SECURITIES PURCHASE AGREEMENT
AND PLAN OF REORGANIZATION
THIS SECURITIES PURCHASE AGREEMENT AND PLAN OF REORGANIZATION ("Agreement")
is entered into on October 30, 1997 by and among HARRIER, INC., a Delaware
corporation ("Harrier"), COPE AG, a Swiss corporation ("COPE"), and XXXXXXX
XXXXXXXXXX ("Xxxxxxxxxx") and XXXXXX XXXXX ("Xxxxx") as majority stockholders of
COPE (the "Majority Stockholders").
R E C I T A L S
A. Harrier has authorized capital stock consisting of 30,000,000 shares of
common stock, $.001 par value ("Harrier Common Stock"), and 5,000,000 shares of
preferred stock, $.001 par value ("Harrier Preferred Stock"). Harrier has
issued and outstanding 15,317,923 shares of Harrier Common Stock and no shares
of Harrier Preferred Stock.
B. Glycosyn Pharmaceuticals, Inc. ("Glycosyn") is a Delaware corporation
with authorized capital stock consisting of 10,000,000 shares of common stock,
$.001 par value ("Glycosyn Common Stock"), and 5,000,000 shares of preferred
stock, $.001 par value ("Glycosyn Preferred Stock"). Glycosyn has issued and
outstanding 5,262,100 shares of Glycosyn Common Stock, of which Harrier owns
5,000,000 shares, and 250,000 shares of Glycosyn Preferred Stock designated as
Series A Preferred Stock.
X. XXXX has share capital of SFr106,000 consisting of 1,060 shares (the
"COPE Shares") of SFr100 par value capital stock ("COPE Capital Stock").
D. Prior to the Closing (as defined in Section 1.4), Harrier shall effect
a 1 for 45 reverse split ("Reverse Split") of the issued and outstanding shares
of Harrier Common Stock.
E. Prior to Closing, each stockholder of COPE other than the Majority
Stockholders shall execute a subscription agreement substantially in the form of
Exhibit B hereto (the "Subscription Agreement") (each such other stockholder a
"Subscriber" and all of the Subscribers together with the Majority Stockholders,
the "Selling Stockholders").
F. The Selling Stockholders wish to sell the COPE Shares and Harrier
wishes to acquire the COPE Shares, at the Closing, in exchange for the transfer
to the Selling Stockholders of an aggregate of 2,862,000 shares (post-split) of
Harrier Common Stock ("Harrier Shares"), subject to the terms and upon the
conditions hereinafter set forth.
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A G R E E M E N T
It is agreed as follows:
1. SECURITIES PURCHASE AND REORGANIZATION.
1.1 AGREEMENT TO EXCHANGE SECURITIES. Subject to the terms and upon
the conditions set forth herein, and in the case of the Subscribers, pursuant to
the Subscription Agreement, each Selling Stockholder agrees to sell, assign,
transfer and deliver to Harrier, and Harrier agrees to purchase from each
Selling Stockholder, at the Closing, the COPE Shares owned by the respective
Selling Stockholder as set forth on the List of Selling Stockholders, in
exchange for the transfer, at the Closing, by Harrier to each Selling
Stockholder of a pro rata share of Harrier Shares. A Selling Stockholder's pro
rata share of Harrier Shares shall be determined by multiplying the total number
of Harrier Shares (I.E., 2,862,000 shares (post-split) of Harrier Common Stock)
by a fraction, the numerator of which is the total number of COPE Shares owned
by the Selling Stockholder at the Closing and the denominator of which is the
total number of COPE Shares issued and outstanding at the Closing.
1.2 INSTRUMENTS OF TRANSFER.
(a) COPE SHARES. The Selling Stockholders shall deliver to
Harrier at the Closing evidence of the COPE Shares with such endorsements,
assignments and other instruments of transfer, in form satisfactory to Harrier
and its counsel, in order to effectively vest in Harrier all of the Selling
Stockholders' right, title and interest in and to the COPE Shares. From time to
time after the Closing, and without further consideration, the Selling
Stockholders will execute and deliver such other instruments of transfer and
take such other actions as Harrier may reasonably request in order to more
effectively transfer to Harrier the securities intended to be transferred
hereunder.
(b) HARRIER SHARES. Harrier shall deliver to the Selling
Stockholders at the Closing original certificates evidencing Harrier Shares, in
form and substance satisfactory to COPE and its counsel, in order to effectively
vest in the Selling Stockholders all right, title and interest in and to the
Harrier Shares. From time to time after the Closing, and without further
consideration, Harrier will execute and deliver such other instruments and take
such other actions as the Selling Stockholders may reasonably request in order
to more effectively issue to them Harrier Shares.
1.3 APPROVAL OF HARRIER STOCKHOLDERS. Harrier will duly call and
will promptly hold a meeting of its stockholders for the purpose of approving
its acquisition of the COPE Shares on the terms and conditions set forth in this
Agreement and in connection therewith will comply fully with the applicable
provisions of the Bylaws of Harrier and the Delaware General Corporation Law
relating to the calling and holding of a meeting of stockholders for such
purpose. In connection with the foregoing, and except as expressly limited by
Section 3.9, Harrier will comply fully with the requirements of the Securities
Exchange Act of 1934 Act, as amended ("Exchange Act"), and the rules and
regulations thereunder with respect to the solicitation of proxies for use at
such meeting.
1.4 CLOSING. The closing ("Closing") of the exchange of the COPE
Shares and Harrier Shares shall take place at Holiday Inn Crowne Plaza, 000
Xxxxx Xxxxxx Xxxxx, Xxxxxxx Xxxxx,
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Xxxxxxxxxx, at 10:00 a.m., local time, on January 30, 1998, or at such other
time and place as may be mutually agreed to in writing by the Selling
Stockholders and Harrier ("Closing Date").
2. REPRESENTATIONS AND WARRANTIES OF THE SELLING STOCKHOLDERS. Each
Majority Stockholder severally represents, warrants and covenants to and with
Harrier as follows:
2.1 POWER AND AUTHORITY. The Majority Stockholder has all requisite
individual power and authority to enter into and to carry out all of the terms
of this Agreement and all other documents executed and delivered in connection
herewith. All individual action on the part of the Majority Stockholder
necessary for the authorization, execution, delivery and performance of this
Agreement by the Majority Stockholder has been taken and no further
authorization on the part of the Majority Stockholder is required to consummate
the transactions provided for in this Agreement. When executed and delivered by
the Majority Stockholder, this Agreement shall constitute the valid and legally
binding obligation of the Majority Stockholder enforceable in accordance with
its terms, subject to the qualification and limitation that the procedural and
remedial rights of the other parties to this Agreement may be limited or
rendered unenforceable by (i) bankruptcy, insolvency, reorganization, moratorium
or other similar laws, (ii) legal or equitable principles now or hereafter in
effect relating to or affecting the enforcement of rights or remedies generally,
or (iii) the availability of equitable remedies.
2.2 OWNERSHIP OF AND TITLE TO SECURITIES. The List of Majority
Stockholders set forth on Exhibit A hereto (the "Stockholder List") accurately
sets forth the name, residence address and number of shares of COPE Capital
Stock owned by the Majority Stockholder. The Majority Stockholder represents
that, except for the COPE Shares or as disclosed on the COPE Disclosure Schedule
attached as Schedule 1 hereto ("COPE Disclosure Schedule"), there are no
warrants, options, subscriptions, calls, or other similar rights of any kind for
the issuance or purchase of any securities of COPE held by the Majority
Stockholder. The Majority Stockholder represents that the Majority Stockholder
has and will transfer to Harrier good and marketable title to the COPE Shares
which it owns as set forth on the Stockholder List, free and clear of all
pledges, security interests, mortgages, liens, claims, charges, restrictions or
encumbrances, except for restrictions under applicable U.S. federal or state
securities laws.
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2.3 INVESTMENT AND RELATED REPRESENTATIONS.
(a) HARRIER SHARES AS REGULATION S OR "RESTRICTED" SECURITIES.
The Majority Stockholder is aware that neither the Harrier Shares nor the offer
or sale thereof to the Majority Stockholder has been registered under the U.S.
Securities Act of 1933, as amended ("Securities Act"), or under any foreign or
state securities law. The Majority Stockholder further understands that no
registration statement has been filed with the Securities and Exchange
Commission ("SEC"), nor with any other U.S. or foreign regulatory authority and
that, as a result, any benefit which might normally accrue to an investor such
as the Majority Stockholder by an impartial review of such a registration
statement by the SEC or other regulatory commission will not be forthcoming.
The Majority Stockholder acknowledges that the Harrier Shares are being offered
alternatively pursuant to Regulation S under the Securities Act and certain
exemptions from Section 5 of the Securities Act. The Majority Stockholder
acknowledges that, except as otherwise disclosed on the COPE Disclosure
Schedule, it is not a "U.S. person" as defined by Rule 902(o) under the
Securities Act, a copy of which has been provided to each Majority Stockholder,
and that it is not acquiring the Harrier Shares for the account or benefit of
any "U.S. person." The Majority Stockholder understands that to the extent
Regulation S does not apply to Harrier's issuance of Harrier Shares to the
Majority Stockholder, the Harrier Shares will be characterized as "restricted"
securities under U.S. federal securities laws inasmuch as they are being
acquired in a transaction not involving a public offering and that under such
laws and applicable regulations such securities may be resold without
registration under the Securities Act only in certain limited circumstances.
The Majority Stockholder represents that the Majority Stockholder is familiar in
general with Rule 144 under the Securities Act (which provides generally for a
one year holding period and limitations on the amount of "restricted" securities
that can be sold in compliance with the rule uon completion of the holding
period), and understands the resale limitations imposed thereby and by the
Securities Act. The Majority Stockholder agrees that the Majority Stockholder
will not sell all or any portion of Harrier Shares except in accordance with
Regulation S, pursuant to registration under the Securities Act or pursuant to
an available exemption from registration under the Securities Act. The Majority
Stockholder understands that each certificate for Harrier Shares issued to the
Majority Stockholder or to any subsequent transferee shall be stamped or
otherwise imprinted with an appropriate legend summarizing the restrictions
described in this Section 2.4(a) and that Harrier shall refuse to transfer the
Harrier Shares except in accordance with such restrictions, such legend to be
substantially as follows:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND SUCH SECURITY MAY NOT BE OFFERED, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED EXCEPT (1) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT; (2) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904
OF REGULATION S UNDER THE SECURITIES ACT, OR (3) PURSUANT TO
AN EXEMPTION FROM REGISTRATION, IN EACH CASE AS CONFIRMED IN
AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND IN
EACH CASE IN ACCORDANCE WITH ANY OTHER APPLICABLE LAW.
