EXHIBIT 10.1
ASSET PURCHASE AGREEMENT
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THIS ASSET PURCHASE AGREEMENT (this "AGREEMENT") dated as of March 21,
1997, is made between ZYNAXIS, INC., a Pennsylvania corporation (the "SELLER"),
and PROCLINICAL, INC., a Pennsylvania corporation (the "PURCHASER").
The Seller has entered into an Agreement and Plan of Merger Contribution,
dated December 6, 1996, by and among the Seller, CytRx Corporation, Vaxcel, Inc.
("VAXCEL"), a Delaware corporation and a wholly-owned subsidiary of CytRx
Corporation, and Vaxcel Merger Subsidiary, Inc. ("VAXCEL MERGER SUB"), a Georgia
corporation and a newly-formed, wholly-owned subsidiary of Vaxcel, which
provides for the merger (the "MERGER") of Vaxcel Merger Sub with and into the
Seller, with the effect that the Seller, as the surviving corporation resulting
from the Merger, will be a wholly-owned subsidiary of Vaxcel.
The Seller operates a division known as the Cauldron Process Chemistry
Operations (the "CAULDRON DIVISION"). The Seller desires to sell to the
Purchaser, and the Purchaser desires to buy from the Seller, substantially all
of the assets, properties and rights of the Seller used in or related to the
Cauldron Division (the "ASSETS").
In consideration of the mutual covenants herein, and intending to be
legally bound hereby, the parties agree as follows:
Section 1. Sale and Purchase of the Assets:
1.1. Agreement to Sell. At the Closing (hereinafter defined), the Seller
shall sell, grant, convey, transfer, assign and deliver the Assets to the
Purchaser, upon the terms and subject to the conditions of this Agreement. The
Assets consist of all of the Seller's right, title and interest in and to the
following:
(a) All inventory owned by the Cauldron Division on the Closing Date;
(b) All furniture, fixtures, machinery and equipment of the Cauldron
Division as listed on Exhibit "A" hereto (the "FIXED ASSETS");
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(c) All rights and privileges of the Cauldron Division under contracts
and open orders with its customers, including pre-paid orders, in existence on
the Closing Date, or in existence on the date hereof as set forth on Exhibit "B"
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hereto and not completed prior to the Closing (the "CONTRACTS");
(d) All rights and privileges of the Cauldron Division under the
leases, licenses, and agreements set forth on Exhibit "C" hereto. It is
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understood that Seller will use commercially reasonable efforts prior to the
Closing Date to have the lessor of the UV-VIS system and plate reader
terminate the existing single equipment lease for those two assets and reissue
two separate equipment leases for the two assets (since the UV-VIS system will
be part of the assets sold to Purchaser, while the plate reader shall be
retained by Seller). If Seller is unable to obtain separate equipment leases
for the two assets, Seller shall pay to Purchaser from and after the Closing
Date a monthly payment equal to a percentage of the monthly payment due under
the combined equipment lease that reflects the relative original value of the
plate reader compared to the UV-VIS system;
(e) All accounts receivable and customer deposits, if any, of the
Cauldron Division in existence as of the Closing, but only to the extent that
such receivables or deposits are for work that has not been performed by Seller
under the Contracts prior to the Closing;
(f) All of Seller's right, title and interest under the lease (the
"LEASE") dated August 30, 1988, between PMRA III, c/o PM Realty Advisors, a
California corporation, successors to Xxxxx & Associates, a Pennsylvania limited
partnership, ("LANDLORD") and Seller, as amended, for the facilities used by the
Cauldron Division (the "PREMISES"), a copy of which is attached hereto as
Exhibit "D". Seller represents and warrants to Purchaser that at the time of
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transfer of the Lease from Seller to Purchaser at Closing, Seller shall have
prepaid $250,000 of the basic rent under the Lease;
(g) All patents, trademarks, service marks, copyrights or applications
therefore, licenses, trade names, fictitious names, slogans, royalty agreements
and brand or private label names of which the Seller is the owner and which are
used by the Cauldron Division, as and to the extent set forth on Exhibit "E",
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hereto, and all customer lists, correspondence files and records, customers,
files, production records, inventory records, software, hardware and firmware
and disks, data files or other media, goodwill, and other assets owned by Seller
and used by the Cauldron Division.
