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EXHIBIT 10.49
STOCK PURCHASE AGREEMENT
Dated as of August 23, 2001
By and Between
PHARMACEUTICAL MARKETING BRANDS, INC. (AND ITS SUCCESSOR AND ASSIGNS)
and
BIONUTRICS, INC.
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TABLE OF CONTENTS
PAGE
ARTICLE 1 SALE OF STOCK.................................................1
1.1 Sale of Stock....................................................1
1.2 Purchase Price and Payment.......................................1
1.3 Closing..........................................................1
ARTICLE 2 REPRESENTATIONS OF PMB........................................2
2.1 Knowledge of BNRX................................................2
2.2 Existence and Good Standing......................................2
2.3 Subsidiaries.....................................................2
2.4 Capital Stock....................................................2
2.5 Purchased Shares.................................................3
2.6 Authorization, Etc...............................................3
2.7 No Violation.....................................................3
2.8 Financial Statements.............................................3
2.9 Books and Records................................................4
2.10 Title to Properties; Encumbrances................................4
2.11 Real Property; Leases............................................5
2.12 Intellectual Property............................................5
2.13 Material Contracts...............................................5
2.14 Consents and Approvals; No Violations............................6
2.15 Litigation.......................................................6
2.16 Taxes............................................................7
2.17 Liabilities......................................................8
2.18 Insurance........................................................8
2.19 Compliance with Laws.............................................8
2.20 ERISA and Related Matters........................................9
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TABLE OF CONTENTS
(continued)
PAGE
2.21 Customer Warranties.............................................12
2.22 Environmental Laws and Regulations..............................12
2.23 Bank Accounts, Powers of Attorney...............................12
2.24 Compensation of Employees.......................................12
2.25 Conduct of Business.............................................12
2.26 Accounts Receivable; Inventories................................13
2.27 Customer and Suppliers..........................................13
2.28 Broker's or Finder's Fees.......................................14
2.29 Disclosure......................................................14
2.30 Copies of Documents.............................................14
2.31 Assets..........................................................14
2.32 SEC Reporting...................................................14
2.33 Acknowledgement of Disclosure of Acquisition Plan...............14
ARTICLE 3 REPRESENTATIONS OF PMB.......................................15
3.1 Representations of PMB..........................................15
3.2 Existence and Good Standing; Power and Authority................15
3.3 Consents and Approvals; No Violations...........................15
3.4 Broker's or Finder's Fees.......................................15
3.5 Investment Representations......................................15
ARTICLE 4 COVENANTS OF BNRX............................................17
4.1 Conduct of Business of the Corporation..........................17
4.2 Exclusive Dealing...............................................17
4.3 Review of the Corporation.......................................17
4.4 Notice of Developments..........................................18
4.5 Notices and Consents............................................18
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TABLE OF CONTENTS
(continued)
PAGE
4.6 No Dissolution..................................................18
4.7 Monthly Financial Statements....................................18
4.8 Disclosure Statement............................................18
4.9 Stock Option Grant..............................................18
ARTICLE 5 CONDITIONS TO PMB'S OBLIGATION TO CLOSE......................19
5.1 Deliveries by the Corporation at Closing........................19
5.2 No Material Adverse Change......................................19
5.3 Truth of Representations and Warranties.........................19
5.4 No Litigation Threatened........................................19
5.5 Performance of Agreements.......................................19
5.6 Notices and Consents............................................19
5.7 Due Diligence...................................................19
5.8 NASDAQ Listing..................................................20
5.9 Technology Value................................................20
5.10 Review by Tax Counsel...........................................20
5.11 Board of Directors..............................................20
5.12 Disclosure Statement............................................20
5.13 Shareholder Approval............................................20
ARTICLE 6 CONDITIONS TO THE CORPORATION'S OBLIGATIONS
TO CLOSE.....................................................20
6.1 Deliveries by PMB to the Corporation at the Closing.............20
6.2 Truth of Representations and Warranties.........................20
6.3 Performance of Agreements.......................................21
6.4 No Litigation Threatened........................................21
6.5 Fairness Opinion................................................21
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE 7 THE CORPORATION'S DELIVERIES AT CLOSING......................21
7.1 Deliveries by the Corporation to PMB at Closing.................21
ARTICLE 8 PMB'S DELIVERIES AT CLOSING..................................22
8.1 Deliveries by PMB to BNRX at Closing............................22
ARTICLE 9 TERMINATION AND ABANDONMENT..................................22
9.1 Methods of Termination..........................................22
9.2 Procedure Upon Termination......................................23
ARTICLE 10 MISCELLANEOUS................................................23
10.1 Survival........................................................23
10.2 Expenses........................................................23
10.3 Governing Law...................................................23
10.4 Captions........................................................23
10.5 Notices.........................................................24
10.6 Parties in Interest.............................................24
10.7 Counterparts....................................................24
10.8 Entire Agreement................................................24
10.9 Amendments......................................................24
10.10 Severability....................................................24
10.11 Third Party Beneficiaries.......................................25
10.12 Assignment......................................................25
10.13 Jurisdiction....................................................25
10.14 Waiver of Jury Trial............................................26
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STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") dated as of the 23rd day of
August, 2001 by and among Pharmaceutical Marketing Brands, Inc., a Delaware
corporation, and its successors and assigns ("PMB"), and Bionutrics, Inc., a
Nevada corporation (referred to herein as "BNRX" or the "Corporation"). PMB and
BNRX are herein collectively referred to as the "Parties."
W I T N E S S E T H:
WHEREAS, BNRX is in the business of discovering, developing and applying
biologically active compounds from natural sources, and owns certain proprietary
technology, compounds, processing methods and products (collectively referred to
herein as the "Business");
WHEREAS, BNRX is a corporation whose common stock was publicly traded on
the NASDAQ SmallCap Market under the symbol "BNRX" and is currently traded on
the OTC Bulletin Board; and
WHEREAS, PMB desires to acquire, and BNRX desires to sell, such number of
shares of capital stock as will equal 49 percent of the total issued and
outstanding shares of capital stock of BNRX, on a fully diluted basis (as
provided herein), as of the Closing Date (as herein defined).
NOW, THEREFORE, THE PARTIES HERETO, INTENDING TO BE LEGALLY BOUND, HEREBY
AGREE AS FOLLOWS:
ARTICLE 1
SALE OF STOCK
1.1 Sale of Stock. Subject to the terms and conditions to closing set
forth in this Agreement, BNRX does hereby agree to issue, sell, convey, transfer
and deliver to PMB, and PMB does hereby agree to purchase from BNRX, on the
Closing Date, such number of shares of BNRX common stock as shall equal 49
percent of the total issued and outstanding shares of capital stock, on a fully
diluted basis (assuming the exercise of all options and warrants to purchase
capital stock of the Corporation and the conversion of all preferred stock and
any other securities that are convertible into capital stock of the
Corporation), of the Corporation (collectively referred to herein as the
"Purchased Shares"). The certificates representing the Purchased Shares shall be
delivered to PMB or its designees in such denominations as PMB shall designate
in writing to BNRX.
1.2 Purchase Price and Payment. In full consideration for the sale of
the Purchased Shares, and the representations, covenants and agreements of BNRX
set forth herein, PMB agrees to pay to BNRX the sum of $5,000,000 (the "Purchase
Price") in cash at Closing.
1.3 Closing. Closing on the transactions contemplated by this Agreement
("Closing") shall occur on or before October 15, 2001 or at such other time and
date as the parties hereto shall designate in writing (the "Closing Date");
provided, however, that PMB may extend the Closing Date in its sole discretion
if any of the conditions to PMB's obligations to close set forth in Article V
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herein are not satisfied in PMB's sole and absolute discretion. Closing shall
occur at PMB's offices located at 000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000,
Xxxxxxxxxx, Xxx Xxxxxx 00000.
ARTICLE 2
REPRESENTATIONS OF BNRX
All references to the Corporation or BNRX in this Article 2 shall include
all subsidiaries of the Corporation.
Except as set forth in the disclosure statement to be delivered by the
Corporation to PMB by no later than September 20, 2001 (the "Disclosure
Statement") and which provides an exception to or otherwise qualifies in
reasonable detail, and with specific Section references, the representations and
warranties of the Corporation specifically referred to therein, the Corporation
hereby represents and warrants to PMB as of the date hereof and as of the
Closing Date as follows:
2.1 Knowledge of BNRX. The representations and warranties of BNRX
herein to the extent based on knowledge shall be deemed to be based on the
knowledge of Xx. Xxxxxx X. Xxxx, Chairman and CEO, and Xxxxx Xxxxxxx, Chief
Accounting Officer, of BNRX (the "BNRX Management").
2.2 Existence and Good Standing. The Corporation is a corporation duly
organized, validly existing and in good standing under the laws of the state of
Nevada. The Corporation's subsidiaries are corporations duly organized, validly
existing and in good standing under the laws of the state of their respective
incorporation. The Corporation and its subsidiaries have the requisite corporate
power and authority to own, lease and operate their respective properties and to
carry on their respective businesses as now being conducted. The Corporation and
its subsidiaries are duly qualified and are in good standing as foreign
corporations in every jurisdiction in which the location of the properties
owned, leased or operated by the them or the nature of the business conducted by
them makes such qualification as a foreign corporation necessary.
