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EXHIBIT 10.133
ASSET PURCHASE AND SALE AGREEMENT
among
ECOGEN INC.,
ECOGEN-BIO INC.
and
SCENTRY BIOLOGICALS, INC.
April 28, 1998
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ASSET PURCHASE AND SALE AGREEMENT
This Asset Purchase and Sale Agreement ("Agreement") is dated as
of April 28, 1998 by and among Ecogen Inc., a Delaware corporation
("Ecogen"), Ecogen-Bio Inc., a Delaware corporation ("Ecogen-Bio"), and
Scentry Biologicals, Inc., a Delaware corporation ("Purchaser"). Ecogen and
Ecogen-Bio are hereinafter collectively referred to as "Seller".
Seller is engaged, among other things, in the business of
developing, manufacturing and selling agricultural pest control products
based upon pheromone, honeybee attractant, insect trap and lure, and insect
feeding stimulant technologies (the "Business"). Seller desires to sell to
Purchaser, and Purchaser desires to purchase from Seller, certain of the
assets of Seller that are primarily used in the conduct of the Business.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties, intending to be legally bound, agree
as follows:
ARTICLE I
PURCHASE AND SALE OF ASSETS
1.1 Purchase and Sale. Upon the terms and subject to the
conditions of this Agreement, on the Closing Date (as defined in Section 2.1)
Seller shall sell, assign, transfer, convey and deliver, or caused to be
sold, assigned, transferred, conveyed and delivered, to Purchaser, and
Purchaser shall purchase and accept, the Acquired Assets (as defined in
Section 1.2).
1.2 Acquired Assets. "Acquired Assets" means, subject to
Section 1.3, the following properties, assets and rights of Seller, to the
extent they are in existence on the Closing Date and primarily used in
connection with the Business:
(a) All raw materials (including packaging materials),
works-in-process and finished goods inventories of the Business in
existence as of the Closing Date (the "Closing Date Inventory"). A
list of such inventory as of January 31, 1998 (the "Base Inventory") is
set forth in Schedule 1.2(a);
(b) All customer lists, supplier list, customer records,
advertising and promotional literature of the Business (collectively,
the "Marketing Assets"); provided, however, Seller may retain copies of
existing promotional literature relating to BeeScent Attractant,
NoMate BHF or NoMate LRX.
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(c) All U.S. and foreign patents, trademarks and trade
names identified in Schedule 1.2(c) (the "Intangible Assets");
(d) All fixed assets, production and processing
equipment, warehouse equipment, computer hardware, furniture and
fixtures, transportation equipment and supplies of the Business
identified in Schedule 1.2(d);
(e) All transferable rights relating to the Business
under the contracts, leases and other agreements identified in Schedule
1.2(e) (the "Contracts");
(f) All transferable rights under all customer orders in
existence as of the Closing Date (the "Customer Orders"); and
(g) All transferable rights to the U.S. and foreign
product registrations identified in Schedule 1.2(g) (the "Product
Registrations") and all records and other documentation relating
thereto.
1.3 Excluded Assets. Notwithstanding anything in this
Agreement to the contrary, the Acquired Assets shall not include the
following:
(a) Cash, cash equivalents, bank deposits, trade
receivables and other accounts receivable including, but not limited
to, the items identified on Schedule 1.3(a);
(b) The packaging equipment, ribbon blender, inventory
and other items located at the Business facility in Billings, Montana
but not used primarily in the Business which are listed in Schedule
1.3(b) (the "Non-Business Assets"); and
(c) All rights to the trade name or trademark "Ecogen".
1.4 Assumption of Obligations. Purchaser shall assume and
timely pay, perform and satisfy the liabilities identified below. For
purposes of this Agreement, the term "Assumed Liabilities" shall mean the
liabilities identified in Paragraphs 1.4(a) and 1.4(b), as such liabilities
exist on the Closing Date and the term "Estimated Assumed Liabilities" shall
mean the liabilities identified in Paragraphs 1.4(a) and 1.4(b) as such
liabilities exist on April 10, 1998. Notwithstanding anything herein to the
contrary, except to the extent specifically provided in this Agreement,
Purchaser shall not assume and shall not be liable for any claims,
obligations or liabilities of Seller, Seller's affiliates or the Business of
any nature whatsoever, relating to the period prior to Closing, all of which
shall be retained by Seller.