Attached hereto and incorporated herein as Exhibit "F" is a schedule (the
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"BALANCE SHEET") on which is shown a condensed, summarized balance sheet of the
Cauldron Division as of February 28, 1997, the pro forma eliminations therefrom
to show the assets and liabilities of the Cauldron Division shown thereon which
are not subject to this Agreement, and the assets and liabilities of the Seller
shown thereon which are the subject of this Agreement. Seller agrees that it
will update the information set forth in the Balance Sheet and deliver a revised
Balance Sheet to Purchaser shortly before the Closing. It is understood,
however, that no change in the Balance Sheet shall affect the Purchase Price
(defined hereafter).
1.2. Agreement To Purchase. At the Closing, the Purchaser shall purchase
the Assets from the Seller, upon the terms and subject to the conditions of this
Agreement and in reliance upon the representations and warranties of the Seller
in this Agreement, and, as consideration therefore, shall: (a) pay to the Seller
as set forth in paragraph 2.1 the purchase price for the Assets; and (b) assume
and agree to pay or discharge promptly when due all of the Seller's liabilities
and obligations of any nature whatsoever under or pursuant to the Lease, the
Contracts and the Additional Contracts.
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Section 2. Purchase Price
2.1. The purchase price for the Assets (the "PURCHASE PRICE") shall be
Eight Hundred Thirty-Two Thousand Dollars ($832,000), which shall be paid as
follows:
(a) $50,000 on the date hereof, to be held in escrow until the Closing
by the Purchaser's counsel;
(b) $482,000 to Seller at the Closing, in immediately available funds;
and
(c) a promissory note (the "NOTE") payable to the Seller in the
original principal amount of $300,000 in substantially the form of Exhibit "G"
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hereto.
2.2. Assumption of Liabilities. At the Closing, in addition to its other
obligations under this Agreement, the Purchaser shall assume and then be solely
liable and responsible for, and agree to pay, discharge and perform on a timely
basis, and hold Seller harmless and indemnify Seller from, all liabilities and
obligations of any nature whatsoever of the Cauldron Division arising under:
(i) the Lease, (ii) the Contracts; (iii) the Additional Contracts (as
hereinafter defined); and (iv) any orders for inventory placed by Seller between
the date of this Agreement and the Closing (to the extent Seller may not have
paid for such inventory by the Closing). Except for those liabilities recited
in the immediately preceding sentence, all liabilities and obligations of the
Cauldron Division, whether known or unknown, direct or contingent, in litigation
or threatened, or not yet ascertainable but attributable to Seller shall be
Seller's responsibility. Specifically excluded from the liabilities assumed by
Purchaser are any liabilities of the Seller with respect to any federal, state,
local or foreign income, franchise, or other tax imposed upon the Seller, any
obligation of the Seller for any employee grievance pending at the Closing Date,
any obligations of the Seller for the adjustment or payment for returned or
defective goods at any time shipped by the Seller except under the Contracts,
for all of which Seller shall remain responsible.
Section 3. Closing Procedures
3.1. Closing. The closing of the sale and purchase of the Assets (the
"CLOSING") shall be held as soon as practicable after all conditions to the
Closing set forth in Sections 7 and 8 hereto have been satisfied or waived, but
in any event, on or before May 31, 1997 (the "CLOSING DATE"), at the offices of
the Purchaser, 000 Xxxxxxxxx Xxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx, or on any other
date and at such other place or places as the parties may mutually agree in
writing.
3.2. Transfer of the Assets. At the Closing, the Seller shall deliver to
the Purchaser the following:
(a) Such bills of sale, endorsements, assignments and other good and
sufficient instruments of conveyance and transfer, in form and substance
reasonably satisfactory to the
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Purchaser's counsel, as shall be effective to vest in the Purchaser all of the
Seller's right, title and interest in and to the Assets; and
(b) Evidence that all Contracts and Additional Contracts which cannot
be transferred effectively without the consent of third parties have received
such consent, or if such consent is unobtainable, an agreement reasonably
satisfactory to the Purchaser and its counsel assuring to the Purchaser the
benefits and obligations of such Contracts and Additional Contracts.
3.3. Purchase Price. At the Closing, the Purchaser shall pay to the Seller
the portion of the Purchase Price in accordance with Section 2 hereof and
deliver the Note.
3.4. Release of Liens. At or prior to the Closing, the Seller shall
deliver all necessary releases of liens and Uniform Commercial Code termination
statements in forms reasonably acceptable to the Purchaser's counsel so that the
Seller's title to the Assets is in conformity with paragraph 4.2 hereof.
