Exhibit 2.1
TERMINATION AND RELEASE AGREEMENT
THIS TERMINATION AND RELEASE AGREEMENT (the "Agreement") is made and
entered into this 15th day of July, 2003, by and among North Atlantic Trading
Company, Inc., a Delaware corporation ("NATC"), Star Scientific, Inc., a
Delaware corporation ("Parent") and Star Tobacco, Inc., a Virginia corporation
("Opco" and together with Parent, "STAR").
WITNESSETH:
-----------
WHEREAS, NATC and STAR have entered into that certain Asset Purchase
Agreement, dated as of February 18, 2003 (the "Purchase Agreement");
WHEREAS, the parties hereto wish to terminate the Purchase Agreement
and release their respective rights, claims, obligations, and liabilities in
connection therewith;
WHEREAS, the board of directors of each party hereto has approved
such termination and authorized such party to enter into this Agreement; and
WHEREAS, capitalized terms used herein but not defined herein shall
have the meanings ascribed to them in the Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual agreements contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound hereby, agree as follows:
1. Termination of Purchase Agreement. Upon the execution of this
Agreement by each of the parties hereto and in accordance with subsection (a) of
Section 7.1 of the Purchase Agreement, the parties hereto agree that the
Purchase Agreement is terminated, null and void and of no future force or
effect.
2. Mutual Release. Simultaneously with the execution of this
Agreement, the parties hereto will execute and exchange the releases attached
hereto as Annex A-1 and Annex A-2 (the "Releases").
3. Xxxxxxx Money Deposit. Parent shall be entitled to the Xxxxxxx
Money Deposit and NATC shall be entitled to the Remaining Escrow Funds.
Immediately following the execution of this Agreement and the Releases, the
parties hereto shall execute and deliver to the Escrow Agent the instructions
attached hereto as Annex B.
4. Press Release. Promptly following the execution of this Agreement
by the parties hereto, NATC and Parent agree to cooperate in issuing a joint
press release regarding the execution of this Agreement substantially in the
form attached hereto as Annex C. The parties hereto agree not to issue or make
any other press release or statement to the media regarding this Agreement
without the consent of the other parties; provided, however, that (i) nothing in
this Agreement shall require any party hereto to obtain the consent of any other
party prior to making any other press release or statement to the media which
does not refer to such other party and (ii) no party shall unreasonably withhold
its consent to the issuance of a press release that refers to such party if it
is issued by any other party based on the advice of counsel that the issuance
thereof is required by NASDAQ or a Governmental Authority.
5. Governing Law. This Agreement, and all matters relating hereto,
shall be governed by, and construed in accordance with, the laws of the State of
New York.
6. Cooperation. Each party hereto agrees to cooperate with the other
and to take all action reasonably necessary to give full effect to the
provisions and intent of this Agreement. For such purpose, each party will bear
its own costs and expenses incurred to take such action.
7. Third Party Beneficiaries. The provisions of this Agreement are
solely for the benefit of the parties hereto and nothing express or implied in
this Agreement is intended to confer upon any Person, other than the parties
hereto, any rights or remedies hereunder.
8. Counterparts. This Agreement may be executed in any number of
counterparts by facsimile or otherwise, each of which shall be deemed to be an
original and all of which together shall constitute one and the same instrument.
9. Assignment and Successors. Neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned by any of the
parties hereto (whether by operation of law or otherwise) without the prior
written consent of the other parties. Subject to the preceding sentence, this
Agreement shall be binding upon, inure to the benefit of and be enforceable by
the parties and their respective successors and assigns.
2
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the undersigned parties as of the
date first written above.
NORTH ATLANTIC TRADING COMPANY, INC.
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: President
STAR SCIENTIFIC, INC.
By: /s/ Xxxx X. Xxxxxx
---------------------------------------------------
Name: Xxxx X. Xxxxxx
Title: Chairman, President and C.O.O.
STAR TOBACCO, INC.
By: /s/ Xxxxx X. Xxxx
---------------------------------------------------
Name: Xxxxx X. Xxxx
Title: Secretary and Treasurer
3
