ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT (this "Agreement") made as of the 30th day of
December, 1999, by and between ImmuCell Corporation, a Delaware corporation
having its principal place of business at 00 Xxxxxxxxx Xxxxx xx Xxxxxxxx,
Xxxxx (the "Buyer") and AMBI Inc., a New York corporation having its
principal place of business at 0 Xxxxxxxxxxxxxx Xxxx in Purchase, New York
(the "Seller").
W I T N E S S E T H:
WHEREAS, the Buyer desires to acquire from the Seller certain assets
related to the Seller's product, "WIPE OUT Dairy Wipes," upon
the terms and conditions set forth in this Agreement; and
WHEREAS, the Seller desires to sell to the Buyer certain assets
related to the Seller's product, "WIPE OUT Dairy Wipes," upon
the terms and conditions set forth in this Agreement.
NOW THEREFORE, for and in consideration of the mutual agreements
hereinafter set forth and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
ARTICLE I
DEFINITIONS
In addition to those terms defined elsewhere in this Agreement, as
used in this Agreement, and unless the context requires a different
meaning, the following terms have the meanings indicated below:
1.1 AFFILIATE shall mean as to any party, an individual or entity
controlling, controlled by or under common control with such party, now or
in the future, including without limitation partnerships in which such
party may invest as a limited or general partner.
1.2 Assigned Contracts shall mean:
(a) FermPro Manufacturing LP's agreement to fill orders from
the Buyer on the same basis that FermPro previously filled orders from the
Seller, dated December 22, 1999.
(b) that certain Supply Agreement between the Seller and
Nice-Pak Products, Inc. dated as of February 1, 1996 (the "Nice-Pak
Agreement");
(c) Useful Product Inc.'s agreement to provide warehousing
and distribution services to the Buyer on the same basis that Useful
Products previously provided services to the Seller, dated December 22,
1999; and
(d) that certain Executive Call Centers-Inbound Telemarketing
Service Agreement between the Seller and Executive Exchange, Inc. (n/k/a
Abacus Communications LP) dated as of November 26, 1996.
1.3 ENVIRONMENTAL SANITIZERS shall mean the use of Nisin
Preparations for application on hard surfaces, but not for application
thereof on, in or with food or for food preservation.
1.4 LICENSED PRODUCTS shall mean Environmental Sanitizers, Skin
Sanitizers and Wipe Out.
1.5 NISIN PREPARATIONS shall mean all products containing a
measurable concentration of any form, variant or derivative of nisin.
1.6 SKIN SANITIZERS shall mean the use of Nisin Preparations for
topical application on human skin for cleansing purposes, but not for a
prescription or over-the-counter drug for any specific indication.
1.7 WIPE OUT shall mean towels impregnated with Nisin Preparations
for use on bovine udders as a mastitis preventative, but not as a mastitis
treatment such as an intramammary infusion, which are marketed by the
Seller as WIPE OUT Dairy Wipes.
ARTICLE II
PURCHASE AND SALE
2.1 ACQUIRED ASSETS. Subject to the terms and conditions set
forth in this Agreement, at the Closing referred to in Article V hereof,
the Seller shall sell, assign, transfer, and deliver to the Buyer, and the
Buyer shall purchase, acquire, and take assignment and delivery of all of
the following assets (all of which assets are hereinafter referred to
collectively as the "Acquired Assets"):
(a) the equipment described on SCHEDULE 2.1(A) hereto (the
"Equipment") used in the manufacturing of nisin at the location designated
on SCHEDULE 2.1(A) (the "Location");
(b) all good and saleable inventory of Wipe Out (including
raw materials, work-in-process and finished goods) with an expiration date
of no earlier than January 31, 2000, contained at any of the Seller's
warehouses, offices and other premises and at the Location (collectively,
the "Inventory"). The Inventory shall be listed on a schedule to be
prepared by the Seller, which shall be attached hereto and be deemed a part
hereof as SCHEDULE 2.1(B) hereto;
(c) any lists in the possession of the Seller that identify
customers to whom sales of Licensed Products have been made during the
previous three (3) years, all clinical trial data relating to the Licensed
Products, all regulatory licenses and registrations relating to the
Licensed Products, all formulae relating to the Licensed Products, all
bills of materials and manufacturing documents relating to the Licensed
Products (including but not limited to standard operating procedures), all
quality control documents and specifications relating to the Licensed
Products and the 0-(000) 000-XXXX phone number (collectively, the
"Intangible Assets");
(d) all operating supplies, packaging supplies and shipping
materials relating to the Licensed Products (the "Supplies");
(e) the WIPE OUT and ONE STEP COW PREP trademarks listed in
SCHEDULE 2(E) (the "Trademarks");
(f) the Assigned Contracts; and
(g) pre-paid amounts under Section 7 of the Nice-Pak
Agreement.
2.2 EXCLUDED ASSETS. Notwithstanding the foregoing, the Seller is
not selling, and the Buyer is not purchasing pursuant to this Agreement,
any assets of the Seller other than the Acquired Assets, and, without
limitation, the term "Acquired Assets" shall not include:
(a) any cash of the Seller;
(b) any accounts receivable of the Seller relating to the
shipment of Wipe Out prior to the Effective Date (as hereinafter defined);
(c) any inventory of the Seller not referred to on SCHEDULE
2.1(B); or
(d) any other assets set forth as "Excluded Assets" on
SCHEDULE 2.2 hereto.