Section 4. Representations and Warranties of the Seller
The Seller hereby represents and warrants to the Purchaser, intending for
the Purchaser to rely hereon, as of the date hereof as follows:
4.1. Organization and Good Standing. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Pennsylvania.
4.2. Title to the Properties. Seller owns, and has good and marketable
title to, or at the Closing date will own and have good and marketable title to,
all of the Assets, free and clear of all liens, pledges, mortgages, security
interests, leases, conditional sales contracts or other encumbrances or
conflicting claims of any nature whatsoever, for immaterial liens or
encumbrances that do not affect the use of the Assets by the Purchaser and
except as set forth in Exhibit "H" hereto.
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4.3. Tax Matters. The Seller has filed or caused to be filed all federal,
state and local tax returns and reports of the Seller, through the taxable year
ending December 31, 1995 which are due and required to be filed and has paid or
caused to be paid all taxes due through December 31, 1995 and any assessment of
taxes received, except taxes or assessments that are being contested in good
faith. Seller has received no notice of, any pending or threatened proceeding
or claim by any governmental agency for assessment or collection of taxes from
the Seller. All such returns and reports have been prepared on the same basis
as that of previous years and in accordance with all applicable laws,
regulations and requirements, and accurately reflect the taxable income of the
Seller.
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4.4. Litigation. Except as disclosed in Exhibit "I" hereto:
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(a) there is no dispute, claim, action, suit, proceeding, arbitration
or governmental investigation, either administrative or judicial, pending, or to
the knowledge of the Seller threatened, against the Seller, relating to the
Cauldron Division or the Assets; and
(b) the Seller is not in default with respect to any order, writ,
injunction or decree of any court or governmental department, commission, board,
bureau, agency or instrumentality, which involves the possibility of any
judgment or liability which may result in any material adverse change in the
financial condition of the Cauldron Division or the Assets.
4.5. Absence of Undisclosed Liabilities. There are no liabilities or
obligations accrued, absolute, contingent or otherwise, of the Cauldron Division
except as set forth in the Balance Sheet, as disclosed or referred to in this
Agreement or the Exhibits hereto or otherwise disclosed to the Seller, or as
incurred, consistent with past business practice, in the normal and ordinary
course of its business since the date of the Balance Sheet.
4.6. Financial Statements. The Seller has previously delivered to the
Purchaser the Cauldron Division balance sheet as of February 28, 1997, and a
statement of income for the year ended December 31, 1996 (collectively the
"PRIOR FINANCIAL STATEMENTS"). The Prior Financial Statements have been
prepared on an unaudited basis, in accordance with the books and records of the
Cauldron Division, and present fairly the financial position of the Cauldron
Division at February 28, 1997 and the results of operations for the year ended
December 31, 1996.
4.7. Absence of Certain Changes and Events. Since the date of the Balance
Sheet, except as set forth in Exhibit "J" attached hereto, there has not been:
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(a) any material adverse change in the condition, financial or other, of the
Cauldron Division; (b) any damage, destruction or loss, whether covered by
insurance or not, materially adversely affecting the business of the Cauldron
Division or the Assets; (c) any claim of unfair labor practice or union
organizing activity involving the Seller's Cauldron Division; (d) any increase
in compensation payable or to become payable to any employee or amounts payable
under any bonus, insurance, pension or other benefit plan.
4.8. Additional Contracts. Except as disclosed in Exhibit "K" hereto or
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elsewhere in this Agreement or the Exhibits attached hereto, the Cauldron
Division neither owns, has in existence, has any rights or interest in or to,
nor uses in its business:
(a) any employment agreement or arrangement, oral or written, with any
employee of the Cauldron Division, under which any amount will remain unpaid on
the Closing Date or become payable after the Closing Date;
(b) any lease pursuant to which the Cauldron Division leases personal
property to or from any person or entity;
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(c) any agreement or other arrangement under which the Cauldron
Division has agreed or is obligated to sell or supply products or perform any
services;
(d) any contract or commitment for the future purchase of, or payment
for, raw materials, supplies or products;
(e) any contract or commitment for any charitable contribution;
(f) any consulting, agency or representative contract to which the
Cauldron Division is a party or is otherwise bound;
(g) any commission program for salesmen, representatives or agents of
the Cauldron Division;
(h) any collective bargaining agreement of the Cauldron Division with
any labor union or other representative of employees; or
(i) any fictitious name utilized by the Cauldron Division.