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(b) INVESTMENT REPRESENTATION. This Agreement is made with the
Majority Stockholder in reliance upon the Majority Stockholder's representation
to the other parties to this Agreement, which by the Majority Stockholder's
execution of this Agreement the Majority Stockholder hereby confirms, that the
Harrier Shares to be received by the Majority Stockholder are being acquired
pursuant to this Agreement for investment and not with a view to the public
resale or distribution thereof unless in accordance with Regulation S, pursuant
to an effective registration statement or exemption under the Securities Act.
(c) NO PUBLIC SOLICITATION. The Majority Stockholder is
acquiring the Harrier Shares after private negotiation and has not been
attracted to the acquisition of the Harrier Shares by any press release,
advertising or publication.
(d) ACCESS TO INFORMATION. The Majority Stockholder believes it
has received all of the information it considers necessary or appropriate for
deciding whether to acquire the Harrier Shares, including, but not limited to
the copies of the Harrier SEC Reports (as defined in Section 4.4). The Majority
Stockholder further represents that it has had an opportunity to ask questions
of, and to receive answers from, Harrier regarding Harrier, its business and
prospects, and the Harrier Shares.
(e) INVESTOR SOPHISTICATION AND ABILITY TO BEAR RISK OF LOSS.
The Majority Stockholder, if a corporation or a partnership, has not been
organized for the purpose of acquiring the Harrier Shares. The Majority
Stockholder acknowledges that it is able to protect its interests in connection
with the acquisition of the Harrier Shares and can bear the economic risk of
investment in such securities without producing a material adverse change in the
Majority Stockholder's financial condition. The Majority Stockholder otherwise
has such knowledge and experience in financial or business matters that the
Majority Stockholder is capable of evaluating the merits and risks of the
investment in the Harrier Shares.
3. REPRESENTATIONS AND WARRANTIES OF COPE, ISENSCHMID AND XXXXX. XXXX,
Xxxxxxxxxx and Xxxxx each severally represents, warrants and covenants to and
with Harrier as follows:
3.1 CORPORATE ORGANIZATION, ETC. COPE is a Swiss corporation duly
organized, validly existing and in good standing under the laws of Switzerland
and is duly qualified to do business and is in good standing as a foreign
corporation under the laws of each jurisdiction in which the character or
location of the assets owned or leased by it require qualification, except where
the failure to so qualify would not materially adversely affect the business or
condition, financial or otherwise, of COPE. COPE has delivered or prior to the
Closing Date will deliver to Harrier complete and correct copies of its bylaws
and other organizational documents, as amended, certified by the Chairman of
COPE to be complete and correct. COPE owns all of the issued and outstanding
securities of COPE GmbH, Ltd., a German corporation, COPE Handelsgmbh, an
Austrian limited liability company, and Xpert, Inc., a Florida corporation.
Other than COPE GmbH, COPE Handelsgmbh and Xpert, Inc. (the "COPE
Subsidiaries"), COPE has no subsidiaries or equity ownership in any other
entities. No warrants, options, subscriptions, calls, commitments, or other
rights or agreements of any kind for the purchase, issuance or sale of the
capital shares of COPE GmbH, COPE Handelsgmbh or Xpert, Inc. are outstanding or
otherwise exist.
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3.2 CAPITALIZATION. The authorized, issued and outstanding
capitalization of COPE is as recited in the second recital to this Agreement.
All issued and outstanding shares of COPE Capital Stock have been duly
authorized and validly issued and are fully paid and non-assessable and none of
such issued and outstanding shares of COPE Capital Stock have been issued in
violation of the preemptive rights of any past or present stockholders. No
warrants, options, subscriptions, calls, commitments or other rights or
agreements of any kind issued, granted or entered into by COPE for the purchase,
issuance or sale of, or security exchangeable for or convertible into, any
authorized shares of COPE Capital Stock are outstanding or otherwise exists and
no authorized unissued shares of COPE Capital Stock are reserved for any
purpose. The Majority Stockholders are the only holders of COPE Capital Stock
and the Stockholder List accurately sets forth the names and residence addresses
and number of COPE Shares owned by the Majority Stockholders.
3.3 CORPORATE POWER AND AUTHORITY. COPE and each of the COPE
Subsidiaries has all requisite corporate power and authority to own or lease all
of its properties and assets, to operate its properties and assets and to carry
on its businesses as now conducted. COPE has all requisite corporate power and
authority to enter into and to carry out all of the terms of this Agreement.
All corporate action on the part of COPE and its stockholders necessary for the
authorization, execution, delivery and performance of this Agreement by COPE has
been taken and no further corporate authorization on the part of COPE is
required to consummate the transactions provided for in this Agreement. Neither
the execution, delivery nor performance of this Agreement by COPE or the
Majority Stockholders shall violate or result in a breach of any provisions of
the Bylaws or other organizational documents, as amended, of COPE. Neither the
execution, delivery nor performance of this Agreement by the Majority
Stockholders shall constitute a default or result in a breach of or accelerate
the performance required under any mortgage, deed of trust, lien, lease,
restriction or other contract or agreement to which COPE or any of its
properties or assets are bound or affected, or violate any order, writ,
injunction, decree, judgment or other restriction of any court, administrative
agency or governmental body.
3.4 FINANCIAL STATEMENTS. COPE has furnished to Harrier its
consolidated balance sheet as of the end of its fiscal year ended December 31,
1996 and its consolidated statements of earnings, stockholders' equity and cash
flows for the fiscal years ended December 31, 1996 and 1995, together with
appropriate notes to such consolidated financial statements. Prior to the
Closing, COPE shall deliver to Harrier the aforementioned financial statements,
accompanied by reports thereon containing opinions without comment or
qualification, except as therein noted, by its independent certified public
accountants. COPE has also furnished to Harrier its consolidated balance sheet
as of June 30, 1997 and its consolidated statements of earnings and cash flows
for the six months ended on such date, together with appropriate notes to such
consolidated financial statements.
All of the foregoing consolidated financial statements (collectively, the
"COPE Financial Statements"), including in each case the related notes, have
been prepared in conformity with United States generally accepted accounting
principles consistently applied and are correct and complete in all material
respects and such consolidated financial statements fairly present the financial
position of COPE and the COPE Subsidiaries as of the dates of such balance
sheets and the results of operations for the respective periods indicated.
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3.5 ABSENCE OF UNDISCLOSED LIABILITIES. COPE and the COPE
Subsidiaries have no material liabilities, fixed or contingent, other than
(i) liabilities fully reflected in the COPE Financial Statements, or
(ii) liabilities incurred since June 30, 1997 in the ordinary course of business
or as contemplated or permitted by this Agreement or referred to in the COPE
Disclosure Schedule, all of which in the aggregate, taking into consideration
all other changes in the financial condition of COPE and the COPE Subsidiaries
in the ordinary course of business, have had no material adverse affect on the
financial position or results of operations of COPE and the COPE Subsidiaries,
taken as a whole, or on the conduct of its businesses.
3.6 ABSENCE OF ADVERSE CHANGES. Except as disclosed in the COPE
Disclosure Schedule or the COPE Financial Statements, since June 30, 1997, there
has not been (i) any material adverse change in the assets or liabilities or in
the condition, financial or otherwise, or business, properties, earnings or net
worth of COPE and the COPE Subsidiaries, taken as a whole, or (ii) any damage or
destruction in the nature of a casualty loss, whether covered by insurance or
not, materially and adversely affecting any property or business of COPE or the
COPE Subsidiaries which is material to the consolidated financial condition,
operation or business of COPE and the COPE Subsidiaries, taken as a whole.
3.7 CONTRACTS AND AGREEMENTS. Set forth in the COPE Disclosure
Schedule is a list of all contracts and agreements (including loan agreements),
other than contracts for goods or services in the ordinary course of business,
to which COPE or any COPE Subsidiary is a party or by which it is bound,
involving more than $50,000. Except as set forth in the COPE Disclosure
Schedule, none of the contracts and agreements will expire or be terminated or
be subject to any modification of terms or conditions upon the consummation of
the transactions contemplated by this Agreement. Except as set forth in the
COPE Disclosure Schedule, neither COPE nor any COPE Subsidiary is in default in
any material respect under the terms of any such contract or agreement nor in
default in the payment of any principal of or interest on any indebtedness for
borrowed money nor has any event occurred which, with the passage of time or
giving of notice, would constitute such a default by COPE or any COPE Subsidiary
and no other party to any such contract or agreement is in default in any
material respect thereunder nor has any such event occurred with respect to such
party.
3.8 NO VIOLATION OR LITIGATION. Except as set forth in the COPE
Disclosure Schedule, neither COPE nor any COPE Subsidiary is in material
violation of any law or order, writ, injunction or decree of any court or other
governmental department, commission, board, bureau, agency or instrumentality,
and there are no material lawsuits, proceedings, claims or governmental
investigations pending or, to the knowledge of any executive officer of COPE,
threatened against COPE, any COPE Subsidiary or against the properties or
business of any of them, nor is there any reasonable basis known to COPE for any
such action and there is no action, suit, proceeding or investigation pending,
threatened or, to the knowledge of COPE, contemplated which questions the
legality, validity or propriety of the transactions contemplated by this
Agreement.
3.9 ACCURACY OF PROXY STATEMENT. Harrier's notice of special meeting
and proxy statement ("Proxy Statement"), including any amendments or supplement
thereto, will, when the Proxy Statement is mailed to the stockholders of Harrier
as contemplated by Section 1.3 hereof, contain the information with respect to
COPE and the Selling Stockholders required by the Exchange Act and the rules and
regulations thereunder. The Proxy Statement will not, at the time of mailing,
at the time of the meeting of stockholders of Harrier or at the Closing, include
any untrue statement of a material fact
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or omit to state a material fact with respect to COPE or the Selling
Stockholders required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The Selling Stockholders make no representations as to
statements or omissions regarding information solely relating to Harrier, it
being the agreement of the parties that responsibility for such statements or
omissions rests solely with Harrier.
3.10 EMPLOYEE OR CONSULTING AGREEMENTS. The COPE Disclosure Schedule
lists all plans, contracts, and arrangements, oral, implied or written, included
but not limited to union contracts, employment agreements, consulting
agreements, employee manuals, incentive payment plans and employee benefit
plans, whereunder COPE or any COPE Subsidiary has any obligations (other than
obligations to make current wage or salary payments terminable on notice of
90 days or less) to its officers or employees or other persons or their
beneficiaries or whereunder any of such person owes money to COPE or any COPE
Subsidiary, except to the extent any such obligation is set forth in the COPE
financial statements.