ARTICLE III
PURCHASE PRICE
The Buyer shall pay to the Seller, as the aggregate purchase price for
the Acquired Assets (the "Asset Purchase Price"), an amount equal to five
hundred forty-eight thousand nine hundred seventy-three dollars ($548,973),
subject to adjustment determined in accordance with Article VI hereof. The
Asset Purchase Price shall be paid in the manner provided in SECTION 5.3(A)
hereof and shall be allocated among the Acquired Assets in the manner set
forth on SCHEDULE 3 hereto. The parties hereto covenant and agree that the
allocations set forth on SCHEDULE 3 hereto were arrived at by arm's length
negotiation and that neither of them will take a position on any tax
return, before any governmental agency charged with the collection of any
tax or in any judicial proceeding that is in any manner inconsistent with
the terms of this Article III without the written consent of the other
party to this Agreement.
ARTICLE IV
EXCLUDED LIABILITIES
Except for the assumption of obligations incurred by the Buyer from
and after the Effective Date under the Assigned Contracts, the Buyer shall
not assume and shall not be liable or responsible for any debt, obligation
or liability of the Seller, or any subsidiary or Affiliate thereof, or any
claims against any of the foregoing of any kind, whether known or unknown,
contingent, absolute or otherwise. Except for such obligations under the
Assigned Contracts, the Seller shall forever defend, indemnify and hold
harmless Buyer and its affiliates from and against any and all such
liabilities in accordance with Article XIV hereof.
ARTICLE V
CLOSING
5.1 TIME AND PLACE. The closing of the purchase and sale hereunder
(the "Closing") shall take place at the offices of the Seller at 0
Xxxxxxxxxxxxxx Xxxx in Purchase, New York at 10:00 a.m. on December 30,
1999, or at such other place, time or date as the parties hereto may agree.
The time and date of the Closing are herein called the "Closing Date." It
is agreed that: (a) the effective date of the Closing shall be December
30, 1999 (the "Effective Date"); (b) all sales of Nisin Preparations and
Licensed Products prior to the Effective Date shall be recorded by the
Seller; and (c) all sales of Nisin Preparations and Licensed Products after
the Effective Date shall be recorded by the Buyer.
5.2 DOCUMENTS TO BE DELIVERED BY THE SELLER TO THE BUYER. At the
Closing, the Seller will deliver to the Buyer:
(a) a Warranty Xxxx of Sale from the Seller to the Buyer in
substantially the form of EXHIBIT A;
(b) a License and Sublicense Agreement between the Buyer and
the Seller covering proprietary information and patents relating to the
Licensed Products in substantially the form of EXHIBIT B (the "License
Agreement");
(c) an Assignment and Assumption Agreement between the Buyer
and the Seller relating to the Assigned Contracts, in substantially the
form of EXHIBIT C (the "Assignment and Assumption");
(d) such other bills of sale, certificates of title, and
other instruments of assignment or transfer with respect to the Acquired
Assets as the Buyer may reasonably request and as may be necessary to vest
in the Buyer good record and marketable title to all of the Acquired
Assets, in each case subject to no Encumbrance (as hereinafter defined);
(e) the Intangible Assets, including but not limited to all
contracts, books, records and other data of the Seller relating to the
Acquired Assets (except the Seller's minute and stock books and all other
records which the Seller is required by law to keep in its possession);
(f) a Supply Agreement between the Buyer and the Seller in
substantially the form of EXHIBIT D (the "Supply Agreement");
(g) a Trademark Assignment in substantially the form of
EXHIBIT E (the "Trademark Assignment");
(h) a certificate of an officer of the Seller certifying (i)
as to the completeness and accuracy of the resolutions of the Board of
Directors of the Seller approving and authorizing the execution and
delivery of the Agreement and the performance by the Seller of the
transactions contemplated by the Agreement, (ii) as to the accuracy of the
Seller's representations and warranties at and as of the Closing Date, and
(iii) that the Seller has performed and complied with all of the terms and
conditions to be performed and complied with by the Seller on or before the
Closing Date;
(i) an opinion of counsel to the Seller in form and substance
satisfactory to the Buyer and to the Buyer's counsel; and
(j) such other certificates and documents as the Buyer or its
counsel may reasonably request.
5.3 Payment and Documents to be Delivered by the Buyer to the
Seller. At the Closing, the Buyer will deliver to the Seller:
(a) a cashier's, certified or bank check payable to the order
of, or wire transfer to an account designated by, the Seller in the amount
of $424,000.00;
(b) a certificate of the Buyer certifying (i) as to the
accuracy of the Buyer's representations and warranties at and as of the
Closing Date, and (ii) that the Buyer has performed and complied with all
of the terms, provisions and conditions to be performed and complied with
by the Buyer at or before the Closing;
(c) the License Agreement;
(d) the Assignment and Assumption; and
(e) the Supply Agreement.
5.4 Payments Subsequent to Closing by the Buyer to the Seller.
(a) On February 15, 2000, the Buyer will pay to the Seller by
cashier's, certified or bank check payable to the order of, or wire
transfer to an account designated by, the Seller the amount of $62,486.50;
and
(b) On March 31, 2000, the Buyer will pay to the Seller by
cashier's, certified or bank check payable to the order of, or wire
transfer to an account designated by, the Seller the amount of $62,486.50,
subject to downward adjustment on a dollar for dollar basis for the cost
per unit stated on SCHEDULE 2.1(B) of any finished goods referred to in
such Schedule which have a February 2000 expiration date (approximately 611
cases of refills) and which are either not sold by the Buyer by the close
of business on February 28, 2000 or are sold by the Buyer and returned by a
customer due to short dating, and subject to further adjustment in
accordance with SECTION 6.2.