The agreements, contracts or obligations listed on Exhibit "K" hereto are
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referred to as "ADDITIONAL CONTRACTS."
4.9. Compliance With Laws. To the knowledge of the Seller, the Cauldron
Division has complied with and is not in default under, or in violation of, any
law, ordinance, rule, regulation or order (including, without limitation, any
environmental, zoning, safety, health or price or wage control law, ordinance,
rule, regulation or order) applicable to its operations, or business as
presently constituted, except where the failure to be in compliance with the
foregoing would not materially adversely affect or, so far as the Seller can now
foresee, in the future materially adversely affect, the business of the Cauldron
Division or the Assets.
4.10. Employee Benefit Plans. Exhibit "L" sets forth a true and
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complete list of all pension, profit-sharing, stock bonus, stock option,
employment or severance agreements, deferred compensation plans, health, life,
accident or disability plans, and any other agreement, arrangement, commitment
or other employee benefit plan (including, but not limited to, "employee benefit
plans" within the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended and the regulations promulgated thereunder
("ERISA")) (the "BENEFIT PLANS") currently maintained with respect to the
Cauldron Division, or with respect to which the Seller has, or may in the future
have, any liability with respect to any current or former employee of the
Cauldron Division. Except as specifically set forth in Section 11, Purchaser is
not assuming any obligations of Seller under any such Benefit Plans.
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4.11. Authorization. The Seller has full corporate power and authority
to enter into this Agreement and, upon and subject to receipt of approval of
Seller's shareholders to sell all or substantially all the assets of the Seller,
to consummate the transactions on its part contemplated hereby. The execution
and delivery of this Agreement, and the sale, transfer, and other actions
contemplated hereby have been duly authorized by the board of directors of
Seller, and, except for the requirement to obtain shareholder approval and
required consents for assignment of the Contracts, Lease and the Additional
Contracts. This Agreement constitutes the legal, valid and binding obligation
of the Seller enforceable in accordance with its terms, and neither the
execution and delivery of this Agreement nor the consummation of the
transactions anticipated hereby by the Seller constitutes or will constitute a
violation or breach of (i) applicable law, (ii) the Seller's Articles of
Incorporation or By-laws, (iii) any contract or instrument to which the Seller
is a party or by which it is bound, or (iv) any order, writ, injunction, decree
or judgment applicable to Seller.
4.12. Employees. Exhibit "M" hereto is a true and complete list of the
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names of all current Cauldron Division employees, with their annual compensation
and expected accrued vacation to March 31, 1997. Seller agrees that it will
update the information set forth on Exhibit M and deliver a revised Exhibit M to
Purchaser shortly before the Closing. It is understood, however, that no change
in the information set forth on Exhibit M shall affect the Purchase Price.
4.13. Inventories. A correct and complete summary of all inventory of
the Cauldron Division as of March 6, 1997 is set forth as Exhibit "N" hereto.
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4.14. Product Warranties. Except as set forth in Exhibit "P" hereto
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and except for warranties mandated by law, including implied warranties pursuant
to the Uniform Commercial Code of Pennsylvania, the Seller's Cauldron Division
has neither given nor made any oral, written or implied warranties or assurances
with respect to products to be distributed or sold pursuant to the Contracts.
4.15. Suppliers and Customers. Since the date of the Balance Sheet,
there has been no cancellation or modification in any material respect to the
major suppliers and customers of the Cauldron Division.
4.16. Environmental. (a) To the Seller's knowledge, no pollutants or
other toxic or hazardous substances, including any solid, liquid, gaseous or
thermal irritant or contaminant, such as smoke, vapor, soot, fumes, acids,
alkalis, chemicals or waste (including materials to be recycled, reconditioned
or reclaimed) (collectively "MATERIALS") have been discharged, dispersed,
released, stored, treated, generated, disposed of, or allowed to escape
(collectively referred to as the "INCIDENT") on or from the Premises or disposed
of by the Cauldron Division, in material violation of any federal, state or
local statute, law or regulation.
(b) To the Seller's knowledge, no asbestos or asbestos-containing
materials have been installed (and have not since been removed), used,
incorporated into, or disposed of on the Premises.
