be
agreed upon in writing.
8.7 Captions. The captions and headings contained herein are solely for
convenience of reference and will not affect the interpretation of any provision
hereof.
8.8 Waiver, Discharge, etc. This Agreement may not be released, discharged or
modified except by an instrument in writing signed on behalf of each of the
Parties. The failure of a party to enforce any provision of this Agreement shall
not be deemed a waiver by such party of any other provision or subsequent breach
of the same or any other obligation hereunder.
8.9 Governing Law. This Agreement shall be construed and the rights of the
Parties hereunder shall be governed by laws of the State of New York. Venue for
any dispute regarding this Agreement shall be in a court of competent
jurisdiction in New York County, New York.
8.10 Counterparts and Facsimile Signatures. This Agreement may be executed in
one or more counterparts, each of which shall be deemed to be an original, but
all of which shall constitute one Agreement. This Agreement may be executed by
facsimile signature.
8.11 Severability. Any portion of this Agreement that a court of competent
jurisdiction shall determine to be void, unenforceable or against public policy,
or for any other reason, shall be deemed to be severable from this Agreement and
shall have no effect on the other covenants or provisions in this Agreement. It
is agreed that the court shall be empowered to reform and construe any provision
that would otherwise be void or unenforceable in a manner that will be valid and
enforceable to the maximum extent permitted by law.
8.12 Attorneys' Fees. In the event that any action or proceeding is brought in
connection with this Agreement, the prevailing party therein shall be entitled
to recover its costs and reasonable attorney's fees.
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8.13 Further Assurances. Seller shall, and shall cause its officers, directors
and Affiliates to, execute and deliver all other documents and instruments of
conveyance, transfer or assignment and take all other actions reasonably
requested by Purchaser at any time before or after the Closing Date to effect
the sale and transfer to Purchaser of the Transferred Assets in accordance with
this Agreement. Purchaser shall, and shall cause its officers, directors and
Affiliates to, execute and deliver all other documents and instruments of
conveyance, transfer or assignment and take all other actions reasonably
requested by Seller at any time before or after the Closing Date to effect the
sale and transfer to Seller of the Cash Consideration and the Transferred Shares
in accordance with this Agreement.
[signature page follows]
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IN WITNESS WHEREOF, each of the parties hereto has executed
this Agreement as of the 28th day of February, 2007.
SELLER: BevSpec, Inc.
-------------------------------------
By: --------------------------------
Its: --------------------------------
PURCHASER: Bioscience Technologies, Inc.
-------------------------------------
By: E. Xxxxxx Xxx, President
PARENT: Integrated BioPharma, Inc.
-------------------------------------
By: --------------------------------
Its: --------------------------------
SHAREHOLDERS AND FINDERS SIGNING BELOW DO SO WITH REGARD SOLELY TO THE
PROVISIONS OF SECTION 2.1(b) AND ARTICLES IV AND VII HEREOF:
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Xxxx X'Xxxx
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Xxxxxxx Xxxxxxxx
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Xxxxxx Xxxx
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Xxxxxx Xxxxx
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Xxxxx Xxxxxxxx
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Xxxxx Xxxxxx
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Xxxxxxxxx Xxxxx Xxxxxxxxxxx
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Xxxxx Xxxxx
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Xxxx Xxxxxxxxxxx
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Xxxxxxx Xxxxx
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Xxxxx Xxxxxx
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Xxxxxx Xxxxxx
