ASSET PURCHASE AGREEMENT
BY AND AMONG
VIBRANT HEALTH INTERNATIONAL,
OPTIGENEX ACQUISITION CORP.,
XXXXXX X. XXXXXX
AND
OPTIGENEX INC.
TABLE OF CONTENTS
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ARTICLE I Purchase and Sale Agreement...................................4
1.1 Agreement of Purchase and Sale........................................4
1.2 Purchase Price........................................................4
1.3 Purchased Assets......................................................4
1.4 Assumption of Liabilities.............................................6
1.5 Options and Warrants..................................................6
1.6 Exemption from Registration...........................................6
ARTICLE II Tax Free Reorganization.......................................6
ARTICLE III Representations and Warranties of Optigenex...................6
3.1 Organization..........................................................6
3.2 Capital...............................................................6
3.3 Subsidiaries..........................................................7
3.4 Directors and Officers................................................7
3.5 Financial Statements..................................................7
3.6 Absence of Changes....................................................7
3.7 Absence of Undisclosed Liabilities....................................7
3.8 Tax Returns...........................................................7
3.9 Proprietary Rights....................................................7
3.10 Compliance with Laws..................................................8
3.11 Litigation............................................................8
3.12 Authority.............................................................8
3.13 Ability to Carry Out Obligations......................................8
3.14 Full Disclosure.......................................................8
3.15 Assets................................................................8
3.16 Material Contracts....................................................9
3.17 Criminal or Civil Acts................................................9
3.18 Restricted Securities.................................................9
3.19 Environmental Compliance..............................................9
3.20 Insurance............................................................10
3.21 Brokers or Finders...................................................10
ARTICLE IV Representations and Warranties of Vibrant....................10
4.1 Organization.........................................................10
4.2 Capital..............................................................11
4.3 Subsidiaries.........................................................11
4.4 Directors and Officers...............................................11
4.5 SEC Filings; Financial Statements....................................11
4.6 Absence of Change....................................................12
4.7 Absence of Undisclosed Liabilities...................................12
4.8 Tax Matters..........................................................13
4.9 Proprietary Rights...................................................15
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4.10 Compliance with Laws.................................................15
4.11 Litigation...........................................................15
4.12 Authority............................................................15
4.13 Ability to Carry Out Obligations.....................................16
4.14 Full Disclosure......................................................16
4.15 Assets...............................................................16
4.16 Material Contracts...................................................16
4.17 Criminal or Civil Acts...............................................16
4.18 Personnel and Employee Benefits......................................16
4.19 Environmental Compliance.............................................17
4.20 Insurance............................................................17
4.21 Stock Consideration..................................................18
4.22 Brokers or Finders...................................................18
ARTICLE V Covenants Prior to the Closing Date..........................18
5.1 Investigative Rights; Confidentiality................................18
5.2 Conduct of Business by Optigenex.....................................19
5.3 Consummation of Transaction..........................................19
ARTICLE VI Conditions Precedent to the Vibrant Parties' Performance.....19
6.1 Conditions...........................................................19
6.2 Accuracy of Representations..........................................19
6.3 Performance..........................................................20
6.4 Absence of Litigation................................................20
6.5 Officer's Certificate................................................20
6.6 Corporate Action.....................................................20
6.7 Private Placement....................................................20
6.8 Opinion of Counsel...................................................20
ARTICLE VII Conditions Precedent to Optigenex's Performance..............20
7.1 Conditions...........................................................20
7.2 Accuracy of Representations..........................................20
7.3 Performance..........................................................20
7.4 Absence of Litigation................................................20
7.5 Officer's Certificate................................................21
7.6 Directors of Vibrant.................................................21
7.7 Officers of Vibrant..................................................21
7.8 Corporate Action.....................................................21
7.9 Divestiture of Assets and Current Operations.........................21
7.10 Opinion of Counsel...................................................21
ARTICLE VIII Closing......................................................21
8.1 Closing..............................................................21
ARTICLE IX .............................................................22
9.1 Termination by Mutual Consent........................................22
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9.2 Other Termination....................................................22
9.3 Termination by Vibrant...............................................22
9.4 Termination by Optigenex.............................................22
ARTICLE X Survival; Indemnification....................................23
10.1 Survival.............................................................23
10.2 Indemnification......................................................23
10.3 Limitations on Indemnification.......................................24
ARTICLE XI Post Closing Covenants.......................................24
11.1 Form 10-Q............................................................24
11.2 Liquidation of Optigenex.............................................19
11.3 Merger...............................................................24
ARTICLE XII Miscellaneous................................................25
12.1 Captions and Headings................................................25
12.2 No Oral Change.......................................................25
12.3 Non-Waiver...........................................................25
12.4 Time of Essence......................................................25
12.5 Entire Agreement.....................................................25
12.6 Choice of Law........................................................25
12.7 Counterparts.........................................................25
12.8 Notices..............................................................25
12.9 Binding Effect.......................................................26
12.10 Mutual Cooperation...................................................26
12.11 Announcements........................................................26
12.12 Expenses.............................................................26
12.13 Exhibits.............................................................26
12.14 Legal Counsel........................................................26
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ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT ("AGREEMENT") made this day of July, 2004, by and
between Vibrant Health International, a Nevada corporation ("Vibrant"),
OPTIGENEX ACQUISITION CORP., a Delaware corporation ("Acquisition Sub"),
Optigenex Inc., a Delaware corporation ("Optigenex") and Xxxxxx X. XxXxxx
("Principal Stockholder").
WHEREAS, Optigenex is an applied DNA sciences company with platform
technology which competes in the preventative medicine / wellness market (the
"Business");
WHEREAS, Acquisition Sub is a wholly-owned subsidiary of Vibrant;
WHEREAS, Optigenex wishes to sell to Acquisition Sub, and Acquisition Sub
wishes to purchase from Optigenex, as a going concern, the Business and all of
the properties and assets of Optigenex, all subject to the terms and conditions
hereinafter set forth; and
WHEREAS, the parties hereto intend that the transaction which is the
subject of this Agreement shall constitute a tax-free reorganization pursuant to
Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code").
NOW, THEREFORE, in consideration of the mutual promises, covenants and
representations contained herein, THE PARTIES HERETO AGREE AS FOLLOWS:
ARTICLE I
PURCHASE AND SALE AGREEMENT
1.1 Agreement of Purchase and Sale. Subject to the terms and conditions
set forth in this Agreement and in reliance upon the representations,
warranties, covenants and conditions herein contained, on the Closing Date (as
defined in Section 8.1 hereof) Optigenex shall sell, convey, assign, transfer
and deliver to Acquisition Sub, and Acquisition Sub shall purchase from
Optigenex, the Purchased Assets (as defined in subparagraph 1.3 hereof).
1.2 Purchase Price. The total purchase price for the Purchased Assets
shall be as follows:
(a) such number of unregistered shares of the common stock, $.001
par value, of Vibrant (the "Vibrant Common Stock") as equals the number of
outstanding shares of common stock, $.01 par value, of Optigenex at the Closing
(the "Stock Consideration"); and
(b) the assumption by Acquisition Sub of the Assumed Liabilities
pursuant to Section 1.4.