(a) All trade accounts payable arising in the ordinary
course of business of the Business prior to Closing and reflected on
the books and records
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of the Business as of the Closing Date that are payable to vendors or
suppliers providing services or materials to Ecogen that relate solely to
the Business. A list of all such trade accounts as of April 28, 1998 is
set forth in Schedule 1.4(a);
(b) All customer promotion allowances, royalties and
other obligations which were incurred in the ordinary course of
business of the Business prior to Closing and are reflected on the
books and records of the Business as of the Closing Date. A list of
all such allowances, royalties and obligations as of April 28, 1998 is
set forth in Schedule 1.4(b);
(c) All liabilities and obligations relating to the
Customer Orders; and
(d) All liabilities and obligations relating to the
Contracts not due and payable prior to the Closing Date.
1.5 Payment at Closing. In consideration for the Acquired
Assets and the covenants of Seller contained in this Agreement, Purchaser
shall pay to Seller at the Closing by wire transfer of immediately available
funds to an account designated by Seller the amount of $2,400,000 less the
amount of the Estimated Assumed Liabilities.
1.6 Adjustment to the Amount of Assumed Liabilities. Within
seven days after the Closing, Purchaser will deliver to Seller a proposed
reconciliation between the Estimated Assumed Liabilities and the Assumed
Liabilities proposed by Purchaser. Purchaser and Seller shall then cooperate
to promptly determine the actual amount of Assumed Liabilities. The
difference between the Estimated Assumed Liabilities and the Assumed
Liabilities shall be paid by Seller to Purchaser or by Purchaser to Seller
(as appropriate) by check delivered to the recipient thereof within seven
days after the determination of such difference.
1.7 Inventory Adjustment. The purchase price paid at Closing
shall be adjusted on a dollar-for-dollar basis to reflect the change in the
physical count between the Base Inventory and the Closing Date Inventory.
For purposes of this Agreement, the dollar value of the Base Inventory is
deemed to be $2,292,633 (the "Base Inventory Amount"). In the event that the
Closing Date Inventory Amount (as defined below) is greater than the Base
Inventory Amount, Purchaser, within five days after the determination of the
Closing Date Inventory Amount, shall pay to Seller the difference between the
Closing Date Inventory Amount and the Base Inventory Amount by wire transfer
of immediately available funds to an account designated by Seller. In the
event that the Closing Date Inventory Amount is less than the Base Inventory
Amount, Seller, within five days after the determination of the Closing Date
Inventory Amount, shall pay Purchaser the difference between the Base
Inventory Amount and the Closing Date Inventory Amount by wire transfer of
immediately available funds to an account designated by Purchaser.
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The Closing Date Inventory Amount shall be determined by the
parties as soon as practicable after the Closing. The Closing Date Inventory
Amount shall be based on a physical count of inventory actually existing as
of the Closing and such inventory shall be valued at the various specific
cost factors used to determine the Base Inventory Amount being set forth in
Schedule 1.2(a). There shall be no consideration of the salability,
obsolescence or other factors upon which an inventory reserve may be
calculated. The Closing Date Inventory Amount shall be based solely on the
existence of inventory items as of the Closing valued at the same specific
cost factor used to determine the Base Inventory Amount.
Within five days after the Closing Date one or more
representatives of Purchaser and one or more representatives of Seller shall
together conduct a physical count of the existence of inventory as of the
Closing. Within three days after the conclusion of such physical count,
Seller shall deliver to Purchaser a proposed reconciliation between the Base
Inventory Amount and the Closing Date Inventory Amount. Purchaser and Seller
shall then cooperate to promptly determine the Closing Date Inventory Amount
which shall be calculated by multiplying the number of units of each
inventory item in existence as of the Closing by the specific cost factor
used for such inventory item in determining the Base Inventory Amount.
1.8 NO WARRANTIES. NOTWITHSTANDING ANYTHING CONTAINED IN ANY
PROVISION OF THIS AGREEMENT TO THE CONTRARY, IT IS THE EXPLICIT INTENT OF
EACH PARTY HERETO THAT SELLER IS NOT MAKING ANY REPRESENTATION OR WARRANTY
WHATSOEVER, EXPRESS OR IMPLIED, BEYOND THOSE EXPRESSLY GIVEN IN THIS
AGREEMENT, INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED WARRANTY OR
REPRESENTATION AS TO THE CONDITION, MERCHANTABILITY, FITNESS FOR PARTICULAR
PURPOSE OR SUITABILITY AS TO ANY OF THE ACQUIRED ASSETS. THE ACQUIRED ASSETS
ARE BEING SOLD, CONVEYED, TRANSFERRED OR ASSIGNED BY SELLER AND ARE BEING
PURCHASED AND ACCEPTED BY PURCHASER ON AN "AS IS, WHERE IS" BASIS.