2.3 Subsidiaries. The Corporation has no subsidiaries. The Corporation
has no interest, direct or indirect, and has no commitment to purchase any
interest, direct or indirect, in any other corporation or in any partnership,
joint venture, or other business enterprise or entity. The Business carried on
by the Corporation has not been conducted through any other direct or indirect
subsidiary or Affiliate of any Stockholder. All of the outstanding shares of the
capital stock of each subsidiary are owned by the Corporation, are duly
authorized, validly issued, fully paid and nonassessable, and have been issued
in material compliance with all applicable securities laws. The Corporation has
good and marketable title to all of the shares of outstanding capital stock of
each subsidiary, free and clear of all liens, contracts or other limitations
whatsoever. True, complete and correct copies of each subsidiary's charter and
bylaws as presently in effect are attached to the Disclosure Statement. No
shares of capital stock of any subsidiary are reserved for issuance and there
are no outstanding options, claims, contracts, convertible or exchangeable
securities or other commitments, contingent or otherwise, relating to the
capital stock of any subsidiary or pursuant to which any subsidiary is or may
become obligated to issue or exchange any shares of capital stock.
2.4 Capital Stock. The Corporation has authorized and issued and
outstanding capital stock as set forth in the Disclosure Statement. All
outstanding shares of capital stock of the
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Corporation have been, and will on the Closing Date be, duly authorized, validly
issued, fully paid and nonassessable. There are no outstanding subscriptions,
options, warrants, rights, calls, commitments, conversion rights, rights of
exchange, preemptive rights, rights of first refusal, rights of first offer,
plans or other agreements of any character providing for the purchase, issuance
or sale of any shares of the capital stock of the Corporation, other than as
contemplated by this Agreement.
2.5 Purchased Shares. The Purchased Shares to be delivered at Closing
have been duly authorized for issuance and, when delivered and paid for in
accordance with this Agreement, will be duly and validly issued, fully paid and
nonassessable and will be free and clear of all liens, encumbrances,
restrictions and claims of every kind.
2.6 Authorization, Etc. The Corporation has full power and authority to
enter into this Agreement and the agreements contemplated hereby and to issue
and deliver the Purchased Shares and the certificates evidencing such Purchased
Shares to PMB as provided for herein. This Agreement and all other agreements
contemplated hereby to be entered into by the Corporation each constitute a
legal, valid and binding obligation of the Corporation, enforceable against the
Corporation in accordance with their respective terms. The Corporation has all
necessary corporate power and has taken all necessary corporate action required
for the due authorization, execution, delivery and performance by the
Corporation of this Agreement and any other agreements or instruments executed
by the Corporation in connection herewith and the consummation of the
transactions contemplated herein and therein. This Agreement and the other
agreements and instruments executed by the Corporation in connection herewith
will each be a valid and binding obligation of the Corporation enforceable in
accordance with its respective terms except to the extent that its
enforceability may be subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles.
2.7 No Violation. The execution, delivery and performance by the
Corporation of this Agreement, and all other agreements contemplated hereby, and
the fulfillment of and compliance with the respective terms hereof and thereof
by the Corporation, do not and will not (a) conflict with or result in a breach
of the terms, conditions or provisions of, (b) constitute a default or event of
default under (with due notice, lapse of time or both), (c) result in the
creation of any lien upon the Corporation's capital stock or assets pursuant to,
(d) give any third party the right to accelerate any obligation under, (e)
result in a violation of, or (f) require any authorization, consent, approval,
exemption or other action by, notice to, or filing with any authority pursuant
to, the charter or bylaws of the Corporation or any applicable regulation, order
or any material contract to which the Corporation is subject. The Corporation
has complied in all material respects with all applicable regulations and orders
in connection with the execution, delivery and performance of this Agreement and
the transactions contemplated hereby.
2.8 Financial Statements.
(a) True, correct and complete copies of the audited
consolidated balance sheets of the Corporation and its subsidiaries as of
October 31, 1998, 1999 and 2000 and the related audited statements of income,
retained earnings and cash flows of the Corporation and its subsidiaries for the
fiscal years then ended, all certified by Deloitte & Touche LLP (individually, a
"Corporation Audited Financial Statement" and collectively, the "Corporation
Audited Financial Statements") and the unaudited consolidated balance sheets of
the Corporation and its subsidiaries as of July 31, 2001
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and the related consolidated statements of income, retained earnings and cash
flows of the Corporation and its subsidiaries for the nine month period then
ended (the "Corporation Interim Financial Statements") are attached to the
Disclosure Statement. The Corporation Audited Financial Statements and the
Corporation Interim Financial Statements have been prepared in accordance with
generally accepted accounting principles consistently applied by the Corporation
throughout the periods indicated ("GAAP"), are complete and accurate, certified
by the Corporation's President or Chief Accounting Officer, and fairly present
in all material respects, the consolidated financial position of the Corporation
and its subsidiaries at the respective dates thereof, and the consolidated
results of the operations and cash flows of the Corporation and its subsidiaries
for the respective periods indicated (except that the Corporation Interim
Financial Statements may not contain all of the footnotes required by GAAP).
(b) Except as set forth in the Corporation Interim Financial
Statements, the Corporation does not have any indebtedness, obligation or
liability (whether accrued, absolute, contingent, unliquidated or otherwise,
whether due or to become due) arising out of transactions entered into at or
prior to the Closing Date, or any state of facts existing at or prior to the
Closing Date.
(c) Since July 31, 2001, there has been (i) no material
adverse change in the Business, operations, assets, accounting treatment,
liabilities, financial condition, results of operations or prospects of the
Corporation and its subsidiaries, or (ii) material damage or loss to any asset
or property, tangible or intangible, of the Corporation or its subsidiaries
which materially affects the ability of the Corporation or its subsidiaries to
conduct the Business.
(d) The Disclosure Statement sets forth a projection, which
represents BNRX Management's best estimate, of the cash flow of the Corporation
for the two-year period commencing as of August 1, 2001.
(e) The Disclosure Statement sets forth all licenses fees,
royalties and other payments in connection with the technology used by the
Corporation which the Corporation currently owes, or is anticipated to owe in
the future.
2.9 Books and Records. The minute books of the Corporation which have
been and will be made available to PMB and its representatives prior to Closing
contain accurate records of all meetings of, and corporate action taken by, the
stockholders and Board of Directors of the Corporation.
2.10 Title to Properties; Encumbrances. Except for such properties and
assets which have been sold or otherwise disposed of in the ordinary course of
business, the Corporation has good title to its properties and assets (real and
personal, tangible and intangible) used in its Business and reflected on the
Corporation Interim Financial Statements. None of such properties or assets are
subject to any encumbrance, lien, charge, claim or other restriction of any kind
or character ("Encumbrances"), except for (i) Encumbrances reflected in the most
recent Corporation Financial Statements or Corporation Interim Financial
Statements, (ii) Encumbrances for current taxes, assessments or governmental
charges or levies on property not yet due and delinquent, (iii) Encumbrances
arising by operation of law in the ordinary course of business, which are not
material either individually or in the aggregate, and (iv) Encumbrances
described in the Disclosure Statement which are not material either individually
or in the aggregate (Encumbrances of the type described in
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clauses (i), (ii), (iii) and (iv) above are hereinafter sometimes referred to as
"Permitted Encumbrances").
2.11 Real Property; Leases. The Corporation owns no real property nor
has it owned any real property in the past. The Disclosure Statement contains an
accurate and complete list of all real property leased by the Corporation. Each
lease set forth in the Disclosure Statement is in full force and effect; all
rents and additional rents due to date from the Corporation on each such lease
have been paid; and, to the knowledge of BNRX Management, there exists no event,
occurrence, condition or act (including the consummation of the sale
contemplated hereby) which, with the giving of notice, the lapse of time or the
happening of any further event or condition, would become a material default by
the Corporation under such lease. No damage or destruction has occurred
affecting any of the real property which could have a material adverse effect on
the Corporation or its Business, ordinary wear and tear excepted. All of the
buildings, structures and appurtenances situated on the real property leased by
the Corporation are in good operating condition and are adequate for the
purposes for which they are presently being used. No condemnation proceeding is
pending or, to the knowledge of BNRX Management, threatened which would preclude
or impair the use of any such property by the Corporation for the purposes for
which it is currently used.
2.12 Intellectual Property. The Disclosure Statement sets forth a
complete and accurate list of all patents, patent applications and disclosures,
unpatented inventions, copyrights, trade secrets, URLs, domain names,
trademarks, service marks, know-how, and intellectual property owned or licensed
by the Corporation both registered and unregistered (collectively referred to
herein as "Intellectual Property"). Except as set forth in the Disclosure
Statement (i) all Intellectual Property is owned by the Corporation, (ii) no
rights to any of the Intellectual Property have been granted to any individual,
partnership, joint venture, corporation, trust, unincorporated organization,
government or other entity (each a "Person") and (iii) the Corporation possesses
all Intellectual Property necessary or desirable to conduct its Business as
currently conducted or proposed to be conducted. The Corporation has not
received notice of any adverse claim to the Corporation's ownership of any
rights in Intellectual Property, nor is the Corporation aware of facts that
would support such a claim. During the past five years, the Corporation has not
(i) infringed or violated any Intellectual Property right belonging to any other
Person, or (ii) received notice from any Person of such infringement or
violation. The Corporation represents that all Intellectual Property for which a
patent has not been issued or applied has been protected by agreements
restricting the use and disclosure of information relating to such Intellectual
Property (collectively referred to herein as "Confidentiality Agreements"). All
Confidentiality Agreements shall be made available to PMB, which the Corporation
represents constitute all such Confidentiality Agreements executed by the
Corporation relating to the Corporation.