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(c) To the Seller's knowledge, no polychlorinated biphenyls ("PCBS")
are located on the Premises in the form of electrical transformers, fluorescent
light fixtures, cooling oils, or other devices in violation of any federal,
state or local statutes, laws or regulations.
(d) To the Seller's knowledge, no underground storage tanks are
located on the Premises or were located on the Premises and subsequently removed
or filled.
(e) To the Seller's knowledge, no investigation, administrative order,
consent order, agreement, litigation or settlement is proposed, or threatened,
or anticipated with respect to the Premises.
(f) To the Seller's knowledge, the Premises have at all times been in
substantial compliance with all federal, state and local statutes, laws and
regulations relating to the environment.
4.17. Disclosure. No representation or warranty by the Seller in this
Agreement contains any untrue statement of material fact or omits or will omit
to state any material fact necessary to make any statement herein and therein
not misleading.
Section 5. Representation and Warranties of the Purchaser
The Purchaser hereby warrants to the Seller, intending for the Seller to
rely hereon, as follows:
5.1. Organization and Good Standing. The Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Pennsylvania.
5.2. Authorization. The execution and delivery of this Agreement, and
other actions contemplated hereby, have been duly authorized by all requisite
corporate action on the part of Purchaser. The Purchaser has the corporate
power and authority to consummate the transaction on its part contemplated
hereby, including without limitation, issuance of the Note, none of which will
constitute any violation or breach of its Articles of Incorporation or By-Laws.
This Agreement and the Note constitute the legal, valid and binding obligations
of the Purchaser, enforceable in accordance with their respective terms.
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Section 6. Conduct Pending the Closing
The Seller hereby covenants and agrees that, pending the Closing and except
as otherwise agreed in writing by the Purchaser:
6.1. Conduct of Business. The Seller shall carry on the business of the
Cauldron Division diligently and substantially in the same manner as heretofore
and refrain from any action that would result in any material breach of any of
the representations, warranties or covenants of the Seller hereunder.
6.2. Access. The Purchaser and its authorized representatives shall have
full access during normal business hours upon prior arrangement with the Seller
to all books, records, contracts and documents of the Cauldron Division, as well
as to the Premises, and Seller shall furnish or cause to be furnished to the
Purchaser and its authorized representatives, all information with respect to
the Assets and the business of the Cauldron Division as the Purchaser may
reasonably request. In the event of a termination of this Agreement, all such
information shall remain confidential and shall not be used by the Purchaser,
its officers, directors, employees or agents, and all copies thereof shall be
returned to the Seller.
6.3. Contracts and Commitments; Liabilities. The Cauldron Division shall
not enter into any contract, commitment or transaction except in the ordinary
course of business and consistent with past practices. The Seller will not,
and will not agree to, create any indebtedness or any other fixed or contingent
liability in connection with its operation of the Cauldron Division or the
Assets including, without limitation, liability as a guarantor or otherwise with
respect to the obligations of others, other than that created or incurred: (i)
in the usual and ordinary course of the business of the Cauldron Division; or
(ii) pursuant to existing contracts to be assumed by Purchaser, which contracts
are disclosed in the Exhibits attached hereto.
6.4. Insurance. All present insurance insuring the Cauldron Division, its
employees and the Assets, will be maintained by the Seller.
6.5. Preservation of Organization and Employees. The Seller will use its
best efforts, to the extent deemed reasonable by the Seller given its current
financial condition, to preserve the business of the Cauldron Division intact,
to keep available its respective key officers and employees, and preserve the
present relationships of the Cauldron Division with its suppliers, customers,
referring sources and others having business relations with it. The Seller will
not increase the compensation payable or to become payable to the employees of
the Cauldron Division or otherwise offer contractual changes in the terms of
Seller's employment of such employees.
6.6. No Default. The Seller will not do anything to omit or do anything to
permit any act or omission to act, which will cause a material breach of the
Agreement.
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Section 7. Conditions Precedent to the Purchaser's Obligations
All obligations of the Purchaser under this Agreement are subject to the
fulfillment, prior to or at the Closing, of each of the following conditions
unless otherwise waived in writing by the Purchaser:
7.1. Representations and Warranties. The Seller's representations and
warranties contained in this Agreement or in any list, certificate or document
delivered pursuant to the provisions hereof shall be true and correct in all
material respects.