3.11 INSURANCE. COPE and the COPE Subsidiaries each maintain
policies of fire and casualty, liability and other forms of insurance in such
amounts and against such risks and losses as are reasonable for its businesses
and properties, and will keep such insurance in full force and effect through
the Closing. A list and brief description (including effective and termination
dates) of all policies of insurance, including insurance providing benefits for
employees, owned or held by COPE or the COPE Subsidiaries on the date hereof and
of all material performance bonds maintained by COPE on the date hereof are set
forth in the COPE Disclosure Schedule. Neither COPE nor any of the COPE
Subsidiaries are subject to any liabilities as a self-insurer of its business
and property which could have a material adverse impact on its business,
properties or prospects, taken as a whole, except as disclosed in the COPE
Disclosure Schedules.
3.12 TRADEMARKS AND PATENTS. COPE and the COPE Subsidiaries have no
material trademarks, trade names, copyrights, inventions, patents or
applications therefor which are owned, used, registered in the name of or
licensed to COPE or any COPE Subsidiary, except for those listed in the COPE
Disclosure Schedule. Except as disclosed in the COPE Disclosure Schedule, no
proceedings have been instituted or are pending or threatened or contemplated
which challenge the validity of the ownership by COPE or any COPE Subsidiary of
any such trademark, trade name, copyright, invention or patent. Except as
disclosed in the COPE Disclosure Schedule, neither COPE nor any COPE Subsidiary
has licensed anyone to use any such trademark or any technical know how or other
proprietary rights of COPE or any COPE Subsidiary.
3.13 NO GOVERNMENTAL OR OTHER PROCEEDING OR LITIGATION. No order of
any court or administrative agency is in effect which restrains or prohibits
COPE or the Selling Stockholders from consummating the transactions contemplated
hereby, and no suit, action, investigation, inquiry or proceeding by any
governmental body or other person or legal or administrative proceeding has been
instituted or threatened which questions the validity or legality of COPE's or
the Selling Stockholders' consummation of the transactions contemplated hereby.
3.14 APPROVALS AND CONSENTS. There are no permits, consents,
mandates or approvals of public authorities, either U.S. or Swiss, federal,
state or local, or of any third party necessary for COPE's or the Selling
Stockholders' consummation of the transactions contemplated hereby.
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3.15 BROKERAGE. No broker or finder has acted directly or indirectly
for the Selling Stockholders in connection with this Agreement or the
transactions contemplated hereby, and no broker or finder is entitled to any
brokerage or finder's fee or other commission in respect thereof based in any
way on agreements, arrangements or understandings made by or on behalf of the
Selling Stockholders.
3.16 PERMITS AND OTHER OPERATING RIGHTS. Except as disclosed in the
COPE Disclosure Schedule, COPE and the COPE Subsidiaries currently possess all
permits, licenses, certificates and other authorizations from third parties,
including, without limitation, foreign and domestic governmental authorities,
necessary or required by applicable provisions of law and judicial decisions,
and by the property and contract rights of third parties, for it to own or lease
its properties and assets and to operate its business in the manner in which it
is intended.
3.17 EMPLOYEE RETIREMENT PLANS. Neither COPE nor any COPE Subsidiary
has an employee pension, retirement or benefit plan.
3.18 PERSONAL PROPERTY, INVENTORIES AND TITLE TO PROPERTY. All
personal property owned, leased or used by COPE and the COPE Subsidiaries is
reflected in the COPE Financial Statements, and is in good operating and working
condition and fit for operation in the usual course of business, ordinary wear
and tear excepted. Except as set forth in the COPE Disclosure Schedule, COPE
and the COPE Subsidiaries have good and marketable title to all of their assets,
and a good and valid leasehold interest in all property leased by the
corporation, free and clear of all liens.
3.19 ENVIRONMENTAL MATTERS. There has been no manufacture, refining,
storage, disposal or treatment of Hazardous Substances (as hereinafter defined)
by COPE or any COPE Subsidiary at any real property currently or in the past
owned, operated, used, leased or contracted for by COPE or any COPE Subsidiary,
or otherwise in violation of any Environmental Laws (as hereinafter defined) or
which would require remedial action under any Environmental Law. During the
past three years neither COPE nor any COPE Subsidiary has received (a) notice of
any such violation with respect to any Hazardous Substance at or by any of such
real property, (b) notice from any governmental agency that COPE or any COPE
Subsidiary, or any present or former owner, lessee or operator of such real
property, is a potentially responsible party for cleanup liability with respect
to the emission, discharge or release of any Hazardous Substance or for any
other matter arising under the Environmental Laws or in any litigation,
administrative proceeding, finding, order, citation, notice, investigation or
complaint under any Environmental Law, or (c) notice of violation, citation,
complaint, request for information, order, directive, compliance schedule,
notice of claim, proceeding or litigation from any party concerning COPE's or
any COPE Subsidiaries' compliance with any Environmental Law. As used herein
"Environmental Laws" means the Resource Conservation Recovery Act, the
Comprehensive Environmental Responsibility Compensation and Liability Act, the
Superfund Amendments and Reauthorization Act, the Toxic Substances Control Act,
the Hazardous Materials Transportation Act, the Clean Air Act, the Clean Water
Act, and other similar foreign, federal, state and local laws, as amended,
together with all regulations issued or promulgated thereunder, relating to
pollution, the protection of the environment or the health and safety of workers
or the general public. As used herein "Hazardous Substance" means any hazardous
substance, hazardous or toxic waste, hazardous material, polutant or
contaminant, as those or similar terms are used in the Environmental Laws,
including, without limitation, asbestos and asbestos-related products,
chlorofluorocarbons, oils or petroleum derived compounds, polychlorinated
biphenyl, pesticides and radon.
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3.20 TAX MATTERS. COPE and each COPE Subsidiary has timely filed all
tax returns and all information returns and reports required to be filed by or
with respect to it under the laws of its jurisdiction for all periods ending on
or prior to the date hereof and will timely file all such returns and reports
required to be filed from the date hereof through the Closing Date. COPE and
the COPE Subsidiaries have paid all taxes which have become due or payable, and
will pay on or prior to the Closing Date all taxes which have become due or
payable on or prior to the Closing Date.
3.21 TRANSACTIONS WITH AFFILIATES. Except as set forth in the notes
to the COPE Financial Statements or the COPE Disclosure Schedule, neither COPE
nor any COPE Subsidiary has purchased, acquired or leased any property or
services from, or sold, transferred or leased any property or services to, or
loaned or advanced any money to, or borrowed any money from, or guaranteed or
otherwise become liable for any indebtedness or other obligations of, or
acquired any capital stock, obligations or securities of, or made any
management, consulting or similar fee arrangement with any officer, director,
employee or stockholder of COPE or any COPE Subsidiary (nor any spouse, child or
affiliate thereof), nor is COPE or any COPE Subsidiary a party to any agreement
oral or written with respect to any of the foregoing.
3.22 OTHER INFORMATION. None of the written information, documents
or memoranda furnished or to be furnished by COPE or the Majority Stockholders
to Harrier or any of their representatives is false or misleading in any
material respect or omits to state a material fact required to be stated therein
or necessary in order to make any of the statements therein, in the light of the
circumstances under which they were made, not misleading.
4. REPRESENTATIONS, WARRANTIES AND COVENANTS OF HARRIER. Harrier
represents, warrants and covenants to and with COPE and the Selling Stockholders
as follows:
4.1 CORPORATE ORGANIZATION, ETC. Harrier and Glycosyn are
corporations duly organized, validly existing and in good standing under the
laws of the State of Delaware, and are duly qualified to do business and are in
good standing as foreign corporations under the laws of each jurisdiction in
which the character or location of the assets owned or leased by each of them
require qualification, except where the failure to so qualify would not
materially adversely affect the business or condition, financial or otherwise,
of Harrier on a consolidated basis. Harrier and Glycosyn have delivered or
prior to the Closing Date will deliver to COPE complete and correct copies of
their certificates of incorporation, as amended, and bylaws, as amended,
certified by their respective secretaries to be complete and correct. As of the
date of this Agreement, Harrier is the owner of 5,000,000 shares of the Glycosyn
Common Stock and a membership interest in DermaRay LLC, a California limited
liability company ("DermaRay"). Other than Glycosyn and DermaRay, Harrier has
no other subsidiaries or equity ownership in any other entity.
4.2 CAPITALIZATION. The authorized, issued, outstanding and reserved
capital stock of Harrier and Glycosyn is as recited in the recitals to this
Agreement. All issued and outstanding shares of capital stock of Harrier and
Glycosyn have been duly authorized and validly issued and are fully paid and
non-assessable and none of such issued and outstanding shares have been issued
in violation of the preemptive rights of any past or present stockholder.
Except as set forth in the recitals or the Harrier Disclosure Schedule attached
hereto as Schedule 2 ("Harrier Disclosure Schedule"), no warrants, options,
subscriptions, calls, commitments or other rights or agreements of any kind
issued, granted or
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entered into by Harrier or Glycosyn for the purchase, issuance or sale of, or
security exchangeable for or convertible into, any shares of such authorized
capital stock is outstanding or otherwise exists and no authorized unissued
shares of Harrier or Glycosyn are reserved for any purpose.
4.3 CORPORATE POWER AND AUTHORITY. Harrier and Glycosyn have all
requisite corporate power and authority to own or lease all of their respective
properties and assets, to operate their respective properties and assets and to
carry on their respective businesses as now conducted. Harrier has all
requisite corporate power and authority to enter into and to carry out all of
the terms of this Agreement. The execution, delivery and performance of this
Agreement has been or prior to the Closing will be duly authorized and approved
by vote of Harrier board of directors without dissent. All corporate action on
the part of Harrier, its officers, directors and stockholders necessary for the
authorization, execution, delivery and performance of this Agreement by Harrier
will have been taken prior to the Closing and no further corporate authorization
on the part of Harrier will be required to consummate the transactions provided
for in this Agreement. Harrier has furnished or on or before the Closing Date
will furnish COPE with certified copies of all corporate resolutions or consents
relating to the execution, delivery and performance of this Agreement. When
executed and delivered by Harrier, this Agreement shall constitute the valid and
legally binding obligation of Harrier enforceable in accordance with its terms
subject to the qualification and limitation that COPE and the Selling
Stockholders' procedural and remedial rights may be limited or rendered
unenforceable by (i) bankruptcy, insolvency, reorganization, moratorium or other
similar laws, (ii) equitable principles now or hereafter in effect relating to
or affecting the enforcement of rights or remedies generally, or (iii) the
availability of equitable remedies. Neither the execution, delivery nor
performance of this Agreement by Harrier shall violate or result in a breach of
any provisions of Harrier's certificate of incorporation or bylaws. Except
where such violation or breach would not adversely affect the performance by
Harrier of its obligations hereunder and would not have a material adverse
affect on the business or condition, financial or otherwise, of Harrier on a
consolidated basis, neither the execution, delivery nor performance of this
Agreement by Harrier shall constitute a default or result in a breach of or
accelerate the performance required under any mortgage, deed of trust, lien,
lease, restriction or other contract or agreement to which Harrier or Glycosyn
or any of their properties or assets are bound or affected, or violate any
order, writ, injunction, decree, judgment or other restriction of any court,
administrative agency or governmental body.