ARTICLE VI
ADJUSTMENTS
6.1 TAX ADJUSTMENTS. All personal property taxes with respect to
the Acquired Assets shall be apportioned and shall be adjusted, as of the
Effective Date, and the net amount thereof shall be added to or deducted
from, as the case may be, that portion of the Asset Purchase Price paid by
the Buyer on the Closing Date. If the amount of any item is not known at
the time of Closing, it shall be apportioned on a basis which is agreed to
by the Buyer and the Seller prior to the payment of the Asset Purchase
Price with a reapportionment when definitive data is available. The Seller
shall pay all sales, use, and other transfer taxes with respect to the sale
and the Buyer's purchase of the Acquired Assets.
6.2 INVENTORY ADJUSTMENT. On or before January 7, 2000, the Buyer
and the Seller shall jointly prepare a statement (the "Inventory
Statement") showing the actual value of the Inventory as of the Effective
Date (the "Inventory Value"). In the event that the Buyer and the Seller,
using their best efforts, are unable to agree upon the Inventory Value
within seven (7) days following the Effective Date, or such additional
period as may be agreed upon by them, the Buyer and the Seller shall submit
a list of the disputed issues to KPMG LLP (the "Accounting Firm") for
prompt resolution. The decision of the Accounting Firm shall be final and
binding only as to the determination of the Inventory Value provided for in
this SECTION 6.2. The parties agree that the Inventory Statement shall be
prepared solely for the purpose of determining the post-closing
adjustments, if any, to the Asset Purchase Price. The Buyer and the Seller
shall each pay one-half of the costs and expenses of the Accounting Firm in
resolving the disputed issues, if any. In the event that the Inventory
Value set forth on the final Inventory Statement is less than the
allocation to Inventory set forth on SCHEDULE 3, the aggregate Asset
Purchase Price shall be decreased by the amount of the difference (the
"Reduction Amount") and shall be deducted from the amount due from the
Buyer to the Seller on March 31, 2000. If the Reduction Amount is greater
than the amount due to the Seller on March 31, 2000, then the Seller shall
promptly remit the difference to the Buyer. In the event that the
Inventory Value set forth on the final Inventory Statement is greater than
the allocation to Inventory set forth on SCHEDULE 3, the aggregate Asset
Purchase Price shall be increased by the lesser of (a) the amount of the
excess and (b) five thousand dollars ($5,000) and shall be paid by the
Buyer to the Seller on March 31, 2000.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller represents and warrants to the Buyer, except as set forth
in the appropriate corresponding section of the separate Disclosure
Schedules which have been prepared by the Seller and delivered to the Buyer
contemporaneously with the execution and delivery of this Agreement, as
follows:
7.1 ORGANIZATION OF THE SELLER; AUTHORITY. The Seller is a
corporation duly organized, validly existing and in good standing under the
laws of the State of New York and has the corporate power and authority to
own or lease all of its properties and assets (including, without
limitation, the Licensed Products and the Acquired Assets) and to carry on
its business as it is now being conducted. The Board of Directors of the
Seller has authorized and approved the transactions contemplated by the
Agreement, and the Seller has the corporate power and is duly authorized to
enter into this Agreement and all ancillary agreements, and to carry out
the transactions, contemplated hereby. No other corporate proceedings of
the Seller are necessary to authorize and approve the execution, delivery
and performance of this Agreement and the transactions contemplated hereby.
Each of this Agreement and the License Agreement, the Warranty Xxxx of
Sale, the Assignment and Assumption, the Supply Agreement and the Trademark
Assignment (collectively, the "Other Agreements") has been duly executed
and delivered by the Seller and constitutes the legal, valid, and binding
obligation of the Seller, enforceable against the Seller in accordance with
its terms.
7.2 NONCONTRAVENTION. Neither the execution and delivery of this
Agreement or the Other Agreements by the Seller, nor the consummation by
the Seller of the transactions contemplated hereby, will constitute a
violation of, or be in conflict with, or constitute or create a default
under, or result in the creation or imposition of any Encumbrance (as
hereinafter defined) upon any property of the Seller (including, without
limitation, any of the Licensed Products or Acquired Assets) pursuant to
(a) the charter documents or bylaws of the Seller, each as amended to date;
(b) any agreement or commitment to which the Seller is a party or by which
the Seller or any of its properties or assets (including, without
limitation, any of the Licensed Products or Acquired Assets) is bound, or
to which the Seller or any of such properties or assets is subject; or (c)
any statute, judgment, decree, order, regulation, or rule of any court or
governmental authority applicable to the Seller.
