EX-2.1 2 d211742dex21.htm ASSET PURCHASE AGREEMENT EXECUTION VERSION ASSET PURCHASE AGREEMENT By and Among PROBIORA HEALTH, LLC, a Delaware limited liability company (“Buyer”), CHRISTINE L. KOSKI, The Sole Member and Manager of Buyer and a Personal...
Exhibit 2.1
EXECUTION VERSION
By and Among
PROBIORA HEALTH, LLC,
a Delaware limited liability company
(“Buyer”),
XXXXXXXXX X. XXXXX,
The Sole Member and Manager of Buyer and a Personal Guarantor
(“Xxxxx”),
and
ORAGENICS, INC.,
a Florida corporation
(“Seller”)
Effective as of June 22, 2016
TABLE OF CONTENTS
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ARTICLE I DEFINITIONS | 2 | |||||||
1.1 | Definitions | 2 | ||||||
ARTICLE II PURCHASE AND SALE | 2 | |||||||
2.1 | Purchased Assets | 2 | ||||||
2.2 | Excluded Assets | 2 | ||||||
2.3 | Assumed Liabilities | 2 | ||||||
2.4 | Purchase Price | 2 | ||||||
2.5 | Allocation of Purchase Price | 3 | ||||||
2.6 | Non-Assignable Purchased Assets | 3 | ||||||
ARTICLE III CLOSING | 4 | |||||||
3.1 | Closing | 4 | ||||||
3.2 | Closing Deliverables | 5 | ||||||
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER | 7 | |||||||
4.1 | Organization of Seller | 7 | ||||||
4.2 | Authorization of Transaction | 7 | ||||||
4.3 | Non-contravention | 7 | ||||||
4.4 | Brokers’ Fees | 7 | ||||||
4.5 | Title to Assets | 8 | ||||||
4.6 | Condition of Assets | 8 | ||||||
4.7 | Inventory | 8 | ||||||
4.8 | Undisclosed Liabilities | 8 | ||||||
4.9 | Intellectual Property | 8 | ||||||
4.10 | Contracts | 10 | ||||||
4.11 | Permits | 10 | ||||||
4.12 | Non-Foreign Status | 10 | ||||||
4.13 | Compliance With Laws | 10 | ||||||
4.14 | Legal Proceedings | 11 | ||||||
4.15 | Full Disclosure | 11 | ||||||
4.16 | No Material Adverse Effects | 11 | ||||||
4.17 | Tax Matters | 11 | ||||||
4.18 | Powers of Attorney | 11 | ||||||
4.19 | Product Warranty | 11 | ||||||
4.20 | Product Liability | 12 | ||||||
4.21 | Environment, Health and Safety | 12 | ||||||
4.22 | Customers and Suppliers | 14 | ||||||
4.23 | Disclosure | 14 | ||||||
14 | ||||||||
5.1 | Organization of Buyer | 14 | ||||||
5.2 | Authorization of Transaction | 15 |
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5.3 | Noncontravention | 15 | ||||||
5.4 | Brokers’ Fees | 15 | ||||||
ARTICLE VI COVENANTS | 15 | |||||||
6.1 | General | 15 | ||||||
6.2 | Litigation Support | 16 | ||||||
6.3 | No Change | 16 | ||||||
6.4 | Transition | 16 | ||||||
6.5 | Confidentiality | 16 | ||||||
6.6 | Transfer Taxes | 17 | ||||||
6.7 | Employees | 17 | ||||||
6.8 | Hold Harmless | 17 | ||||||
6.9 | Existing Packaging | 17 | ||||||
ARTICLE VII INDEMNIFICATION | 17 | |||||||
7.1 | Survival | 17 | ||||||
7.2 | Indemnification by Seller | 18 | ||||||
7.3 | Indemnification by Buyer | 18 | ||||||
7.4 | Certain Limitations | 18 | ||||||
7.5 | Indemnification Procedures | 19 | ||||||
7.6 | Tax Treatment of Indemnification Payments | 20 | ||||||
7.7 | Effect of Investigation | 20 | ||||||
7.8 | Cumulative Remedies | 20 | ||||||
ARTICLE VIII CONDITIONS PRECEDENT TO BUYER’S OBLIGATION TO CLOSE | 20 | |||||||
ARTICLE IX TERMINATION, AMENDMENT AND WAIVER | 21 | |||||||
9.1 | Termination. | 21 | ||||||
9.2 | Effect of Termination | 21 | ||||||
ARTICLE X MISCELLANEOUS | 22 | |||||||
10.1 | Expenses | 22 | ||||||
10.2 | Notices | 22 | ||||||
10.3 | Headings | 23 | ||||||
10.4 | Severability | 23 | ||||||
10.5 | Entire Agreement | 23 | ||||||
10.6 | Successors and Assigns | 23 | ||||||
10.7 | No Third-Party Beneficiaries | 23 | ||||||
10.8 | Amendment and Modification | 23 | ||||||
10.9 | Waiver | 23 | ||||||
10.10 | Governing Law | 24 | ||||||
10.11 | Submission to Jurisdiction | 24 | ||||||
10.12 | Waiver of Jury Trial | 24 | ||||||
10.13 | Specific Performance | 24 | ||||||
10.14 | Counterparts | 24 |
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Exhibit A – Xxxx of Sale and Assignment and Assumption Agreement
Exhibit B –Sub-lease
Exhibit C – Transition Services Agreement
Exhibit D – Intellectual Property Assignment Agreement
Exhibit E – Assignment of the Manufacturing Agreement
Exhibit F – Non-Competition and Non-Solicitation Agreement
Exhibit G – Fulfillment Assistance Agreement
Exhibit H – Promissory Note
Exhibit I – Personal Guaranty
Exhibit J – Resignation Letter
Exhibit K – Correspondence
Schedule 1.1 – Definitions
Schedule 2.1 – Purchased Assets
Schedule 2.1(A) – Patents and Applications
Schedule 2.1(B) – Trademark Applications and Registrations
Schedule 2.2 – Excluded Assets
Schedule 2.3 – Assumed Liabilities
Schedule 2.5 – Allocation Schedule
Schedule 4.3 – Required Consents
Schedule 4.7 – Inventory Locations
Schedule 4.16 – No Material Adverse Effects
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This Asset Purchase Agreement (this “Agreement”) is entered into effective as of June 22, 2016 by and among ProBiora Health, LLC, a Delaware limited liability company (the “Buyer”), Xxxxxxxxx X. Xxxxx (“Xxxxx”), the sole member and manager of Buyer and a personal guarantor (“Guarantor”) of certain of the payment obligations of Buyer, and Oragenics, Inc., a Florida corporation (the “Seller”). Buyer, Xxxxx, and Seller are referred to collectively in this Agreement as the “Parties.”