7.2. Performance of Agreements. The Seller shall have performed and
complied in all material respects with all agreements and conditions required by
this Agreement to be performed or complied with by it prior to or at the
Closing.
7.3. Adverse Change. There shall not have been a material adverse change,
occurrence or casualty, financial or otherwise, relating to the Cauldron
Division whether covered by insurance or not.
7.4. Closing Deliveries. The Seller shall have delivered the bills of sale
and releases of liens referred to herein.
7.5. Closing Certificates. The Seller shall have delivered to the
Purchaser: (i) a certificate of the Secretary or Assistant Secretary of the
Seller certifying and attaching true and complete copies of the Articles of
Incorporation and By-laws of the Seller as the same are in force on the Closing
Date and of the resolutions adopted by the board of directors relating to this
Agreement and the transactions contemplated hereby, and certifying the
incumbency of the officers of the Seller executing this Agreement or any
documents delivered hereunder; and (ii) a certificate signed by the President of
the Seller, confirming to the best of his knowledge, satisfaction of the
conditions set forth in this Section 7.
7.6. No Litigation. There shall not be any pending (or to the knowledge of
the Seller threatened) action, proceeding or investigation by or before any
court, arbitrator, governmental body or agency which shall seek to restrain,
prohibit or invalidate the transactions contemplated hereby or which, if
adversely determined, would result in a breach of a representation, warranty or
covenant of either party herein.
7.7. Assignment of Lease. The Purchaser shall have obtained an assignment
of the Lease in a form reasonably satisfactory to Purchaser.
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Section 8. Conditions Precedent to the Seller's Obligations
All obligations of the Seller under this Agreement are subject to the
fulfillment, prior to or at the Closing, of the following conditions:
8.1. Representations and Warranties. The Purchaser's representations and
warranties contained in this Agreement shall be true and correct in all material
respects.
8.2. Performance of Agreements. The Purchaser shall have performed and
complied with all agreements and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing.
8.3. Closing Deliveries. The Purchaser shall have obtained its financing
as anticipated by the commitment letter therefore previously received by the
Purchaser (a copy of which is attached hereto as Exhibit "Q") and if received,
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shall make payment of the purchase price as specified by this Agreement.
8.4. Closing Certificates. The Purchaser shall have delivered to the
Seller: (i) a certificate of the Secretary or Assistant Secretary of the
Purchaser certifying and attaching true and complete copies of the resolutions
of the board of directors of the Purchaser authorizing the execution and
delivery of this Agreement and the performance of the obligations of the
Purchaser hereunder; and (ii) a certificate of the President or Vice President
of the Purchaser confirming, to the best of his knowledge, satisfaction of the
conditions set forth in this Section 8.
8.5. No Litigation. There shall not be any pending or threatened action,
proceeding or investigation by or before any court, arbitrator, governmental
body or agency which shall seek to restrain, prohibit or invalidate the
transactions contemplated hereby or which, if adversely determined, would result
in a breach of a representation, warranty or covenant of either party herein.
8.6. Lease Agreement. The Lease shall have been assigned to the Purchaser,
the Seller shall have been released from all of its obligations under the Lease,
and the deposit held by the Landlord shall be returned to the Seller.
8.7. Shareholder Approval. The shareholders of the Seller shall have
approved the sale of substantially all the assets of the Seller.
8.8. Merger. The Merger shall have been consummated.
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Section 9. Fees and Expenses
9.1. Expenses of the Transaction. Each party hereto shall pay its own
expenses incidental to the preparation of this Agreement and the consummation of
the transactions contemplated hereby. Transfer taxes, if any, shall be split by
the parties.
Section 10. Indemnification
10.1. Survival of Representations, Warranties and Agreements. All
representations, warranties and agreements made by the parties in this Agreement
or in any certificate delivered pursuant hereto shall survive the Closing for a
period of one year after Closing.
10.2. Indemnification by the Seller. Subject to Section 10.1, the
Seller shall defend, indemnify and hold the Purchaser, its successors and
assigns, harmless from and against: (a) any and all liabilities and obligations
of, or claims against, the Seller not expressly assumed by the Purchaser
hereunder and all claims, demands, liabilities, damages, losses and out-of-
pocket expenses including reasonable attorneys fees, whether or not reduced to
judgment, order or award, caused by the breach of any agreement or of any
representation or warranty made by the Seller in this Agreement or in any
exhibit, list, certificate or document delivered by it pursuant hereto.