7.3 TITLE TO THE ACQUIRED ASSETS; INVENTORY. The Seller is the
lawful owner of, has good and valid record and marketable title to, and has
the full right to sell, convey, transfer, assign, and deliver the Acquired
Assets, without any restrictions of any kind whatsoever. All of the
Acquired Assets at the Closing will be free and clear of any security
interest, liens, claims, charges, options, mortgages, debts, leases (or
subleases), conditional sales agreements, title retention agreements,
encumbrances of any kind, or restrictions against the transfer or
assignment thereof (collectively, "Encumbrances"), and as of the Closing
there will be no filings in the U.S. Patent and Trademark Office, in any
registry of deeds in any jurisdiction or under the Uniform Commercial Code
or similar statute in any jurisdiction which create or perfect or which
purport to create or perfect any Encumbrance in or on any of the Acquired
Assets. At and as of the Closing, the Seller will convey the Acquired
Assets to the Buyer by bills of sale, certificates of title, and
instruments of assignment and transfer effective to vest in the Buyer, and
the Buyer will have, good and valid record and marketable title to all of
the Acquired Assets, free and clear of all Encumbrances. The Inventory has
been accounted for at the lower of cost (last in, first out) or market and
represents items that are of merchantable quality and fit for the use
intended.
7.4 LITIGATION, ETC. There is no claim, action, suit, proceeding,
or investigation pending or to Seller's knowledge threatened, relating to
or affecting any of the Acquired Assets or Licensed Products or relating to
or affecting the activities of the Seller carried on with any of the
Acquired Assets or Licensed Products, or which questions the validity of
this Agreement or challenges any of the transactions contemplated hereby,
nor is there any basis for any such claim, action, suit, proceeding, or
investigation. There is no claim, action, suit or proceeding pending or to
Seller's knowledge threatened or proposed in any manner relating to the any
of the Assigned Contracts.
7.5 ABSENCE OF CHANGES. Since September 30, 1999, there has been
no material change in the business, prospects, results of operations,
assets, or the conduct of business of the Seller relating to any of the
Acquired Assets, Licensed Products or Nisin Preparations, other than
changes in the ordinary course of business.
7.6 CONFORMITY TO LAW. The Seller has materially complied with,
and is in material compliance with, (a) all laws, statutes, governmental
regulations, and all judicial or administrative tribunal orders, judgments,
writs, injunctions, decrees, or similar commands applicable to any of the
Acquired Assets, Licensed Products or Nisin Preparations (including,
without limitation, any labor, environmental, occupational health, zoning,
or other law, regulation, or ordinance); and (b) all terms and provisions
of all material contracts, agreements, and indentures to which the Seller
is a party relating to the Acquired Assets, Licensed Products or Nisin
Preparations (including but not limited to the Assigned Contracts), or by
which the Seller or any of the Acquired Assets, Licensed Products or Nisin
Preparations is subject. The Seller has not committed, been charged with,
or been under investigation with respect to, nor to Seller's knowledge does
there exist, any violation of any provision of any federal, state, or local
law or administrative regulation in respect of any of the Acquired Assets,
Licensed Products or Nisin Preparations.
7.7 BROKERS; COMMISSIONS. The Seller has not retained, utilized,
or been represented by any broker or finder in connection with the
transactions contemplated by this Agreement. The Seller does not owe nor
will it owe any commissions to any broker, agent or customer of the Seller,
and the Seller is not obligated to pay any other amounts to or perform
other obligations (other than routine servicing of customer accounts) for
any broker, agent or customer of the Seller.
7.8 PATENTS, TRADEMARKS, ETC. Set forth on Exhibit C to the
License Agreement is a complete and accurate list of all patents and patent
applications owned or licensed by or to the Seller relating to the Acquired
Assets and the Licensed Products, and set forth on SCHEDULE 2.1(E) hereto
is a complete list of all trademarks, trademarks and service marks owned by
the Seller relating to the Acquired Assets and the Licensed Products
(collectively, the "Intellectual Property"). Except as set forth on
SCHEDULE 7.8, the Seller has the sole and exclusive right to the use of the
Intellectual Property. The Seller has no knowledge of any claims or
demands of any other person, firm or corporation pertaining to the
Intellectual Property and the rights thereunder. No proceedings have been
instituted or are pending or to the knowledge of the Seller are threatened,
which challenge the right of the Seller in respect thereof, and none of the
issued patents, trademark registrations, trade names or service marks
included in the Intellectual Property to the knowledge of the Seller
infringes on the rights of others or are being infringed by others and none
is subject to any outstanding order, decree, judgement, stipulation or
agreement restricting the scope or the use thereof. All licenses are valid
and in full force and effect, and neither the Seller nor the other parties
thereto has breached any material provision of and nor is in default in any
material respect under the terms of any such license. SCHEDULE 7.8
correctly identifies any such license which requires the consent of any
person to the consummation of the transactions contemplated thereby and
hereby.
7.9 Suppliers and Customers.
(a) Set forth on SCHEDULE 7.9 is a true and correct list of
all customers who have purchased Wipe Out from the Seller, and the Seller
has identified thereon those customers it considers to be the twenty (20)
largest purchasers (by dollar volume) of Wipe Out in the past two (2)
years. There has been no recent materially adverse change in the Seller's
relations with any such customers.
(b) Set forth on SCHEDULE 7.9 is a list of the six (6)
largest suppliers (by dollar volume) to AMBI of products and services
relating to the Licensed Products.
7.10 GOVERNMENT PERMITS. Set forth on SCHEDULE 7.10 is a complete
and accurate list and description of all material permits, licenses, orders
and other authorizations and approvals of all federal, state, local or
foreign governmental or regulatory bodies (collectively "Government
Permits") used or required in the conduct of the business of the Seller as
such business relates to the manufacturing and sale of Nisin Preparations
or of any Licensed Product. The Seller has and is in substantial
compliance with all such Government Permits; all such Government Permits
are in full force and effect and no suspension or cancellation nor any
proposed adverse modification of any of them is pending or, to the
knowledge of the Seller, threatened. No consent of any governmental or
regulatory body issuing such Government Permits is necessary for the
consummation of the transactions contemplated by this Agreement. The
consummation of the transactions contemplated hereby will not result in the
suspension, cancellation or modification of any Government Permit carried
or obtained by the Seller. As of the Closing, the Buyer will file for its
own Labeler Code and Drug Product Listing with the U.S. Food and Drug
Administration.