ARTICLE II
THE CLOSING
2.1 Closing Date. The closing of the transactions contemplated
by this Agreement (the "Closing") shall take place at the offices of
McDonald, Hopkins, ▇▇▇▇▇ & ▇▇▇▇▇, Cleveland, Ohio at 10:00 a.m., local time,
on April 30, 1998 or at such other time, date and place as shall be agreed in
writing by the parties hereto (such date of the Closing being hereinafter
referred to as the "Closing Date").
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2.2 Procedures at Closing. At the Closing, the parties agree to
take the following actions in the order listed below (provided, however, that
upon their completion all such actions shall be deemed to have occurred
simultaneously):
(a) Seller shall deliver to Purchaser the certificate
required by Section 6.1;
(b) Purchaser shall deliver to Seller the certificate
required by Section 6.2;
(c) Purchaser shall transfer the funds as required by
Section 1.5 and Seller shall receive such funds;
(d) Seller shall deliver to Purchaser a duly executed
▇▇▇▇ of Sale and Assignment, substantially in the form of Exhibit A;
(e) Purchaser and Seller shall each execute and deliver
to the other the Assumption Agreement substantially in the form of
Exhibit B;
(f) Purchaser and Ecogen shall each execute and deliver
to the other the Distribution Agreement substantially in the form of
Exhibit C; and
(g) Purchaser and Ecogen shall each execute and deliver
the Ancillary Agreement substantially in the form of Exhibit D and
shall take the actions required by the Ancillary Agreement to be
performed at the Closing.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Representations and Warranties of the Seller. Seller represents
and warrants to the Purchaser as follows:.
3.1 Corporate Organization. Each Seller is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation.
3.2 Authorization. Each Seller has full corporate power and
authority to execute, deliver and perform this Agreement and the other
documents delivered in connection with this Agreement, to sell, transfer,
convey and assign the Acquired Assets to Purchaser, to execute, deliver and
perform the Distribution Agreement and to consummate the other transactions
contemplated hereby. This Agreement and the other documents delivered in
connection with this Agreement, have been duly and
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validly executed and delivered by Seller, and this Agreement constitutes a valid
and binding agreement of Seller enforceable against Seller in accordance with
its terms.
3.3 No Violations. Except with respect to the contracts,
leases and agreements identified in Schedule 3.3 for which the approval of a
party to such contract, lease or agreement may be required for the transfer
to Purchaser of Seller's rights under such contracts, leases and other
agreements, the execution, delivery and performance of this Agreement by
Seller and the consummation by Seller of the transactions contemplated hereby
do not and will not (i) conflict with or violate any provision of the
Certificate of Incorporation or By-laws of Seller; (ii) conflict with or
violate any statute, ordinance, rule, regulation, order or decree of any
court or of any public, governmental or regulatory body, agency or authority
applicable to Seller or by which any of its properties or assets may be
bound; (iii) conflict with, result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give rise
to any right of termination, cancellation or acceleration) under any of the
terms, conditions or provisions of any material note, bond, mortgage,
indenture, license, agreement or other instrument or obligation to which
Seller is a party or by which Seller or any of its properties or assets may
be bound, excluding from the foregoing conflicts, violations, breaches and
defaults which, individually and in the aggregate, would not have a material
adverse effect on Seller or on the Business or on the ability of Seller to
perform its obligations hereunder or consummate the transactions contemplated
hereby.
3.4 Ownership Interests. Except with respect to the Intangible
Assets and the Contracts, Seller owns the Acquired Assets, free and clear of
all liens, charges, encumbrances, security interests, options, restrictions
on rights of disposition and claims or third party rights, other than as
described in Schedule 3.4.
3.5 Brokers or Finders. Seller represents that no agent,
broker, investment banker or other firm or person has been retained by Seller
or any affiliate of Seller in connection with any of the transactions
contemplated by this Agreement.
3.6 Litigation. To the Best Knowledge of Seller, there is no
pending litigation, proceeding or governmental investigation to which Seller
is a party that questions the validity or enforceability of the transactions
contemplated by this Agreement, or which would have a material adverse effect
on the Business.
3.7 Intangible Assets. Except as described in Schedule 3.7 and
to the Best Knowledge of Seller, Seller has the right to use the Intangible
Assets, free and clear of all liens, security interests, encumbrances and
other adverse claims. Except as described in Schedule 3.7, Seller has received
no written notice from any third party claiming an interest in the Intangible
Assets. To the Best Knowledge of Seller, all issued patents and registered
trademarks listed in Schedule 3.7 have been validly issued and are in full force
and effect. Except as described in Schedule 3.7, there have not been nor are
there presently pending any claims, actions or judicial or other adversarial
proceedings to which Seller is a party concerning the Intangible Assets. To
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the Best Knowledge of Seller, except as described in Schedule 3.7, Seller's use
of the Intangible Assets has not and does not conflict with, infringe upon, or
violate any patent or other proprietary or intellectual property right of any
other person, and, to the Best Knowledge of Seller, Seller in operating the
Business has not infringed and is not now infringing any patent or other
proprietary right belonging to any other person.