10.3. Indemnification by the Purchaser. The Purchaser shall defend,
indemnify and hold the Seller harmless from and against: (a) the liabilities
and obligations assumed by the Purchaser pursuant to this Agreement; and (b) all
damages, losses and out-of-pocket expenses including reasonable attorneys fees,
caused by or arising out of the breach of any of the agreements or
representation or warranties made by the Purchaser in this Agreement or any
certificate or document delivered by it pursuant hereto.
10.4. Defense of Claims. Promptly after any service of process by any
third party in any litigation in respect of which indemnity may be sought from
the other party pursuant to Section 10, the party so served shall notify the
indemnifying party of the commencement of such litigation, and the indemnifying
party shall be entitled to assume the defense thereof at its expense with
counsel reasonably satisfactory to the indemnified party.
Section 11. Cauldron Division Employees
From and after the Closing Date, the Purchaser shall continue to employ all
employees of the Cauldron Division in substantially the same positions as held
by such individuals immediately prior to the Closing, but with the benefit
package offered by Purchaser to its current employees as in effect as on the
Closing Date, for a period of not less than ninety (90) days after the Closing;
provided, that nothing herein shall be deemed to prohibit the Purchaser from
discharging any of such employees for cause at any time or modifying any such
employment or benefit package after ninety
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(90) days from the Closing Date or from making after such 90-day period such
changes in pay, benefits and conditions of employment as the Purchaser, in its
sole discretion, may deem necessary or advisable. All such employees will
receive full credit from Purchaser for any unused vacation days or otherwise for
their amount of service with the Seller. The Purchaser shall have no liability
for, and the Seller shall defend, indemnify and hold the Purchaser harmless from
with respect to, any claims arising out of services prior to the Closing Date by
any persons employed prior to the Closing by the Seller. The Seller shall have
no liability for, and the Purchaser shall defend, indemnify and hold the Seller
harmless with respect, to any claims arising out of services on or after the
Closing Date or relating to or caused by termination of employment of any
persons on or after the Closing Date.
Section 12. Miscellaneous
12.1. Arbitration. If any dispute arises under or in connection with
this Agreement or the performance of enforcement thereof, it shall be decided
finally by three arbitrators in an arbitration proceeding conforming to the
Rules of the American Arbitration Association applicable to commercial
arbitration. The arbitrators shall be appointed as follows: one by the Seller,
one by the Purchaser, and the third by the said two arbitrators, or, if they
cannot agree, then the third arbitrator shall be appointed by the American
Arbitration Association. The third arbitrator shall be chairman of the panel
and the arbitration shall take place in Xxxxxxx County, Pennsylvania. The
decision of a majority of the Arbitrators shall be conclusively binding upon the
parties, final and nonappealable, and such decision shall be enforceable as a
judgment in any court of competent jurisdiction. Each party shall pay the fees
and expenses of the arbitrator appointed by it, its counsel and its witnesses.
The parties shall share equally in the fees and expenses of the impartial
arbitrator.
12.2. Governing Law. This Agreement shall be governed by, and
construed and enforced in accordance with the laws of the Commonwealth of
Pennsylvania.
12.3. Assignment. This Agreement shall not be assignable by either
party without the prior written approval of the other party; provided, however,
that Purchaser may assign its interest in this Agreement to its wholly-owned
subsidiary, Cauldron, Inc., as long as Purchaser unconditionally guarantees the
timely performance when due of all obligations of the Purchaser hereunder, such
guarantee to be in a form reasonably acceptable to the Seller. To the extent so
assignable, this Agreement shall be binding upon, and inure to the benefit of,
the Purchaser and its successors and assigns and the Seller and its successors
and assigns.
12.4. Headings for Reference Only. The section and paragraph headings
in this Agreement are for convenience of reference only and shall not be deemed
to modify or limit the provisions of this Agreement.