1.3 Purchased Assets. As used in this Agreement, the term "Purchased
Assets" means all of the properties and assets owned by Optigenex or otherwise
employed, used or available for use in the Business, real and personal, tangible
and intangible, of every kind and nature, wherever located, as the same shall
exist on the Closing Date, including, but not limited to, all such properties
and assets in the following categories:
(i) all operating equipment (including machinery and tools),
furniture, fixtures, leasehold improvements, computer equipment, office
equipment, communications equipment, articles of store signage and other
tangible personal property which are used or held for use by Optigenex in
connection with the Business;
(ii) all inventory which is used or held for use by Optigenex
in connection with the Business;
(iii) all licenses, permits, approvals, certificates,
consents, orders or other authorizations issued or granted by any governmental
authority, which are owned by Optigenex or which are used or held for use by
Optigenex in connection with the Business;
(iv) originals or copies of all books, records, files and
papers of Optigenex which are used or held for use in connection with the
Business (or any portions thereof), whether in hard copy or computer format,
including books of account, catalogues, mailing lists, customer data bases,
telephone numbers, invoices, sales and promotional materials, manuals, sales and
purchase correspondence, employment records, gift certificate and credit/return
records and documentation declared or used for accounting, marketing and/or
manufacturing;
(v) all rights of Optigenex to any computer software programs
and the license or other agreements conferring rights related thereto;
(vi) all intellectual property rights and industrial property
rights arising under statutory or common law, contract or otherwise, and whether
or not perfected, which are owned by Optigenex or which are used or held for use
by Optigenex in connection with the Business, including without limitation, all
(a) patents, reissues and reexamined patents and patent applications, whenever
filed and wherever issued, including without limitation, continuations,
continuations in part, substitutes and divisions of such applications and all
priority rights result from such applications; (b) rights associated with works
of authorship including, but not limited to, copyrights, moral rights, copyright
applications and copyright registrations; (c) rights relating to the protection
of trade secrets and confidential information; (d) rights in trademarks, service
marks, trade names, logos, symbols, sounds, musical compositions, images,
audio-visual works and the like; (e) rights analogous to those set forth in this
paragraph (i) and any and all other proprietary rights relating to intangible
property; and (f) divisions, continuations, renewals, reissues and extensions of
the foregoing (as and to the extent applicable) now existing, hereafter filed,
issued or acquired;
(vii) all cash deposits, certificates of deposit, money market
accounts and all other funds held by or on behalf of Optigenex;
(viii) all assets included in the Optigenex Balance Sheet (as
hereinafter defined); and
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(ix) all other assets of any kind, nature or description owned
by Vibrant not otherwise described in this Section 1.3.
1.4 Assumption of Liabilities. On the Closing Date, and subject to the
terms and conditions of this Agreement, Optigenex shall assign to Acquisition
Sub, and Acquisition Sub shall assume, become primarily liable for, and agree to
pay, perform and discharge when due, all of the debts, obligations, duties and
liabilities of Optigenex and the Business incurred on or prior to the Closing
(collectively, the "Assumed Liabilities").
1.5 Options and Warrants. Schedule 1.5 lists all outstanding options
("Optigenex Options") and warrants ("Optigenex Warrants") of Optigenex
immediately prior to the Closing. Following the Closing, Vibrant shall issue to
Optigenex 681,895 options ("Substitute Options") and 111,668 warrants
("Substitute Warrants") to purchase Vibrant Common Stock at an exercise price
per share of Vibrant Common Stock equal to the exercise price per share of the
Optigenex Option or Optigenex Warrant immediately prior to Closing. The terms
and conditions of each Substitute Option and each Substitute Warrant, including
any acceleration of vesting and/or exercisability thereof, shall otherwise be
the same as the Optigenex Options or Optigenex Warrants.
1.6 Exemption from Registration. The parties hereto intend that the Stock
Consideration shall be exempt from the registration requirements of the
Securities Act of 1933, as amended (the "Act"), pursuant to Section 4(2) and/or
Rule 506 of the Act and the rules and regulations promulgated thereunder.
ARTICLE II
TAX-FREE REORGANIZATION
For United States Federal income tax purposes, the purchase and sale
transaction contemplated by this Agreement is intended to qualify as a
reorganization within the meaning of Section 368(a) of the Code, and this
Agreement is intended to be and is adopted as a plan or reorganization within
the meaning of the Code and the Treasury Regulations promulgated thereunder.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF OPTIGENEX
Optigenex hereby represents and warrants to Vibrant that:
3.1 Organization. Optigenex is a corporation duly organized, validly
existing and in good standing under the laws of Delaware, has all necessary
corporate powers to own its properties and to carry on its business as now owned
and operated by it, and is duly qualified to do business and is in good standing
in each of the states where the failure to so qualify would have an Optigenex
Material Adverse Effect (as hereinafter defined).
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3.2 Capital. The authorized capital stock of Optigenex consists of
20,000,000 authorized shares of $.01 par value common stock and 1,000,000
authorized shares of $.01 par value preferred stock. There are currently
8,621,255 shares of Optigenex Common Stock outstanding and no shares of
preferred stock outstanding. Optigenex also has 681,895 Optigenex Options and
111,668 Optigenex Warrants outstanding as set forth on Schedule 1.5 hereof. The
parties hereto acknowledge that Optigenex may continue to sell shares of its
common stock in the Private Placement (as defined in Section 6.7) between the
date hereof and the Closing Date. All of the outstanding Optigenex Common Stock
is duly and validly issued, fully paid and nonassessable. Except as described in
this Section 3.2, there are no other outstanding subscriptions, options, rights,
warrants, debentures, instruments, convertible securities or other agreements or
commitments obligating Optigenex to issue or to transfer from treasury any
additional shares of its capital stock of any class.
3.3 Subsidiaries. Optigenex does not have any subsidiaries or own any
interest in any other enterprise.
3.4 Directors and Officers. The names and titles of the directors and
officers of Optigenex as of the date of this Agreement are as follows: Xxxxxxx
X. Xxxxxxx, Chairman of the Board of Directors; Xxxxxxx X. Xxxxxx, Chief
Executive Officer, President, Secretary and a Director; and Xxxxxxx X. Xxxxxxxx,
Chief Science Officer and a director.
3.5 Financial Statements. Schedule 3.5 hereto consists of the audited
balance sheet of Optigenex for the year ended December 31, 2003 and the
unaudited balance sheet of Optigenex at March 31, 2004 (collectively, the
"Optigenex Balance Sheet"). The Optigenex Balance Sheet has been prepared in
accordance with accounting principles and practices consistently followed by
Optigenex throughout the period indicated, and fairly present the financial
position of Optigenex as of the date indicated.
3.6 Absence of Changes. Since December 31, 2003, there has not been any
material adverse effect on the business, operations, financial condition,
assets, liabilities or results of operations of Optigenex, taken as a whole
("Optigenex Material Adverse Effect"); provided, however, that for purposes of
this Agreement, the continuing operating losses of Optigenex shall not be deemed
an Optigenex Material Adverse Effect.
3.7 Absence of Undisclosed Liabilities. Except as set forth on Schedule
3.7, as of December 31, 2003, Optigenex did not have any material debt,
liability or obligation of any nature, whether accrued, absolute, contingent or
otherwise, and whether due or to become due (collectively, "Liabilities"), that
was not reflected or reserved against in the Optigenex Balance Sheet.
3.8 Tax Returns. Optigenex has filed all federal, state and local tax
returns required by law and has paid all taxes, assessments and penalties due
and payable or has filed appropriate extensions therefor. The provisions for
taxes, if any, reflected in Schedule 3.8 are adequate for the periods indicated.
There are no present disputes as to taxes of any nature payable by Optigenex.
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3.9 Proprietary Rights. Optigenex owns, or has a valid license to, all
necessary trademarks, service marks, trade names, copyrights, patents and
proprietary information necessary to conduct its business as it is currently
conducted.
3.10 Compliance with Laws. Optigenex has complied in all material respects
with, and is not in violation of, applicable federal, state or local statutes,
laws and regulations, including federal and state securities laws applicable to
it or to the conduct or operation of its business or the ownership of its
assets.
3.11 Litigation. Except as set forth on Schedule 3.11, Optigenex is not a
defendant in any suit, action, arbitration or legal, administrative or other
proceeding, or governmental investigation which is pending or, to the best
knowledge of Optigenex, threatened against or affecting Optigenex or its
business, assets or financial condition. Optigenex is not in default with
respect to any order, writ, injunction or decree of any federal, state, local or
foreign court, department, agency or instrumentality applicable to it. Optigenex
is not engaged in any material litigation to recover monies due to it. All
references herein to "the best knowledge of Optigenex" or similar phrases shall
mean the actual knowledge of the president of Optigenex.
3.12 Authority. The Board of Directors and stockholders of Optigenex have
authorized the execution of this Agreement and the consummation of the
transactions contemplated herein, and Optigenex has full power and authority to
execute, deliver and perform this Agreement, and this Agreement is a legal,
valid and binding obligation of Optigenex and is enforceable in accordance with
its terms and conditions.