2.13 Material Contracts. The Disclosure Statement contains a complete
list of every material contract to which the Corporation is a party or to which
its assets are bound. The Corporation is neither a party to nor is bound by (i)
any agreement, contract or commitment that involves the performance by the
Corporation, the purchase of its goods or services, the provision of the
Corporation employees, a capital expenditure by the Corporation, in each of the
foregoing cases in excess of $25,000 annually, (ii) any agreement, indenture or
other instrument which contains restrictions with respect to payment of
dividends or any other distribution in respect of its capital stock, (iii) any
agreement relating to the deferred purchase price of property (excluding trade
payables in the ordinary course of business), (iv) any loan or advance to,
investment in, or commitment to make any loan, advance or investment in any
Person, (v) any agreement or commitment involving a
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sharing of the Corporation profits, (vi) any guarantee or other contingent
liability in respect of any indebtedness or obligation of any Person, (vii) any
agreement, contract or commitment limiting the ability of the Corporation to
engage in any line of business or to compete with any Person or to otherwise
acquire property or conduct business in any area, (viii) any warranty, guaranty
or other similar undertaking with respect to a contractual performance extended
by the Corporation, other than in the ordinary course of business, (ix)
employment, consulting, sales, commissions, advertising or marketing contracts
which provide for annual payments in excess of $25,000, or (x) any material
contract that requires the consent of any party in connection with the
execution, delivery or performance of this Agreement. Each contract or agreement
set forth in the Disclosure Statement (or required to be set forth in the
Disclosure Statement) is valid, binding and enforceable in accordance with its
terms, is in full force and effect and there exists no material default by the
Corporation or, to the knowledge of BNRX Management, event, occurrence,
condition or act (including the consummation of the sale contemplated hereby)
which, with the giving of notice, the lapse of time or the happening of any
other event or condition, could become a default by the Corporation. To the
knowledge of BNRX Management, there does not exist any material default by any
other party to any contract or agreement set forth in the Disclosure Statement.
2.14 Consents and Approvals; No Violations. The execution, delivery and
performance of this Agreement (a) will not violate or contravene any provision
of the Articles of Incorporation or Bylaws of the Corporation, (b) will not
violate or contravene any statute, rule, regulation, licensing requirement,
order or decree of any court or governmental, regulatory or authority applicable
to the Corporation, its business, properties or operations as presently
conducted, (c) will not require any filing with, or obtaining the consent or
approval of, or the giving of any notice to, any governmental agency or
authority, or any other Person, and (d) will not result in a violation or breach
of, constitute (with or without due notice or lapse of time or both) a default,
give rise to any right of termination, cancellation, payment or acceleration
under, or result in the creation of any encumbrance upon any of the properties
or assets of the Corporation under, any of the terms, conditions or provisions
of any agreement, instrument or obligation to which the Corporation is a party,
or by which the Corporation, or any of its assets, may be bound.
2.15 Litigation. There is no pending action, suit, proceeding,
arbitration, or administrative proceeding by or before any court or governmental
agency, or, to the knowledge of any of BNRX Management, threatened, against or
affecting the Corporation, or against any of the capital stock, properties,
assets or business prospects of the Corporation, which could reasonably be
expected to have a material adverse effect on the right or ability of the
Corporation to carry on its business as now conducted or affect the ability of
the parties hereto to consummate the transactions contemplated by this
Agreement, and none of BNRX Management knows of any valid basis for any such
action or proceeding. The Corporation is not subject to any judgment, order or
decree entered in any lawsuit or proceeding which could reasonably be expected
to have a material adverse effect on the business, financial condition, assets,
results of operations or prospects of the Corporation. The Disclosure Statement
contains a description of all litigation, arbitration, mediations, and
administrative proceedings, in which the Corporation has been involved over the
past five years from the date hereof, including, but not limited to, any such
matter which has been resolved or adjudicated.
2.16 Taxes.
(a) Tax Returns. The Corporation has timely filed or caused to
be timely filed with the appropriate taxing authorities all returns, statements,
forms and reports for taxes
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("Returns") required to be filed by, or with respect to, the Corporation prior
to the Closing Date. The Returns were correct and complete in all respects, and
accurately reflect all liability for taxes of the Corporation for the periods
covered thereby. For purposes hereof, the term "Taxes" shall mean any federal,
state, local, or foreign income, gross receipts, license, payroll, employment,
excise, severance, stamp, occupation, premium, windfall profits, environmental
(including taxes under Internal Revenue Code of 1986, as amended (the "Code"),
customs duties, capital stock, franchise, profits, withholding, social security,
unemployment, disability, real property, personal property, sales, use,
transfer, registration, value added alternative or add-on minimum, estimated, or
other tax of any kind whatsoever, including any interest, penalty, or addition
thereto, whether disputed or not.
(b) Payment of Taxes. All Taxes and Tax liabilities of the
Corporation for all taxable years or periods that end on or before the Closing
Date and, with respect to any taxable year or period beginning before and ending
after the Closing Date, the portion of such taxable year or period ending on and
including the Closing Date ("Pre-Closing Periods"), whether or not shown on the
Returns, have been timely paid or accrued. If accrued, such Taxes and Tax
liabilities have been adequately disclosed on the books and records of the
Corporation in accordance with GAAP, and the Corporation has reserved sufficient
funds to fully satisfy such Taxes and Tax liabilities.
(c) Partnerships, Tax Sharing Agreements, etc. Neither the
Corporation nor its subsidiaries is subject to any joint venture, partnership,
or other arrangement or contract which is treated as a partnership for federal
income tax purposes. Neither the Corporation nor its subsidiaries is a party to
any Tax sharing agreement. Neither the Corporation nor its subsidiaries has
filed a consent under Section 341(f) of the Code or comparable provisions of any
state statutes. Neither the Corporation nor its subsidiaries has made any
payments, is obligated to make any payments or is a party to any agreement that
under certain circumstances could obligate it to make any payments that will not
be deductible under Section 280G of the Code. The Corporation and its
subsidiaries have not been classified as a "United States Real Property Holding
Corporation" within the meaning of Section 897(c)(2) of the Code during the
applicable period specified in Section 897(c)(1)(A)(ii) of the Code and will
provide PMB with the appropriate certification described in Treas. Reg. 1.1445-2
on the Closing Date. No power of attorney has been granted by the Corporation or
its subsidiaries with respect to any matter relating to Taxes which is currently
in force.
(d) Other Tax Matters.
(i) There is no action, suit, proceeding,
investigation, audit, assessment or claim now pending or, to the knowledge of
BNRX Management, threatened by any authority regarding any Taxes relating to the
Corporation for any Pre-Closing Period.
(ii) All Taxes which the Corporation is (or was)
required by law to withhold or collect have been duly withheld or collected, and
have been timely paid over to the proper authorities to the extent due and
payable.
(iii) No claim has ever been made by any taxing
authority in a jurisdiction where the Corporation does not file Returns that the
Corporation is or may be subject to taxation by that jurisdiction.
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(iv) There are no agreements for the extension or
waiver of the time for assessment or collection of any Taxes relating to the
Corporation for any Pre-Closing Period and the Corporation has not been
requested to enter into any such agreement or waiver.
(v) There are no liens or security interests on any
of the assets of the Corporation that arose in connection with any failure (or
alleged failure) to pay any Taxes.
2.17 Liabilities. The Corporation is not in default in respect of the
terms or conditions of any indebtedness, commitment or liability. The
Corporation represents to PMB that it has not received any notice or claim of
such default with respect to the foregoing. The Disclosure Statement contains a
true and correct list of all debt agreements to which the Corporation or its
assets are bound. None of the obligations set forth in such agreements will be
accelerated, mature, or result in any penalty to the Corporation as a result of
the consummation of the transactions contemplated by this Agreement.
2.18 Insurance. The Disclosure Statement contains an accurate and
complete summary description of all policies of property, fire and casualty,
general liability, workers compensation and other forms of insurance owned or
held by the Corporation. The Corporation has not received any notice of
cancellation of any policy described in the Disclosure Statement or refusal of
coverage thereunder. With respect to each such policy listed on the Disclosure
Statement: (a) the policy is legal, valid, binding, enforceable, and in full
force and effect; (b) the policy will continue to be legal, valid, binding and
enforceable, and in full force and effect on identical terms following the
consummation of the sale of the Purchased Shares to PMB; and (c) neither the
Corporation nor, to the knowledge of BNRX Management, any other party to the
policy is in breach or default (including with respect to the payment of
premiums or the giving of notices) and no event has occurred which, with notice
or the lapse of time, would constitute such a breach or default or permit
termination, modification, or acceleration under the policy. The Corporation
currently is and has been for the past three years covered by insurance in scope
and amount customary and reasonable for the Businesses in which it has engaged
during this period, including but not limited to directors and officers
liability insurance. Since the last renewal date of any insurance policy, there
has not been any material adverse change in the relationship of the Corporation
with its insurers or in the premiums payable pursuant to such policies. All
insurance premiums owing prior to the Closing Date shall have been paid.