4.4 FINANCIAL STATEMENTS; SEC REPORTS. Harrier has furnished to the
Selling Stockholders its consolidated balance sheet as of the end of its fiscal
year ended June 30, 1997 and its consolidated statements of earnings,
stockholders' equity and cash flows for the fiscal years ended June 30, 1997 and
1996. Prior to the Closing, Harrier shall deliver to COPE the aforementioned
financial statements, together with appropriate notes to such consolidated
financial statements, accompanied by reports thereon containing opinions without
comment or qualification, except as therein noted, by its independent certified
public accountants.
All of the foregoing consolidated financial statements (collectively, the
"Harrier Financial Statements"), including in each case the related notes, have
been prepared in conformity with generally accepted accounting principles
consistently applied and are correct and complete in all material respects and
such consolidated financial statements fairly present the financial position of
Harrier and the Glycosyn as of the dates of such balance sheets and the results
of operations for the respective periods indicated.
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Harrier has also furnished to the Selling Stockholders its Annual Report on
Form 10-KSB for the fiscal year ended June 30, 1996, and all quarterly reports
on Form 10-QSB and current reports on Form 8-K which it has filed with the SEC
since June 30, 1996. Prior to the Closing, Harrier shall deliver to the Selling
Stockholders its Annual Report on Form 10-KSB for the fiscal year ended June 30,
1997. The above reports of Harrier to the SEC are sometimes collectively
referred to hereinafter as the "Harrier SEC Reports." The Harrier SEC Reports
contain all of the information required by the Exchange Act and the rules and
regulations thereunder and do not contain any untrue statements of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading.
4.5 ABSENCE OF UNDISCLOSED LIABILITIES. Harrier and Glycosyn have no
material liabilities, fixed or contingent, other than (i) liabilities fully
reflected in the Harrier Financial Statements, or (ii) liabilities incurred
since June 30, 1997 in the ordinary course of business or as contemplated or
permitted by this Agreement or referred to in the Harrier Disclosure Schedule,
all of which in the aggregate, taking into consideration all other changes in
the financial condition of Harrier and Glycosyn in the ordinary course of
business, have had no material adverse effect on the financial position or
results of operations of Harrier and Glycosyn, taken as a whole, or on the
conduct of its businesses.
4.6 ABSENCE OF ADVERSE CHANGES. Except as disclosed in the Harrier
Disclosure Schedule or Harrier Financial Statements, since June 30, 1997, there
has not been any material adverse change in the assets or liabilities or in the
condition, financial or otherwise, or business, properties, earnings or net
worth of Harrier and Glycosyn, taken as a whole, or (ii) any damage or
destruction in the nature of a casualty loss, whether covered by insurance or
not, materially and adversely affecting any property or business of Harrier or
Glycosyn which is material to the consolidated financial condition, operation or
business of Harrier and Glycosyn, taken as a whole.
4.7 CONTRACTS AND AGREEMENTS. Set forth in the Harrier Disclosure
Schedule is a list of all contracts and agreements (including loan agreements)
to which Harrier or Glycosyn is a party or by which it is bound, involving more
than $5,000. Except as set forth in the Harrier Disclosure Schedule, none of
the contracts and agreements will expire or be terminated or be subject to any
modification of terms or conditions upon the consummation of the transactions
contemplated by this Agreement. Except as set forth in the Harrier Disclosure
Schedule, neither Harrier nor Glycosyn is in default in any material respect
under the terms of any such contract or agreement nor in default in the payment
of any principal of or interest on any indebtedness for borrowed money nor has
any event occurred which, with the passage of time or giving of notice, would
constitute such a default by Harrier or Glycosyn and no other party to any such
contract or agreement is in default in any material respect thereunder nor has
any such event occurred with respect to such party.
4.8 NO VIOLATION OR LITIGATION. Except as set forth in the Harrier
Disclosure Schedule, neither Harrier nor Glycosyn is in violation of any law or
order, writ, injunction or decree of any court or other governmental department,
commission, board, bureau, agency or instrumentality, and there are no lawsuits,
proceedings, claims or governmental investigations pending or, to the knowledge
of any executive officer of Harrier, threatened against Harrier, Glycosyn or
against the properties or business of any of them, nor is there any reasonable
basis known to Harrier for any such action and there is no action, suit,
proceeding or investigation pending, threatened or, to the knowledge of Harrier,
contemplated which questions the legality, validity or propriety of the
transactions contemplated by this Agreement.
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4.9 ACCURACY OF PROXY STATEMENT. Harrier's notice of special meeting
and proxy statement ("Proxy Statement"), including any amendments or supplement
thereto, will, when the Proxy Statement is mailed to the stockholders of Harrier
as contemplated by Section 1.3 hereof, contain the information with respect to
Harrier and Glycosyn required by the Exchange Act and the rules and regulations
thereunder. The Proxy Statement will not, at the time of mailing, at the time
of the meeting of stockholders of Harrier or at the Closing, include any untrue
statement of a material fact or omit to state a material fact with respect to
Harrier or Glycosyn required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading. Harrier makes no representations as to statements or
omissions regarding information solely relating to COPE or the Selling
Stockholders, it being the agreement of the parties that responsibility for such
statements or omissions rests solely with the Selling Stockholders.
4.10 EMPLOYEE OR CONSULTING AGREEMENTS. The Harrier Disclosure
Schedule lists all plans, contracts, and arrangements, oral, implied or written,
included but not limited to union contracts, employment agreements, consulting
agreements, employee manuals, incentive payment plans and employee benefit
plans, whereunder Harrier or Glycosyn has any obligation (other than obligations
to make current wage or salary payments terminable on notice of 30 days or less)
to its officers or employees or other persons or their beneficiaries or
whereunder any of such persons owe money to Harrier or Glycosyn.
4.11 INSURANCE. Harrier and Glycosyn each maintain policies of fire
and casualty, liability and other forms of insurance in such amounts and against
such risks and losses as are reasonable for its businesses and properties, and
will keep such insurance in full force and effect through the Closing. A list
and brief description (including policy numbers, deductibles, potential loss
adjustments under retrospective policies, carriers and effective and termination
dates) of all policies of insurance, including insurance providing benefits for
employees, owned or held by Harrier or Glycosyn on the date hereof and of all
material performance bonds maintained by Harrier on the date hereof are set
forth in the Harrier Disclosure Schedule. Neither Harrier nor Glycosyn is
subject to any liabilities as a self-insurer of its business and property which
could have a material adverse impact on its business, properties or prospects,
taken as a whole, except as disclosed in the Harrier Disclosure Schedules.
4.12 TRADEMARKS AND PATENTS. Harrier and the Harrier Subsidiaries
have no material trademarks, trade names, copyrights, inventions, patents or
applications therefor which are owned, used, registered in the name of licensed
to Harrier or Glycosyn, except for those listed in the Harrier Disclosure
Schedule. Except as disclosed in the Harrier Disclosure Schedule, no
proceedings have been instituted or are pending or threatened or contemplated
which challenge the validity of the ownership by Harrier or Glycosyn of any such
trademark, trade name, copyright, invention or patent. Except as disclosed in
the Harrier Disclosure Schedule, neither Harrier nor Glycosyn has licensed
anyone to use any such trademark or any technical know how or other proprietary
rights of Harrier or Glycosyn.
4.13 PERMITS AND OTHER OPERATING RIGHTS. Except as disclosed in the
Harrier Disclosure Schedule, Harrier and Glycosyn currently possess all permits,
licenses, certificates and other authorizations from third parties, including,
without limitation, foreign and domestic governmental authorities, necessary or
required by applicable provisions of law and judicial decisions, and by the
property and contract rights of third parties, for it to own or lease its
properties and assets and to
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operate its business in the manner in which it is intended.
4.14 NO GOVERNMENTAL OR OTHER PROCEEDING OR LITIGATION. No order of
any court or administrative agency is in effect which restrains or prohibits
Harrier or Glycosyn from consummating the transactions contemplated hereby, and
no suit, action, investigation, inquiry or proceeding by any governmental body
or other person or legal or administrative proceeding has been instituted or
threatened which questions the validity or legality of Harrier's or Glycosyn's
consummation of the transactions contemplated hereby.
4.15 APPROVALS AND CONSENTS. Except as contemplated by Sections 1.3
and 5.6, there are no permits, consents, mandates or approvals of public
authorities, either U.S. or Swiss, federal, state or local, or of any third
party necessary for Harrier's consummation of the transactions contemplated
hereby.
4.16 BROKERAGE. No broker or finder has acted directly or indirectly
for Harrier in connection with this Agreement or the transactions contemplated
hereby, and no broker or finder is entitled to any brokerage or finder's fee or
other commission in respect thereof based in any way on agreements, arrangements
or understandings made by or on behalf of Harrier.
4.17 EMPLOYEE RETIREMENT INCOME SECURITY ACT. Neither Harrier nor
Glycosyn has an "employee pension benefit plan," as such term is defined in
Section 3 of the Employee Retirement Income Security Act of 1974. Neither
Harrier nor Glycosyn, nor any ERISA Affiliate of either of them, has ever
sponsored, maintained, or contributed to, or been required to sponsor, maintain
or contribute to, any single or multiemployer plan as defined in Section 4001 of
the Employee Retirement Security Act of 1974, as amended ("ERISA"). For
purposes of the foregoing, "ERISA Affiliate" shall mean any person (as defined
in Section 3(9) of ERISA), which together with Harrier, or Glycosyn would be
deemed to be a single employer plan (i) within the meaning of Section 414(b),
(c), (m) or (o) of the Internal Revenue Code of 1986, as amended, or (ii) as a
result of Harrier or Glycosyn being or having been a general partner of such
person.
4.18 PERSONAL PROPERTY, INVENTORIES AND TITLE TO PROPERTY. All
personal property owned, leased or used by Harrier and Glycosyn is reflected in
the Harrier Financial Statements, and is in good operating and working condition
and fit for operation in the usual course of business, ordinary wear and tear
excepted. Except as set forth in the Harrier Disclosure Schedule, Harrier and
Glycosyn have good and marketable title to all of its assets, and a good and
valid leasehold interest in all property leased by the corporation, free and
clear of all liens.