ARTICLE I
ARTICLE II
(a) The aggregate cash purchase price for the Purchased Assets shall be one million seven hundred thousand dollars ($1,700,000.00), payable in two payments of: (i) $1,250,000.00 to be paid by wire transfer to Seller’s designated bank account in readily available funds at Closing and (ii) $450,000.00 to be paid by wire transfer to Seller’s designated bank account in readily available funds on or before July 31, 2016 (provided that certain requirements set forth on Exhibit B to the TSA are satisfied on or before July 31, 2016) (the “Deferred Purchase Price Amount”). Interest will accrue on the Deferred Purchase Price Amount from the date of Closing, calculated at the rate of one percent (1%) per annum.
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(b) Buyer will execute a promissory note, in the face amount of the Deferred Purchase Price Amount, in favor of Seller (the “Promissory Note”).
(c) The Promissory Note shall be personally guaranteed by Xxxxxxxxx X. Xxxxx (“Xxxxx”), subject to the conditions stated in the personal guarantee (the “Personal Guaranty”).
(d) Buyer will also be obligated to pay to Seller contingent consideration (“Contingent Consideration”) in amounts calculated at five percent (5%) of Buyer’s Contribution Margin (as defined below) on sales of products which utilize the Purchased Assets in excess of $2,000,000.00 annually over the contingent contribution period (defined below), subject to a maximum payment of two million dollars. “Contribution Margin” for this purpose is calculated as gross revenue from sales of products utilizing the Purchased Assets, less: (i) cost of goods sold, (ii) credit card processing fees, (iii) sales tax, (iv) shipping costs, (v) coupons, returns, and allowances, and (vi) direct and indirect sales commissions paid by Buyer. The aggregate Contingent Consideration payable over the Contingent Consideration Period (defined below) is capped at two million dollars ($2,000,000.00) (the “Contingent Consideration Cap”). The Contingent Consideration Period runs from the termination of the TSA (as defined below) until the earlier of: (i) achieving the Contingent Consideration Cap, or (ii) December 31, 2025. There is no minimum contingent consideration payable by Buyer. For the avoidance of doubt, and by way of example, if the sales of the products utilizing the Purchased Assets by Buyer fails to exceed $2,000,000 for any year during the Contingent Consideration Period, there will be no Contingent Consideration payable to Seller by Buyer for that year. In any year during the Contingent Consideration Period in which the sales of the products of Buyer utilizing the Purchased Assets exceeds $2,000,000, there will be Contingent Consideration payable to Seller by Buyer in any such year, calculated at the rate of five percent (5%) of the amount of the Contribution Margin on sales in excess of $2,000,000 for that year. Within ninety (90) days after the end of each fiscal year during the Contingent Consideration Period, Buyer shall prepare and deliver the calculation of the amount of the Contingent Consideration for such fiscal year, if any, along with reasonable detail to allow the Seller to review and verify the same.
2.6 Non-Assignable Purchased Assets.
(a) To the extent that any of the Purchased Assets are not capable of being assigned by Seller to Buyer at Closing without the consent of a third party, or if such assignment would constitute a breach of an agreement or violation of any law, this Agreement shall not
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constitute an assignment thereof, unless any required consent is obtained. In the event that any such third party consent is required, Seller shall use best efforts, at Seller’s cost and expense, and shall cooperate with Buyer, as required pursuant to the TSA, to acquire any and all such consent(s) after Closing, effective as of the Closing Date; provided, however, that Buyer shall undertake to pay or satisfy the corresponding liabilities related to such non-assignable Purchased Asset to the extent Buyer would have been responsible therefor if such consent had been acquired. Once such consent is acquired with respect to a non-assignable Purchased Asset or Buyer otherwise commences doing business with the applicable third party with respect to a non-assignable Purchased Asset, such non-assignable Purchased Asset shall for all purposes of this Agreement be treated as a Purchased Asset for no additional consideration.