2.19 Compliance with Laws. To the knowledge of BNRX Management, the
Corporation has operated in compliance with all applicable laws, regulations,
licensing requirements, orders, judgments and decrees applicable to its
Business, assets and operations, and has obtained all required governmental
approvals and permits in each jurisdiction in which it does business except
where the failure to so comply or obtain could not reasonably be expected to
have a material adverse effect on the Corporation or its Business, financial
condition, assets, results of operations or prospects. The Corporation has not
received nor is BNRX Management aware of any action, suit, proceeding,
investigation, charge, complaint or notice or claim alleging a failure to so
comply.
2.20 ERISA and Related Matters.
(a) Benefit Plans; Obligations to Employees. Neither the
Corporation, nor any ERISA Affiliate of the Corporation, is a party to or
participates in or has any liability or contingent liability with respect to:
(i) any "employee welfare benefit plan" or "employee pension
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benefit plan" or "multiemployer plan" (as those terms are respectively defined
in Sections 3(1), 3(2) and 3(37) of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA")); or (ii) any retirement or deferred compensation
plan, incentive compensation plan, stock plan, unemployment compensation plan,
vacation pay, severance pay, bonus or benefit arrangement, insurance or
hospitalization program or any other fringe benefit arrangements for any current
or former employee, director, consultant or agent, whether pursuant to contract,
arrangement, custom or informal understanding, which does not constitute an
"employee benefit plan" (as defined in Section 3(3) of ERISA). For purposes
hereof, the term "ERISA Affiliate" shall mean any trade or business, whether or
not incorporated, that together with the Corporation would be deemed a "single
employer" within the meaning of Section 4001(b)(i) of ERISA. Any plan,
arrangement or contract described in (i) or (ii) above for which the Corporation
or any ERISA Affiliate of the Corporation may have any liability or contingent
liability is sometimes hereinafter referred to as a "Benefit Plan."
(b) Plan Documents and Reports. A true and correct copy of
each of the Benefit Plans listed on the Disclosure Statement, and all contracts
relating thereto, or to the funding thereof, including, without limitation, all
trust agreements, insurance contracts, investment management contracts,
subscription and participation contracts and recordkeeping contracts, each as in
effect on the date hereof, has been supplied to PMB. In the case of any Benefit
Plan that is not in written form, PMB has been supplied with an accurate
description of such Benefit Plan as in effect on the date hereof. A true and
correct copy of the three most recent annual reports and accompanying schedules,
the three most recent actuarial reports, and the most recent summary plan
description and Internal Revenue Service determination letter with respect to
each such Benefit Plan, to the extent applicable, and a current schedule of
assets (and the fair market value thereof assuming liquidation of any asset
which is not readily tradable) held with respect to any funded Benefit Plan has
been supplied to PMB by the Corporation, and there have been no material changes
in the financial condition of the respective Benefit Plans from that stated in
the annual reports and actuarial reports supplied.
(c) Compliance with Laws; Liabilities. As to all Benefit
Plans, except as would not have a material adverse effect:
(i) All Benefit Plans comply, and have been
administered in form and in operation, with all Regulations and Benefit Plan
documents applicable thereto, including without limitation the timely filing of
all annual reports required with respect to such Benefit Plans, and neither the
Corporation nor any ERISA Affiliate of the Corporation has received any notice
from any authority questioning or challenging such compliance.
(ii) All Benefit Plans that are intended to be
qualified under Section 401(a) of the Code comply in form and in operation with
all applicable requirements of Sections 401(a) and 501(a) of the Code; there
have been no amendments to such Benefit Plans which are not the subject of a
determination letter issued with respect thereto by the Internal Revenue
Service; and no event has occurred that will or could give rise to
disqualification of any such Benefit Plan under such sections or to any Tax
under Section 511 of the Code. Except as required to maintain the tax-qualified
status of any Benefit Plan intended to qualify under Section 401(a) of the Code,
no condition or circumstance exists that would prevent the termination or
amendment of any Benefit Plan.
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(iii) None of the assets of any Benefit Plan are
invested in employer securities or employer real property, as those terms are
defined in Section 407(d) of ERISA.
(iv) There have been no "prohibited transactions" (as
described in Section 406 of ERISA or Section 4975 of the Code) with respect to
any Benefit Plan and neither the Corporation nor any ERISA Affiliate of the
Corporation has otherwise engaged in any prohibited transaction.
(v) There have been no acts or omissions by the
Corporation or any ERISA Affiliate of the Corporation that have given rise to or
may give rise to fines, penalties, taxes or related charges under Sections
502(c), 502(i) or 4071 of ERISA or Chapter 43 of the Code for which the
Corporation or any ERISA Affiliate of the Corporation may be liable.
(vi) There are no claims (other than routine claims
for benefits) pending or threatened involving any Benefit Plans or the assets of
such plans, and no facts exist which could give rise to any such claims (other
than routine claims for benefits). Except for payments of premiums to the
Pension Benefit Guaranty Corporation ("PBGC"), which have been timely paid in
full, neither the Corporation nor any ERISA Affiliate has incurred any liability
(including, for this purpose and for the purpose of all of the representations
in this Section 2.20, any indirect, contingent, or secondary liability) to the
PBGC in connection with any Benefit Plan, including, without limitation, any
liability under Section 4069 or 4212(c) of ERISA or any penalty imposed under
Section 4071 of ERISA, or ceased operations at any facility or withdrawn from
any such Benefit Plan in a manner which could subject it to liability under
Section 4062, 4063 or 4064 of ERISA, or knows of any facts or circumstances that
might give rise to any liability of the Corporation or any ERISA Affiliate to
the PBGC under Title IV of ERISA that could reasonably be anticipated to result
in any claims being made against PMB by the PBGC.
(vii) As to any Benefit Plan that is subject to Title
IV of ERISA, there have been no "reportable events" (as described in Section
4043 of ERISA), and no steps have been taken to terminate any such Benefit Plan.
Neither the Corporation nor any of its subsidiaries nor any of their respective
directors, officers, employees or, to the knowledge and belief of BNRX
Management, other persons who participate in the operation of any Benefit Plan
or related trust or funding vehicle, has engaged in any transaction with respect
to any Benefit Plan or breached any applicable fiduciary responsibilities or
obligations under Title I of ERISA that would subject any of them to a tax,
penalty or liability for prohibited transactions or breach of any obligations
under ERISA or the Code or would result in any claim being made under, by or on
behalf of any such Benefit Plan by any party with standing to make such claim.
(viii) All Benefit Plans that are group health plans
have been operated in compliance with the group health plan continuation
coverage requirements of Section 4980B of the Code and Section 601 of ERISA to
the extent such requirements are applicable, and no such group health plan is a
self-insured plan. Neither the Corporation nor any of its subsidiaries maintains
any Benefit Plan (whether qualified or non-qualified under Section 401(a) of the
Code) providing for post-employment or retiree health, life insurance and/or
other welfare benefits and having unfunded liabilities, and neither the
Corporation nor any of its subsidiaries have any obligation to provide any such
benefits to any retired or former employees or active employees following such
employees' retirement or termination of service. Neither the Corporation nor any
of its subsidiaries
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have any unfunded liabilities pursuant to any Benefit Plan that is not intended
to be qualified under Section 401(a) of the Code.
(ix) Actuarially adequate accruals for all
obligations or contingent obligations under the Benefit Plans are reflected in
the Corporation's Financial Statements and such obligations include a pro rata
amount of the contributions which would otherwise have been made in accordance
with past practices for the plan years which include the Closing Date.
(x) There are no unfunded benefit liabilities, within
the meaning of Section 4001(a)(16) of ERISA, with respect to any Benefit Plan
subject to Title IV of ERISA.
(xi) No Benefit Plan subject to the requirements of
Section 412 of the Code or Section 302 of ERISA has incurred an "accumulated
funding deficiency" (as defined in such applicable section and any regulations
thereunder), and none of the assets of the Corporation or its ERISA Affiliates
is subject to any lien arising under Section 302(f) of ERISA or Section 412(n)
of the Code.
(xii) Except as specifically set forth in the
Disclosure Statement to this Agreement, the execution of and performance of the
transactions contemplated by this Agreement will not (either alone or upon the
occurrence of any additional or subsequent events) result in any payment
(whether of severance pay or otherwise), acceleration, vesting, or increase in
benefits under any Benefit Plan. No Benefit Plan provides for the payment of
severance, termination, change in control or similar-type payments or benefits.
(xiii) Full payment has been timely made of all
amounts which the Corporation or any ERISA Affiliate is required, under
applicable law or under any Benefit Plan or any contract relating to any Benefit
Plan to which the Corporation or any ERISA Affiliate is a party, to have paid as
contributions or premiums thereto as of the last day of the most recent fiscal
year of such Benefit Plan ended prior to the date hereof. All such contributions
and/or premiums have been fully deducted for income tax purposes and no such
deduction has been challenged or disallowed by any authority, and to the
knowledge of the Corporation no event has occurred and no condition or
circumstance has existed that could give rise to any such challenge or
disallowance. Benefits under all Benefit Plans are as represented and have not
been increased subsequent to the date as of which documents have been provided.
(d) Multiemployer Plans. Each Benefit Plan that is a "multiemployer
plan" (within the meaning of Section 3(37) of ERISA) with respect to which the
Corporation or any ERISA Affiliate may have any liability, including any
liability attributable to a current or former ERISA Affiliate of the
Corporation, and the maximum amount of such liability (determined in the case as
if the Corporation or any ERISA Affiliate of the Corporation incurred complete
withdrawal immediately after the Closing) is listed on the Disclosure Statement.