3.8 Taxes. Seller has prepared in compliance with all
applicable laws and duly and timely filed or caused to be filed all material
tax returns and reports relating to the Business and required to be filed by
it with any governmental authority. All material taxes (including, without
limitation, any and all interest and penalties) owed to any governmental
authority by Seller for a period covered by such returns and reports, and all
claims, demands, assessments, judgment, costs and expenses connected
therewith, have been duly and timely paid in full. Seller has duly and
timely paid in full all estimated tax payments and tax deposits. Nether
Seller nor any person on behalf of Seller has executed or filed with any
governmental authority any agreement extending the period for assessment or
collection of any taxes.
3.9 Customers of the Business. Except as set forth in Schedule
3.9, to the Best Knowledge of Seller, Seller has not received, since October
31, 1996, written notice from any customer of the Business accounting for at
least ten percent of the aggregate annual sales revenue of the Business, that
such customer will not continue to be a customer of the Business.
3.10 Regulatory Compliance. Except as set forth in Schedule
3.10, to the Best Knowledge of Seller, Seller has not received, within the
last twelve months prior to the date of this Agreement, written notice from
any governmental authority that the Business has been or is now being
conducted in violation of any applicable law, regulation or order, which
violation would have a material adverse effect on the Business.
3.11 Environmental Compliance. Except as set forth in Schedule
3.11, to the Best Knowledge of Seller, Seller has not received, within the
last twelve months prior to the date of this Agreement, written notice from
any governmental authority that the Business has been or is now being
conducted in violation of any applicable environmental, land use or zoning
law, regulation or order which violation would have a material adverse effect
on the Business.
3.12 Employee Benefits. Except as set forth in Schedule 3.12,
the employee benefits that have been authorized by Seller that are available
as of the date of this Agreement to employees of the Business are set forth
in Seller's Human Resources Policies and Procedures Employee Handbook, a copy
of which has been provided to Purchaser.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to Seller as follows:
4.1 Corporate Organization. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation.
4.2 Authorization. Purchaser has full corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Purchaser and this Agreement constitutes the valid
and binding agreement of Purchaser enforceable against Purchaser in
accordance with its terms.
4.3 No Violations. The execution, delivery and performance of
this Agreement by Purchaser, and the consummation of the transactions
contemplated hereby, do not and will not (i) conflict with or violate any
provision of Purchaser's Certificate of Incorporation or its By-Laws;
(ii) conflict with or violate any statute, ordinance, rule, regulation, order
or decree of any court or of any public, governmental or regulatory body,
agency or authority applicable to Purchaser or by which any of its respective
properties or assets may be bound; or (iii) conflict with, result in a
violation or breach of, or constitute (with or without due notice or lapse of
time or both) a default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms, conditions or
provisions of any material note, bond, mortgage, indenture, license,
agreement or other instrument or obligation to which Purchaser is a party, or
by which it or any of its properties or assets may be bound, excluding from
the foregoing clauses conflicts, violations, breaches and defaults which,
individually and in the aggregate, would not have a material adverse effect
on Purchaser or on the ability of Purchaser to perform its obligations
hereunder or consummate the transactions contemplated hereby.
4.4 Brokers or Finders. Purchaser represents that, except for
▇▇▇▇ & Company whose fees and commissions will be the exclusive
responsibility of Purchaser, no agent, broker, investment banker or other
firm or person is or will be entitled to any broker's or finder's fee or any
other commission or similar fee in connection with any of the transactions
contemplated by this Agreement as a result of any action of Purchaser.
4.5 Litigation. Purchaser has no knowledge of any pending
litigation, proceeding or governmental investigation to which Purchaser is a
party that questions the validity or enforceability of the transactions
contemplated by this Agreement, or which would have a material adverse effect
on the Business.