(b) To the extent that any Purchased Asset cannot be transferred to or assumed by Buyer following the Closing pursuant to this Section, the Buyer and Seller shall use best efforts to enter into, or to cause their respective Affiliates to enter into, such arrangements (such as subleasing, sublicensing or subcontracting) to provide the Parties the economic and, to the extent permitted under applicable law, operational equivalent of the transfer of such Purchased Asset to Buyer as of the Closing and the performance by Buyer of its obligations with respect thereto. Buyer shall, as agent or subcontractor for Seller, pay, perform and discharge fully the Liabilities of Seller thereunder from and after the Closing Date. To the extent permitted under applicable law, Seller shall hold in trust for and pay to Buyer promptly upon receipt thereof, such Purchased Asset and all income, proceeds and other monies received by Seller to the extent related to such Purchased Asset in connection with the arrangements under this Section.
ARTICLE III
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(a) At the Closing, Seller shall deliver to Buyer the following:
(i) a xxxx of sale and assignment and assumption agreement in the form of Exhibit A (the “Xxxx of Sale”) and duly executed by Seller, effecting the assignment to Buyer of the Purchased Assets and the assumption of the Assumed Liabilities by Buyer;
(ii) A sub-lease from Seller to Buyer for a portion of the space at Seller’s Tampa office location in the form of Exhibit B executed by Seller;
(iii) the Transition Services Agreement ( the “TSA”)in the form of Exhibit C and duly executed by Seller;
(iv) the Intellectual Property Assignment Agreement(s) in the form of Exhibit D and duly executed by Seller;
(v) the Assignment of the Manufacturing Agreement in the form of Exhibit E, duly executed by Seller, Manufacturer (if necessary), and Buyer;
(vi) the Non-Competition and Non-Solicitation Agreement in the form of Exhibit F, duly executed by the Seller;
(vii) the Fulfillment Assistance Agreement in the form of Exhibit G, duly executed by the Seller;
(viii) a certificate of the Secretary (or equivalent officer) of Seller certifying as to its: (A) the Articles of Incorporation; (B) Bylaws; (C) resolutions of the Special Committee of the board of directors, duly adopted and in effect, which authorize the execution, delivery and performance of this Agreement and the transactions contemplated hereby; (D) resolutions of the board of directors (with the exception of Xxxxx and Xxxxxx X. Xxxxx), duly adopted and in effect, which authorize the execution, delivery and performance of this Agreement and the transactions contemplated hereby; (E) incumbency certificate; and (F) Certificate of Good Standing;
(ix) a fairness opinion from Xxxxxxx Securities Inc. (the “Fairness Opinion”);
(x) copies of Lallemand SAS Invoice #552380 dated June 9, 2016 and # 552356 dated June 7, 2016, Nutraceutix, Inc. PO #2775 dated April 14, 2016, Logic PAKaging PO #2776 dated April 22, 2016 and Best PO#2777 dated May 25, 2016;
(xi) a certificate pursuant to Treasury Regulations Section 1.1445-2(b) that Seller is not a foreign person within the meaning of Section 1445 of the Internal Revenue Code duly executed by Seller;
(xii) Out of State Affidavit of Acceptance;
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(xiii) copies of all books and records related to the Purchased Assets; and
(xiv) such other customary instruments of transfer, assumption, filings or documents, in form and substance reasonably satisfactory to Buyer, as may be required to give effect to this Agreement.
(b) At the Closing, Buyer shall deliver to Seller the following:
(i) the cash portion of the Purchase Price;
(ii) the Promissory Note for the Deferred Purchase Price to Seller in the form of Exhibit H executed by Buyer (the “Promissory Note”);
(iii) the personal guaranty in the form of Exhibit I executed by Xxxxx (the “Personal Guaranty”);
(iv) a Resignation Letter in the form of Exhibit J duly executed by Xxxxx, making effective, as of the Closing Date, her resignation from Seller’s Board of Directors;
(v) the Xxxx of Sale and Assignment and Assumption Agreement in the form of Exhibit A duly executed by Buyer;
(vi) the Sub-Lease in the form of Exhibit B, duly executed by Buyer;
(vii) the TSA in the form of Exhibit C duly executed by Buyer;
(viii) the Intellectual Property Assignment Agreement in the form of Exhibit D duly executed by Buyer;
(ix) the Assignment of the Manufacturing Agreement in the form of Exhibit E, duly executed by Buyer;
(x) a Non-Competition and Non-Solicitation Agreement in the form of Exhibit F, duly executed by Buyer;
(xi) the Fulfillment Assistance Agreement in the form of Exhibit G, duly executed by Buyer;
(xii) a certificate of the Secretary (or equivalent officer) of Buyer certifying as to its: (A) Certificate of Organization; (B) manager resolutions, duly adopted and in effect, which authorize the execution, delivery and performance of this Agreement and the transactions contemplated hereby; (C) incumbency certificate; and (D) Certificate of Good Standing;
(xiii) Out of State Execution Affidavit; and
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(xiv) such other customary instruments of transfer, assumption, filings or documents, as may be required to give effect to this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer that the statements contained in this Article IV are correct and complete as of the date of this Agreement and shall be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Article IV), except as set forth in the disclosure schedule accompanying this Agreement (the “Seller Disclosure Schedule”). The Seller Disclosure Schedule shall be arranged in paragraphs corresponding to the lettered and numbered paragraphs contained in this Article IV.