4.19 ENVIRONMENTAL MATTERS. There has been no manufacture, refining,
storage, disposal or treatment of Hazardous Substances (as hereinafter defined)
by Harrier or Glycosyn at any real property currently or in the past owned,
operated, used, leased or contracted for by Harrier or Glycosyn, or otherwise in
violation of any Environmental Laws (as hereinafter defined) or which would
require remedial action under any Environmental Law. During the past three
years neither Harrier nor Glycosyn has received (a) notice of any such violation
with respect to any Hazardous Substance at or by any of such real property, (b)
notice from any governmental agency that Harrier, or any present or former
owner, lessee or operator of such real property, is a potentially responsible
party for cleanup liability with respect to the emission, discharge or release
of any Hazardous Substance or for any other matter arising under the
Environmental Laws or in any litigation, administrative proceeding, finding,
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order, citation, notice, investigation or complaint under any Environmental Law,
or (c) notice of violation, citation, complaint, request for information, order,
directive, compliance schedule, notice of claim, proceeding or litigation from
any party concerning the corporation's compliance with any Environmental Law.
As used herein "Environmental Laws" means the Resource Conservation Recovery
Act, the Comprehensive Environmental Responsibility Compensation and Liability
Act, the Superfund Amendments and Reauthorization Act, the Toxic Substances
Control Act, the Hazardous Materials Transportation Act, the Clean Air Act, the
Clean Water Act, and other similar federal, state and local laws, as amended,
together with all regulations issued or promulgated thereunder, relating to
pollution, the protection of the environment or the health and safety of workers
or the general public. As used herein "Hazardous Substance" means any hazardous
substance, hazardous or toxic waste, hazardous material, pollutant or
contaminant, as those or similar terms are used in the Envronmental Laws,
including, without limitation, asbestos and asbestos-related products,
chlorofluorocarbons, oils or petroleum derived compounds, polychlorinated
biphenyl, pesticides and radon.
4.20 TAX MATTERS. Harrier and Glycosyn have timely filed all
federal, state and local tax returns and all information returns and reports
required to be filed by or with respect to it under the laws of the United
States or any state or other jurisdiction for all periods ending on or prior to
the date hereof and will timely file all such returns and reports required to be
filed from the date hereof through the Closing Date. All federal, state,
county, local, and foreign income, profits, franchise, sales, use, occupational,
property, excise, payroll, withholding and other taxes (including interest and
penalties) (collectively, "Taxes") required to have been paid or accrued by
Harrier or Glycosyn have been fully paid or are adequately provided for on
Harrier's consolidated balance sheet and any Taxes required to be paid or
accrued prior to the Closing Date will be fully paid or adequately provided for
on the books of Harrier or Glycosyn as the case may be. To the knowledge of
Harrier, no issues have been raised (and are currently pending) by the Internal
Revenue Service or any other taxing authority concerning the liability of
Harrier, Glycosyn or DermaRay for Taxes, and no waivers of statutes of
limitations have been given or requested with respect to Harrier, Glycosyn or
DermaRay. There is no tax lien of any kind outstanding against the assets,
property, or business of Harrier, Glycosyn or, to the knowledge of Harrier,
DermaRay. All deficiencies asserted or assessments (including interest and
penalties) made as a result of any examination by the Internal Revenue Service
or by appropriate state or departmental tax authorities of the federal, state or
local income tax, sales tax or franchise tax returns of or with respect to
Harrier, Glycosyn or, to the knowledge of Harrier, DermaRay have been fully paid
or are adequately provided for on Harrier's consolidated balance sheet and no
proposed (but unassessed) additional taxes, interest or penalties have been
asserted.
4.21 TRANSACTIONS WITH AFFILIATES. Except as set forth in the
Harrier SEC Reports or the notes to the Harrier Financial Statements, neither
Harrier nor Glycosyn has purchased, acquired or leased any property or services
from, or sold, transferred or leased any property or services to, or loaned or
advanced any money to, or borrowed any money from, or guaranteed or otherwise
become liable for any indebtedness or other obligations of, or acquired any
capital stock, obligations or securities of, or made any management, consulting
or similar fee arrangement with any officer, director, employee or stockholder
of Harrier or Glycosyn (nor any spouse, child or affiliate thereof), nor is
Harrier or Glycosyn a party to any agreement oral or written with respect to any
of the foregoing.
4.22 OTHER INFORMATION. None of the written information, documents
or memoranda furnished or to be furnished by Harrier to COPE or the Selling
Stockholders or any of their representatives is false or misleading in any
material respect or omits to state a material fact required to
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be stated therein or necessary in order to make any of the statements
therein, in the light of the circumstances under which they were made, not
misleading.
5. CERTAIN ADDITIONAL UNDERSTANDINGS AND AGREEMENTS.
5.1 APPROVALS AND CONSENTS.
(a) IN GENERAL. The parties hereto shall each use all
reasonable best efforts to obtain, and shall not take any action which
jeopardizes obtaining, the necessary approvals and consents of other persons and
governmental authorities required to be obtained to consummate the transactions
contemplated by this Agreement.
(b) COPE AND SELLING STOCKHOLDERS COMPLIANCE WITH SECURITIES
LAWS. COPE and each Selling Stockholder shall take such actions as shall be
required in order to exempt the offer and sale of the COPE Shares to Harrier
from the registration and prospectus delivery requirements under the Securities
Act and to register or qualify or exempt from registration and qualification
requirements the offer and sale of the COPE Shares to Harrier under applicable
foreign and state securities laws.
(c) HARRIER COMPLIANCE WITH SECURITIES LAWS. Harrier shall
cooperate with the Selling Stockholders in taking such actions as shall be
required in order to exempt the offer and sale of the Harrier Shares to the
Selling Stockholders from the registration and prospectus delivery requirements
under the Securities Act and to register or qualify or exempt from registration
and qualification requirements the offer and sale of the Harrier Shares to the
Selling Stockholders under applicable foreign and state securities laws.
5.2 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
(a) COPE AND MAJORITY STOCKHOLDERS. The representations and
warranties of COPE and the Majority Stockholders made herein shall not be
affected by any information furnished to, or investigations made by Harrier or
any of its employees or representatives in connection with the subject matter of
this Agreement. The representations and warranties of the Majority Stockholders
shall survive the execution and delivery of this Agreement and the consummation
of the transactions contemplated thereby for a period of four (4) years after
the Closing Date. The representations and warranties of COPE shall not survive
the Closing.
(b) HARRIER. The representations and warranties of Harrier made
herein shall not be affected by any information furnished to, or investigations
made by, COPE or the Majority Stockholders, or any of their employees or
representatives, in connection with the subject matter of this Agreement and
shall survive the execution and delivery of this Agreement and the consummation
of the transactions contemplated thereby for period of four (4) years after the
Closing Date.
5.3 CONDUCT OF BUSINESS PRIOR TO THE CLOSING DATE. From the date
hereof until the Closing Date, COPE and the Majority Stockholders, on the one
hand, and Harrier, on the other, shall each act as follows, except as otherwise
expressly consented to by the other in writing, which consent shall not be
unreasonably withheld, except such actions taken to consummate the transactions
in accordance with this Agreement as contemplated thereby:
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(a) NOTIFICATION. COPE and the Majority Stockholders and
Harrier shall each immediately notify the other of any material breaches of the
representations and warranties or any material nonfulfillment of the covenants,
agreements or obligations of it or of any developments which could materially
adversely affect the value of the COPE Shares or Harrier Shares. Without
limiting the foregoing, COPE and the Majority Stockholders and Harrier shall
each immediately notify the other of (1) any unexpected emergency or other
material change in the normal course of business or in the operation of its
properties, (2) the instigation of or any material development in any litigation
or regulatory proceedings, governmental complaints, investigations or hearings
(or communications indicating that the same may be contemplated) in which COPE
or Harrier is named as a party, and (3) budgets, capital expenditures and
material decisions involving its material properties or assets. COPE and the
Majority Stockholders and Harrier shall each keep the other fully informed of
such events and permit its representatives access to all materials prepared in
connection therewith.
(b) FORBEARANCE. From the effective date hereof to the Closing
Date, COPE and Harrier, or any of their subsidiaries, shall not, without the
prior written consent of the other, which consent shall not be unreasonably
withheld, except for such actions taken to consummate the transactions in
accordance with this Agreement as contemplated thereby: (1) amend its articles
of incorporation or bylaws; (2) issue any shares of capital stock or securities
convertible into any such securities or enter into any agreement or commitment
with respect to the issuance or purchase of any such securities; (3) declare,
pay or set aside for payment any dividend or distribution in respect to any
securities, or redeem, purchase or otherwise acquire any securities any options,
warrants or other rights to purchase or subscribe to any securities; (4) make or
contract for any capital investment, capital expenditure, capital addition or
capital improvement; (5) negotiate with any person other than the other
concerning any merger, disposition of all or substantially all of its business,
properties, or assets, any tender offer, acquisition or other business
combination, other than the transactions provided for in this Agreement;
(6) organize any new subsidiary, acquire any capital stock or other debt or
equity securities of any corporation, enter into any partnership or joint
venture or acquire any equity or ownership interest in any business; or (7) take
any action which would cause or constitute a material breach, or would, if it
had been taken prior to the date hereof, have caused a material breach of the
representations and warranties of it set forth herein.
5.4 ACCESS. Each of the parties hereto may, prior to the Closing
Date, through its respective representatives, make such reasonable investigation
as is permitted by the laws of its respective jurisdiction of organization of
the property, records and the financial condition of the other parties hereto as
it reasonably deems necessary or advisable to assure itself of the accuracy of
the representations and warranties of the other parties hereto and compliance by
the other parties hereto with all agreements and conditions to be satisfied by
them. Such investigation shall be done at reasonable times and under reasonable
circumstances. Each party shall each keep confidential in the same manner in
which it preserves its own confidential information any information so obtained
which is not otherwise publicly available or ascertainable and to which it has
been given access by another party, subject to applicable reporting and
disclosure requirements under applicable foreign, federal and state laws,
including without limitation securities laws. Nothing in this Section 5.4 shall
be deemed to constitute a waiver by any party, or an agreement of any party to
waive, with respect to any document, any claim of attorney-client privilege or
legal or contractual privilege or requirement of confidentiality; provided,
however, that the party claiming such privilege or requirement shall identify to
the extent it is legally permitted the subject matter thereof to the party
seeking such document.