3.13 Ability to Carry Out Obligations. Except as set forth on Schedule
3.13, the execution and delivery of this Agreement by Optigenex and the
performance by Optigenex of its obligations hereunder in the time and manner
contemplated will not cause, constitute or conflict with or result in (a) any
breach or violation of any of the provisions of or constitute a default under
any material license, indenture, mortgage, instrument, article of incorporation,
bylaw, or other material agreement or instrument to which Optigenex is a party,
or by which it may be bound, nor will any consents or authorizations of any
party other than those hereto be required, (b) an event that would permit any
party to any material agreement or instrument to terminate it or to accelerate
the maturity of any material indebtedness or other material obligation of
Optigenex, or (c) an event that would result in the creation or imposition of
any liens, adverse claims, security interests, mortgages, charges or
encumbrances of any nature whatsoever (collectively, "Liens") on any asset of
Optigenex, except to the extent such breach or violation would not have an
Optigenex Material Adverse Effect.
3.14 Full Disclosure. None of the representations and warranties made by
Optigenex herein or in any exhibit, certificate or memorandum furnished or to be
furnished by Optigenex, or on its behalf, contains or will contain any untrue
statement of material fact or omit any material fact the omission of which would
be misleading.
3.15 Assets. Optigenex's material assets are as set forth in Schedule 3.15
and are not subject to any Liens, except (i) encumbrances arising in connection
with equipment or maintenance financing or leasing arrangements, (ii)
encumbrances that do not materially detract from the value of any of the assets
of Optigenex or materially interfere with the use thereof as currently used or
(iii) as otherwise indicated in Schedule 3.15.
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3.16 Material Contracts. Except as set forth on Schedule 3.16, Optigenex
does not have any contracts that relate to or affect its assets, properties, or
its business or operations, the performance of which involves annual
consideration in excess of $50,000.
3.17 Criminal or Civil Acts. For the period of five years prior to the
execution of this Agreement, no executive officer, director or principal
stockholder of Optigenex has been convicted of a felony crime, filed for
personal bankruptcy, been the subject of a Securities and Exchange Commission
("Commission") or NASD judgment or decree, or is currently the subject to any
investigation in connection with a felony crime or Commission or NASD
proceeding.
3.18 Restricted Securities. Optigenex acknowledges that all of the Stock
Consideration and the shares of Vibrant Common Stock issuable upon exercise of
the Substitute Options to be issued by Vibrant will be restricted securities and
none of such securities may be sold or publicly traded except in accordance with
the provisions of the Act.
3.19 Environmental Compliance.
(a) None of Optigenex's properties or assets, nor to the best of
Optigenex's knowledge, Optigenex's leased premises, contains (x) any asbestos,
polychlorinated biphenyls or any PCB contaminated oil; (y) any contaminants; and
to Optigenex's knowledge, such premises is, and always has been, in compliance
with applicable Environmental Laws (as defined below).
(b) Optigenex has obtained all Governmental Authorizations (as
defined below) that are required under all Environmental Laws, and Optigenex has
no liability, contingent or otherwise, under or arising from any violation by
Optigenex or any third party, of any Environmental Law.
(c) For purposes of this Agreement, follow terms shall have the
meanings set forth below:
(i) "Environmental Laws" shall mean and include, but not be
limited to, any applicable federal, state or local law, statute, charter,
ordinance, rule or regulation or any Governmental Body (as hereinafter defined)
interpretation, policy or guidance, including, without limitation, applicable
safety/environmental/health laws, such as, but not limited to, the Resource
Conservation and Recovery Act of 1976, Comprehensive Environmental Response
Compensation and Liability Act, Federal Emergency Planning and Community
Right-to-Know Law, the Clean Air Act, the Clean Water Act, and the Toxic
Substance Control Act, as any of the foregoing have been amended, and any
Governmental Authorization or order applicable to or affecting any property
(real or personal) used by or relating to such party or issued pursuant to any
Environmental Laws which pertains to, governs, or controls the generation,
storage, remediation or removal of contaminants or otherwise regulates the
protection of health and the environment, including, but not limited to, any of
the following activities, whether on site or off site if such could materially
affect the site: (x) the emission, discharge, release, spilling or dumping of
any contaminant into the air, surface water, ground water, soil or substrata; or
(y) the use, generation, processing, sale, recycling, treatment, handling,
storage, disposal, transportation, labeling or any other management of any
Contaminant.
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(ii) "Governmental Authorization" means any approval, consent,
license, permit, waiver, or other authorization issued, granted, given, or
otherwise made available by or under the authority of any Governmental Body or
any federal, state, local, municipal, foreign, international, multinational,
self regulatory organization or court or other administrative order,
constitution, law, ordinance, principle of common law, rule, regulation,
statute, treaty, by-law, or the like.
(iii) "Governmental Body" means any (a) nation, state, county,
city, town, village, district, or other jurisdiction of any nature; (b) federal,
state, local, municipal, foreign, or other government; (c) governmental or
quasi-governmental authority of any nature (including any governmental agency,
branch, department, official, or entity and any court or other tribunal); (d)
multi-national organization or body; (e) self-regulatory organization; or (f)
body exercising, or entitled to exercise, any administrative, executive,
judicial, legislative, police, regulatory, or taxing authority or power of any
nature.
3.20 Insurance. Optigenex maintains insurance coverage with reputable
insurers in such amounts and covering such risks as are in accordance with
normal industry practice for companies engaged in businesses similar to that of
Optigenex (taking into account the cost and availability of such insurance).
3.21 Brokers or Finders. Neither Optigenex, nor any director, officer,
agent or employee thereof, has employed any broker or finder or has incurred or
will incur any broker's, finder's or similar fees, commissions or expenses, in
each case in connection with the transactions contemplated by this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF VIBRANT
Vibrant and the Principal Stockholder, jointly and severally, represent
and warrant to Optigenex that:
4.1 Organization. Vibrant is a corporation duly organized, validly
existing and in good standing under the laws of Nevada. Each Subsidiary (as
defined in Section 4.3) of Vibrant is duly organized, validly existing, and in
good standing under the laws of the state of its formation. Each of Vibrant and
its Subsidiaries has all necessary corporate powers to carry on its business,
and is duly qualified to do business and is in good standing in each of the
states where the failure to so qualify would have a material adverse effect on
the business, operations, financial condition, assets, liabilities or results of
operations, taken as a whole, of Vibrant or any of its Subsidiaries ("Vibrant
Material Adverse Effect"). True and complete copies of the Articles of
Incorporation of each of Vibrant and its Subsidiaries and all amendments
thereof, and of the By-Laws of each of Vibrant and its Subsidiaries, as amended
to date, have heretofore been furnished to Optigenex and, with respect to
Vibrant, have been filed in the Vibrant SEC Reports (as hereinafter defined).
Each of Vibrant's and its Subsidiaries' respective minute books which have been
furnished to Optigenex contain records of the meetings and other corporate
actions of Vibrant's and its Subsidiaries' respective stockholders and Board of
Directors (including committees of its Board of Directors) that are accurate and
complete in all material respects.
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4.2 Capital. The authorized capital stock of Vibrant consists of
100,000,000 shares of Vibrant Common Stock and 5,000,000 shares of preferred
stock, of which 4,360,600 shares of Vibrant Common Stock are issued and
outstanding and no shares of preferred stock are outstanding. On the Closing
Date, the authorized capital stock of Vibrant will consist of 100,000,000 shares
of Vibrant Common Stock and 5,000,000 shares of preferred stock, of which (prior
to the issuance of the Stock Consideration contemplated by this Agreement) not
more than 564,882 shares of Vibrant Common Stock will be issued and outstanding.
All of Vibrant's outstanding securities are duly and validly issued, fully paid
and nonassessable. There are (i) no shares of Vibrant Common Stock held in
treasury and (ii) no outstanding subscriptions, options, rights, warrants,
debentures, instruments, convertible securities or other agreements or
commitments obligating Vibrant or any of its Subsidiaries to issue or to
transfer from treasury any shares of its capital stock of any class except
shares issuable under this Agreement.