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ARTICLE V
COVENANTS PENDING CLOSING
5.1 Covenants of Seller. Seller covenants and agree that,
except as otherwise consented to by Purchaser, prior to the Closing:
(a) Seller shall carry on the Business and operate or use
the Acquired Assets in the ordinary course of business or consistent
with past practices;
(b) Seller shall use all reasonable efforts to cause the
conditions specified in Section 6.2 to be satisfied as soon as
practicable;
(c) Seller shall provide Purchaser, upon reasonable
notice and at reasonable times, access to the properties and operations
of the Business at the Business Facilities, provided, however, such
access shall not disrupt the day-to-day operations of the Business;
(d) From time to time prior to the Closing, Seller shall
deliver to Purchaser information concerning events subsequent to the
date of this Agreement to supplement the Schedules hereto, in order to
keep such information therein timely, complete and accurate and any
covenant, representation or warranty affected thereby shall be deemed
amended accordingly; and
(e) Seller shall, promptly upon Purchaser's request,
provide Purchaser with such information and documentation concerning
Seller as may be reasonably necessary for Purchaser to verify Seller's
performance of and compliance with the representations, warranties,
covenants and conditions made by Seller pursuant to this Agreement.
5.2 Covenants of Purchaser. Purchaser covenants and agrees
that, except as otherwise consented to by Seller, prior to the Closing:
(a) Purchaser shall use all reasonable efforts to cause
the conditions specified in Section 6.1 to be satisfied as soon as
practicable;
(b) Promptly upon the execution and delivery of this
Agreement by the parties, Purchaser shall offer employment to each of
the employees of Seller identified on Schedule 5.2(b) (the "Business
Employees") by delivering to each Business Employee a written offer of
employment as of the Closing Date substantially in the form attached
hereto as Exhibit E, at no less than such Business Employee's base rate
of compensation, with comparable
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benefits, taken as a whole, to those provided by Seller. Purchaser shall
recognize and credit for the benefit of each Business Employee, such
employee's accrued and unused vacation and other benefits. Seller shall
have the right to review and approve the form of written offers of
employment to the Business Employees. Effective as of the Closing Date,
Seller shall cease to employ, and Seller shall cease to provide, any
employee benefits or compensation to the Business Employees;
(c) Purchaser shall, promptly upon Seller's request,
provide Seller with such information and documentation concerning
Purchaser as may be reasonably necessary for Seller to verify
Purchaser's performance of and compliance with the representations,
warranties, covenants and conditions made by Purchaser pursuant to this
Agreement;
(d) Purchaser shall prior to the Closing cause Marketing
Arm International, Inc. to fully pay to Seller all amounts owed to
Seller for products of the Business delivered to Marketing Arm
International, Inc. prior to the Closing and Purchaser shall prior to
the Closing cause Marketing Arm International, Inc. to agree to
terminate and to release Seller from any liabilities and obligations
under the Distributor Agreement between Marketing Arm International,
Inc. and Seller dated as of April 12, 1994.
(e) Purchaser shall prior to the Closing cause
Yellowstone Resources to agree to terminate and to release Seller from
any liabilities and obligations under the Lease between Yellowstone
Resources and Seller dated September 16, 1992 as amended.
ARTICLE VI
CONDITIONS TO CLOSING
6.1 Conditions to Seller's Obligation to Close. The obligation
of Seller to effect the Closing hereunder is subject to the satisfaction, at
or prior to the Closing, of all of the following conditions (each of which is
for the sole benefit of Seller and may be waived by Seller in its sole
discretion):
(a) The representations and warranties of Purchaser set
forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date as
though made again on and as of the Closing Date, and Seller shall have
received a certificate signed by an authorized representative of
Purchaser to such effect.
(b) Purchaser shall have performed all covenants and
obligations required to be performed by it under this Agreement at or
prior to
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the Closing Date, and Seller shall have received a certificate signed by
an authorized representative of Purchaser to such effect.
(c) All products and other items to be delivered under
Contract No. 536395646 and Contract No. 546395737 (collectively, the
"Designated USDA Contracts") between Seller and the United States
Department of Agriculture ("USDA") have been shipped to the USDA and
Purchaser shall have delivered to Seller a letter (reasonably
acceptable to Seller) representing to Seller that the products and
other items shipped to the USDA meet or exceed the specifications and
other requirements of the Designated USDA Contracts and of the USDA.
6.2 Conditions to Purchaser's Obligation to Close. The
obligation of Purchaser to effect the Closing hereunder is subject to the
satisfaction, at or prior to the Closing, of all of the following conditions
(each of which is for the sole benefit of Purchaser and may be waived by
Purchaser in its sole discretion):
(a) The representations and warranties of Seller set
forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date as
though made again on and as of the Closing Date, and Purchaser shall
have received a certificate signed by an authorized representative of
Seller to such effect.
(b) Seller shall have performed all covenants and
obligations required to be performed by them under this Agreement at or
prior to the Closing Date, and Purchaser shall have received a
certificate signed by an authorized representative of Seller to such
effect.