4.1 Organization of Seller. Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Florida. The execution and delivery of this Agreement, and consummation of the transactions contemplated herein, have been duly and validly authorized by the board of directors (and shareholders, if necessary) of Buyer.
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4.9 | Intellectual Property. |
(a) Schedule 4.9(a) of the Disclosure Schedules identifies each item of Seller-Owned Registered Intellectual Property Related to the ProBiora3 Business, including (a) the nature of the item, including the title; (b) the owner of the item; (c) the jurisdictions in which the item is issued or registered or in which an application for issuance or registration has been filed; (d) the issuance, registration or application numbers and dates; and (e) any deadlines related to: (A) registration, maintenance or renewal fees with respect to Seller-Owned Intellectual Property identified in such Disclosure Schedule; and (B) the filing of any documents, applications or
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certificates (including responses to office actions) that are required within ninety (90) days of the Closing Date to maintain any such Seller-Owned Intellectual Property. Seller owns free and clear of all Liens, the Intellectual Property identified on Schedule 4.9(a) of the Disclosure Schedules. No Person other than Seller has ownership of any such Intellectual Property.
(b) Seller owns, or holds a valid and transferable license to, all Intellectual Property that is or at any time was material to the conduct of the ProBiora3 Business as currently conducted. The Acquired Intellectual Property includes all Intellectual Property Rights necessary and sufficient for the conduct of the ProBiora3 Business by Buyer immediately following the Closing in substantially the same manner as conducted by Seller during the eighteen (18) month period prior to Closing.
(c) To Seller’s Knowledge, the conduct of the ProBiora3 Business has not infringed or misappropriated, and does not infringe or misappropriate the Intellectual Property Rights of any Person. No proceeding is pending or threatened in writing which asserts that the conduct of the ProBiora3 Business infringes, misappropriates, or violates the Intellectual Property Rights of any Person.
(d) To Seller’s Knowledge, no Acquired Intellectual Property is being infringed by any Person.
(e) All registrations with respect to Seller-Owned Registered Property Related to the ProBiora3 Business are valid and in force, and all applications to register any Seller-Owned Registered Intellectual Property Related to the ProBiora3 Business are pending and in good standing, all without (1) challenge, interference or opposition of any kind or (2) threat of challenge, interference or opposition of any kind. There are no facts or circumstances that would render any Seller-Owned Intellectual Property Related to the ProBiora3 Business invalid or unenforceable in any material respect, other than a potential 35 U.S.C. §101 (patentable subject matter) issue with some issued claims of U.S. Xxx. No. 7,931,892 and U.S. Xxx. No. 8,865,156 (from which U.S. Ser. No. 14/518,226 claims priority).
(f) No director, officer, stockholder, employee, agent or other representative of Seller owns or claims any rights in (nor has any of them made application for) any Acquired Intellectual Property.
(g) Schedule 4.9(g) of the Disclosure Schedule sets forth a list of all Inbound IP Licenses necessary and sufficient for the conduct of the ProBiora3 Business. All Inbound IP Licenses listed on Schedule 4.9(g) of the Disclosure Schedule are included in the Acquired Intellectual Property. True, correct and complete copies of each Inbound IP License have been made available to Buyer.
(h) Schedule 4.9(h) of the Disclosure Schedule sets forth a list of all Outbound IP Licenses Related to the ProBiora3 Business. Seller has made available to Buyer for review accurate and complete copies of all Outbound IP Licenses.
(i) The transactions contemplated to be consummated under this Agreement as of the Closing: (A) will result in no material changes to any rights or obligations of Seller under any Inbound IP License or Outbound IP License; (B) do not require the consent of any
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other party to such Inbound IP License or Outbound IP License; (C) will not result in a breach of or default under such Inbound IP License or Outbound IP License; and (D) will not otherwise cause such Inbound IP License or Outbound IP License to cease to be legal, valid, binding, enforceable and in full force and effect on identical terms following the Closing.
(j) Seller has used commercially reasonable efforts to protect trade secret rights included in the Acquired Intellectual Property from unauthorized use or disclosure, has used commercially reasonable efforts to maintain materials protected by trade secret rights in confidence, and has used commercially reasonable efforts to preserve their status as trade secrets. There have been no breaches by Seller or, to Seller’s Knowledge, by the other party to the Contract, of any Contract between Seller and customers or other third parties with respect to trade secrets. There has been no unauthorized use or disclosure of such trade secrets by Seller.
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Schedule 4.19 of the Seller Disclosure Schedule. No Governmental Authority has alleged that any product designed, manufactured, sold, leased, licensed, or delivered by Seller is defective or unsafe or fails to meet any product warranty or any standards promulgated by any such Governmental Authority. No product designed, manufactured, sold, leased, licensed, or delivered by Seller has been recalled, and Seller has not received any notice of recall (written or oral) of any such product from any Governmental Authority. No event has occurred or circumstance exists that (with or without notice or lapse of time) could result in any such Liability or recall.
4.21 Environment, Health and Safety.
(a) The operations of Seller with respect to the ProBiora3 Business and the Purchased Assets are currently and have been in compliance with all Environmental Laws. Seller has not received from any person or entity, with respect to the ProBiora3 Business or the Purchased Assets, any: (i) Environmental Notice or Environmental Claim; or (ii) written request for information pursuant to Environmental Law, which, in each case, either remains pending or unresolved, or is the source of ongoing obligations or requirements as of the Closing Date.