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5.5 INDEMNIFICATION.
(a) INDEMNIFICATION BY HARRIER. Harrier agrees to indemnify,
defend and hold harmless the Selling Stockholders against and in respect of any
and all claims, demands, losses, costs, expenses, liabilities and damages,
including interest, penalties, and reasonable attorneys' fees, that the Selling
Stockholders shall incur or suffer which arise, result from or relate to any
material inaccuracy in or material breach or nonfulfillment of any of the
representations, warranties, covenants or agreements made by Harrier in this
Agreement, the schedules or exhibits hereto or in any other Document furnished
by Harrier under this Agreement.
(b) INDEMNIFICATION BY THE MAJORITY STOCKHOLDERS. Each Majority
Stockholder agrees to indemnify, defend and hold harmless Harrier against and in
respect of any and all claims, demands, losses, costs, expenses, liabilities and
damages, including interest, penalties, and reasonable attorneys' fees, that
Harrier shall incur or suffer which arise, result from or relate to any material
inaccuracy in or material breach of nonfulfillment of any of the
representations, warranties, covenants or agreements made by COPE or the
Majority Stockholder in this Agreement, the schedules or exhibits hereto or in
any other Document furnished by COPE or the Majority Stockholder under this
Agreement.
(c) PROCEDURES; RIGHTS TO SEPARATE COUNSEL. In the event any
party receives a complaint, claim or other notice of any loss, claim or damage,
liability or action, giving rise to a claim for indemnification under this
Section 5.5, the party claiming indemnification shall promptly notify the
indemnifying party of such complaint, notice, claim or action, and such
indemnifying party shall have the right to investigate and defend any such loss,
claim, damage, liability or action. The party claiming indemnification shall
have the right to employ separate counsel in any such action and to participate
in the defense thereof but the fees and expenses of such counsel shall not be at
the expense of the indemnifying party, unless the indemnifying party fails to
promptly defend, in which case the fees and expenses of such separate counsel
shall be borne by the indemnifying party. In no event shall an indemnifying
party be obligated to indemnify another party for any settlement of any claim or
action effected without the indemnifying party's prior written consent.
6. CONDITIONS TO THE OBLIGATIONS OF COPE AND THE MAJORITY STOCKHOLDERS.
The obligations of COPE and the Majority Stockholders, hereunder are subject to
the fulfillment at or before the Closing, of the following conditions (any of
which may be waived in writing by COPE and the Majority Stockholders):
6.1 REPRESENTATIONS AND WARRANTIES, ETC. The representations and
warranties of Harrier contained herein shall have been true and correct in all
material respects when made and as of the Closing, except as affected by actions
taken after the date hereof with the prior written consent of the Selling
Stockholders.
6.2 PERFORMANCE OF COVENANTS. Harrier shall have performed and
complied in all material respects with all covenants, agreements, terms and
conditions and executed all documents required by this Agreement to be
performed, complied with, or executed by it prior to the Closing.
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6.3 NO GOVERNMENTAL OR OTHER PROCEEDING OR LITIGATION. No order of
any court or administrative agency shall be in effect which restrains or
prohibits the transactions contemplated hereby, and no suit, action,
investigation, inquiry or proceeding by any governmental body or other person or
legal or administrative proceeding shall have been instituted or threatened
which questions the validity or legality of the transactions contemplated
hereby.
6.4 APPROVALS AND CONSENTS. All permits, consents or approvals of
applications to public authorities, federal, state or local, and all approvals
of any third persons, including without limitation all approvals or consents
under applicable federal or state securities laws, the granting of which are
necessary for the consummation of the transactions contemplated hereby shall
have been obtained.
6.5 HARRIER STOCKHOLDER APPROVAL. The holders of the outstanding
shares of the Harrier Common Stock shall have approved, in accordance with
Delaware General Corporation Law, (i) Harrier's issuance of Harrier Shares in
exchange for the COPE Shares, (ii) the Reverse Split; (iii) the Amendment to
Harrier's Certificate of Incorporation; (iv) the election of the COPE nominees
to Harrier's board of directors; and (v) Harrier's sale of Glycosyn common
shares in accordance with Section 6.15.
6.6 DELIVERY OF INSTRUMENTS OF TRANSFER. Harrier shall have
delivered to the Selling Stockholders or their representatives certificates
evidencing Harrier Shares.
6.7 CERTIFICATE. The President and Chief Financial Officer of
Harrier shall have delivered to the Selling Stockholders or their
representatives a certificate certifying as of the Closing Date the matters set
forth in Section 6.1 and 6.2.
6.8 DUE DILIGENCE. COPE's investigation of Harrier, Glycosyn and NCT
shall not have revealed any matters regarding the financial condition,
liabilities, operations or prospects of any of them which are not satisfactory
to COPE.
6.9 TAX CONSEQUENCES. COPE's analysis of the proposed ownership
structure of COPE following the Closing shall not have revealed any adverse
income tax consequences which are not acceptable to COPE in its reasonable
discretion.
6.10 RECAPITALIZATION AND CHARTER AMENDMENTS. Harrier will obtain
director and stockholder approval of: (a) this Agreement and the transactions
contemplated hereby; (b) the Reverse Split; (c) the change in the corporate name
of Harrier to "COPE, Inc." or such other mutually agreeable name as may be
available for use in the State of Delaware; (d) such amendments to the bylaws
and certificate of incorporation of Harrier as may be reasonably requested by
COPE; and (e) the election of a new board of directors of Harrier, including
Xxxxxxx Xxxxxxxxxx, Xxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxx Xxxxxxx and Xxxxx XxXxxx,
effective upon and subject to the Closing.
6.11 ASSIGNMENT AND ASSUMPTION. Harrier shall have assigned to
Glycosyn, and Glycosyn shall have assumed, all of Harrier's assets, liquidated
liabilities and indebtedness (including all threatened claims by American
Diagnostica Inc. ("ADI")) and contractual obligations pursuant to the form of
Assumption and Indemnification Agreement previously submitted to the Selling
Stockholders in connection herewith.
-19-
6.12 RELEASE FROM HARRIER CREDITORS. Harrier shall have received
from its creditors documentation unconditionally and irrevocably releasing
Harrier from any further liability, claim or demand. In addition, Harrier shall
have received from each party to an executory contract with Harrier (including
ADI), documentation consenting to the assumption by Glycosyn and releasing
Harrier of any further obligation thereunder.
6.13 SALE OF GLYCOSYN. Harrier shall obtain all necessary director
and stockholder approval of, and shall carry out and effect, (i) the acquisition
by Glycosyn of a nineteen percent (19%) ownership interest in New Concept
Therapeutics, Inc., a North Carolina corporation ("NCT"), plus an option to
acquire at least up to fifty-one percent (51%) of the ownership of NCT; and (ii)
the sale of 2,850,000 shares of the common stock of Glycosyn presently owned by
Harrier to New Capital Investment Fund ("NCIF") in cancellation of all
indebtedness presently owed Harrier to NCIF, in each case pursuant to
documentation reasonably acceptable to COPE.
6.14 LEGAL OPINION. COPE and the Selling Stockholders shall have
received from Xxxxx & Xxxxx, A Professional Corporation, counsel for Harrier, a
favorable opinion dated the Closing Date in form and substance reasonably
satisfactory to COPE and the Selling Stockholders and their counsel, to the
effect that:
(i) Harrier and Glycosyn are corporations duly incorporated,
validly existing and in good standing under the laws of the State of Delaware
and Harrier and Glycosyn have full corporate power and corporate authority to
own or lease its properties and carry on its business as now conducted and is
duly qualified to do business and is in good standing in each jurisdiction where
failure to so qualify would have a material adverse effect on the corporation.
Harrier and Glycosyn have the corporate power and corporate authority to
consummate the transactions as provided herein;
(ii) the authorized capital stock of Harrier consists of
30,000,000 shares of Harrier Common Stock and 5,000,000 shares of Harrier
Preferred Stock, of which 14,767,923 shares of Harrier Common Stock and no
shares of Harrier Preferred Stock are issued and outstanding. To such counsel's
knowledge, no options, warrants, convertible securities, rights of first refusal
or other rights to obtain shares of the capital stock of Harrier, whether on
conversion of other securities or otherwise, have been granted by Harrier, other
than as set forth in the Harrier Disclosure Schedule; no holder of shares of
Harrier's Common Stock has any preemptive rights with respect to any such shares
or any securities convertible into such shares from Harrier. All of the issued
and outstanding shares of Harrier's Common Stock on the Closing Date are validly
issued, fully paid and non-assessable; and there are no other corporations or
other entities in which Harrier owns, directly or indirectly, any equity
interest, except Glycosyn, DermaRay and NCT.
(iii) the Harrier Shares to be issued to the Selling
Stockholders at the Closing will be, when delivered to the Selling Stockholders
or their representatives, validly issued, fully paid and non-assessable shares
of Harrier's Common Stock free and clear of all pledges, security interests,
mortgages, liens, claims, charges, restrictions or encumbrances, except for
restrictions under applicable U.S. federal or state securities laws, and,
assuming the truth and accuracy of the Selling Stockholders' representations and
warranties set forth in Section 2 and the Subscription Agreements, the Harrier
Shares are exempt from the registration requirements of the Securities Act; and
-20-
(iv) this Agreement and the transactions contemplated herein
have been duly approved by the Boards of Directors and by the stockholders of
Harrier and Glycosyn at meetings duly held in compliance with the Delaware Law
and in compliance with the Exchange Act and the applicable regulations
thereunder and this Agreement has been duly and validly executed and delivered
by Harrier; and the consummation of the transactions contemplated herein in
accordance with the terms of this Agreement is a valid and binding obligation of
Harrier, subject to the qualification and limitation that the procedural and
remedial rights of the other parties to this Agreement may be limited or
rendered unenforceable by (i) bankruptcy, insolvency, reorganization, moratorium
or other similar laws, (ii) legal or equitable principles now or hereafter in
effect relating to or affecting the enforcement of rights or remedies generally,
or (iii) the availability of equitable remedies.
The opinions set forth above may be expressly made subject to the
qualifications and limitations that are contained in the Third-Party Legal
Opinion Report (including the legal opinion accord) of the Section of Business
Law, American Bar Association approved August 11, 1991 (the "Accord"). In
giving such opinions, such counsel may rely, in accordance with the Accord, as
to matters of fact, upon certificates of officers of Harrier and governmental
agencies and Harrier's transfer agent and registrar, and as to matters of laws,
upon opinions of other counsel satisfactory to them, and shall deliver copies
thereof to COPE and the Selling Stockholders prior to the Closing Date. Such
opinion may state that such counsel's opinion is furnished, as counsel to
Harrier, to COPE and the Selling Stockholders and is solely for their benefit.