ARTICLE VII
POST CLOSING COVENANTS
7.1 Transition Services. For a period of ninety days after the
Closing Date, Seller shall make available by telephone certain of Seller's
employees to provide assistance to Purchaser with respect to questions
Purchaser may have regarding employee benefits, customer billing, financial
accounting, regulatory compliance and insurance. Purchaser shall reimburse
Seller for all out-of-pocket expenses incurred by Seller in providing such
assistance. Out-of-pocket expenses shall not include any allocation for
salaries or wages of Seller's employees providing such assistance to
Purchaser. Purchaser explicitly acknowledges that such assistance is being
provided to Purchaser solely as an accommodation to Purchaser, that Seller is
not making any representations or warranties regarding the value of such
assistance to Purchaser and that Purchaser is solely responsible for the
operation of the Business after Closing. Purchaser explicitly releases
Seller from any liability and/or responsibility based upon
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any assistance provided to Purchaser under this Section 7.1 other than liability
and responsibility resulting from Seller's intentional and malevolent
misconduct.
7.2 Use of Name Ecogen. Within five days after the Closing,
Purchaser shall remove or otherwise permanently conceal all references to
"Ecogen" on its products and in its product brochures, marketing literature
and all other items (except to the extent approved in writing by Seller with
respect to BeeScent, NoMate BHF and NoMate LRX) and shall remove all signage
that refers to "Ecogen" at the Business Facilities. From and after the
Closing, Purchaser shall not use any name, phrase or logo incorporating
"Ecogen" or any other trademark of Seller not acquired under this Agreement
without the prior written consent of Seller.
7.3 Product Registrations. After the Closing, Seller shall use
all reasonable efforts to transfer the Product Registrations to Purchaser
provided, however, if Seller is not able to transfer one or more of the
Product Registrations to Purchaser, Seller and Purchaser shall enter into a
reasonable arrangement that shall be designed to provide to Purchaser the
benefits of the Product Registrations, consideration for which shall be the
purchase price recited in Section 1.5 hereof.
7.4 Packing and Shipping of Non-Business Assets. Upon Seller's
written request, Purchaser shall promptly pack and ship the Non-Business
Assets to one or more destinations determined by Seller. Purchaser shall use
all reasonable care in packing the Non-Business Assets for shipment and shall
arrange for shipment of the Non-Business Assets as requested by Seller. All
costs of insurance and carriage shall be the responsibility of Seller.
Seller explicitly acknowledges that such assistance is being provided to
Seller solely as an accommodation to Seller and that Purchaser is not making
any representations or warranties regarding the value of such assistance to
Seller. Seller explicitly releases Purchaser from any liability and/or
responsibility based upon any assistance provided to Seller under this
Section 7.4 other than liability and responsibility resulting from
Purchaser's intentional and malevolent misconduct.
7.5 Collection of Receivables. Upon Seller's written request,
Purchaser shall, after the Closing, use all reasonable efforts to assist
Seller in the collection of receivables arising from Seller's operation of
the Business and shall cooperate with Seller in providing information or
other assistance with respect to any claim against Seller with respect to
Seller's operation of the Business. Purchaser shall promptly take all steps
necessary to meet the requirements of the USDA with respect to the Designated
USDA Contracts at no charge to Seller or the USDA; provided, however, in the
event that Seller and the USDA agree subsequent to the Closing Date to an
amendment to the Designated USDA Contracts, Purchaser may charge Seller or
the USDA for work required to meet specifications or requirements arising
solely from such subsequent amendment.
7.6 Maintenance of and Access to Records. Seller and Purchaser
shall, whenever reasonably requested by the other, permit the other to have
access to and make copies of, all records relating to the Business which are
retained by it in
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accordance with this Agreement. Purchaser and Seller shall preserve and maintain
all material books and records relating to the Business for at least five years
after the Closing Date.
7.7 Litigation. Seller will defend any pending or threatened
assessment, litigation, claim or proceeding relating to the Business as
operated by Seller prior to the Closing Date, or the ownership, possession,
use or sale of the Acquired Assets prior to the Closing Date whenever such
claim is asserted and whether or not such claim is asserted against Purchaser
or Seller. Seller shall defend and/or settle any such litigation, claim or
proceeding at its own cost and expense, and shall make such payments as may
be necessary as a result thereof. Purchaser shall give prompt notice to
Seller of the assertion of any such claim, or the commencement of any action,
suit or proceeding and will provide to Seller such information with respect
thereto as may be reasonably requested, but no failure to give such notice
shall relieve Seller of any liability hereunder, except to the extent Seller
suffers actual prejudice thereby.