(b) Seller has obtained and is in material compliance with all Environmental Permits (each of which is disclosed in Schedule 4.21(b) of the Disclosure Schedules) necessary for the conduct of the ProBiora3 Business as currently conducted or the ownership, lease, operation or use of the Purchased Assets and all such Environmental Permits are in full force and effect and shall be maintained in full force and effect by Seller through the Closing Date in accordance with Environmental Law, and Seller is not aware of any condition, event or circumstance that might prevent or impede, after the Closing Date, the conduct of the ProBiora3 Business as currently conducted or the ownership, lease, operation or use of the Purchased Assets. With respect to any such Environmental Permits, Seller has undertaken, or will undertake prior to the Closing Date, all measures necessary to facilitate transferability of the same, and Seller is not aware of any condition, event or circumstance that might prevent or impede the transferability of the same, and has not received any Environmental Notice or written communication regarding any material adverse change in the status or terms and conditions of the same.
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(c) None of the ProBiora3 Business or the Purchased Assets or any real property currently or formerly owned, leased or operated by Seller in connection with the ProBiora3 Business is listed on, or has been proposed for listing on, the National Priorities List (or CERCLIS) under CERCLA, or any similar state list.
(d) There has been no Release of Hazardous Materials in contravention of Environmental Law with respect to the ProBiora3 Business or the Purchased Assets or any real property currently or formerly owned, leased or operated by Seller in connection with the ProBiora3 Business, and Seller has not received an Environmental Notice that any of the ProBiora3 Business or the Purchased Assets or real property currently or formerly owned, leased or operated by Seller in connection with the ProBiora3 Business (including soils, groundwater, surface water, buildings and other structure located thereon) has been contaminated with any Hazardous Material which could reasonably be expected to result in an Environmental Claim against, or a violation of Environmental Law or term of any Environmental Permit by, Seller.
(e) Schedule 4.21(e) of the Disclosure Schedules contains a complete and accurate list of all off-site Hazardous Materials treatment, storage, or disposal facilities or locations used by Seller and any predecessors in connection with the ProBiora3 Business or the Purchased Assets as to which Seller may retain liability, and none of these facilities or locations has been placed or proposed for placement on the National Priorities List (or CERCLIS) under CERCLA, or any similar state list, and Seller has not received any Environmental Notice regarding potential liabilities with respect to such off-site Hazardous Materials treatment, storage, or disposal facilities or locations used by Seller.
(f) Seller has provided or otherwise made available to Buyer and listed in Schedule 4.21(f) of the Disclosure Schedules: (i) any and all environmental reports, studies, audits, records, sampling data, site assessments, risk assessments, economic models and other similar documents with respect to the ProBiora3 Business or the Purchased Assets or any real property currently or formerly owned, leased or operated by Seller in connection with the ProBiora3 Business which are in the possession or control of Seller related to compliance with Environmental Laws, Environmental Claims or an Environmental Notice or the Release of Hazardous Materials; and (ii) any and all material documents concerning planned or anticipated capital expenditures required to reduce, offset, limit or otherwise control pollution and/or emissions, manage waste or otherwise ensure compliance with current or future Environmental Laws (including, without limitation, costs of remediation, pollution control equipment and operational changes).
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(a) Schedule 4.22(a) of the Seller Disclosure Schedule lists all of the customers of Seller related to the ProBiora3 Business for each of the two most recent fiscal years and sets forth opposite the name of each such customer the percentage of consolidated net sales attributable to such customer. Schedule 4.22(a) of the Seller Disclosure Schedule also lists any person that Seller anticipates will be a customer of Seller in the current fiscal year that was not a customer of Seller at any time in the two most recently completed fiscal years.
(b) Schedule 4.22(b) of the Seller Disclosure Schedule lists the 20 largest suppliers of Seller related to the ProBiora3 Business for each of the two most recent fiscal years and sets forth opposite the name of each such supplier the percentage of consolidated net expense attributable to such supplier. Schedule 4.22(b) of the Seller Disclosure Schedule also lists any person or entity that Seller anticipates will be a supplier of Seller in the current fiscal year that was not a supplier of Seller at any time in the two most recently completed fiscal years.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller that the statements contained in this Article V are correct and complete as of the date of this Agreement and shall be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this Article V), except as set forth in the disclosure schedule accompanying this Agreement (the “Buyer Disclosure Schedule”). The Buyer Disclosure Schedule shall be arranged in paragraphs corresponding to the lettered and numbered paragraphs contained in this Article V.
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ARTICLE VI
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ARTICLE VII
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terms. Notwithstanding the foregoing, any claims asserted in writing by notice from the non-breaching Party to the breaching Party prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of such survival period and such claims shall survive until finally resolved.
(a) any inaccuracy in or breach of any of the representations or warranties of Seller contained in this Agreement or any document delivered by Seller under Section 3.2(a);
(b) any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Seller pursuant to this Agreement or any document delivered by Seller under Section 3.2(a); or
(c) any Excluded Asset or Excluded Liability.