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12.5. Notices. Any notice, communication, demand or other writing (a
"notice") required or permitted to be given, made or accepted by any party to
this Agreement shall be given by personal delivery or by depositing the same in
the United States mail, properly addressed, postage prepaid and registered or
certified with return receipt requested. A notice given by personal delivery
shall be effective upon delivery and a notice given by registered or certified
mail shall be deemed effective on the second day after such deposit. For
purposes of notice, the addresses of the parties shall be, until changed by a
notice given in accordance herewith, as follows:
If to the Purchaser:
Proclinical, Inc., 000 Xxxxxxxxx Xxxx, Xxxxxxxxxxxx, XX 00000
With a required copy to:
Xxxxx X. Xxxxxx, Esquire, X.X. Xxx 000, Xxxxxxxx, XX 00000-0000
If to the Seller:
Zynaxis, Inc., 000 Xxxxxxxxxxxx Xxxx, Xxxxxxx, XX 00000
With a required copy to:
Vaxcel, Inc., 000 Xxxxxxxxxx Xxxxxxx, Xxxxxxxxxx Xxxx, Xxxxxxxx, XX
00000.
12.6. Entire Agreement and Amendment. This document states the entire
agreement reached between the parties hereto with respect to the transactions
contemplated hereby and supersedes all prior or contemporaneous agreements,
understandings, representations and warranties between the parties, and may not
be amended except by written instrument executed by the duly authorized officers
of the parties hereto.
12.7. Termination of Agreement. Notwithstanding anything to the
contrary in this Agreement, if the Closing shall not have occurred by June 30,
1997, then either party shall have the right to terminate this Agreement by
delivery of notice to the other party, in which case the deposit monies paid by
Purchaser under this Agreement shall be promptly returned to Purchaser;
provided, however, that no party may terminate this Agreement if that party is
in default of any of its obligations to the other party under this Agreement.
12.8. Counterparts; Facsimile Delivery. This Agreement may be executed
and delivered in one or more counterparts, each of which shall be an original,
but all of which together shall constitute one and the same instrument. This
Agreement may also be executed and delivered by facsimile with the same force
and effect as if originally executed copies of this Agreement had been delivered
by the parties hereto. If this Agreement is executed and delivered in
counterparts or by facsimile, any party may thereafter require that both parties
originally execute and deliver a
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sufficient number of additional copies of this Agreement so that each party may
have two fully executed originals of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered on the day and year first above written.
ATTEST: ZYNAXIS, INC.
/s/ Xxxxxxx X. Xxxxxxxx By:/s/ Xxxxxx X. Xxxxxxxxx
----------------------------- -------------------------------
Name: Xxxxxxx X. Xxxxxxxx Xxxxxx X. Xxxxxxxxx, President
Title: Company Secretary
ATTEST: PROCLINICAL, INC.
/s/ Xxxxxxxx X. Xxxxxxx By:/s/ Xxxx Xxxxx
---------------------------- -----------------------------
Name: Xxxxxxxx X. Xxxxxxx Xxxx Xxxxx, President
Title:
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[THE FOLLOWING INFORMATION IS NOT A PART OF THIS EXHIBIT 10.1, BUT IS PROVIDED
SOLELY FOR THE INFORMATION OF THE SECURITIES AND EXCHANGE COMMISSION.]
List of Exhibits to Asset Purchase Agreement
--------------------------------------------
Exhibit A List of Fixed Assets
Exhibit B List of Contracts and Open Orders
Exhibit C List of Rights and Privileges under Leases, Licenses and Agreements
Exhibit D Copy of Lease dated August 30, 1988, between PMRA III, c/o PM
Realty Advisors, a California corporation, successors to Xxxxx &
Associates, a Pennsylvania limited partnership, and Seller, as
amended, for the facilities used by the Cauldron Division
Exhibit E List of Patents, Trademarks, Service Marks, Copyrights,
Applications, Licenses, Trade Names, Fictitious Names, Slogans,
Royalty Agreements and Brand or Private Label Names
Exhibit F Pro Forma Balance Sheet
Exhibit G Form of Promissory Note Payable to Seller
Exhibit H List of Liens, Security Interests, Etc.
Exhibit I List of Legal Proceedings, Claims, Defaults, Etc.
Exhibit J List of Material Adverse Changes, Etc.
Exhibit K List of Additional Contracts
Exhibit L List of Employee Benefit Plans
Exhibit M List of Employees, Compensation and Accrued Vacation
Exhibit N List of Inventory
Exhibit P Warranties or Assurances in Contracts
Exhibit Q Commitment Letter for Purchaser Financing
THE REGISTRANT HEREBY AGREES TO FURNISH SUPPLEMENTALLY TO THE SECURITIES AND
EXCHANGE COMMISSION UPON REQUEST A COPY OF ANY OMITTED EXHIBIT TO THIS ASSET
PURCHASE AGREEMENT.
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