7.8 Non-Compete. Until January 1, 2001, Seller shall not with
its current resources internally develop insect pheromone products that are
competitive with the products identified in Schedule 1.2(g). Notwithstanding
the foregoing, Seller shall not be prohibited or otherwise restricted from
conducting or expanding the business or operation of any business or
operation Seller may acquire or become affiliated with provided, however, for
a period of two years after the date of this Agreement, Seller shall not
acquire or become affiliated with any company or other entity that is engaged
solely in the development and sale of insect pheromone products.
7.9 Third Party Consents. Seller and Purchaser shall cooperate
to obtain any consent or approval of a third party required for the transfer
of Seller's rights under the contracts, leases and other agreements
identified in Schedule 3.3 In the event that the parties do not obtain any
consent or approval required to transfer any of the Contracts from Seller to
Purchaser such rights shall be deemed not to have been transferred pursuant
to this Agreement and the parties shall enter into a reasonable arrangement
that shall be designed to provide to Purchaser the benefits as well as the
detriments and obligations of such Contract after the Closing Date, the
consideration for which shall be the purchase price recited in Section 1.5
hereof.
7.10 Confidentiality. Seller agrees that it shall not use or
disclose to any third party the confidential and proprietary manufacturing
standard operating procedures of the Business (the "Confidential
Procedures"). Notwithstanding the foregoing, the term "Confidential
Procedures" shall not include information that (i) has not been treated as
confidential information by Seller; (ii) becomes available to the public
other than as a result of a disclosure by Seller; (iii) becomes available to
Seller from a source other than Purchaser or (iv) is required to be disclosed
pursuant to a subpoena, court order or other rule or regulation.
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7.11 Payment of Pre-Closing Liabilities. Seller shall,
consistent with its past practices and procedures, pay and discharge
liabilities relating to the operation of the Business prior to the Closing
Date that are not being assumed by Purchaser.
7.12 Further Assurances. Seller and Purchaser shall each
cooperate with the other to execute and deliver such agreements, instruments
and documents and shall take such other reasonable action as may be
reasonably necessary to effectuate the transactions contemplated by this
Agreement including, without limitation, the execution by Seller of
assignments that may be necessary to transfer the Intangible Assets to
Purchaser.
ARTICLE VIII
INDEMNIFICATION
8.1 Indemnification of Purchaser by Seller. From and after the
Closing Date, Seller shall indemnify and hold harmless Purchaser, its
directors, officers, employees and agents, and each of the heirs, executors,
successors and assigns of any of the foregoing (each an "Indemnified
Purchaser Party") from and against any and all claims, losses, liabilities,
legal actions, damages and expenses, including without limitation, legal fees
and expenses (collectively, "Claims") incurred by or asserted against any of
the Indemnified Purchaser Parties arising or relating to (i) the breach or
failure to comply with any representation, warranty, covenant or obligation
of Seller under this Agreement, or (ii) from the operations, assets,
liabilities or activities of the Business prior to the Closing, other than
Claims arising from or relating to the obligations assumed by Purchaser
pursuant to Section 1.4.
8.2 Indemnification of Seller by Purchaser. From and after the
Closing Date, Purchaser shall indemnify and hold harmless Seller, and each of
their respective directors, officers, employees and agents, and each of the
heirs, executors, successors and assigns of any of the foregoing (each an
"Indemnified Seller Party") from and against any and all Claims incurred by
or asserted against any of the Indemnified Seller Parties arising or relating
to (i) the breach or failure to comply with any representation, warranty,
covenant or obligation of Purchaser under this Agreement, or (ii) from the
operations, assets, liabilities or activities of the Business after the
Closing.
8.3 Notice. Each party entitled to indemnification under this
Article VIII (an "Indemnified Party") shall give notice to the party required
to provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any Claim as to which indemnity may
be sought and shall permit the Indemnifying Party to assume the defense of
any such claim or any litigation resulting therefrom; provided, however, that
counsel for the Indemnifying Party who shall conduct the defense of such
Claim or shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld), and that the Indemnified Party
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may participate in such defense at its own expense; and provided further that
the failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Article VIII unless
such failure is materially detrimental to the Indemnifying Party. No
Indemnifying Party, in the defense of any Claim shall, except with the consent
of each Indemnified Party, consent to the entry of any judgment or enter into
any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a release from
all liability in respect to such Claim.
8.4 Survival of Warranties and Representations.
Notwithstanding any provision of this Agreement to the contrary including,
without limitation, the provisions of Sections 8.1 and 8.2 of this Agreement,
all warranties and representations of Seller set forth in Article III and of
Purchaser set forth in Article IV shall survive the date of execution of this
Agreement for a period of one year and at the expiration of such period
neither party shall have the right (i) to initiate any arbitration or other
proceeding based upon any breach of such representations or warranties or
(ii) otherwise seek or obtain a remedy or other relief for any such breach.