4.3 Subsidiaries. Vibrant has two subsidiaries, Vibrant Health, Inc., a
___________ corporation and Acquisition Sub (the "Subsidiaries"), each of which
are wholly-owned by Vibrant or a Subsidiary, free and clear of any and all
Liens. Vibrant has, at all times, been a holding company, and all commercial
activities of Vibrant were conducted by Vibrant Health, Inc. All of the capital
stock of Vibrant Health, Inc. will be sold to Vibrant's sole officer and
director effective immediately prior to the Closing, pursuant to Section 7.9
hereof.
4.4 Directors and Officers. Xxxxxx X. XxXxxx is the sole officer and
director of Vibrant.
4.5 SEC Filings; Financial Statements.
(a) Vibrant has timely filed all forms, reports and documents
required to be filed by Vibrant with the SEC (collectively, the "Vibrant SEC
Reports"). To the best knowledge of the Principal Stockholder, the Vibrant SEC
Reports, (a) at the time filed, complied in all material respects with the
applicable requirements of the Act and the Securities Exchange Act of 1934, as
amended, as the case may be, and (b) did not at the time they were filed (or if
amended or superseded by a subsequent filing, then on the date of such
subsequent filing), contain any untrue statement of a material fact or omit to
state a material fact required to be stated in such Vibrant SEC Reports or
necessary in order to make the statements in such Vibrant SEC Reports, in the
light of the circumstances under which they were made, not misleading. To the
best knowledge of the Principal Stockholder, there is no information not
contained in the Vibrant SEC Reports which a reasonable investor would consider
material in making an investment decision in a similar situation.
(b) Each of the consolidated financial statements (including, in
each case, any related notes) contained in the Vibrant SEC Reports during the
last three fiscal years, including, without limitation, the audited financial
statements of Vibrant for the year ended December 31, 2003 (the "Vibrant
Financial Statements"), complied as to form in all material respects with the
applicable published rules and regulations of the SEC with respect thereto and
applicable provisions of the Xxxxxxxx-Xxxxx Act of 2002, was prepared in
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accordance with GAAP applied on a consistent basis throughout the periods
involved (except as may be indicated in the notes to such financial statements
or, in the case of unaudited statements, as permitted by Form 10-Q or 8-K
promulgated by the SEC), were accurate and complete in all material respects and
fairly presented the consolidated financial position of Vibrant as at the
respective dates and the consolidated results of its operations and cash flows
for the periods indicated, except that the unaudited interim financial
statements were or are subject to normal and recurring year-end adjustments
which were not or are not expected to be material in amount.
(c) Vibrant and each of its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
(d) There is and has been no failure on the part of Vibrant and any
of its directors or officers, in their capacities as such, to comply in any
material respect with any provision of the Sarbanes Oxley Act of 2002 and the
rules and regulations promulgated in connection therewith, including without
limitation Section 402 related to loans and Sections 302 and 906 related to
certifications.
(e) Vibrant has made available to Optigenex any written reports that
the Vibrant has received from its public accounting firm since January 1, 2002,
regarding critical accounting policies and practices, or alternative treatments
of financial information within GAAP that have been discussed with management of
Vibrant, ramifications of the use of such alternative disclosures and
treatments, and the treatment preferred by such public accounting firm.
4.6 Absence of Change. Since December 31, 2003, there has not been any
material change in the financial condition or operations of Vibrant or any of
its Subsidiaries, except as contemplated by this Agreement.
4.7 Absence of Undisclosed Liabilities. Neither Vibrant nor any of its
Subsidiaries has any material Liability that was not reflected in the Vibrant
Financial Statements or incurred in the ordinary course of business since
December 31, 2003.
4.8 Tax Matters.
(a) Vibrant and each of its Subsidiaries has timely filed all Tax
Returns (as defined below) required to be filed. All such Tax Returns were
correct and complete and have been prepared in compliance in all material
respects with all applicable laws and regulations. All Taxes (as defined below)
owed by Vibrant and each of its Subsidiaries (whether or not shown on any Tax
Return) have been paid. Neither Vibrant nor any of its Subsidiaries currently is
the beneficiary of any extension of time within which to file any Tax Return. No
claim has ever been made by a Governmental Body in a jurisdiction where either
Vibrant or any of its Subsidiaries do not file Tax Returns that they may be
subject to taxation by that jurisdiction. There are no Liens on any of the
assets of either Vibrant or any of its Subsidiaries that arose in connection
with any failure (or alleged failure) to pay any Tax.
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(b) Vibrant and each of its Subsidiaries has withheld and paid all
Taxes required to have been withheld and paid in connection with amounts paid or
owing to any employee, independent contractor, creditor, stockholder or other
Person for whom taxes are required to be withheld and paid for all periods for
which the statutory period of limitations for the assessment of such Tax has not
yet expired and all IRS Forms W-2 and 1099 required with respect thereto have
been properly completed and timely filed.
(c) No foreign, federal, state or local Tax audits or administrative
Tax proceedings are pending or being conducted with respect to Vibrant or any of
its Subsidiaries. Neither Vibrant nor any of its Subsidiaries nor any director
or officer (or employee responsible for Tax matters) of Vibrant or any of its
Subsidiaries has received from any foreign, federal, state or local Taxing
Authority (including jurisdictions where Vibrant and its Subsidiaries have not
filed Tax Returns) any (i) notice indicating an intent to open an audit or other
review; (ii) request for information related to Tax matters; or (iii) notice of
deficiency or proposed adjustment for any amount of Tax proposed, asserted or
assessed by any Taxing Authority (as defined below) against Vibrant or any of
its Subsidiaries.
(d) Schedule 4.8 (i) lists all federal, state, local and foreign Tax
Returns filed with respect to Vibrant or any of its Subsidiaries for taxable
periods ending on or after December 31, 2000; (ii) indicates those Tax Returns
that have been audited; and (iii) indicates those Tax Returns that currently are
the subject of an audit. Correct and complete copies of all material federal,
state, local and foreign income Tax Returns, examination reports, and statements
of deficiencies assessed against, or agreed to by, Vibrant or any of its
Subsidiaries filed or issued since December 31, 2000 have been provided to
Optigenex.
(e) Neither Vibrant nor any of its Subsidiaries have (i) waived any
statute of limitations in respect of any Tax which has continuing effect or (ii)
agreed to any extension of time with respect to a Tax assessment or deficiency
which has not expired.
(f) The unpaid Taxes of Vibrant and its Subsidiaries did not, as of
December 31, 2003, exceed the reserve for Tax liability (rather than any reserve
for deferred Taxes established to reflect timing differences between book and
Tax income) set forth on the face of the Vibrant Financial Statements and (ii)
do not exceed the reserve as adjusted for the passage of time through the
Closing Date in accordance with the past customs and practice of Vibrant and its
Subsidiaries in filing their Tax Returns. Since December 31, 2003, neither
Vibrant nor any of its Subsidiaries have incurred any liability for Taxes
arising from extraordinary gains or losses, as the term is used in GAAP, outside
the ordinary course of business consistent with past custom and practice.
(g) Vibrant and each of its Subsidiaries have disclosed on their
federal income Tax Returns all positions taken therein that could give rise to a
substantial understatement of federal income Tax within the meaning of Section
6662 of the Code.
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(h) Neither Vibrant nor any of its Subsidiaries (i) is or has been a
party to any Tax allocation or sharing agreement or (ii) has been a member of an
Affiliated Group (as defined in Section 1504(a) of the Code) filing a
consolidated federal income Tax Return (other than a group the common parent of
which is Vibrant) or has a liability for Taxes of any person under Treasury
Regulation Section 1.1502-6 (or any similar provision of state, local or foreign
law), as a transferee or successor, by contract or otherwise.
(i) Neither Vibrant nor any of its Subsidiaries has been 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.
(j) There is no contract, agreement, plan or arrangement covering
any persons that, individually or collectively, could give rise to the payment
of any amount that would not be deductible by reason of Section 280G of the
Code, or would constitute compensation in excess of the limitations set forth in
Section 162(m) of the Code.
(k) Neither Vibrant nor any of its Subsidiaries has been the
"distributing corporation" (within the meaning of Section 355(a)(1) of the Code)
nor the "controlled corporation" (within the meaning of Section 355(a)(1) of the
Code) within the two-year period ending as of the date of this Agreement.