7.11 ASSIGNED CONTRACTS. Each of the Assigned Contracts is valid
and in full force and effect, and neither the Seller nor the other parties
thereto has breached any material provision of nor is in default in any
material respect under the terms of any Assigned Contract. As of the
Effective Date, the Recovered Amount (as such term is defined in the Nice-
Pak Agreement) will not exceed fifty-six thousand dollars ($56,000).
7.12 CONSENTS OF THIRD PARTIES. Except as set forth on SCHEDULE
7.12, the Seller has no obligation to secure any consent from any third
party, pursuant to any Assigned Contract or otherwise, in order to permit
the consummation of the transactions contemplated by this Agreement.
7.13 INSURANCE. Set forth in SCHEDULE 7.13 is a complete and
accurate list of all insurance policies maintained by AMBI regarding Wipe
Out setting forth, with respect to each such policy, (a) the types and
amounts of coverage, (b) the name of the insurer and (c) a brief
description of all claims or possible claims as to which the insurer was
given notice thereunder since January 1, 1994. The Seller shall deliver to
the Buyer at the Closing a certificate of insurance showing insured
coverage for WIPE OUT and named locations of Nice-Pak, FermPro and Useful
Products.
7.14 DISCLOSURE. No representation or warranty by the Seller in
this Agreement or in any exhibit or schedule delivered or to be delivered
to the Buyer pursuant hereto contains or will contain any untrue statement
of a material fact, or omits or will omit to state a material fact required
to be stated therein or necessary to make the statements contained therein
not misleading.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the Seller as follows:
8.1 ORGANIZATION OF THE BUYER; AUTHORITY. The Buyer is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware. The Board of Directors of the Buyer has
authorized and approved the execution and delivery of this Agreement and
the transactions contemplated hereby, and the Buyer has corporate power and
is duly authorized to consummate the transactions contemplated by this
Agreement. Each of this Agreement and the Other Agreements to which the
Buyer is a party has been duly executed and delivered by the Buyer and
constitutes the legal, valid, and binding obligation of the Buyer,
enforceable against the Buyer in accordance with its terms.
8.2 NONCONTRAVENTION. Neither the execution and delivery of this
Agreement by the Buyer, nor the consummation by the Buyer of the
transactions contemplated hereby, will constitute a violation of, or be in
conflict with, constitute or create a default under, or result in the
creation or imposition of any liens upon any property of the Buyer pursuant
to (a) the charter documents or bylaws of the Buyer, each as amended to
date; (b) any agreement or commitment to which the Buyer is a party or by
which the Buyer or any of its properties is bound or to which the Buyer or
any of its properties or assets is subject; or (c) any statute or any
judgment, decree, order, regulation, or rule of any court or governmental
authority applicable to the Buyer.
8.3 BROKERS. The Buyer has not retained, utilized, or been
represented by any broker or finder in connection with the transactions
contemplated by this Agreement.
ARTICLE IX
COVENANTS OF THE SELLER
The Seller covenants and agrees with Buyer as follows:
9.1 ACCESS TO INFORMATION AND DOCUMENTS. Prior to the Closing,
the Seller will give to the Buyer and to its agents and representatives
reasonable access during normal working hours to any and all of the
properties, assets, books, records and other documents of the Seller
relating to the Acquired Assets, the Licensed Products and the Nisin
Preparations.
9.2 CONDUCT OF BUSINESS PENDING CLOSING. From the date hereof
until the Effective Date, except as consented to by the Buyer in writing:
(a) the Seller will carry on its business and operations in a
good and diligent manner and substantially in the manner carried on as of
the date hereof;
(b) the Seller will continue to maintain all of its existing
insurance coverage;
(c) the Seller will maintain the Acquired Assets in working
order and good condition, ordinary wear and tear excepted; and
(d) the Seller will use commercially reasonable efforts
consistent with its past practices to preserve its business intact as it
relates to the Acquired Assets, the Licensed Products and the Nisin
Preparations and to preserve for the Buyer its relationships with Wipe Out
customers and others.
In the event that the Seller does not comply with any of the covenants
set forth in this Section 9.2, the Buyer's sole remedy shall be to
terminate this Agreement pursuant to the provisions of Article XIV.
ARTICLE X
CONDITIONS PRECEDENT OF THE SELLER
The obligations of the Seller to sell the Acquired Assets to the Buyer
are subject to the fulfillment prior to or at the Closing of the following
conditions:
10.1 REPRESENTATIONS AND WARRANTIES OF THE BUYER. There shall not
be any material error, misstatement or omission in the representations and
warranties made by the Buyer in this Agreement; all representations and
warranties by the Buyer contained in this Agreement, or in any written
statement delivered by the Buyer to the Seller pursuant to this Agreement,
shall be true in all material respects at and as of the Closing as though
such representations and warranties were made at and as of said time
(except to the extent, if any, that the Seller shall waive the same), and
the Seller shall have received at the Closing a certificate to that effect
dated the Closing Date and executed on behalf of the Buyer by a duly
authorized executive officer.