ARTICLE IX
TERMINATION OF AGREEMENT
9.1 Termination. This Agreement may be terminated at any time
prior to the Closing by:
(a) The mutual consent of Seller and Purchaser; or
(b) Either Seller or Purchaser if the Closing has not
occurred by the close of business on April 30, 1998 and if the failure
to consummate the Closing on or before such date did not result from
the failure by the party seeking termination of this Agreement to
fulfill any condition, undertaking or commitment provided for herein
that is required to be fulfilled prior to or at Closing.
9.2 Procedure and Effect of Termination. In the event of
termination of this Agreement by either or both of Seller and Purchaser
pursuant to Section 9.1, written notice thereof shall forthwith be given by
the terminating party to the other parties hereto, and this Agreement shall
thereupon terminate and become void and have no further effect, except that
the provisions of Sections 10.2 and 10.8 shall survive the termination of
this Agreement; provided, however, that such termination shall not relieve
any party hereto of any liability for any breach of this Agreement.
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ARTICLE X
GENERAL PROVISIONS
10.1 Notices. All notices and other communications required or
permitted under this Agreement shall be in writing and shall be deemed given
if delivered personally, or mailed by registered or certified mail (return
receipt requested) to the parties at the following addresses (or at such
other address for a party as shall be specified by like notice):
(a) if to Seller, to:
Ecogen Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chairman and Chief Executive Officer
with a copy to:
Ecogen-Bio Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman and Chief Executive Officer
(b) if to the Purchaser, to:
Scentry Biologicals, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
10.2 Expenses. Except as explicitly set forth in this
Agreement, whether or not the transactions contemplated by this Agreement are
consummated, all legal and other costs and expenses incurred in connection
with this Agreement shall be paid by the party, incurring such costs and
expenses.
10.4 Amendment. This Agreement may not be amended except by an
instrument in writing signed by each of the parties hereto.
10.5 Waiver. Compliance with any provision of this Agreement
may be waived only in writing signed by the party against which such waiver
is sought to be enforced. No exercise of, or failure to exercise, any right
hereunder and no partial or single exercise of any such right, shall operate
as a waiver, or otherwise affect such exercise or any other exercise of that
or any other right under this Agreement.
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10.6 Counterparts; Facsimile Signatures. This Agreement may be
executed in two or more counterparts, all of which shall be considered one
and the same agreement and shall become effective when one or more
counterparts have been signed by each of the parties and delivered to the
other party, it being understood that the parties need not sign the same
counterpart. Receipt of facsimile copies of signature pages hereof as
between the recipient thereof and the party that executed such signature
pages shall constitute delivery of such signature pages.
10.7 Entire Agreement; No Third Party Beneficiaries. This
Agreement (including the documents and instruments referred to herein) (a)
constitutes the entire agreement among the parties hereto and supersedes all
prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof including, without limitation, the
Confidentiality Letter Agreement, dated February 26, 1998 between Ecogen Inc.
and Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇.
10.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the Commonwealth of Pennsylvania,
without regard to its conflict of law principles or rules.
10.9 Bulk Sales. The parties hereby waive compliance with the
provisions of the "bulk sales laws" of any state which may be applicable to
the transactions contemplated by this Agreement.
10.10 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto without the prior written consent of the other parties which consent
may not be unreasonably withheld.
10.11 Public Announcement. Each party shall inform the other
parties of the proposed public announcement by each such party of the
transactions contemplated by this Agreement and shall disclose to the other
parties the proposed text of such announcement so as to allow the other
parties the opportunity to consider and comment on the proposed text of the
public announcement.
10.12 Seller's Knowledge. For purposes of this Agreement, the
term "to the Best Knowledge of Seller" shall mean the actual knowledge of the
Chief Executive Officer or Chief Financial Officer of Ecogen.
10.13 Purchaser's Knowledge. Each representation and warranty of
Seller set forth in this Agreement shall be deemed to be qualified by all
information within the actual knowledge of Purchaser, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇ or principals of Purchaser. Purchaser shall not have the right to
assert a claim for breach of any representation or warranty of Seller that
Purchaser, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ or any principal of Purchaser had
actual knowledge was false or inaccurate on the date of this Agreement or on
the Closing Date.
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IN WITNESS WHEREOF, the Purchaser and the Seller have caused this
Agreement to be signed by their duly authorized representatives as of the
date first written above.
ECOGEN INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
ECOGEN-BIO INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
SCENTRY BIOLOGICALS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
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