(l) Vibrant and each of its Subsidiaries has disclosed to the
Internal Revenue Service on the appropriate Tax Returns any Reportable
Transaction in which it has participated. Vibrant and each of its Subsidiaries
have retained all documents and other records pertaining to any Reportable
Transaction in which it has participated, including documents and other records
listed in Treasury Regulation Section 1.6011-4(g) and any other documents or
other records which are related to any Reportable Transaction in which it has
participated but not listed in Treasury Regulation Section 1.6011-4(g).
(m) Except as provided for on Schedule 4.8, neither Vibrant nor any
of its Subsidiaries will be required to include any item of income in, or
exclude any item of deduction from, taxable income for any taxable period (or
portion thereof) ending after the Closing Date as a result of any: (i) change in
accounting method for a taxable period ending on or prior to the Closing Date
under Section 481(a) of the Code (or any corresponding provision of state, local
or foreign income Tax law); (ii) "closing agreement" as described in Section
7121 of the Code (or any corresponding provision of state, local or foreign
income Tax law); (iii) installment sale or open transaction disposition made on
or prior to the Closing Date; or (iv) prepaid amount received on or prior to the
Closing Date.
(n) For purposes of this Agreement, the following terms shall have
the meanings set forth below:
(i) "Tax" or "Taxes" means any federal, state, local, or
foreign income, gross receipts, windfall profits, severance, property,
production, sales, use, license, excise, franchise, capital, transfer,
employment, withholding, or other tax or similar governmental assessment,
together with any interest, additions, or penalties with respect thereto and any
interest in respect of such additions or penalties.
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(ii) "Taxing Authority" shall mean any Governmental Body
exercising tax regulatory authority.
(iii) "Tax Return" shall mean all returns and reports, amended
returns, information returns, statements, declarations, estimates, schedules,
notices, notifications, forms, elections, certificates or other documents
required to be filed or submitted to any Governmental Body with respect to the
determination, assessment, collection or payment of any Tax or in connection
with the administration, implementation or enforcement of, or compliance with,
any Tax.
4.9 Proprietary Rights. Neither Vibrant nor any of its Subsidiaries has
any patents, trademarks, service marks, trade names, copyrights or any other
intangibles or intellectual property.
4.10 Compliance with Laws. To the best knowledge of the Principal
Stockholder, each of Vibrant and its Subsidiaries has complied with in all
material respects, and is not in violation of, applicable federal, state or
local statutes, laws or regulations, including, without limitation, federal and
state securities laws, applicable to it or to the conduct or operation of its
business or the ownership or use of any of its assets.
4.11 Litigation. Neither Vibrant nor any of its Subsidiaries is a party to
any suit, action, arbitration, or legal, administrative or other proceeding, or
governmental investigation which is pending or, to the best knowledge of the
Principal Stockholder, threatened, against or affecting Vibrant or any of its
Subsidiaries or their respective business, assets or financial condition.
Neither Vibrant nor any of its Subsidiaries is in default with respect to any
order, writ, injunction or decree of any federal, state, local or foreign court,
department, agency or instrumentality applicable to it. Neither Vibrant nor any
of its Subsidiaries is engaged in any material litigation to recover monies due
to it.
4.12 Authority. The respective Boards of Directors of Vibrant and
Acquisition Sub, the sole stockholder of Acquisition Sub and the stockholders of
Vibrant have authorized the execution of this Agreement and the transactions
contemplated herein, and each of Vibrant and Acquisition Sub has full power and
authority to execute, deliver and perform this Agreement, and this Agreement is
the legal, valid and binding obligation of Vibrant and Acquisition Sub, and is
enforceable in accordance with its terms and conditions. The Principal
Stockholder is an individual having all necessary capacity, power and authority
to execute and deliver this Agreement and such other agreements to be executed
and delivered by him pursuant hereto and to consummate the transactions
contemplated hereby and thereby.
4.13 Ability to Carry Out Obligations. The execution and delivery of this
Agreement by Vibrant, Acquisition Sub and the Principal Stockholder
(collectively, the "Vibrant Parties") and the performance by the Vibrant Parties
of their respective obligations hereunder will not cause, constitute or conflict
with or result in (a) any breach or violation of any of the provisions of or
constitute a default under any material license, indenture, mortgage,
instrument, article of incorporation, bylaw or other material agreement or
instrument to which Vibrant or any of its Subsidiaries is a party, or by which
Vibrant or any of its Subsidiaries may be bound, nor will any consents or
authorization of any party other than those hereto be required, (b) an event
that would permit any party to any material agreement or instrument to terminate
it or to accelerate the maturity of any material indebtedness or other material
obligation of Vibrant or any of its Subsidiaries, or (c) an event that would
result in the creation or imposition of any Lien on any asset of Vibrant or any
of its Subsidiaries, other than any breach or violation that would not have a
Vibrant Material Adverse Effect.
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4.14 Full Disclosure. None of the representations and warranties made by
the Vibrant Parties herein, or in any exhibit, certificate or memorandum
furnished or to be furnished by or on behalf of any of them, contains or will
contain any untrue statement of material fact or omit any material fact the
omission of which would be misleading.
4.15 Assets. On the Closing Date, neither Vibrant nor any of its
Subsidiaries shall have any assets, other than Vibrant's ownership of all of the
issued and outstanding capital stock of Acquisition Sub, or Liabilities.
4.16 Material Contracts. Neither Vibrant nor any of its Subsidiaries has
any material contracts or agreements (whether written or oral), except as
described in this Agreement.
4.17 Criminal or Civil Acts. For a period of five years prior to the
execution of this Agreement, no present or former officer, director or principal
stockholder of Vibrant or any of its Subsidiaries has been convicted of a felony
crime, filed for personal bankruptcy, been the subject of a Commission or NASD
judgment or decree, or is currently the subject to an investigation in
connection with any felony crime or Commission or NASD proceeding.
4.18 Personnel and Employee Benefits.
(a) Except as set forth in Schedule 4.18, neither Vibrant nor any of
its Subsidiary maintains or is obligated to contribute to an "employee pension
benefit plan", as such term is defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or "welfare
benefit plan" as such term is defined in Section 3(1) of ERISA.
(b) Each employee pension benefit plan set forth on Schedule 4.18
complies currently and has been maintained in substantial compliance with its
terms and, both as to form and in operation, with all material requirements
prescribed by any and all material statutes, orders, rules and regulations that
are applicable to such plans, including ERISA and the Code.
(c) Each welfare benefit plan set forth on Schedule 4.18 complies
currently and has been maintained in substantial compliance with its terms and,
both as to form and in operation, with all material requirements prescribed by
any and all material statutes, orders, rules and regulations that are applicable
to such plans, including ERISA and the Code. Neither Vibrant nor any of its
Subsidiaries sponsors, maintains, or contributes to any welfare benefit plan
that provides health or death benefits to former employees of Vibrant or any of
its Subsidiaries other than as required by Section 4980B of the Code or other
applicable laws.
(d) With respect to employee benefit plan of Vibrant or any of its
Subsidiaries, Vibrant and/or its Subsidiaries, as the case may be, will have
made, on or before the Closing Date, all payments required to be made by it on
or before the Closing Date and will have accrued (in accordance with GAAP) as of
the Closing Date all payments due but not yet payable as of the Closing Date, so
there will not have been, nor will there be, any Accumulated Funding
Deficiencies (as defined in ERISA or the Code) or waivers of such deficiencies.
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(e) Except as set forth in Schedule 4.18, neither Vibrant nor any of
its Subsidiaries is a party to or subject to any collective bargaining agreement
or written or oral employment agreement with any employee. Except as set forth
in Schedule 4.18, with respect to the employees, Vibrant and each of its
Subsidiaries have complied in all material respects with all laws, rules and
regulations relating to the employment of labor, including those related to
wages, hours, collective bargaining, occupational safety, discrimination, and
the payment of social security and other payroll related taxes, and has not
received any notice alleging that Vibrant or any of its Subsidiaries has failed
to comply with any such laws, rules, or regulations. No proceedings are pending
or overtly threatened between Vibrant or any of its Subsidiaries, on the one
hand, and any employee (singly or collectively), on the other hand. No labor
union or other collective bargaining unit represents or claims to represent any
of the employees. Except as set forth in Schedule 4.18, there is no union
campaign being conducted to solicit cards from any employees to authorize a
union to represent any of the employees of Vibrant or any of its Subsidiaries or
to request a National Labor Relations Board certification election with respect
to any employees.