10.2 PERFORMANCE BY THE BUYER. The Buyer shall have performed and
complied with all terms, provisions and conditions of this Agreement to be
performed and complied with by the Buyer at or before the Closing.
ARTICLE XI
CONDITIONS PRECEDENT OF THE BUYER
The obligation of the Buyer to purchase the Acquired Assets from the
Seller is subject to the fulfillment prior to or at the Closing of the
following conditions:
11.1 REPRESENTATIONS AND WARRANTIES OF THE SELLER. There shall
not be any material error, misstatement or omission in the representations
and warranties made by the Seller in this Agreement; all representations
and warranties by the Seller contained in this Agreement shall be true in
all material respects at and as of the Closing as though such
representations and warranties were made at and as of said time (except to
the extent, if any, the Buyer shall waive the same), and the Buyer shall
have received at the Closing a certificate to that effect dated the Closing
date and executed on behalf of the Seller by a duly authorized executive
officer.
11.2 PERFORMANCE BY THE SELLER. The Seller shall have performed
and complied with all terms, provisions, conditions and covenants of this
Agreement to be performed and complied with by the Seller at or before the
Closing.
11.3 PHYSICAL PROPERTIES. The Buyer has completed a satisfactory
inspection of the Acquired Assets. There shall have, since the date of
such satisfactory inspection, occurred no material damage to or destruction
or loss of (whether or not covered by insurance) any of the Acquired
Assets.
11.4 THIRD-PARTY CONSENTS. The parties shall have obtained all
third-party consents necessary or required for the consummation of the
transactions contemplated hereby, if any.
11.5 RECOVERED AMOUNT. The Recovered Amount (as such term is
defined in the Nice-Pak Agreement) shall not exceed fifty-six thousand
dollars ($56,000).
ARTICLE XII
INDEMNIFICATION
12.1 INDEMNITY OF THE BUYER. The Seller agrees to indemnify and
hold the Buyer harmless from and with respect to any and all claims,
liabilities, losses, damages, costs, and expenses, including, without
limitation, the reasonable fees and disbursements of counsel ("Losses"),
related to or arising directly or indirectly out of any of the following:
(a) any inaccuracies in any representation or warranty made
by the Seller in or pursuant to this Agreement, or any failure or breach by
the Seller of any covenant, obligation, or undertaking made by the Seller
in this Agreement; and
(b) any and all claims, liabilities, and obligations arising
out of the operation of the Acquired Assets and the manufacturing or sale
of the Licensed Products at any time on or prior to the Closing Date, or
any other business carried on by the Seller at any time prior to or after
the Closing Date.
12.2 INDEMNITY OF THE SELLER. The Buyer agrees to indemnify and
hold the Seller harmless from and with respect to any and all Losses
related to or arising directly or indirectly out of any of the following:
(a) any and all product liability claims relating to the sale
by the Buyer of the Licensed Products after the Closing Date; and
(b) any inaccuracies in any representation or warranty made
by the Buyer in or pursuant to this Agreement, or any failure or breach by
the Buyer of any covenant, obligation, or undertaking made by the Buyer in
this Agreement.
12.3 CLAIMS.
(a) In the event that a party desires to make a claim (a
"Claiming Party") against another party (an "Indemnifying Party") under
Section 12.1 or Section 12.2 hereof in connection with any action, suit,
proceeding, or demand at any time instituted against or made upon such
Claiming Party or otherwise for any Losses for which such Claiming Party
may seek indemnification hereunder (a "Claim"), such Claiming Party shall
notify the Indemnifying Party of such Claim and of its claim of
indemnification with respect thereto, provided that failure of the Claiming
Party to give such notice shall not relieve the Indemnifying Party of its
obligations under this Article XII except to the extent, if at all, that
the Indemnifying Party shall have been prejudiced thereby. Upon receipt of
such notice from the Claiming Party, the Indemnifying Party shall be
entitled to participate in the defense of such Claim. The Indemnifying
Party may assume the defense of such Claim, and in the case of such an
assumption, the Indemnifying Party shall have the authority to negotiate,
compromise, and settle such Claim.
The Claiming Party shall retain the right to employ its own
counsel and to participate in the defense of any Claim, the defense of
which has been assumed by the Indemnifying Party pursuant hereto, but the
Claiming Party shall bear and shall be solely responsible for its own costs
and expenses in connection with such participation, unless a conflict of
interest makes separate representation by the Claiming Party's own counsel
advisable, in which case the Seller shall pay such counsel's reasonable
fees and expenses.
(b) In the event of any Claims under Section 12.1 or Section
12.2 hereof, the Claiming Party shall advise the Indemnifying Party in
writing of the amount and circumstances surrounding such Claim. The
Indemnifying Party shall respond in writing to such Claim within thirty
(30) days of receipt thereof.
12.4 THRESHOLD AMOUNT; LIMITATION ON AMOUNT. Buyer or Seller, as
the case may be, shall be entitled to indemnification hereunder only when
the aggregate of all Losses suffered by Buyer or Seller, as the case may
be, with respect to which Buyer and Seller, as the case may be, would
otherwise be entitled to indemnification hereunder exceeds $10,000 (the
"Threshold Amount"), after which Buyer or Seller, as the case may be, shall
be entitled to indemnification for any Losses in excess of the Threshold
Amount, except (i) that the Threshold Amount limitation provided for in
this Section 12.4 does not apply to indemnification claims in respect of
the Excluded Liabilities described in Article IV, and (ii) in no event
shall the aggregate amount of liability of the Seller for its
representations, warranties and indemnities provided by the Seller, on the
one hand, or the aggregate amount of liability of the Buyer for its
representations, warranties and indemnities provided by the Buyer, on the
other hand, under this Agreement and the License Agreement exceed $548,973.