With respect to such Benefit Plans:
(i) Neither the Corporation nor any ERISA Affiliate
of the Corporation has withdrawn, partially withdrawn, or received any notice of
any claim or demand for withdrawal liability or partial withdrawal liability
against any of them; and
(ii) Neither the Corporation nor any ERISA Affiliate
of the Corporation has received any notice that any such Benefit Plan is in
reorganization, that increased
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contributions may be required to avoid a reduction in benefits under the Benefit
Plan or the imposition of any excise tax, or that any such Benefit Plan is or
may become insolvent.
2.21 Customer Warranties. There are no pending nor, to the knowledge of
BNRX Management, threatened claims under or pursuant to any warranty, whether
expressed or implied, on products or services sold by the Corporation that
should be disclosed pursuant to GAAP but are not disclosed, or referred to in
the Financial Statements and that are not fully reserved against except for such
immaterial claims that the Corporation resolves in the ordinary course of
business by providing additional services to the customer.
2.22 Environmental Laws and Regulations. To the knowledge of BNRX
Management, the Corporation is in compliance with all applicable environmental
laws with respect to any property owned, leased or occupied by it. There are no
pending or, to the knowledge of the BNRX Management, threatened environmental
claims against the Corporation or, to the knowledge of the BNRX Management, any
property owned, leased or occupied by the Corporation. There are no facts,
circumstances, conditions or occurrences on any property leased or occupied by
the Corporation that could reasonably be anticipated (i) to form a basis of an
environmental claim against the Corporation, or (ii) to cause such property or
any of Corporation's assets to be subject to any restrictions on the ownership,
occupancy, use or transferability thereof under any applicable environmental
law.
2.23 Bank Accounts, Powers of Attorney. The Disclosure Statement
contains an accurate and complete list showing the name and address of each bank
in which the Corporation has an account or safe deposit box, the number of any
such account or any such box, and the names of all Persons authorized to draw
thereon or to have access thereto. There are no outstanding powers of attorney
executed on behalf of the Corporation.
2.24 Compensation of Employees. The Disclosure Statement contains an
accurate and complete list showing the names of all Persons employed by the
Corporation with annual compensation in excess of $40,000. Such list sets forth
the compensation structure and total 2000 and expected 2001 compensation of each
such employee.
2.25 Conduct of Business. Since the date of the most recent Corporation
Audited Financial Statement, the Corporation has conducted its operations only
according to its ordinary and usual course of business, preserved intact its
business organization, kept available the services of its officers and
employees, maintained satisfactory relationships with licensors, suppliers,
distributors, customers, landlords, employees, agents and others having business
relationships with it. Since the date of the most recent Corporation Audited
Financial Statement, the Corporation has (a) refrained from paying (other than
in the ordinary course of business consistent with past practice) or increasing
any bonuses, salaries, or other compensation to any director, officer, employee
or shareholder or entering into any employment, severance, or similar agreement
with any director, officer, or employee, (b) refrained from adopting or
increasing the percentage contributed under any profit sharing, bonus, deferred
compensation, savings, insurance, pension, retirement, or other employee benefit
plan for or with any of its employees, (c) refrained from entering into,
modifying, amending, canceling or terminating any material contract or
commitment other than in the normal course of business, (d) refrained from
increasing its Indebtedness and imposing a security interest on any of its
assets, (e) refrained from canceling or waiving any claim or right of
substantial value, (f) refrained from redeeming, purchasing or otherwise
acquiring any of its capital stock, (g) refrained from making any material
change in accounting methods or practices, except as required by law or GAAP (h)
refrained from issuing or
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selling any shares of capital stock or any other securities, or issuing any
securities convertible into, or options, warrants or rights to purchase or
subscribe to, or entering into any arrangement or contract with respect to the
issue and sale of, any shares of its capital stock or any other securities, or
making any other changes in its capital structure, (i) refrained from selling,
transferring, leasing or otherwise disposing of any material asset or property,
(j) refrained from making any capital expenditure or commitment therefor other
than in the ordinary course of business, (k) refrained from writing off as
uncollectable any notes or accounts receivable, except write-offs in the
ordinary course of business charged to applicable reserves, none of which
individually or in the aggregate is material, (l) refrained from granting or
entering into any license, sublicense or any right under or with respect to any
of its Intellectual Property, (m) refrained from making or authorizing any
change in its articles of incorporation or bylaws, (n) refrained from making any
loan to or entering into any other transaction with any of its directors,
officers, and employees, (o) settled accounts payable in a manner consistent
with its past practice by paying bills in a timely fashion, (p) not experienced
any damage, destruction, or loss (whether or not covered by insurance) with
respect to its assets, properties or business, and (q) not experienced any other
occurrence, event, incident, action, failure to act, or transaction outside the
ordinary course of business.
2.26 Accounts Receivable; Inventories. The Disclosure Statement
contains a listing of the Corporation's accounts receivable (collectively, the
"Accounts Receivable"), with aging, as of the date hereof. The amount of all
Accounts Receivable, unbilled invoices and other debts due or recorded in the
accounting records of the Corporation as being due to the Corporation as of the
Closing Date (less the amount of any provision or reserve therefor made in the
accounting records of the Corporation) will represent revenues generated in the
ordinary course of business and were determined in accordance with GAAP in a
manner consistent with past practice. There has been no material adverse change
since the date of the most recent Corporation Financial Statement in the amount,
aging or collectability of accounts receivable or other debts due to the
Corporation. All Accounts Receivable, unbilled invoices and other debts due or
recorded in the records and books of account of the Corporation as being due to
the Corporation as at the Closing Date will be good and collectible in full in
the ordinary course of business and in any event not later than 90 days after
the Closing Date; and none of such Accounts Receivable or other debts is, or at
the Closing Date will be, subject to any counterclaim or set-off. The
Corporation does not maintain any inventories for sale in the ordinary course of
business.
2.27 Customer and Suppliers. No material supplier of the Corporation
has advised the Corporation in writing within the past year that it will stop,
or decrease the rate of, supplying materials, products, or services to the
Corporation and no material customer of the Corporation has advised the
Corporation in writing within the past year that it will stop, or decrease the
rate of, buying materials, products or services from the Corporation. The
Disclosure Statement contains a complete and accurate list of each customer that
accounted for more than ten percent (10%) of the consolidated revenues of the
Corporation during the last full fiscal year and the interim period through July
31, 2001 and the amount of revenues accounted for by such customer during each
such period.
2.28 Broker's or Finder's Fees. No agent, broker, person or firm acting
on behalf of the Corporation is, or will be, entitled to any commission or
broker's or finder's fees from any of the parties hereto in connection with any
of the transactions contemplated by this Agreement.
2.29 Disclosure. Neither this Agreement, nor the Corporation Audited
Financial Statements or Corporation Interim Financial Statements referred to in
Section 2.8, the Disclosure
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Statement, any Exhibit or certificate attached hereto or delivered pursuant to
this Agreement or any document which has been supplied by or on behalf of the
Corporation in connection with the transactions contemplated by this Agreement,
contains any untrue statement of a material fact, or omits any statement of a
material fact necessary in order to make the statements contained herein or
therein not misleading. There is no fact known to BNRX Management which
materially and adversely affects the business, operations, condition (financial
or otherwise) or prospects of the Corporation, which has not been set forth in
any of the foregoing and delivered to PMB.
2.30 Copies of Documents. BNRX has made or will make available for
inspection and copying by PMB and its advisers, true, complete and correct
copies of all documents referred to in this Article II or in the Disclosure
Statement.
2.31 Assets. The real and personal property that will be owned or
leased by the Corporation on the Closing Date constitutes all of the properties
and assets used or held for use in connection with the Corporation's Business
and are sufficient for the continued operation of the Corporation at historic
levels. None of the Corporation's stockholders or Affiliates own or lease any of
the assets which are used in connection with the operation of the Corporation's
Business.
2.32 SEC Reporting. The Corporation has filed on a timely basis with
the Securities and Exchange Commission (the "SEC") all forms, statements,
reports and documents required to be filed by it under each of the Securities
Act of 1933, as amended (the "1933 Act"), and the Securities Exchange Act of
1934, as amended, (the "1934 Act") (collectively, the "Commission Reports"). The
Commission Reports (i) at the time filed, complied in all material respects with
the applicable requirements of the 1933 Act and the 1934 Act, as applicable, and
(ii) did not at the time they were filed (or if amended or superseded by a
filing prior to the date of this Agreement, then on the date of such amending or
superseding filing) contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading. There are no orders issued by the SEC outstanding
against the Corporation. The Disclosure Statement contains copies of (i) all
notices and related correspondence and documents of SEC or NASDAQ violations
since January 1, 1996 and (ii) all correspondence in connection with the
delisting of the Corporation's common stock from the NASDAQ SmallCap Market.
2.33 Acknowledgement of Disclosure of Acquisition Plan. BNRX Management
acknowledge that PBM has disclosed that upon obtaining control of the
Corporation's board of directors, its intends to have the Corporation engage in
an acquisition plan of companies which PMB may make available which will involve
the issuance of the Corporation's common stock as all or part of the
consideration, the election of a new management team, and the creation of a
management stock option plan pursuant to which stock options will be issued to
such management persons.