7. CONDITIONS TO THE OBLIGATIONS OF HARRIER. The obligations of Harrier
hereunder are subject to the fulfillment on or before the Closing, of the
following conditions (any of which may be waived in writing by Harrier):
7.1 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of the Selling Stockholders contained herein shall have been true and
correct in all material respects when made and shall be true and correct in all
material respects as of the Closing.
7.2 PERFORMANCE OF COVENANTS. The Majority Stockholders shall have
performed and complied in all material respects with all covenants, agreements,
terms and conditions and executed all documents required by this Agreement to be
performed, complied with or executed by them prior to or at the Closing. Each
stockholder other than the Selling Stockholders shall have executed a
Subscription Agreement.
7.3 INSTRUMENTS OF TRANSFER. The Selling Stockholders shall have
delivered to Harrier instruments of transfer for the COPE Shares in form and
substance reasonably satisfactory to Harrier and its counsel as shall be
necessary to effectively transfer all of the Selling Stockholders' right, title
and interest in the COPE Shares to Harrier.
7.4 NO GOVERNMENTAL OR OTHER PROCEEDING OR LITIGATION. No order of
any court or administrative agency shall be in effect which restrains or
prohibits the transactions contemplated hereby, and no suit, action,
investigation, inquiry or proceeding by any governmental body or other person or
legal or administrative proceeding shall have been instituted or threatened
which questions the validity or legality of the transactions contemplated
hereby.
-21-
7.5 APPROVALS AND CONSENTS. All permits, consents or approvals of
applications to public authorities, federal, state or local, and all approvals
of any third persons, including without limitation all approvals or consents
under applicable federal or state securities laws, the granting of which are
necessary for the consummation of the transactions contemplated hereby shall
have been obtained.
7.6 HARRIER STOCKHOLDER APPROVAL. The holders of the outstanding
shares of the Harrier Common Stock shall have approved, in accordance with
Delaware General Corporation Law, (i) Harrier's issuance of Harrier Shares in
exchange for the COPE Shares, (ii) the Reverse Split; (iii) the Amendment to
Harrier's Certificate of Incorporation; (iv) the election of the COPE nominees
to Harrier's board of directors; and (v) Harrier's sale of Glycosyn common
shares in accordance with Section 6.13.
7.7 RECAPITALIZATION AND CHARTER AMENDMENTS. Harrier will obtain
director and stockholder approval of: (a) this Agreement and the transactions
contemplated hereby; (b) the Reverse Split; (c) the change in the corporate name
of Harrier to "COPE, Inc." or such other mutually agreeable name as may be
available for use in the State of Delaware; (d) such amendments to the bylaws
and certificate of incorporation of Harrier as may be reasonably requested by
COPE; and (e) the election of a new board of directors of Harrier, including
Xxxxxxx Xxxxxxxxxx, Xxxxxx Xxxxx, Xxxxx Xxxx, Xxxxxx Xxxxxxx and Xxxxx XxXxxx,
effective upon and subject to the Closing.
7.8 ASSIGNMENT AND ASSUMPTION. Harrier shall have assigned to
Glycosyn, and Glycosyn shall have assumed, all of Harrier's assets, liquidated
liabilities and indebtedness (including all threatened claims by American
Diagnostica Inc. ("ADI")) and contractual obligations pursuant to the form of
Assumption and Indemnification Agreement previously submitted to the Selling
Stockholders in connection herewith.
7.9 RELEASE FROM HARRIER CREDITORS. Harrier shall have received from
its creditors documentation unconditionally and irrevocably releasing Harrier
from any further liability, claim or demand. In addition, Harrier shall have
received from each party to an executory contract with Harrier (including ADI),
documentation consenting to the assumption by Glycosyn and releasing Harrier of
any further obligation thereunder.
7.10 SALE OF GLYCOSYN. Harrier shall obtain all necessary director
and stockholder approval of, and shall carry out and effect, (i) the acquisition
of a nineteen percent (19%) ownership interest in New Concept Therapeutics,
Inc., a North Carolina corporation ("NCT"), plus an option to acquire at least
up to fifty-one percent (51%) of the ownership of NCT; and (ii) the sale of
2,850,000 shares of the common stock of Glycosyn presently owned by Harrier to
New Capital Investment Fund ("NCIF") in cancellation of all indebtedness
presently owed Harrier to NCIF.
7.11 LEGAL OPINION. Harrier shall have received from counsel for
COPE and the Selling Stockholders, a favorable opinion dated the Closing Date in
form and substance reasonably satisfactory to Harrier and its counsel, to that
effect that:
(i) COPE and each of the COPE Subsidiaries are corporations
duly incorporated, validly existing and in good standing under the laws of the
country of their organization, and COPE and each of the COPE Subsidiaries have
full corporate power and corporate authority to
-22-
own or lease their properties and carry on their business as now conducted
and is duly qualified to do business and is in good standing in each
jurisdiction where failure to so qualify would have a material adverse effect
on the corporation. COPE and the Selling Stockholders each have the
corporate or individual power and authority to consummate the transactions as
provided herein;
(ii) the authorized capital stock of COPE consists of SFr
106,000 shares of COPE Capital Stock, of which 1,060 shares are issued and
outstanding. To such counsel's knowledge, no options, warrants, convertible
securities, rights of first refusal or other rights to obtain shares of the
capital stock of COPE or any COPE Subsidiary, whether on conversion of other
securities or otherwise, have been granted by COPE or any COPE Subsidiary, other
than as set forth in the COPE Disclosure Schedules; no holder of shares of COPE
Capital Stock has any preemptive rights with respect to any such shares or any
securities convertible into such shares from COPE; all of the issued and
outstanding shares of COPE Capital Stock on the Closing Date are validly issued,
fully paid and non-assessable; and there are no other corporations or other
entities in which COPE owns, directly or indirectly, any equity interest, except
for COPE GmbH, Ltd., COPE Handelsgmbh and Xpert, Inc.;
(iii) the COPE Shares to be transferred and assigned by the
Selling Stockholders to Harrier at the Closing will be, when delivered to
Harrier, validly issued, fully paid and non-assessable shares of COPE Common
Stock, and each Selling Stockholder has and will transfer to Harrier good and
marketable title to the COPE Shares which it owns as set forth on the
Stockholders List, free and clear of all pledges, security interests, mortgages,
liens, claims, charges, restrictions or encumbrances, except for restrictions
under applicable U.S. federal or state securities laws; and
(iv) this Agreement and the transactions contemplated herein
have been duly approved by the Selling Shareholders and managers and directors
and stockholders of COPE in compliance with the Swiss Law, and this Agreement
has been duly and validly executed and delivered by COPE and each Selling
Stockholder; and the consummation of the transactions contemplated herein in
accordance with the terms of this Agreement are the valid and binding obligation
of COPE and each Selling Stockholder, subject to the qualification and
limitation that the procedural and remedial rights of the other parties to this
Agreement may be limited or rendered unenforceable by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws, (ii) legal or
equitable principles now or hereafter in effect relating to or affecting the
enforcement of rights or remedies generally, or (iii) the availability of
equitable remedies.
The opinions set forth above may be expressly made subject to the
qualifications and limitations that are contained in the Third-Party Legal
Opinion Report (including the legal opinion accord) of the Section of Business
Law, American Bar Association approved August 11, 1991 (the "Accord"). In
giving such opinions, such counsel may rely, in accordance with the Accord, as
to matters of fact, upon certificates of directors and managers of COPE and
governmental agencies, and as to matters of laws, upon opinions of other
counsel satisfactory to them, and shall deliver copies thereof to Harrier prior
to the Closing Date. Such opinion may state that such counsel's opinion is
furnished, as counsel to COPE and the Selling Stockholders, to Harrier and is
solely for the benefit of Harrier.
-23-
8. MISCELLANEOUS.
8.1 CUMULATIVE REMEDIES. Any Person having any rights under any
provision of this Agreement will be entitled to enforce such rights
specifically, to recover damages by reason of any breach of any provision of
this Agreement, and to exercise all other rights granted by law, which rights
may be exercised cumulative and not alternatively.
8.2 SUCCESSORS AND ASSIGNS. The rights and obligations of the
parties under this Agreement shall not be assignable without the written consent
of COPE and Harrier and any such purported assignment without their written
consent shall be void AB INITIO. Except as otherwise expressly provided herein,
all covenants and agreements contained in this Agreement by or on behalf of any
of the parties hereto will bind and inure to the benefit of the respective
successors and assigns of the parties hereto whether so expressed or not.
8.3 SEVERABILITY. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement or the other documents.
8.4 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts when taken together will constitute one and the
same agreement.
8.5 NOTICES. Any approvals, consents or notices required or
permitted to be sent or given shall be delivered in writing personally or
mailed, certified mail, return receipt requested, to the following addresses and
shall be deemed to have been received within five days after such mailing:
If to COPE: COPE AG
Xxxxxxxxxxxx 00
XX-0000 Xxxxxxxx
Xxxxxxxxxxx
Attn: Xxxxxx Xxxxx, Chairman
With a copy to: Dechert, Price & Xxxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxx, Esq.
If to the Majority The Majority Stockholders
Stockholders: Address set forth on Exhibit A
with a copy to: Dechert, Price & Xxxxxx
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxx, Esq.
-24-
If to Harrier: Harrier, Inc.
0000 Xxxxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx XxXxxx, President
with a copy to: Xxxxx & Xxxxx
A Professional Corporation
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx, Esq.
8.6 GOVERNING LAW; ARBITRATION. The validity, meaning and effect of
this Agreement shall be determined in accordance with the laws of the State of
California, U.S.A. applicable to contracts made and to be performed in that
state, without regard to its conflicts of laws rules; provided however that the
Federal Arbitration Act of the United States shall govern issues as to
arbitrability. If a dispute arises in connection with or relating to this
Agreement and the parties are unable to resolve it within forty-five (45) days
through direct negotiations, the dispute shall be referred to final and binding
arbitration to be held in Los Angeles, California, U.S.A. in accordance with the
rules of the American Arbitration Association for International Arbitration (as
they may be amended from time to time). The award of the arbitrator(s) shall be
final and binding upon the parties hereto and may be enforced by any court of
competent jurisdiction pursuant to the Convention on the Recognition and
Enforcement of Foreign Arbitral Awards, by which all parties agree to be bound.
8.7 SCHEDULES AND EXHIBITS. All schedules and exhibits are an
integral part of this Agreement.