4.19 Environmental Compliance.
(a) None of Vibrant's or any of its Subsidiaries' respective
properties or assets, nor to the Principal Stockholder's knowledge, Vibrant's
leased premises, contains (x) any asbestos, polychlorinated biphenyls or any PCB
contaminated oil; (y) any Contaminants; and to the Principal Stockholder's
knowledge, such premises is, and always has been, in compliance with applicable
Environmental Laws.
(b) Vibrant and each of its Subsidiaries have obtained all
Governmental Authorizations that are required under all Environmental Laws, and,
to the best knowledge of the Principal Stockholder, Vibrant has no liability,
contingent or otherwise, under or arising from any violation by Vibrant, any of
its Subsidiaries or any third party, of any Environmental Law.
4.20 Insurance. Vibrant and each of its Subsidiaries maintain insurance
coverage with reputable insurers in such amounts and covering such risks as are
in accordance with normal industry practice for companies engaged in businesses
similar to that of Vibrant (taking into account the cost and availability of
such insurance). Schedule 4.20 sets forth a complete listing of all insurance
maintained by Vibrant and any of its Subsidiaries (indicating form of coverage,
name of carrier and broker, coverage limits and premium, whether occurrence or
claims made, expiration dates, deductibles and all endorsements).
4.21 Stock Consideration. The Stock Consideration, when issued, will be
duly authorized and validly issued, fully paid and non-assessable, will be
delivered hereunder free and clear of any and all Liens, except that the Stock
Consideration shall not be registered under the Act or any state securities law
and will be "restricted securities", as such term is defined in the rules and
regulations of the SEC promulgated under the Act, and will be subject to
restrictions on transfers pursuant to such rules and regulations. Vibrant has
reserved an adequate number of shares of Vibrant Common Stock to enable it to
issue the Stock Consideration.
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4.22 Brokers or Finders. Neither Vibrant nor any of its Subsidiaries, nor
any director, officer, agent or employee thereof, has employed any broker or
finder or has incurred or will incur any broker's, finder's or similar fees,
commissions or expenses, in each case in connection with the transactions
contemplated by this Agreement.
ARTICLE V
COVENANTS PRIOR TO THE CLOSING DATE
5.1 Investigative Rights; Confidentiality.
(a) Prior to the Closing Date, each party shall provide to the other
party, and such other party's counsel, accountants, auditors and other
authorized representatives, full access during normal business hours and upon
reasonable advance written notice to all of each party's properties, books,
contracts, commitments and records for the purpose of examining the same. Each
party shall furnish the other party with all information concerning each party's
affairs as the other party may reasonably request.
(b) As used in this Agreement, the term "Confidential Information"
shall mean any and all confidential information of each party (the "Disclosing
Party") to which the other parties and/or its or their representative(s) (the
"Receiving Party") obtains access and any and all information relating to the
business of the disclosing party so designated, other than such information
which can be shown by the disclosing party to be in the public domain (such
information not being deemed to be in the public domain merely because it is
embraced by more general information which is in the public domain) other than
as the result of a breach of the provisions of this Section 5.1(b), including,
but not limited to, information relating to: identity and description of goods
and services used; purchasing; costs; pricing; equipment; technology; research;
test procedures and results; customers and prospects; personnel matters;
business plans and projections; customer or visitor data; marketing; and selling
and servicing. From and after the date hereof, the Receiving Party shall not,
and shall ensure that its representatives do not, at any time, directly or
indirectly, use, communicate, disclose or disseminate any Confidential
Information of the Disclosing Party in any manner whatsoever, except as required
by applicable law.
(c) Conduct of Business by Vibrant. Except as otherwise contemplated
in this Agreement, prior to the Closing Date, Vibrant and its Subsidiaries shall
conduct their respective business in the ordinary course of business. In
addition to and without limiting the foregoing, neither Vibrant nor any of its
Subsidiaries shall, except as contemplated by this Agreement, (i) sell, pledge
or assign any assets without the prior written approval of Optigenex, (ii) amend
its Certificate or Articles of Incorporation or Bylaws, (iii) declare dividends,
redeem or sell stock or other securities, (iv) incur additional or newly-funded
Liabilities, (v) acquire or dispose of fixed assets, (vi) change any employment
terms, enter into any material or long-term contract or guarantee obligations of
any third party, (vii) settle or discharge any balance sheet receivable for less
than its stated amount, (viii) pay more on any liability than its stated amount,
(ix) authorize for issuance, issue, or sell any additional shares of its capital
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stock or issue any securities or obligations convertible or exchangeable into
shares of its capital stock or issue or grant any option, warrant, or other
right to purchase any shares of its capital stock or (x) adopt any change in any
method of accounting or accounting practice, except as contemplated or required
by GAAP. Except as contemplated by this Agreement, prior to the Closing Date,
neither Vibrant nor any of its Subsidiaries shall enter into negotiations with
any third party or complete any transaction with a third party involving the
sale of any of its assets or the exchange of any of its common stock.
5.2 Conduct of Business by Optigenex. Except as contemplated by this
Agreement, prior to the Closing Date, Optigenex shall not enter into
negotiations with any third party or complete any transaction with a third party
involving the sale of substantially all of its assets or the exchange of more
than 50% of its common stock.
5.3 Tax-Free Reorganization. None of the parties hereto shall knowingly
take any action, or knowingly fail to take any action, if such action or failure
to take such action would be reasonably likely to jeopardize the qualification
of the transaction contemplated by this Agreement as a reorganization within the
meaning of Section 368(a) of the Code.
5.4 Consummation of Transaction. Each of the parties hereto hereby agrees
to use its commercially reasonable efforts to cause all conditions precedent to
its obligations (and to the obligations of the other parties hereto to
consummate the transactions contemplated hereby) to be satisfied; provided,
however, that nothing herein contained shall be deemed to modify any of the
absolute obligations imposed upon any of the parties hereto under this Agreement
or any agreement executed and delivered pursuant hereto.
ARTICLE VI
CONDITIONS PRECEDENT TO THE VIBRANT PARTIES' PERFORMANCE
6.1 Conditions. The Vibrant Parties' obligations hereunder shall be
subject to the satisfaction at or before the Closing of all the conditions set
forth in this Article VI. Vibrant may waive any or all of these conditions in
whole or in part without prior notice; provided, however, that no such waiver of
a condition shall constitute a waiver by Vibrant of any other condition of or
any of Vibrant's other rights or remedies, at law or in equity, if Optigenex
shall be in default of any of its representations, warranties or covenants under
this Agreement.
6.2 Accuracy of Representations. Except as otherwise permitted by this
Agreement, all representations and warranties by Optigenex in this Agreement or
in any written statement that shall be delivered to Vibrant by Optigenex under
this Agreement shall be true and accurate in all material respects on and as of
the Closing Date as though made at that time.
6.3 Performance. Optigenex shall have performed, satisfied and complied in
all material respects with all covenants, agreements and conditions required by
this Agreement to be performed or complied with by it on or before the Closing
Date.
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6.4 Absence of Litigation. No action, suit or proceeding before any court
or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or to its consummation, shall have been
instituted or threatened against Optigenex on or before the Closing Date.
6.5 Officer's Certificate. Optigenex shall have delivered to Vibrant a
certificate dated the Closing Date signed by the Chief Executive Officer of
Optigenex certifying that each of the conditions specified in this Article has
been fulfilled and that all of the representations set forth in Article III are
true and correct in all material respects as of the Closing Date.
6.6 Corporate Action. Optigenex shall have obtained the approval of the
Optigenex Stockholders for the transactions contemplated by this Agreement in
accordance with the requirement of the DGCL.
6.7 Private Placement. Prior to the Closing Date, Optigenex shall have
completed a private placement of at least 1,000,000 shares of its common stock
at a purchase price of $3.00 per share (the "Private Placement").