(a) any inaccuracy in or breach of any of the representations or warranties of Buyer contained in this Agreement or any document delivered by Buyer under Section 3.2(b);
(b) any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Buyer pursuant to this Agreement or any document delivered by Buyer under Section 3.2(b); or
(c) any Assumed Liability.
(a) Seller shall not be liable to Buyer for indemnification under Section 7.2 until the aggregate amount of all Losses in respect of indemnification under Section 7.2 exceeds Seventeen Thousand Five Hundred Dollars ($17,500.00) (the “Deductible”), in which event Seller shall only be required to pay or be liable for Losses in excess of the Deductible. The limitations under this Section 7.4 shall not apply to (i) any breach of the Fundamental Representations, (ii) in the event of fraud or intentional misrepresentation, (iii) Section 7.2(b), or (iv) an Excluded Liability.
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(b) Recovery in an amount not to exceed Three Hundred Fifty Thousand Dollars ($350,000.00) shall be the Buyer’s sole and exclusive remedy for indemnifiable Losses resulting from the matters referred to in Section 7.2(a), provided, that, the limitations under this Section 7.4(b) shall not apply to (i) any breach of the Fundamental Representations and (ii) in the event of fraud or intentional misrepresentation. The maximum amount of indemnifiable Losses which may be recovered from Seller arising out of or resulting from the Fundamental Representations shall be limited to (1) the Purchase Price paid to and received by Seller plus (2) the aggregate amount of Contingent Consideration paid to and received by Seller (if any).
(c) Payments by any Indemnifying Party pursuant to Section 7.2 or 7.3 in respect of any Loss shall be calculated net of any insurance proceeds actually received on account of such Loss, if any, by the Indemnified Party.
(d) Payments by the Indemnifying Party pursuant to Section 7.2 or 7.3 in respect of any Loss shall be reduced by an amount equal to any Tax benefit actually realized by the Indemnified Party on account of such Loss as a refund or reduction in Taxes payable in the year such Loss occurs or the immediately succeeding taxable year.
(e) Except with respect to any Third Party Claim against an Indemnified Party, in no event shall any Indemnifying Party be liable to any Indemnified Party for any punitive, consequential, exemplary, special damages, including loss of future revenue or income, loss of profits, loss of business reputation or opportunity relating to the breach or alleged breach of this Agreement.
(f) Notwithstanding Notwithstanding anything herein to the contrary, Seller shall not be liable for any Losses incurred by Buyer arising or relating to Section 4.20 (Product Liability) claims arising from sales of products created and sold after Closing, which are due to: (i) Buyer’s specific deviation from a specific Historical Standard which specific deviation directly gives rise to the specific Loss, (ii) Buyer’s use of the Historical Standard after a change in law after the Effective Time that requires a change in the Historical Standard, or (iii) Inventory that was not stored or handled by Buyer in accordance with manufacturer instructions.
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ARTICLE VIII
CONDITIONS PRECEDENT TO BUYER’S OBLIGATION TO CLOSE
Buyer’s obligation to purchase the Purchased Assets and to take the other actions required to be taken by Buyer at the Closing shall be subject to satisfaction (or waiver by Buyer) of each of the following conditions:
8.1 The absence of any pending or threatened claims, or litigation seeking to enjoin or prevent the conveyance of the ProBiora3 Business, or which seeks damages, conditions, or challenges to the consummation of the Closing on any basis, or which could have a Material Adverse Effect on the Purchased Assets or the ProBiora3 Business;
8.2 All of the representations and warranties given by Seller in Article IV of the Agreement being true and correct in all material respects as of the date of Closing;
8.3 The transfer, conveyance and delivery of the Purchased Assets, on a lien-free basis;
8.4 Nothing having occurred which has had or could have a Material Adverse Effect on the Purchased Assets or the ProBiora3 Business;
8.5 The execution and delivery, of either Buyer or Seller and to either Buyer or Seller, as the case may be, of all of the ancillary agreements, contracts, or documents to be provided under Article III hereof;
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8.6 Seller shall have supplied Buyer with a portable hard drive containing all reasonably accessible books and records of the ProBiora3 Business of Seller; and
8.7 Seller shall have signed, and sent by overnight delivery service, correspondence addressed to the list of parties identified on Exhibit K, with a return envelope addressed to Buyer (collectively, the “Correspondence”), and provided Buyer with copies of all such Correspondence as well as a list of delivery agent tracking numbers for the Correspondence.
ARTICLE IX
TERMINATION, AMENDMENT AND WAIVER
(a) This Agreement may be terminated and the transactions contemplated by this Agreement may be abandoned at any time prior to the Closing:
(i) by the mutual written consent of Seller and Buyer;
(ii) by Seller, if the Closing shall not have occurred by June 24, 2016 (such date, the “Outside Date”); provided, however, that the right to terminate this Agreement under this Section 9.1(a)(ii) shall not be available to Seller if its action(s) or failure to perform or comply with any covenant or other obligation under this Agreement shall have been the principal cause of, or shall have resulted in, the failure of the Closing to occur on or prior to such date and such action(s) or failure to perform or comply constitutes a breach of this Agreement;
(iii) by Seller or Buyer, if any law shall have been enacted, enforced or deemed applicable to the transactions contemplated by this Agreement that has the effect of making the transactions contemplated by this Agreement illegal;
(b) In order to terminate this Agreement pursuant to this Section 9.1, the party seeking to terminate this Agreement shall deliver written notice thereof to the other parties hereto, specifying (i) the subsection of Section 9.1 pursuant to which this Agreement is being terminated and, (ii) the factual basis, in reasonable detail, giving rise to such party’s right to terminate this Agreement pursuant to this Section 9.1.