12.5 OTHER LIMITATIONS. No indemnification shall be payable with
respect to claims asserted under Sections 12.1 or 12.2 of this Agreement
based upon inaccuracies of the representations or warranties contained in
this Agreement, and no other recovery shall be sought for any Losses based
upon inaccuracies of the representations or warranties contained in this
Agreement, if asserted after April 1, 2001, provided, however, that the
foregoing limitation shall not apply in respect of any action brought for
fraud with an actual intent to deceive.
ARTICLE XIII
COVENANT-NOT-TO-COMPETE
13.1 NON-COMPETITION. From the Effective Date, and for a period
of five (5) years thereafter, the Seller and its Affiliates will not (a)
directly or indirectly engage in any business or undertaking directly or
indirectly competitive with the commercial manufacture and sale of Wipe Out
anywhere in the world, (b) engage in any business or undertaking that uses
nisin-based preparations to compete with Environmental Sanitizers or Skin
Sanitizers, (c) directly or indirectly, provide consulting services for the
purpose of assisting any person or entity in engaging in any business or
undertaking that is prohibited to AMBI under (a) or (b) above, or (d) be an
investor in any entity whose principal business is prohibited to AMBI under
(a) or (b) above. Nothing herein shall impair or limit AMBI's right to
manufacture, sell, license or otherwise deal in or with prescription or OTC
drugs, dietary supplements, or medical foods, whether or not such drugs,
supplements or foods use or incorporate Nisin Preparations, or to sell or
otherwise dispose of the business of manufacturing, selling, licensing or
otherwise dealing in or with prescription or OTC drugs, dietary
supplements, or medical foods, whether or not such drugs, dietary
supplements, or medical foods use or incorporate Nisin Preparations.
13.2 AGREEMENT AS TO SCOPE. THE PARTIES AGREE THAT THE TIME PERIOD
AND GEOGRAPHICAL AREA OF NON-COMPETITION SPECIFIED ABOVE ARE REASONABLE AND
NECESSARY IN LIGHT OF THE TRANSACTIONS ENTERED INTO UNDER THIS AGREEMENT.
If, however, it shall be determined at any time by a court of competent
jurisdiction that either the time period restriction or the geographical
area restriction, or both, are invalid or unenforceable, the parties agree
that any such restriction determined to be invalid or unenforceable shall
be deemed so amended as to make such restriction valid and enforceable in
the determination of said court, and such restriction, as so amended, shall
be enforceable between the parties to the same extent as if such amendment
had been made as of the date of this Agreement.
13.3 NO AGENCY. The Seller shall have no authority or power to
act on behalf or in the name of the Buyer or any of its Affiliates or to
bind the Buyer or any of its Affiliates.
13.4 SPECIFIC ENFORCEMENT. THE PARTIES ACKNOWLEDGE THAT THE BUYER
WOULD BE IRREPARABLY DAMAGED AND THERE WOULD BE NO ADEQUATE REMEDY AT LAW
FOR THE SELLER'S BREACH OF THIS ARTICLE XIII AND, ACCORDINGLY, THE TERMS OF
THIS ARTICLE XIII SHALL BE SPECIFICALLY ENFORCED. THE SELLER HEREBY
CONSENTS TO THE ENTRY OF ANY TEMPORARY RESTRAINING ORDER OR PRELIMINARY OR
EX PARTE INJUNCTION, IN ADDITION TO ANY OTHER REMEDIES AVAILABLE AT LAW OR
IN EQUITY, TO ENFORCE THE PROVISIONS OF THIS ARTICLE XIII.
ARTICLE XIV
TERMINATION
This Agreement may be terminated as follows:
14.1 TERMINATION BY THE BUYER. The Buyer may, with no liability
to the Seller, terminate this Agreement by notice to Seller (a) at any time
prior to the Closing if default shall be made by Seller in the observance
or in the due and timely performance of any of the terms hereof to be
performed by Seller that cannot be cured at or prior to the Closing, or (b)
at the scheduled time of the Closing if any of the conditions precedent to
the performance of the Buyer's obligations pursuant to this Agreement shall
not have been fulfilled.
14.2 TERMINATION BY THE SELLER. The Seller may, with no liability
to the Buyer, terminate this Agreement by notice to the Buyer (a) at any
time prior to the Closing if default shall be made by the Buyer in the
observance or in the due and timely performance of any of the terms hereof
to be performed by the Buyer that cannot be cured at or prior to the
Closing, or (b) at the scheduled time of the Closing if any of the
conditions precedent to the performance of the Seller's obligations
pursuant to this Agreement shall not have been fulfilled.
14.3 EFFECT OF TERMINATION. If this Agreement is terminated
pursuant to this Article XIV, this Agreement shall no longer be of any
force or effect, and there shall be no liability in relation to this
Agreement on the part of any party or its respective directors, officers or
shareholders except, in the case of termination because of a material
default or material breach resulting from the willful fault of another
party. If this Agreement shall be terminated, each party will (a)
redeliver all documents, work papers and other materials of any other party
relating to the transactions contemplated hereby to the party furnishing
the same, and (b) destroy all documents, work papers and other materials
developed by its agents and employees in connection with the transactions
contemplated hereby which embody confidential information furnished by any
party hereto, or deliver such documents, work papers and other materials to
the party furnishing the same.