6.8 Opinion of Counsel. Vibrant shall have received an opinion of Blank
Rome LLP, counsel to Optigenex, in the form of Exhibit A annexed hereto.
ARTICLE VII
CONDITIONS PRECEDENT TO OPTIGENEX'S PERFORMANCE
7.1 Conditions. Optigenex's obligations hereunder shall be subject to the
satisfaction at or before the Closing of all the conditions set forth in this
Article VII. Optigenex may waive any or all of these conditions in whole or in
part without prior notice; provided, however, that no such waiver of a condition
shall constitute a waiver by Optigenex of any other condition of or any of
Optigenex's rights or remedies, at law or in equity, if any of the Vibrant
Parties shall be in default of any of its representations, warranties or
covenants under this Agreement.
7.2 Accuracy of Representations. Except as otherwise permitted by this
Agreement, all representations and warranties by the Vibrant Parties in this
Agreement or in any written statement that shall be delivered to Optigenex by
any of the Vibrant Parties under this Agreement shall be true and accurate in
all material respects on and as of the Closing Date as though made at that time.
7.3 Performance. Vibrant shall have performed, satisfied and complied with
all covenants, agreements and conditions required by this Agreement to be
performed or complied with by it in all material respects on or before the
Closing Date.
7.4 Absence of Litigation. No action, suit or proceeding before any court
or any governmental body or authority, pertaining to the transaction
contemplated by this Agreement or to its consummation, shall have been
instituted or threatened against any of the Vibrant Parties on or before the
Closing Date.
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7.5 Officer's Certificate. Each of Vibrant and Acquisition Sub shall have
delivered to Optigenex a certificate dated the Closing Date signed by the Chief
Executive Officer of Vibrant and President of Acquisition Sub certifying that
each of the conditions specified in this Article has been fulfilled and that all
of the representations set forth in Article IV are true and correct in all
material respects as of the Closing Date.
7.6 Directors of Vibrant. On the Closing Date, the Principal Stockholder
shall have resigned as a director of Vibrant and the stockholders of Vibrant
shall have elected each of Xxxxxxx X. Xxxxxxx and Xxxxxxx X. Xxxxxx as directors
of Vibrant.
7.7 Officers of Vibrant. On the Closing Date, the newly constituted Board
of Directors of Vibrant shall elect such officers of Vibrant as they shall
determine.
7.8 Corporate Action. Prior to the Closing Date, Vibrant shall have taken
all necessary corporation action such that on the Closing Date Vibrant shall
have not more than 564,882 shares of capital stock outstanding on a fully
diluted basis before giving effect to the issuance of the Stock Consideration.
7.9 Divestiture of Assets and Current Operations. On or before the Closing
Date, Vibrant shall have divested all of its assets (subject to the provisions
of Section 11.4 hereof), Liabilities and operations (including, without
limitation, all of the issued and outstanding capital stock of Vibrant Health,
Inc.) by the sale of such assets and operations to the Principal Stockholder,
its sole officer and director, in accordance with the provisions of the Asset
Purchase Agreement attached hereto as Exhibit B (the "Divestiture Agreement").
In exchange for acquiring such assets and operations, the Principal Stockholder
shall convey to Vibrant for retirement a total of 3,417,560 shares of his
Vibrant Common Stock and shall assume all of Vibrant's Liabilities, such that as
of the Closing Date Vibrant shall have no assets and no Liabilities.
7.10 Opinion of Counsel. Optigenex shall have received an opinion of Xxxx
X. Agron, counsel to the Vibrant Parties, in the form of Exhibit C annexed
hereto (the "Agron Opinion").
ARTICLE VIII
CLOSING
8.1 Closing. The Closing of this Agreement shall be held at the offices
of Blank Rome LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at any
mutually agreeable time on the second business day following the
satisfaction or waiver of all conditions to the obligations of the parties
hereto to consummate the transactions contemplated by this Agreement (the
"Closing Date"), unless extended by mutual agreement. At the Closing:
(a) Vibrant shall deliver to Optigenex the Stock Consideration;
(b) Each of Vibrant and Acquisition Sub shall deliver to Optigenex (i)
the officer's certificate described in Section 7.5, (ii) a signed
consent and/or minutes of its directors and shareholders approving
this Agreement and each matter to be approved under this Agreement,
(iii) the Agron Opinion, (iv) evidence of the retirement of
3,417,560 shares of Vibrant Common Stock in accordance with the
provisions of Section 7.9 hereof and (v) such other documents as are
listed in this Agreement or as are reasonably requested by Optigenex
or its counsel for complete implementation of this Agreement and
consummation of the transaction contemplated hereby; and
(c) Optigenex shall deliver to Vibrant (i) the officer's certificate
described in Section 6.5, (ii) a signed consent and/or minutes of
its shareholders and directors approving this Agreement and each
matter to be approved under this Agreement, (iii) the Blank Rome
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Opinion, (iv) a xxxx of sale and assignment with respect to the
Purchased Assets, (v) an assignment and assumption agreement with
respect to the Assumed Liabilities and (vi) such other documents as
are listed in this Agreement or as are reasonably requested by the
Vibrant Parties or their counsel for complete implementation of this
Agreement and consummation of the transaction contemplated hereby.
ARTICLE IX
Termination
9.1 Termination by Mutual Consent. This Agreement may be terminated at any
time prior to Closing by the mutual consent of Vibrant and Optigenex.
9.2 Other Termination. This Agreement may be terminated by any party
hereto if any other party hereto (the Vibrant Parties, on the one hand, and
Optigenex, on the other hand) shall have failed to satisfy any of its respective
conditions precedent under Article VI or Article VII hereof, as the case may be
(unless such failure results primarily from the terminating party's breach of
any representation, warranty or covenant contained in this Agreement or under
any other agreement contemplated hereunder), or the Closing shall not have
occurred, on or before August 1, 2004.
9.3 Termination by Vibrant. Vibrant may terminate this Agreement by giving
written notice to Optigenex at any time prior to the Closing in the event
Optigenex has breached any representation, warranty or covenant contained in
this Agreement in any material respect, Vibrant has notified Optigenex of such
breach and such breach has continued without cure for a period of 10 business
days after the notice of such breach.
9.4 Termination by Optigenex. Optigenex may terminate this Agreement by
giving written notice to Vibrant at any time prior to the Closing in the event
the Vibrant Parties have breached any representation, warranty or covenant
contained in this Agreement in any material respect, Optigenex has notified
Vibrant of such breach and such breach has continued without cure for a period
of 10 business days after the notice of breach.
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ARTICLE X
SURVIVAL; INDEMNIFICATION
10.1 Survival. All representations and warranties of Optigenex and the
Vibrant Parties contained in or made pursuant to this Agreement or in any
certificate furnished pursuant hereto shall survive the Effective Time for a
period of six months. Notwithstanding anything in this Agreement to the
contrary, the provisions of Section 5.1(b) (Confidentiality), Section 12.11
(Announcements) and Section 12.12 (Expenses) shall survive the termination of
this Agreement and the provisions of Section 10.2(b)(iii) hereof shall survive
the Effective Time.
10.2 Indemnification.
(a) Indemnification by Optigenex.
(i) Optigenex hereby indemnifies and agrees to defend and hold
harmless Vibrant from and against any and all losses, obligations, deficiencies,
liabilities, claims, damages, costs and expenses (including, without limitation,
the amount of any settlement entered into pursuant hereto, and all reasonable
legal and other expenses incurred in connection with the investigation,
prosecution or defense of any matter indemnified pursuant hereto) (collectively,
the "LOSSES") which it may sustain, suffer or incur and which arises out of, are
caused by, relate to, or result or occur from or in connection any
misrepresentation of a material fact contained in any representation of
Optigenex contained in, or the breach by Optigenex of any warranty or covenant
made by it in this Agreement. The foregoing indemnification shall also apply to
direct claims by Vibrant against Optigenex.