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ARTICLE X
If to Seller: | Oragenics, Inc. 0000 Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000 Xxxxx, XX 00000 Attn: Xxxxxxx Xxxxxxxx, CFO | |
with a copy, which shall not constitute notice, to: | Xxxx X. Xxxxxxx, Esq. Xxxxxxxx, Loop & Xxxxxxxx LLP 000 Xxxx Xxxxxxx Xxxx., Xxxxx 0000 Xxxxx, XX 00000 xxxxxxxx@xxx-xxx.xxx | |
If to Buyer: | ProBiora Health, LLC 0000 Xxxxx Xxxxxxx Xx., #000 Xxxxxx, XX 00000 Attn: Xxxxxxxxx X. Xxxxx, Manager xxxxxx@xxxxxxxxxxxxxx.xxx | |
with a copy, which shall not constitute notice, to: | Louis X. X. Xxxxx, Esq. Xxxxxxx & Xxxxxx LLP 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000 Xxxxx, Xxxxxxx 00000 xxxxx.xxxxx@xxxxx.xxx | |
If to Personal Guarantor: | Xxxxxxxxx X. Xxxxx 0000 Xxxxxx Xxxxx Xxxx, 00X Xxxxxx, XX 00000 xxxxxx@xxxxxxxxxxxxxx.xxx | |
with a copy, which shall not constitute notice, to: | Louis X. X. Xxxxx, Esq. Xxxxxxx & Xxxxxx LLP 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000 Xxxxx, Xxxxxxx 00000 xxxxx.xxxxx@xxxxx.xxx |
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operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.
10.10 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Florida without giving effect to any choice or conflict of law provision or rule (whether of the State of Florida or any other jurisdiction).
10.11 Submission to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby may be instituted in the federal courts of the United States of America or the courts of the State of Florida in each case located in the city of Tampa and county of Hillsborough, and each Party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding.
10.12 Waiver of Jury Trial. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES AND, THEREFORE, EACH SUCH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Parties hereto have caused this Asset Purchase Agreement to be duly executed as of the date first written above by their respective duly authorized signatories.
ORAGENICS, INC. | ||
By: | /s/ Xxxxxxx Xxxxxxxx | |
Name: Xxxxxxx Xxxxxxxx | ||
Title: Chief Financial Officer | ||
PROBIORA HEALTH, LLC | ||
By: | /s/ Xxxxxxxxx X. Xxxxx | |
Name: Xxxxxxxxx X. Xxxxx | ||
Title: Manager | ||
XXXXXXXXX X. XXXXX, individually | ||
/s/ Xxxxxxxxx X. Xxxxx |
SIGNATURE PAGE TO ASSET PURCHASE AGREEMENT
SCHEDULE 1.1
Acquired Intellectual Property means all Seller Intellectual Property, worldwide, comprising or Related to the ProBiora3 Business.
Adverse Consequence means all actions, suits, proceedings, hearings, investigations, charges, complaints, claims, causes of action, demands, injunctions, judgments, orders, decrees, rulings, damages, including any indirect, consequential, special, incidental or punitive damages (including lost profits, loss of use, damage to goodwill or loss of business), deficiency, dues, penalties, fines, awards, assessment, diminution in value, costs, amounts paid in settlement, liabilities, obligations, Taxes, liens, losses, expenses, and fees, including costs of investigation, court costs and reasonable attorneys’ fees and expenses.
Affiliate means any Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. With regard to Seller, Affiliate does not include the Xxxxx Family Limited Partnership or any of its partners or affiliates, Intrexon Corporation or any of its affiliates or subsidiaries and Third Security, LLC or any of its affiliates or subsidiaries.
CERCLA means the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.
Encumbrance means any charge, claim, community property interest, pledge, condition, equitable interest, lien (statutory or other), option, security interest, mortgage, easement, encroachment, right of way, right of first refusal, or restriction of any kind, including any restriction on use, voting, transfer, receipt of income or exercise of any other attribute of ownership.
Environmental Claim means any Action, Governmental Order, lien, fine, penalty, or, as to each, any settlement or judgment arising therefrom, by or from any Person alleging liability of whatever kind or nature (including liability or responsibility for the costs of enforcement proceedings, investigations, cleanup, governmental response, removal or remediation, natural resources damages, property damages, personal injuries, medical monitoring, penalties, contribution, indemnification and injunctive relief) arising out of, based on or resulting from: (a) the presence, Release of, or exposure to, any Hazardous Materials; or (b) any actual or alleged non-compliance with any Environmental Law or term or condition of any Environmental Permit.
Environmental Law means any applicable Law, and any Governmental Order or binding agreement with any Governmental Authority: (a) relating to pollution (or the cleanup thereof) or the protection of natural resources, endangered or threatened species, human health or safety, or the environment (including ambient air, soil, surface water or groundwater, or subsurface strata); or (b) concerning the presence of, exposure to, or the management, manufacture, use, containment, storage, recycling, reclamation, reuse, treatment, generation, discharge, transportation, processing, production, disposal or remediation of any Hazardous Materials. The term “Environmental Law” includes, without limitation, the following (including their
SCHEDULE 1.1
implementing regulations and any state analogs): the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. §§ 9601 et seq.; the Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976, as amended by the Hazardous and Solid Waste Amendments of 1984, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1977, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control Act of 1976, as amended, 15 U.S.C. §§ 2601 et seq.; the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the Clean Air Act of 1966, as amended by the Clean Air Act Amendments of 1990, 42 U.S.C. §§ 7401 et seq.; and the Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. §§ 651 et seq.