8.8 LITIGATION COSTS. If any legal action or any arbitration or
other proceeding is brought for the enforcement of this Agreement, or because of
an alleged dispute, breach, default, or misrepresentation in connection with any
of the provisions thereof, the successful or prevailing party or parties shall
be entitled to recover reasonable attorneys' fees and other costs incurred in
that action or proceeding, in addition to any other relief to which it or they
may be entitled.
8.9 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement and understanding of the parties with respect to the subject matter
thereof, and supersedes all prior and contemporaneous agreements and
understandings.
-25-
IN WITNESS WHEREOF, each of the parties to this Agreement has executed Or
caused this Agreement to be executed as of the date first above written.
"HARRIER"
Harrier, Inc.
a Delaware corporation
By: /s/ Xxxxx XxXxxx
------------------------------------------
Xxxxx XxXxxx, President
"COPE"
COPE AG,
a Swiss corporation
By: /s/ Xxxxxx Xxxxx
------------------------------------------
Xxxxxx Xxxxx, Chairman
"MAJORITY SHAREHOLDERS"
/s/ Xxxxxxx Xxxxxxxxxx
----------------------------------------------
Xxxxxxx Xxxxxxxxxx
/s/ Xxxxxx Xxxxx
----------------------------------------------
Xxxxxx Xxxxx
-26-
EXHIBIT A
LIST OF SELLING STOCKHOLDERS
Name and Address of Number of Shares of COPE
Selling Stockholder Capital Stock Owned by
Selling Stockholder
-------------------------------- ---------------------------
Xxxxxxx Xxxxxxxxxx 480
Xxxxxxxxx 0
XX-0000 Xxxxx
XXXXXXXXXXX
Xxxxxx Xxxxx 480
Xxxxxxxxxxx 00
0000 Xxxxxx
XXXXXXXXXXX
Xxxxx & Co. 20
4th Floor, 00 Xxxx Xxxxxxxx
Xxxxxxxxxxxxx, Xxxxxx
XX0 0XX, U.K.
Xx. Xxxxxx Fueter 10
Xxxxxxxxxxxxxx 000
0000 Xxxxxx
XXXXXXXXXXX
Xxxxxxxx Xxxx 10
Xxxxxxxxxxx 000
00000 Xxxxxxxxx
XXXXXXX
Xxxxx Xxxxxxx 00
Xxxxxxxxxxx 00
00000 Xxxxxxxxx
XXXXXXX
Xxxxx Xxxxxxx 0
Xxxxxxxxx. 00
0000 Xxxxxx
XXXXXXXXXXX
Xxxxx Xxxxxxx 5
A-1
Name and Address of Number of Shares of COPE
Selling Stockholder Capital Stock Owned by
Selling Stockholder
-------------------------------- ---------------------------
Xxxxxxxxxxxxxxxxx 00
0000 Xxxxxx
XXXXXXXXXXX
Xxxxxx Xxxxxxxxxxxx 5
x/x Xxxxxx Xxxxxx XX, Xxx00
0000 Xxxxxx
XXXXXXXXXXX
Xxxxxx Xxxxx 4
Xxxxxxxxxxx 00
0000 Xxxxxxxxx
XXXXXXXXXXX
Xxxxxx Xxxxxx 3
c/o Xxxx Xxxx
Xxxx Xxxxxxx. 000
0000 Xxxxxxx
XXXXXXXXXXX
Xxxx Xxxxxxxx 3
Xxxxxxxxxxx 00
0000 Xxxx
XXXXXXXXXXX
Xxxx Xxxxxxxxxxx 0
x/x Xxxxx Xxxxxx
Xxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
Xxxxx Xxxxx 2
Xxxxxxxxxxxxx. 0
0000 Xxxxxx
XXXXXXXXXXX
Xxxxx Naf 2
x/x Xxxxx Xxxxxx
Xxxxxxxx 0
0000 Xxxxxxxxxx
A-2
Name and Address of Number of Shares of COPE
Selling Stockholder Capital Stock Owned by
Selling Stockholder
-------------------------------- ---------------------------
Xxxxxx Xxxx 0
Xxxxxxx
0000 Xxxxxxx
XXXXXXXXXXX
Hans Bitzi 1
x/x Xxxxxx Xxxxxx XX, Xxx00
0000 Xxxxxx
XXXXXXXXXXX
Xxxx Xxxx 0
Xx. Xxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
Xxxxxx Xxxxxxxx 1
Xxxxxxxxxxxx 00
0000 Xxxxxxxxx
XXXXXXXXXXX
Xxxxx Xxxxxx 1
Xxxxxxxxxxxxx. 0
00000 Xxxxxxxx
XXXXXXX
Xxxx Xxxxx 1
Xxxxxxxxxxxxx 00
0000 Xxx
XXXXXXXXXXX
August Xxxxxxxxx 1
c/o Prime Invest
Xxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
Xxxx Xxxxx 1
x/x Xxxxx Xxxxxx
xxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
A-3
Name and Address of Number of Shares of COPE
Selling Stockholder Capital Stock Owned by
Selling Stockholder
-------------------------------- ---------------------------
Xxxx-Xxxxxx Xxxxxxxx 1
x/x Xxxxxx Xxxxxxx XX, Xxx00
0000 Xxxxxx
XXXXXXXXXXX
Xxxxxxxxxx Xxxxx 1
Xxxxxxxx 00
0000 Xxxxx
XXXXXXXXXXX
Xxxxx Xxxx 1
Xxxxxxxxxxxxxxx 0
0000 Xxxxxx
XXXXXXXXXXX
Xxxxxxxxx Xxxxx 1
c/o Prime Invest
Xxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
Xxxx Xxxxx 1
c/o Prime Invest
Xxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
Xxxxxx Xxxxx 1
c/o Prime Invest
Xxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
Xxxxx Xxxxxx 1
Xxxxxxxxxxxxxxxxxxx 000
0000 Xxxxx
XXXXXXXXXXX
Xxxxx Xxxxxxx 1
A-4
Name and Address of Number of Shares of COPE
Selling Stockholder Capital Stock Owned by
Selling Stockholder
-------------------------------- ---------------------------
Xxxxxxxxxx 0
0000 Xxxxxxxxxx
XXXXXXXXXXX
Translex AG 1
Xxxxxxxxxxxx. 000
0000 Xxxx
XXXXXXXXXXX
Xxxxxx Xxxxx-Xxxxxx 1
Xxxxxxxxxxx 00
0000 Xxxxxxxxx
XXXXXXXXXXX
A-5
SCHEDULE 1
COPE DISCLOSURE SCHEDULE
Section 2.2. OPTIONS, WARRANTS, SUBSCRIPTION CALLS
None.
Section 2.3. SELLING STOCKHOLDERS WHO ARE U.S. PERSONS
None
Section 3.5 Undisclosed Liabilities
None
Section 3.6 Material Adverse Changes
None
Section 3.7 Contracts and Agreements involving more than $50,000
CS Credit Suisse Lucern, Sfr. 1 Million Credit Contract
dated 9/3/96 BAWAG Wien, ATS 1 Million Credit Contract
renewed 9/9/97 Office Lease Rotkreuz, New Contract dated
9/9/97, $110,000 Take over Office Interior Rotkreuz,
Contract dated 9/9/97, $150,000.
Section 3.8 Court Orders, Proceedings
None
Section 3.10 Employment Agreements
Consulting Agreements:
1-1
Section 3.11 Insurance Policy
Life Insurance Xxxxxxx Xxxxxxxxxx 5/95 Termination Date $350,000
Xxxxxx Xxxxx 5/96 Termination Date $350,000
Xxxxxxxx Xxxxxxxxxx 2/97 Termination Date $150,000
Liability Insurance Effective date 6/97, Termination date 6/2002 $3,500,000
Transport Insurance Effective date 2/97, Termination date 2/2002 $650,000
Fire/
Water Insurance Effective date 1/95, Termination date 1/2000 $650,000
Section 3.12 Trademarks and Patents
Trademark COPE, Organization Mondial de la Propriete Intellectuelle
International Registry Xx. 000000, xxxxxxxx Xxxxxxx, Xxxxxxx, Benelux,
France, Italy, Scandinavia
Section 3.16 Permits or Operating Rights not Obtained
None.
1-2
SCHEDULE 2
HARRIER DISCLOSURE SCHEDULE
SECTION 4.2
Set forth below are the outstanding warrants and options to purchase
Harrier Common Stock responsive to Section 4.2:
Number of Exercise Price
Underlying Shares (Pre-Split) Expiration Date
Name of Holder (Pre-Split)
--------------------------- ------------------ ------------------ --------------
X. Xxxxxx 30,000 $0.50 January 10, 1998
X. Xxxxxxx 50,000 $0.70 November 20, 1997
X. Xxxxxx 100,000 $0.30 March 19, 1998
Hochstrasser 100,000 $0.30 Xxxxx 00, 0000
Xxxxxxx 10,000 $0.22 March 10, 1998
XxXxxx 150,000 $0.50 May 22, 1998
Hollister 75,000 $0.50 May 22, 1998
Xxxxxx 75,000 $0.50 May 22, 1998
Beaver 75,000 $0.50 May 22, 1998
Xxxxxx, Xxxxxxxx & Assoc. 75,000 $0.50 May 22, 1998
Xxxx Xxxxxxx 1,000,000 $0.13 April 1, 2000
Xxxxxx Xxxxx 700,000 $0.13 April 23, 2000
Xxxxxxxx Xxxxxxxxx 100,000 $0.13 April 23, 1999
Xxxxxxxxx Xxxxxxxxx 100,000 $0.13 April 23, 2000
A.S.
Xxxx Xxxxxxx 100,000 $0.13 April 23, 2000
Xxxxxx Xxxxx 200,000 $0.13 September 2, 2000
Xxxx Xxxxxxx 500,000 $0.13 September 2, 1999
SECTION 4.7
Set forth below are the contracts and agreements of Harrier and Glycosyn
responsive to Section 4.7:
Research and Development Agreement dated May 1, 1993 between American
Diagnostica, Inc. and Harrier, Inc.
DermaRay International, L.L.C. Limited Liability Company Agreement dated
November 29, 1994 between Harrier, Inc. and Naturade, Inc.
2-1
Asset Transfer Agreement and Plan of Liquidation and Dissolution dated June
30, 1997 by and among Harrier, Inc., Naturade, Inc. and DermaRay
International, L.L.C.
Technology Transfer Agreement dated January 31, 1996 between Harrier, Inc.
and Glycosyn Pharmaceuticals, Inc.
Letter Agreement dated September 30, 1997 between Glycosyn Pharmaceuticals,
Inc., New Concept Therapeutics, Inc., Xxxxxx Head and Xxxxx Xxxxxxxxxx.
2-2