EXHIBIT
ASSIGNMENT SATISFACTION AND INVESTMENT AGREEMENT
THIS AGREEMENT (this "Agreement") is made and entered into this - day
of April, 2003, by and De Xxxxxxx Xxxxxxxxxxx Xxxxx & Xxxxx, a professional
corporation ("DFRV"), Bigmar, Inc. ("Bigmar") and Xxxx X. Xxxxxxxxxx ("JT").
WITNESSETH:
WHEREAS, through the date of this Agreement Bigmar owes DFRV an
aggregate amount of $292,110.61 for services rendered and costs incurred through
December 31, 2002 (the "Receivable");
WHEREAS, DFRV ceased to represent Bigmar as of December 31, 2003:
WHEREAS, DFRV has pledged the account receivable owed to it by Bigmar
to Citibank, FSB ("Citibank") as part of a security interest that was granted to
Citibank in all of the accounts receivable of DFRV that secured a line of credit
extended by Citibank to DFRV;
WHEREAS, as of the date of this Agreement the amount of money owed by
DFRV to Citibank under the line of credit is $185,500, and such line of credit
is due and Receivable;
WHEREAS, DFRV has threatened to initiate litigation to collect the
Receivable;
WHEREAS, JT and Bigmar think it is in the best interests of Bigmar to
maintain good professional relations with the former lawyers of DFRV, who
continue to provide legal advice to Bigmar, and who are personally obligated on
the line of credit from Citibank to DFRV, and are interested in entering into a
transaction that. will cause the payment of a substantial amount of the
Receivable; and
WHEREAS, JT is willing to purchase from DFRV and DFRV is willing to
sell to JT all right, title and interest in the Receivable due to DFRV from
Bigmar, provided that Bigmar is willing to commit that Receivable immediately
and contemporaneously into equity securities of Bigmar; and
WHEREAS, Bigmar and JT have agreed that Bigmar will immediately issue
to JT three thousand two hundred and three (3,203) shares of its Series C
Preferred Stock in full satisfaction of the indebtedness represented by the
Receivable upon the conclusion of the assignment of that Receivable by DFRV to
Bigmar pursuant to this Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, and other good and valuable consideration, receipt of which is
hereby acknowledged, the parties hereby agree as follows:
1. As further provided herein, DFRV hereby agrees to sell the
Receivable to JT and JT agrees to purchase the Receivable from
DFRV free and clear of any lien, claim or encumbrance in
consideration of the immediate payment of United States
federal funds to DFRV in the amount of $185,500 plus JT's
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commitment to pay an additional amount of $106,610.1 (the
"Balance of the Consideration") to DFRV within twenty-four
months of the date hereof (the "Sale"). The Sale will be
effective as of the Effective Date defined in paragraph 2
below.
2. The Sale will be effective upon the payment of $185,500 in
United States federal funds by JT to DFRV (the "Effective
Date"). DFRV hereby assigns transfers and sells all of its
right, title and interest in the Receivable to JT and DFRV
hereby releases Bigmar from any and all obligation to pay any
or all of the Receivable, effective upon the Effective Date.
DFRV represents, warrants and covenants that as of the
Effective Date, DFRV will cause Citibank to release its lien
on the Receivable, and title to the Receivable will vest in JT
free and clear of any lien, claim or encumbrance.
3. Bigmar hereby represents, warrants and covenants that it
consents to the transactions contemplated by this Agreement;
that it will be obligated to JT for the full amount of the
Receivable, effective as of the Effective Date; and it further
represents, warrants and covenants that it will issue to JT at
the Effective Date three thousand two hundred and three
(3,203) shares of its Series C Preferred Stock (the "Share
Consideration") in full satisfaction of the indebtedness
represented by the Receivable. Bigmar further represents,
warrants and agrees that it will deliver certificates
representing the Share Consideration at the Effective Date;
that it has all corporate power necessary to execute this
Agreement and to issue the Share Consideration to JT; that the
execution of this Agreement has been duly authorized by it;
and that the Conversion Shares, when issued, will be duly
issued, fully paid and non-assessable.
4. The parties represent, warrant and agree that the certificate
or certificates representing the Share Consideration shall be
imprinted on its/their face with the restrictive legend
generally utilized by Bigmar in connection with the issuance
of restricted stock, the effect that the subject securities
have not been registered under United States securities laws
and may not be transferred or sold absent registration or a
legal opinion acceptable in form and substance to the Borrower
that an exemption from registration is available.
5. JT hereby represents, warrants and covenants that promptly
upon the execution of this Agreement JT will cause $185,500 in
United States federal funds to be wired to the DFRV Operating
Account at Bank of America: 0041 2629 2251; and that he will
cause the Balance of the Consideration to be paid to DFRV,
with simple annual interest thereon at 10% within twenty-four
months of the date hereof.
6. As an inducement for Bigmar to issue the Share Consideration
to JT, JT further represents, warrants and covenants that he
is accepting the Share Consideration for investment purposes
and not with a view to resale or distribution; that he is an
"accredited investor" as that term is defined by Rule 501(a)
of Regulation D promulgated under the Securities Act of 1933,
as amended; and that he is a sophisticated investor with
access to any and all information regarding Bigmar and its
subsidiaries.
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7. Each of the parties hereto represents to the other parties
that it has the right and power, and has taken all necessary
action to authorize it, to execute, deliver and perform under
this Agreement, and that this Agreement has been duly executed
and delivered by such party and will be, a legal, valid and
binding obligation of such party, enforceable against such
party in accordance with its terms except as such
enforceability may be limited by applicable equitable rights
or bankruptcy, insolvency, reorganization or similar laws
affecting the performance of creditors' rights.
8. This Agreement shall be governed by the laws of the state of
Delaware.
9. Each party represents that it/he has had the opportunity to
confer with independent counsel with respect to this
Agreement, and that none of DFRV, Xx. Xx Xxxxxxx or Xx. Xxxxx
(affiliates of DFRV) or Xxxxxxxx Xxxxxx, LLP has provided
legal advice to any party in connection with the transaction
contemplated hereby.
[SIGNATURE PAGE FOLLOWS.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
DE XXXXXXX XXXXXXXXXXX XXXXX & XXXXX,
a professional corporation
By:
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Xxxxx X. Xx Xxxxxxx,
Vice President and Secretary
BIGMAR, INC.
By:
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Philippe X.X. Xxxxxx,
Chief Financial Officer, Secretary and Director
XXXX X. XXXXXXXXXX
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Xxxx X. Xxxxxxxxxx
Enclosure
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