Environmental Notice means any written directive, notice of violation or infraction, or notice respecting any Environmental Claim relating to actual or alleged non-compliance with any Environmental Law or any term or condition of any Environmental Permit.
Environmental Permit means any Permit, letter, clearance, consent, waiver, closure, exemption, decision or other action required under or issued, granted, given, authorized by or made pursuant to Environmental Law.
Hazardous Materials means: (a) any material, substance, chemical, waste, product, derivative, compound, mixture, solid, liquid, mineral or gas, in each case, whether naturally occurring or manmade, that is hazardous, acutely hazardous, toxic, or words of similar import or regulatory effect under Environmental Laws; and (b) any petroleum or petroleum-derived products, radon, radioactive materials or wastes, asbestos in any form, lead or lead-containing materials, urea formaldehyde foam insulation and polychlorinated biphenyls.
Historical Standard means as of the Closing Date, the specific design, storage, formulation, materials, workmanship, labeling, instructions, or otherwise used by Seller with respect to any product designed, manufactured, sold, leased, licensed, or delivered in connection with the ProBiora3 Business.
In-Licensed Intellectual Property means Intellectual Property subject to an Inbound IP License.
Inbound IP License means a license, sublicense, or other agreement under which Seller is authorized to practice Intellectual Property Rights owned by another Person.
Intellectual Property or Intellectual Property Rights means all of the following in any jurisdiction: (a) issued patents and patent applications, and any divisionals, continuations, continuations-in-part, renewals, reexaminations, substitutions, extensions, or reissues thereof, and the rights related thereto; (b) trademarks, service marks, trade names, logos, slogans, and other source identifiers, including Internet domain names, (including, in each case, the goodwill associated therewith), whether registered or unregistered, and all registrations and applications for registration and renewals thereof; (c) registered and unregistered works of authorship, the right to copy, distribute, modify, publicly perform, and publicly display such works, copyright
SCHEDULE 1.1
registrations, and applications for copyright registration, and any extensions or renewals thereof; and (d) trade secrets, including rights in confidential know-how, technology or information, including confidential know-how, technology or information: (i) that derives economic value, actual or potential, from not being generally known to or readily ascertainable by others; and (ii) that is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.
Knowledge or any other similar knowledge qualification, means the actual or constructive knowledge of any director or officer of Seller, after due inquiry.
Losses means all claims, judgments, damages, liabilities, settlements, losses, costs and expenses, including attorneys’ fees and disbursements.
Outbound IP License means a license, agreement or permission pursuant to which Seller has authorized any Person to practice any Seller-Owned Intellectual Property.
Person means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association or other entity.
ProBiora3 Business means Seller’s oral probiotic business utilizing a proprietary blend of three naturally occurring strains of beneficial bacteria, Streptococcus oralis, Streptococcus uberis, and Streptococcus rattus, marketing under the xxxx ProBiora3®, with existing products in capsule and powder form for consumption by humans and pets sold under the brand names EvoraKids, EvoraPlus, EvoraPro and EvoraPet, as well as all international and private label business (including, without limitation, any licensing arrangements and contract sales).
Related to the ProBiora3 Business means required for, material to, or used primarily in, or arising, directly or indirectly, primarily out of the operation or conduct of, the ProBiora3 Business, or held primarily for such use.
Release means any actual or threatened release, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, abandonment, disposing or allowing to escape or migrate into or through the environment (including, without limitation, ambient air (indoor or outdoor), surface water, groundwater, land surface or subsurface strata or within any building, structure, facility or fixture).
Seller Intellectual Property means: (i) Seller-Owned Intellectual Property; and (ii) In-Licensed Intellectual Property.
Seller-Owned Intellectual Property means: (i) Seller Registered Intellectual Property; and (ii) Seller Unregistered Intellectual Property.
Seller Registered Intellectual Property means Intellectual Property that meets the following criteria: the Intellectual Property: (i) is owned by Seller; and (ii) has been registered with the appropriate Government Authority, or is subject to a pending application for registration.
Seller Unregistered Intellectual Property means all Intellectual Property that is owned by Seller but that is not Seller Registered Intellectual Property.
SCHEDULE 1.1
Tax or Taxes means all federal, state, local, foreign and other income, gross receipts, sales, use, production, ad valorem, transfer, documentary, franchise, registration, profits, license, lease, service, service use, withholding, payroll, employment, unemployment, estimated, excise, severance, environmental, stamp, occupation, premium, property (real or personal), real property gains, windfall profits, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, together with any interest, additions or penalties with respect thereto and any interest in respect of such additions or penalties.
Third Party Claim means any Action, suit, claim or other legal proceeding made or brought by any Person who is not a party to this Agreement or an Affiliate of a party to this Agreement or a representative of the foregoing.
Transferred Employees means Xxxxx Xxxxx, Xxx Xxxx, and Xxxxx Maroon.
SCHEDULE 1.1