ARTICLE 3
REPRESENTATIONS OF PMB
PMB represents and warrants to the Corporation as follows as of the date
hereof and as of the Closing Date:
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3.1 Representations of PMB. For purposes of the following
representations, warranties and agreements of PMB, the phrase "to the knowledge
of PMB" shall mean to the knowledge of the senior executive officers of PMB
("PMB Management").
3.2 Existence and Good Standing; Power and Authority. PMB is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware. PMB has the requisite corporate power and authority to
own, lease and operate its properties and to carry on its business as now being
conducted. PMB has the legal power and authority to enter into, execute and
deliver this Agreement and perform its obligations hereunder. This Agreement has
been duly authorized and approved by PMB and is a valid and binding obligation
of PMB enforceable against PMB in accordance with its terms, except to the
extent that its enforceability may be subject to applicable bankruptcy,
insolvency, reorganization, moratorium and other similar laws effecting the
enforcement of creditors' rights generally and by general equitable principles.
3.3 Consents and Approvals; No Violations. The execution, delivery and
performance of this Agreement by PMB (a) will not violate or contravene any
provision of the Certificate of Incorporation or Bylaws of PMB, (b) will not
violate or contravene any statute, rule, regulation, licensing requirement,
order or decree of any court or governmental, regulatory or authority applicable
to PMB, (c) will not require any filing with, or obtaining the consent or
approval of, or the giving of any notice to, any governmental agency or
authority, or any other Person, and (d) will not result in a violation or breach
of, constitute (with or without due notice or lapse of time or both) a default,
give rise to any right of termination, cancellation, payment or acceleration
under, or result in the creation of any encumbrance upon any of the properties
or assets of PMB under, any of the terms, conditions or provisions of any
agreement, instrument or obligation to which PMB is a party, or by which any of
its assets may be bound.
3.4 Broker's or Finder's Fees. No agent, broker, person or firm acting
on behalf of PMB is, or will be, entitled to any commission or broker's or
finder's fees from any of the parties hereto in connection with any of the
transactions contemplated by this Agreement.
3.5 Investment Representations.
(a) PMB is aware that the Purchased Shares are being offered
and sold by means of an exemption under the 1933 Act, as well as exemptions
under certain state securities laws for nonpublic offerings, and that it makes
the representations, declarations and warranties as contained in this Section
3.5 with the intent that the same shall be relied upon in determining its
suitability as a purchaser of the Purchased Shares.
(b) PMB is an "Accredited Investor" as defined in Rule 501 of
Regulation D and has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of an investment
in the Corporation and of making an informed investment decision.
(c) PMB is aware that the Purchased Shares are "restricted
securities" under the 1933 Act and cannot be sold or otherwise transferred
without registration under the 1933 Act and applicable state securities laws or
without an exemption therefrom, and is aware that it may be required to bear the
financial risks of its purchase for the indefinite period of time.
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(d) PMB is purchasing the Purchased Shares for investment for
its own account and not with a view to or for sale in connection with any
distribution of the Purchased Shares to or for the account of others.
(e) PMB recognizes that no federal or state agency has
recommended or endorsed the purchase of the Purchased Shares or passed upon the
adequacy or accuracy of the information set forth herein, and that the
Corporation is relying on the truth and accuracy of the representations,
declarations and warranties made by PMB as contained herein in selling the
Purchased Shares.
(f) PMB has at all times been given the opportunity to obtain
reasonably requested additional information, to verify the accuracy of the
information received and to ask questions of and receive answers from certain
representatives of the Corporation concerning the terms and conditions of PMB's
investment in the Corporation and the nature and prospect of the Corporation's
business.
(g) PMB recognizes that the purchase of the Purchased Shares
is a speculative investment and any financial forecasts or other estimates which
may have been made by the Corporation merely represent predictions of future
events which may or may not occur and are based on assumptions which may or may
not occur. As a consequence, such financial forecasts or other estimates may not
be relied upon to indicate the actual results which might be attained.
(h) PMB is not relying upon the Corporation with respect to
PMB's tax and other economic circumstances in connection with its investment in
the Corporation. In regard to the tax and other economic considerations related
to such investment, PMB has relied on the advice of, or has consulted with, only
its own professional advisors.
(i) PMB understanding and agrees that a legend in
substantially the following form may be placed on all certificates evidencing
the Purchased Shares:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), NOR ANY
APPLICABLE STATE SECURITIES LAW BY REASON OF SPECIFIC EXEMPTIONS THEREUNDER
RELATING TO THE LIMITED AVAILABILITY OF THE OFFERING. THESE SECURITIES CANNOT BE
OFFERED, SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR OTHERWISE DISPOSED OF TO ANY
PERSON OR ENTITY UNLESS SUBSEQUENTLY REGISTERED UNDER THE SECURITIES ACT AND THE
APPLICABLE STATE LAWS, IF SUCH REGISTRATION IS REQUIRED, OR IN COMPLIANCE WITH
RULE 144 PROMULGATED UNDER THE SECURITIES ACT OR UNLESS THE CORPORATION HAS
RECEIVED AN OPINION OF COUNSEL, SATISFACTORY TO THE CORPORATION AND ITS COUNSEL,
THAT SUCH REGISTRATION IS NOT REQUIRED.
ARTICLE 4
COVENANTS OF BNRX
From the date hereof until the Closing Date, except as otherwise consented
to or approved by PMB in writing, the Corporation agrees that it shall act, or
refrain from acting where required hereinafter, to comply with the following:
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4.1 Conduct of Business of the Corporation. The Corporation shall
conduct its operations only according to its ordinary and usual course of
business to preserve intact the Corporation's Business, keep available the
services of its officers and employees and maintain satisfactory relationships
with licensors, suppliers, distributors, clients and others having business
relationships with them. In addition, the Corporation shall: (a) not amend its
Articles of Incorporation or By-Laws, (b) maintain at their current levels the
compensation payable or to become payable by the Corporation to any officer,
employee or agent being paid $40,000.00 per year or more on June 30, 2001, other
than adjustments to compensation which may have been made in the ordinary course
of business consistent in nature and amount with the Corporation's past
practices, (c) refrain from making any bonus, pension, retirement or insurance
payment or arrangement to or with any such persons except those that may have
already been accrued or those which are in the ordinary course of business
consistent in nature and amount with the Corporation's past practices, (d)
refrain from entering into any contract or commitment except contracts in the
ordinary course of business, (e) refrain from making any change affecting any
bank, safe deposit or power of attorney arrangements of the Corporation, (f)
refrain from taking any of the actions referred to in Section 2.25 of this
Agreement, and (g) refrain from taking any action, or omitted to take any
action, which with the passage of time would cause the representations and
warranties contained in Article II hereof to be untrue or incorrect.
4.2 Exclusive Dealing. The Corporation represents and agrees that as
the date hereof and until the Closing Date or earlier termination of this
Agreement, the Corporation has not taken and will not take any action to,
directly or indirectly, encourage, initiate or engage in discussions or
negotiations with, or provide any information to, or entered into any agreement
or understanding with, any Person, other than PMB and its representatives,
concerning any purchase of any capital stock or other securities of the
Corporation, any stock dividend, stock split or recapitalization, or any merger,
sale of substantial assets or similar transaction involving the Corporation,
except as disclosed in the Disclosure Statement or as otherwise agreed by PMB.
4.3 Review of the Corporation. PMB, prior to the Closing Date, directly
or through its representatives, shall have been provided access to all
information about the Corporation including, but not limited to, review of the
assets, liabilities, Business, contracts, corporate and business books and
records of the Corporation and its financial and legal condition to the extent
it deems necessary or advisable. Such review shall not, however, affect the
representations and warranties made by the Corporation. At all reasonable times
prior to the Closing Date and upon reasonable notice, the Corporation shall
permit PMB and its representatives to have access to the premises, personal
property, contracts, documents, and books and records of the Corporation and to
cause the Corporation to have furnished PMB with such financial and operating
data and other information with respect to the Business of the Corporation as
PMB shall have reasonably requested.
4.4 Notice of Developments. As of the Closing Date, BNRX Management
shall have caused the Corporation to confer on a regular and frequent basis with
one or more designated representatives of PMB to report material operational
matters and to report the general status of ongoing operations. BNRX Management
shall have caused the Corporation to notify PMB of any material occurrence,
unexpected emergency or other change in the normal course of its Business or in
the operation of its properties and of any governmental complaints,
investigations or proceedings, involving any material property of the
Corporation. The Corporation shall have given prompt written notice to PMB of
any material adverse development that could reasonably be expected to cause any
of the representations and warranties set forth in Article II above to be untrue
or incorrect as of the
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Closing Date. No disclosure by the Corporation pursuant to this Section,
however, shall be deemed to amend or supplement any representation or warranty
set forth in Article II or the Disclosure Statement, or to prevent or cure any
misrepresentation, breach of warranty, or breach of covenant.
4.5 Notices and Consents. As of the Closing Date, BNRX Management shall
have caused the Corporation to give any notices to third parties and shall have
caused the Corporation to use its best efforts to obtain any third party
consents that PMB may have requested in connection with the transactions
contemplated by this Agreement. BNRX Management shall have caused the
Corporation to give all notices to, make all filings with, and shall have used
its best efforts to obtain any authorizations, consents, and approvals of
governments and governmental agencies in connection with the transactions
contemplated by this Agreement.