ARTICLE XV
MISCELLANEOUS
15.1 EXPENSES. All expenses of the preparation, execution, and
consummation of this Agreement and of the transactions contemplated hereby,
including, without limitation, attorneys', accountants' and outside
advisors' fees and disbursements, shall be borne by the party incurring
such expenses.
15.2 NOTICES. All notices, demands, and other communications
hereunder shall be in writing and shall be deemed to have been duly given
if delivered personally, or if (a) mailed by certified mail, return receipt
requested, postage prepaid, (b) sent by nationally recognized overnight
courier service or (c) sent by facsimile, as follows:
If to the Seller, to:
AMBI Inc.
0 Xxxxxxxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Attention: Xxxxxxxx Xxxxx, Esq.
Fax: 000-000-0000
with a copy to:
Xxxxx X. Xxxxxx, Esq.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Fax: 000- 000-0000
If to the Buyer, to:
ImmuCell Corporation
00 Xxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: Xx. Xxxxxxx X. Xxxxxxx
Fax: 000-000-0000
with a copy to:
Day, Xxxxx & Xxxxxx LLP
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Fax: 000.000.0000
15.3 ENTIRE AGREEMENT. This Agreement, together with the
Schedules and Exhibits hereto and the License Agreement, contains the
entire understanding of the parties, supersedes all prior agreements and
understandings relating to the subject matter hereof. This Agreement shall
not be amended except by a written instrument hereafter signed by all of
the parties hereto.
15.4 GOVERNING LAW. The validity and construction of this
Agreement shall be governed by the laws of the State of New York, without
regard to its conflicts of law provisions.
15.5 JURISDICTION AND VENUE. The parties agree not to contest
personal jurisdiction and further agree that any action initiated relating
to this Agreement shall be filed in the United States District Court for
the Southern District of New York.
15.6 SECTIONS AND SECTION HEADINGS. All enumerated subdivisions
of this Agreement are herein referred to as "article," "section" or
"subsection." The headings of articles, sections and subsections are for
convenience of reference only and shall not limit or control the meaning
thereof.
15.7 ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the successors and permitted assigns of each of the parties.
Neither this Agreement nor the obligations of any party hereunder shall be
assignable or transferable by such party without the prior written consent
of the other party hereto; provided, however, that nothing contained in
this Section 15.7 shall prevent the Buyer, without the consent of the
Seller, from transferring or assigning this Agreement or its rights or
obligations hereunder to an Affiliate of the Buyer.
15.8 SURVIVAL AND MATERIALITY OF REPRESENTATIONS AND WARRANTIES.
The representations and warranties of the parties hereto contained in this
Agreement shall be deemed to have been relied on by the Buyer and shall
survive the Closing for all written claims made by either party on or
before April 1, 2001.
15.9 FURTHER ASSURANCES. From time to time, at the request of the
Buyer and without further consideration, the Seller shall execute and
deliver such further instruments of conveyance and transfer and take such
other actions as the Buyer may reasonably require to more effectively
convey and transfer any of the Acquired Assets to the Buyer. The Seller
and the Buyer shall also execute and deliver to the appropriate other party
such other instruments as may be reasonably required in connection with the
performance of this Agreement, and each shall take all such further actions
as may be reasonably required to carry out the transactions contemplated by
this Agreement.
15.10 PUBLIC ANNOUNCEMENTS. Except as may be required by
applicable law, no party to this Agreement shall, nor shall such party
permit its Affiliates to, make any announcement to the general public in
respect of this Agreement or the transactions contemplated hereby without
the prior written consent of the other party hereto.
15.11 NO IMPLIED RIGHTS OR REMEDIES. Except as otherwise
expressly provided herein, nothing herein expressed or implied is intended
or shall be construed to confer upon or to give any person, firm, or
corporation, other than the Seller and the Buyer and their respective
shareholders, any rights or remedies under or by reason of this Agreement.
15.12 COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF, and intending to be legally bound hereby, the
parties hereto have caused this Agreement to be duly executed and delivered
by their respective duly authorized officers as an instrument under seal as
of the date and year first above written.
AMBI INC.
By: /s/Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
IMMUCELL CORPORATION
By: /s/Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President and
Chief Fiancial Officer
Schedules and Exhibits Omitted in Accordance
with Item 601(b)(2) of Regulation S-K
ImmuCell will furnish supplementally a copy of any omitted exhibit or
schedule to the Securities and Exchange Commission upon request; provided,
however, that ImmuCell may request confidential treatment pursuant to Rule
24b-2 of the Exchange Act for any schedule or exhibit so furnished.
Exhibit A Form of Warranty Xxxx of Sale
Exhibit B Form of License and Sublicense Agreement
Exhibit C Form of Assignment and Assumption Agreement
Exhibit D Form of Supply Agreement
Exhibit E Form of Trademark Assignment
Schedule 2.1(a) Equipment; Location
Schedule 2.1(b) Inventory
Schedule 2.1(e) Trademarks
Schedule 2.2 Excluded Assets
Schedule 3 Allocation of Purchase Price
Schedule 7.8 Intellectual Property
Schedule 7.9 Customers and Suppliers
Schedule 7.10 Government Permits
Schedule 7.12 Consents of Third Parties
Schedule 7.13 Insurance