(b) Indemnification by the Principal Stockholder. The Principal
Stockholder indemnifies and agrees to defend and hold harmless Acquisition Sub
from and against any and all Losses, which it may sustain, suffer or incur and
which arise out of, are caused by, relate to, or result or occur from or in
connection with (i) any misrepresentation of a material fact contained in any
representation of any of the Vibrant Parties contained herein or in the
Divestiture Agreement, (ii) the breach by any of the Vibrant Parties of any
warranty or covenant made by any or all of them herein or therein or (iii) any
Liabilities of Vibrant or any of its Subsidiaries arising or accruing prior to
the Effective Time, which Liabilities shall be assumed by the Principal
Stockholder pursuant to the provisions of the Divestiture Agreement (the
"Divested Liabilities"). The foregoing indemnification shall also apply to
direct claims by Acquisition Sub against Vibrant or the Principal Stockholder.
(c) Third-Party Claims. If a claim by a third party is made against
any party or parties hereto and the party or parties against whom said claim is
made intends to seek indemnification with respect thereto under Sections 10.2(a)
or 10.2(b), the party or parties seeking such indemnification shall promptly
notify the indemnifying party or parties, in writing, of such claim; provided,
however, that the failure to give such notice shall not affect the rights of the
indemnified party or parties hereunder except to the extent that such failure
materially and adversely affects the indemnifying party or parties due to the
inability to timely defend such action. The indemnifying party or parties shall
have ten (10) business days after said notice is given to elect, by written
notice given to the indemnified party or parties, to undertake, conduct and
control, through counsel of their own choosing (subject to the consent of the
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indemnified party or parties, such consent not to be unreasonably withheld) and
at their sole risk and expense, the good faith settlement or defense of such
claim, and the indemnified party or parties shall cooperate with the
indemnifying parties in connection therewith; provided: (a) all settlements
require the prior reasonable consultation with the indemnified party and the
prior written consent of the indemnified party, which consent shall not be
unreasonably withheld, and (b) the indemnified party or parties shall be
entitled to participate in such settlement or defense through counsel chosen by
the indemnified party or parties, provided that the fees and expenses of such
counsel shall be borne by the indemnified party or parties. So long as the
indemnifying party or parties are contesting any such claim in good faith, the
indemnified party or parties shall not pay or settle any such claim; provided,
however, that notwithstanding the foregoing, the indemnified party or parties
shall have the right to pay or settle any such claim at any time, provided that
in such event they shall waive any right of indemnification therefor by the
indemnifying party or parties. If the indemnifying party or parties do not make
a timely election to undertake the good faith defense or settlement of the claim
as aforesaid, or if the indemnifying parties fail to proceed with the good faith
defense or settlement of the matter after making such election, then, in either
such event, the indemnified party or parties shall have the right to contest,
settle or compromise (provided that all settlements or compromises require the
prior reasonable consultation with the indemnifying party and the prior written
consent of the indemnifying party, which consent shall not be unreasonably
withheld) the claim at their exclusive discretion, at the risk and expense of
the indemnifying parties.
(d) Assistance. Regardless of which party is controlling the defense
of any claim, each party shall act in good faith and shall provide reasonable
documents and cooperation to the party handling the defense.
10.3 Limitations on Indemnification. Notwithstanding anything contained in
this Agreement to the contrary, Optigenex's and the Principal Stockholder's
respective aggregate liability for indemnity under this Section 10.3 shall be
limited to an amount equal to the product of (x) the number of shares of Vibrant
capital stock outstanding immediately prior to the Closing. hereof multiplied by
(y) $3.00; provided, however, that this Section 10.3 shall not apply with
respect to claims based upon any Losses arising out of or relating to the
Divested Liabilities.
ARTICLE XI
POST CLOSING COVENANTS
11.1 Liquidation of Optigenex. Following the Closing, Optigenex shall
adopt a plan of liquidation pursuant to which it shall satisfy all of its
outstanding liabilities and liquidate in accordance with the Delaware General
Corporation Law.
11.2 Reincorporation in Delaware. Following the Closing, Vibrant shall
reincorporate in Delaware through a merger of Vibrant with and into a newly
created wholly-owned subsidiary of Vibrant incorporated in Delaware.
11.3 Options and Warrants. Following the Closing, Vibrant shall issue the
Substitute Options and Substitute Warrants in accordance with the provisions of
Section 1.5.
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11.4 Use of the Name "Vibrant". The Principal Stockholder, on behalf
of himself and his affiliates, hereby grants to Vibrant, as of the Closing
Date, all of the Principal Stockholder's intellectual property rights, title
and interest in and to the trade name, trademark and service xxxx "Vibrant"
and any derivatives thereof (other than the name "Vibrant Health"), whether
or not registered. Following the closing, the Principal Stockholder shall
not, directly or indirectly, use the name "Vibrant" or any derivative
thereof; provided, however, the Principal Stockholder may continue to use
the name "Vibrant Health" in connection with Vibrant Health, Inc.'s business
after the Closing.
ARTICLE XII
MISCELLANEOUS
12.1 Captions and Headings. The article and paragraph headings throughout
this Agreement are for convenience and reference only and shall not define,
limit or add to the meaning of any provision of this Agreement.
12.2 No Oral Change. This Agreement and any provision hereof may not be
waived, changed, modified or discharged orally, but only by an agreement in
writing signed by the party against whom enforcement of any such waiver, change,
modification or discharge is sought.
12.3 Non-Waiver. The failure of any party to insist in any one or more
cases upon the performance of any of the provisions, covenants or conditions of
this Agreement or to exercise any option herein contained shall not be construed
as a waiver or relinquishment for the future of any such provisions, covenants
or conditions. No waiver by any party of one breach by another party shall be
construed as a waiver with respect to any other subsequent breach.
12.4 Time of Essence. Time is of the essence of this Agreement and of each
and every provision hereof.
12.5 Entire Agreement. This Agreement contains the entire Agreement and
understanding between the parties hereto and supersedes all prior agreements and
understandings.
12.6 Choice of Law. This Agreement and its application shall be governed
by the laws of the state of New York.
12.7 Counterparts. This Agreement may be executed simultaneously in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
12.8 Notices. All notices, requests, demands and other communications
under this Agreement shall be in writing and shall be deemed to have been duly
given on the date of service if served personally on the party to whom notice is
to be given, or on the third day after mailing if mailed to the party to whom
notice is to be given, by first class mail, registered or certified, postage
prepaid, and properly addressed as follows:
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Vibrant or Acquisition Sub:
Vibrant Health International
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxxx Xxxxxxx, XX 00000
Attn: Xxxxxx X. XxXxxx, President
With a copy to:
Xxxx X. Agron, Esq.
0000 XXX Xxxx., Xxxxx 000
Xxxxxxxxx Xxxxxxx, XX 00000
Optigenex:
Optigenex Inc.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, President
with a copy to:
Blank Rome LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx Esq.
12.9 Binding Effect. This Agreement shall inure to and be binding upon the
heirs, executors, personal representatives, successors and assigns of each of
the parties to this Agreement.
12.10 Mutual Cooperation. The parties hereto shall cooperate with each
other to achieve the purpose of this Agreement and shall execute such other and
further documents and take such other and further actions as may be necessary or
convenient to effect the transaction described herein.
12.11 Announcements. The parties will consult and cooperate with each
other as to the timing and content of any public announcements regarding this
Agreement.
12.12 Expenses. Optigenex, on the one hand, and the Principal Stockholder
(on behalf of the Vibrant Parties), on the other hand, shall bear its own
expenses incurred in connection with this Agreement and the transactions
contemplated hereby.
12.13 Exhibits. As of the execution hereof, the parties have provided each
other with the Exhibits described herein. Any material changes to the Exhibits
shall be immediately disclosed to the other party.
12.14 Legal Counsel. Each of the parties has been represented by its own
legal counsel.
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In witness whereof, the parties have executed this Agreement on the date
indicated above.
VIBRANT HEALTH INTERNATIONAL OPTIGENEX INC.
By: /s/ Xxxxxx X. XxXxxx By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------- --------------------------------
Xxxxxx X. XxXxxx, President Xxxxxxx X. Xxxxxx, President
OPTIGENEX ACQUISITION CORP.
By: /s/ Xxxxxx X. XxXxxx
----------------------------------
Xxxxxx X. XxXxxx, President
/s/ Xxxxxx X. XxXxxx
----------------------------------
Xxxxxx X. XxXxxx, individually
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