4.6 No Dissolution. From the date hereof until the Closing Date, there
shall not have been taken any action to dissolve, liquidate, or terminate the
legal existence of the Corporation.
4.7 Monthly Financial Statements. Monthly unaudited consolidated
financial statements of the Corporation and its subsidiaries since July 31, 2001
will be prepared in accordance with GAAP (except as to the absence of
footnotes), will be provided to PMB in a timely manner when available (but in no
event later than the 15th day following the end of each month) and will be
certified as true and correct in all material respect by the Corporation's
President and Chief Accounting Officer. Such statements will indicate any
material changes in the results of operations, balance sheet or cash flow of the
Corporation since the date of the Corporation Interim Financial Statements.
4.8 Disclosure Statement. No later than September 20, 2001, the
Corporation shall deliver to PMB the Disclosure Statement.
4.9 Stock Option Grant. Effective as of the date hereof, the
Corporation hereby grants to PMB (or to one or more persons or entities
designated by PMB) an option to purchase 5,000,000 shares of the Corporation's
common stock at a price per share equal to $1.00 (the "PMB Option"). The PMB
Option shall (i) have a term of ten years, (ii) be freely transferable, in whole
or in part, and (iii) be fully vested and exercisable on and after October 15,
2001; provided, however, that the PMB Option shall terminate immediately in the
event that this Agreement is terminated by PMB pursuant to Section 9.1(a),
(c)(i) or (c)(ii) or pursuant to Section 9.(c)(iii) if any of the conditions set
forth in Sections 5.7, 5.8, 5.9, 5.10 or 5.12 have not been satisfied. Promptly
following the date hereof, the Corporation shall provide to PMB an option
agreement, in a form and substance reasonably satisfactory to PMB, evidencing
the PMB Option.
ARTICLE 5
CONDITIONS TO PMB'S OBLIGATION TO CLOSE
The obligation of PMB to consummate the transactions contemplated by this
Agreement on the Closing Date is conditioned upon satisfaction on or prior to
the Closing Date of each of the following conditions:
5.1 Deliveries by the Corporation at Closing. The Corporation shall
deliver to PMB at Closing each of the items set forth in Section 7.1 below.
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5.2 No Material Adverse Change. From the date of this Agreement to the
Closing Date there shall have been no (i) material adverse change in the
Business, operations, assets, nature of assets, accounting treatment,
liabilities, condition (financial or otherwise), results of operations, or
prospects of the Corporation and its subsidiaries, taken as a whole and (ii)
material damage, destruction, or loss to any asset or property, tangible or
intangible, of the Corporation and its subsidiaries which materially affects the
ability of the Corporation and its subsidiaries to conduct its Business, or
material adverse occurrences which affect the Purchased Shares or the ability of
the Corporation to issue, transfer, sell and convey the Purchased Shares as
contemplated by this Agreement.
5.3 Truth of Representations and Warranties. The representations and
warranties of the Corporation contained in this Agreement shall have been true
and correct when made and shall be true and correct on the Closing Date with the
same effect as though such representations and warranties had been made on and
as of such date.
5.4 No Litigation Threatened. No action or proceedings against the
Corporation shall have been instituted or, to the knowledge of BNRX Management,
threatened before a court or other government body or by any public authority to
restrain or prohibit any of the transactions contemplated hereby.
5.5 Performance of Agreements. All of the covenants, agreements and
obligations of the Corporation to be performed prior to the Closing pursuant to
the terms of this Agreement shall have been duly performed.
5.6 Notices and Consents. As of the Closing Date, the Corporation shall
have given any notices to third parties and shall have obtained any third party
consents that are required or that PMB may reasonably have requested in
connection with the transactions contemplated by this Agreement. The Corporation
shall have given all notices to, make all filings with, and shall have obtained
any authorizations, consents, and approvals of governments and governmental
agencies in connection with the transactions contemplated by this Agreement.
5.7 Due Diligence. PMB and any lender or investor which provides
financing in connection with the transactions contemplated by this Agreement
shall have completed its or their business, financial and legal due diligence
investigations of BNRX and its subsidiaries, the Business and the Purchased
Shares, and each shall be satisfied, in their sole and absolute discretion, as
to the results thereof. PMB also shall have received and be satisfied with the
monthly financial statements delivered by BNRX pursuant to Section 4.7 above.
5.8 NASDAQ Listing. The Corporation shall be relisted and in good
standing on the NASDAQ SmallCap Market without any conditions which are
unsatisfied, except the consummation of the purchase of the Purchased Shares by
PMB described herein.
5.9 Technology Value. PMB shall have obtained an opinion or
verification from an independent appraiser which is satisfactory to PMB, in its
sole discretion, as to the value of the Corporation's technology.
5.10 Review by Tax Counsel. PMB shall have the opportunity to review
the structure of this transaction with tax counsel of its choosing. Should such
tax counsel advise that the transactions contemplated herein could be structured
on a more tax neutral basis, the parties hereto agree to
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modify the form and structure of the transactions contemplated herein to achieve
such objective; provided, however, that any such modification must not have any
unreasonable negative tax impact on the Corporation or its stockholders.
5.11 Board of Directors. The Board of Directors of BNRX shall have been
reconstituted such that a majority of the Board of Directors as of the Closing
Date shall be designees of PMB.
5.12 Disclosure Statement. PMB shall be satisfied, in its sole and
absolute discretion, with the disclosures, exceptions and other information
provided by the Corporation in the Disclosure Statement.
5.13 Shareholder Approval. BNRX shall have obtained the requisite
shareholder approval for the issuance by BNRX of the Purchased Shares and the
PMB Option and the consummation of the transactions contemplated herein.
ARTICLE 6
CONDITIONS TO THE CORPORATION'S
OBLIGATIONS TO CLOSE
The obligations of the Corporation to consummate the transactions
contemplated by this Agreement on the Closing Date are conditioned upon
satisfaction on or prior to the Closing Date, of each of the following
conditions:
6.1 Deliveries by PMB to the Corporation at the Closing. PMB shall
deliver to the Corporation at the Closing each of the items set forth in Section
8.1 below.
6.2 Truth of Representations and Warranties. The representations and
warranties of PMB contained in this Agreement shall be true and correct when
made and on the Closing Date with the same effect as though such representations
and warranties had been made on and as of such date.
6.3 Performance of Agreements. All of the covenants, agreements and
obligations of PMB to be performed by it prior to the Closing pursuant to the
terms of this Agreement shall have been duly performed.
6.4 No Litigation Threatened. No action or proceedings against PMB
shall have been instituted or, to the knowledge of PMB, threatened before a
court or other government body or by any public authority to restrain or
prohibit any of the transactions contemplated hereby.
6.5 Fairness Opinion. An opinion, dated as of the Closing Date, from
the Corporation's financial advisors stating that the transactions contemplated
by this Agreement are fair, from a financial point of view, to the Corporation's
stockholders shall have been delivered to the Board of Directors of the
Corporation.
ARTICLE 7
THE CORPORATION'S DELIVERIES AT CLOSING
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7.1 Deliveries by the Corporation to PMB at Closing. At the Closing,
the Corporation shall deliver to PMB the following certificates, agreements and
other documents, each in form and substance satisfactory to PMB in its sole and
absolute discretion:
(a) Stock certificates evidencing the Purchased Shares;
(b) A Shareholders' Agreement, signed by the Corporation and
the holders of not less than 50% of the issued and outstanding capital stock of
the Corporation (excluding the Purchased Shares), that provides, among other
things, that such holders shall agree (i) not to sell their shares of capital
stock except as provided therein and (ii) to vote their shares of capital stock
for the election to the Board of the nominees of PMB and to not change the size
of the Board without PMB's consent (the "Shareholders' Agreement");
(c) A Registration Rights Agreement, signed by the Corporation
that provides certain demand and "piggyback" registration rights to the holders
of the Purchased Shares and to the holders of the shares of BNRX common stock
issuable upon exercise of the PMB Option;
(d) A certificate executed by the Secretary of the
Corporation, as to the charter and bylaws of the Corporation, the resolutions
adopted by the directors and stockholders of the Corporation in connection with
this Agreement, the incumbency of certain officers of the Corporation and the
jurisdictions in which the Corporation is qualified to conduct business;
(e) A certificate from the Secretary of State for the State of
Nevada to the effect that the Corporation is in good standing in the State of
Nevada;
(f) A certificate executed by the President and Chief
Accounting Officer of the Corporation, dated the Closing Date, certifying (i)
the accuracy of the Corporation's representations and warranties set forth in
Article II hereunder; (ii) that the Corporation has performed and complied with
all agreements, covenants and conditions required hereunder; and (iii) that no
action or proceeding has been instituted against the Corporation, or, to the
best knowledge, information and belief of the President of the Corporation,
threatened before a court or other government body or by any public authority to
restrain or prohibit any of the transactions contemplated hereby; and
(g) an opinion of counsel for the Corporation.
ARTICLE 8
PMB'S DELIVERIES AT CLOSING
8.1 Deliveries by PMB to BNRX at Closing. At the Closing, PMB shall
deliver to BNRX the following:
(a) The Purchase Price for the Purchased Shares as set forth
in Section 1.2 above;
(b) A certificate executed by the Secretary of PMB, dated the
Closing Date, as to the charter and bylaws of PMB, the resolutions adopted by
the directors of PMB in
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connection with this Agreement, the incumbency of certain officers of PMB and
the jurisdiction in which PMB is qualified to conduct business;
(c) A certificate from the Secretary of State for the State of
Delaware to the effect that PMB is in good standing in the State of Delaware;
(d) A certificate executed by the President of PMB, dated the
Closing Date, certifying the accuracy of PMB's representations and warranties
set forth in Article III hereunder and that PMB has performed and complied with
all agreements, covenants and conditions required hereunder; and
(e) The Shareholders' Agreement executed by PMB.
ARTICLE 9
TERMINATION AND ABANDONMENT
9.1 Methods of Termination. This Agreement may be terminated and the
transactions herein contemplated may be abandoned at any time:
(a) by mutual consent of PMB and BNRX;
(b) by PMB or BNRX if this Agreement is not consummated on or
before October 15, 2001; provided, however, that PMB may extend the Closing Date
for an additional 60 days if the condition set forth in Section 5.8 has not been
satisfied; and provided further that if any party has willfully breached or
defaulted with respect to its respective obligations under this Agreement on or
before such date, such party may not terminate this Agreement pursuant to this
Section 9.1(b), and each other party to this Agreement shall at its option
enforce its rights against such breaching or defaulting party and seek any
remedies against such party, in either case as provided hereunder and by
applicable law;
(c) by PMB if (i) PMB or any lender or investor which provides
financing in connection with the transactions contemplated by this Agreement
shall not have been satisfied, in their sole and absolute discretion, with the
results of their business, financial and legal due diligence investigation of
BNRX and its subsidiaries, the Business and the Purchased Shares, (ii) PMB
cannot obtain financing, on terms satisfactory to PMB in its sole and absolute
discretion, to fund the Purchase Price, or (iii) any of the other conditions
specified in Article V hereof have not been satisfied as of the Closing Date; or
(d) by BNRX if as of the Closing Date any of the conditions
specified in Article VI hereof have not been satisfied.
9.2 Procedure Upon Termination. In the event of termination and
abandonment pursuant to Section 9.1 hereof and subject to the proviso contained
in Section 9.1(b), this Agreement shall terminate and shall be abandoned,
without further action by any of the parties hereto. If this Agreement is
terminated as provided herein:
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(a) each party shall deliver all documents and other material
of any other party relating to the transactions contemplated hereby, whether
obtained before or after the execution hereof, to the party furnishing the same;
(b) all information received by any party hereto with respect
to the business of any other party or the Corporation or any subsidiary (other
than information which is a matter of public knowledge or which has heretofore
been or is hereafter published in any publication for public distribution or
filed as public information with any governmental authority) shall not at any
time be used for the advantage of, or disclosed to third parties by, such party
to the detriment of the party furnishing such information.
ARTICLE 10
MISCELLANEOUS
10.1 Survival. The representations and warranties contained in this
Agreement shall survive the execution and delivery of this Agreement and the
Closing contemplated herein.
10.2 Expenses. BNRX shall each pay its own expenses incident to the
negotiation, preparation and carrying out of this Agreement. BNRX shall also pay
at Closing the reasonable fees and expenses of one counsel for PMB and its
designees and assigns in connection with the negotiation, execution and
consummation of this Agreement.
10.3 Governing Law. The interpretation and construction of this
Agreement, and all matters relating hereto, shall be governed by the internal
laws of the State of Delaware applicable to agreements executed and to be
performed solely within such State.
10.4 Captions. The Article and Section captions used herein are for
reference purposes only, and shall not in any way affect the meaning or
interpretation of this Agreement.
10.5 Notices. Any notice, demand or other communication required or
permitted under this Agreement shall be sufficiently given if and when (a)
delivered in person, (b) sent by telecopy, (c) three days after mailing by
registered or certified mail, postage prepaid, addressed as follows:
if to PMB, to:
Pharmaceutical Marketing Brands, Inc.
Attn: Xxxxx Xxxxxx, Chairman
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxx Xxxxxx 00000
tel: (000) 000-0000
fax: (000) 000-0000
and if to the Corporation, to:
Bionutrics, Inc.
Attn: Xxxxxx Xxxxxx Lane, Ph.D.
0000 X. XxxxxXxxx Xxxx
Xxxxx 000
00
00
Xxxxxxx, Xxxxxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
or such other address or number as shall be furnished in writing by any such
party, and such notice or communication shall be deemed to have been given as of
the date so delivered, sent by telecopier or mailed.
10.6 Parties in Interest. Other than as provided in Section 10.12
hereof, this Agreement may not be transferred, assigned, pledged or hypothecated
by any party hereto, other than by operation of law. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective heirs, executors, administrators, successors and permitted assigns.
10.7 Counterparts. This Agreement may be executed by facsimile or
original signature in two or more counterparts, all of which taken together
shall constitute one instrument.
10.8 Entire Agreement. This Agreement, including the exhibits,
schedules, and other documents referred to herein and therein which form a part
hereof and thereof, contain the entire understanding of the parties hereto with
respect to the subject matter contained herein and therein. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
10.9 Amendments. This Agreement may not be changed orally, but only by
an agreement in writing signed by PMB and BNRX.
10.10 Severability. In case any provision in this Agreement shall be
held invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions hereof will not in any way be
affected or impaired thereby.
10.11 Third Party Beneficiaries. Each party hereto intends that this
Agreement shall not benefit or create any right or cause of action in or on
behalf of any Person other than the parties hereto.
10.12 Assignment. This Agreement is not assignable or transferable by
any of the parties hereto without the consent of all of the parties hereto;
provided, however, that, without the approval of any party hereto, PMB may
assign this Agreement to one or more "accredited investors", including an entity
formed for the purpose of acquiring the Purchased Shares of the Corporation. The
right to make any such assignment is conditioned upon each assignee agreeing in
writing to be bound by all of the provisions (including, but not limited to, the
representations and warranties) of this Agreement as if the assignee had
originally executed this Agreement in place of PMB. It is also agreed that PMB
and its assigns may grant liens in respect of its rights and interests hereunder
to its lenders (and any agent for the lenders), and the parties hereto consent
to any exercise by such lenders (and such agent) of their rights and remedies
with respect to such collateral.
10.13 Jurisdiction.
(a) Each of the parties hereto hereby irrevocably acknowledges
and consents that any legal action or proceeding brought with respect to any of
the obligations arising under or relating to this Agreement may be brought in
the courts of the State of New Jersey located in
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Middlesex County, New Jersey, or in any court within the jurisdiction of the
United States District Court for the District of New Jersey, as the party
bringing such action or proceeding may elect, and each of the parties hereto
hereby irrevocably submits to and accepts with regard to any such action or
proceeding, for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. Each party hereby
further irrevocably waives any claim that any such courts lack jurisdiction over
such party, and agrees not to plead or claim, in any legal action or proceeding
with respect to this Agreement or the transactions contemplated hereby brought
in any of the aforesaid courts, that any such court lacks jurisdiction over such
party. Each party irrevocably consents to the service of process in any such
action or proceeding by the mailing of copies thereof by registered or certified
mail, postage prepaid, to such party, at its address for notices set forth in
Section 10.6, such service to become effective ten days after such mailing. Each
party hereby irrevocably waives any objection to such service of process and
further irrevocably waives and agrees not to plead or claim in any action or
proceeding commenced hereunder or under any other documents contemplated hereby
that service of process was in any way invalid or ineffective. The foregoing
shall not limit the rights of any party to serve process in any other manner
permitted by law.
(b) The parties hereto agree that any judgment obtained by any
party hereto or its successors or assigns in any action, suit or proceeding
referred to above may, in the discretion of such party (or its successors or
assigns), be enforced in any jurisdiction, to the extent permitted by applicable
law.
(c) The parties hereto agree that the remedy at law for any
breach of this Agreement may be inadequate and that should any dispute arise
concerning any matter hereunder, this Agreement shall be enforceable in a court
of equity by an injunction or a decree of specific performance. Such remedies
shall, however, be cumulative and nonexclusive, and shall be in addition to any
other remedies that the parties hereto may have.
(d) The parties hereto agree that the prevailing party or
parties, as the case may be, in any action, suit, arbitration or other
proceeding arising out of or with respect to this Agreement or the transactions
contemplated hereby shall be entitled to reimbursement of all costs of
litigation, including reasonable attorneys' fees, from the non-prevailing party.
10.14 Waiver of Jury Trial. EACH OF THE PARTIES HERETO KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN
CONNECTION WITH, THIS AGREEMENT OR ANY EXHIBIT HERETO, OR ANY COURSE OF CONDUCT,
COURSE OF DEALING OR STATEMENTS (WHETHER VERBAL OR WRITTEN) RELATING TO THE
FOREGOING. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES HERETO TO
ENTER INTO THIS AGREEMENT.
*******
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IN WITNESS WHEREOF, the Corporation and PMB have executed this Stock
Purchase Agreement as of the day and year first above written.
Attest: PHARMACEUTICAL MARKETING
BRANDS, INC.
/s/ Xxxxx Xxxxxxx By: /s/ Xxxxx Xxxxxx
______________________________ ___________________________________
Xxxxx Xxxxxx, Chairman
Attest: BIONUTRICS, INC.
/s/ Xxxxx X. Xxxxxxx By: /s/ Xxxxxx Xxxxxx Xxxx
______________________________ ___________________________________
Xxxxxx Xxxxxx Lane, Ph. D.
Chairman and Chief Executive
Officer
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