10.21 Trutona Purchase Agreement
An AGREEMENT dated this 15th day of February 1999, by and between:
BIOPROGRESS TECHNOLOGY INTERNATIONAL, INC., (BTI), a corporation registered in
the State of Nevada, having offices situate at 0000 Xxxxxxxx, Xxxxx 0000,
Xxxxxx, Xxxxxxxx 00000; and,
TRUTONA INTERNATIONAL, INC., (TI) a corporation registered in the State of
Delaware, having offices situate at 0000 Xxxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxx
00000.
WHEREAS:
TI is the owner of those patents, trademarks, licenses, other valuable
intellectual property and inventory (together the Assets) set out in Schedule 1
attached hereto.
BTI wishes to buy and TI wishes to sell the Assets upon the terms and conditions
set forth in this agreement (the Agreement).
It is AGREED as follows:
1. Consideration:
1.1 The consideration payable (the Purchase Price) by BTI to TI for the purchase
of the Assets shall be ONE MILLION FIVE HUNDRED THOUSAND US DOLLARS (US
$1,500,000).
1.2 The Purchase Price shall be paid as follows:
1.2.1 upon formal closing of this Agreement (Completion) BTI shall issue to TI
ONE MILLION EIGHT HUNDRED AND SEVENTY FIVE THOUSAND (1,875,000) ordinary shares
of common stock in BTI (the BTI Shares) having an agreed price (the Agreed
Price) of US FORTY CENTS (US $0.40) per share; and,
1.2.2 on or before 31 December 1999, BTI shall (a) issue to TI an additional ONE
MILLION EIGHT HUNDRED AND SEVENTY-FIVE THOUSAND (1,875,000) BTI Shares, or (b)
shall pay to TI in cash up to THREE HUNDRED AND EIGHTY THOUSAND US DOLLARS (US
$380,000) plus such number of BTI Shares at the Agreed Price as shall equal the
total amount of SEVEN HUNDRED AND FIFTY THOUSAND US DOLLARS (US $750,000), the
apportionment of said cash and BTI Shares shall be determined by BTI at its sole
discretion.
1.2.3 Unless previously registered with the Securities and Exchange Commission
of the United States of America (such registration to be at the sole discretion
of BTI), the BTI Shares shall be restricted from sale, assignment or disposal
for a period of TWENTY-FOUR (24) months from the date of Completion of this
Agreement and each share certificate shall bear a legend stating the same.
2. Effective Date and Completion
2.1. This Agreement shall be effective the date hereof.
2.2. Completion of this Agreement shall be take place at any time on or before
31 March 1999.
2.3. At Completion BTI shall deliver to TI ONE MILLION EIGHT HUNDRED AND
SEVENTY-FIVE THOUSAND (1,875,000) BTI Shares and TI shall deliver to BTI the
Assets.
3. Representations, Warranties and Covenants of BTI:
3.1. All necessary steps have been taken to make this Agreement a legal, valid
and binding obligation on BTI and enforceable in accordance with its terms and
conditions.
3.2. The execution and delivery of this Agreement and the performance by BTI of
its obligations hereunder will not result in any material breach or violation of
or material default under any material agreement, indenture, lease, license,
mortgage, instrument, or understanding, nor result in any violation of any law,
rule, regulation, statute, order or decree of any kind, to which BTI or any of
its subsidiaries is a party or by which they or any of their property is or may
be or become subject, nor in the violation of the articles or bylaws governing
the conduct of BTI.
3.3. BTI has delivered to TI its annual report on Form 10-KSB for the year ended
December 31, 1997, and its quarterly reports on Form 10-QSB for the fiscal
quarters ended March 31, 1998, June 30, 1998, and September 30, 1998 all of
which were true and correct as of the date of filing and remain true and correct
in all material respects as of the date hereof. Also, BTI has provided TI full
access to any and all information it desires concerning the business and
operations of BTI, and BTI has made available to TI such personnel as has been
requested to answer any and all questions that TI may have had concerning its
investment in BTI. Further, BTI is current in all of its required reports under
the Securities Exchange Act of 1934, as amended.
3.4. The BTI Shares have each been validly authorized and are fully paid and
non-assessable.
4. Representations, Warranties and Covenants of the TI:
4.1. All necessary steps have been taken to make this Agreement a legal, valid
and binding obligation on TI enforceable in accordance with its terms and
conditions.
4.2. The execution and delivery of this Agreement and the performance by TI of
its obligations hereunder will not result in any material breach or violation of
or material default under any material agreement, indenture, lease, license,
mortgage, instrument, or understanding, nor result in any violation of any law,
rule, regulation, statute, order or decree of any kind, to which TI is a party
or by which it or any its property is or may be or become subject, nor in the
violation of the articles or bylaws governing the conduct of TI.
4.3. The Assets are not, and prior to Completion shall not become subject to any
lien, encumbrance, security interest or financing statement whatsoever. Further,
the Assets are not the subject of any other agreement in regards thereof.
4.4. TI has provided BTI full access to any and all information it desires
concerning the Assets, and TI has made available to BTI such personnel as has
been requested to answer any and all questions which BTI may have had concerning
its purchase of the Assets.
5. Understanding of BTI:
5.1. TI makes no warranties (expressed or implied) regarding the value or
potential value of the Assets.
6. Understandings of TI:
6.1. The certificates representing the BTI Shares will bear a legend restricting
transfer under Rule 144 of the Securities Act of 1933, as amended, and will be
issued solely in the name of TI.
6.2. The BTI Shares have not been registered under the Securities Act of 1933,
as amended, or any applicable state law (collectively, the Securities Act);
further, the BTI Shares may not be sold, offered for sale, transferred, pledged,
hypothecated or otherwise disposed of except in compliance with the Securities
Act; further, BTI has no obligation, and does not intend, to cause the BTI
Shares to be registered under the Securities Act, or to comply with any
exemption under the Securities Act that would permit a sale or sales or all or
any portion of the BTI Shares; further, the legal consequences of the foregoing
mean that TI must bear the economic risk of the investment in the BTI Shares for
an indefinite period of time; and, further, if TI desires to sell or transfer
any or all of the BTI Shares within the restricted period, BTI may require TI's
counsel to provide legal opinion that the transfer may be made without
registration under the Securities Act.
6.3. No federal or state agency has made any findings or determination as to the
fairness of an investment in BTI, or any recommendation or endorsement of this
investment.
6.4. There is presently only a limited market for the BTI Shares and no market
may exist in the future for any sale or sales of all or any part thereof.
6.5. TI has evaluated the high risks of investing in the BTI Shares and has such
knowledge and experience in financial and business matters in general and in
particular with respect to this type of investment that it is capable of
evaluating the merits and risks of an investment in the BTI Shares.
6.6. TI has been given the opportunity to ask questions and receive answers from
BTI concerning the terms and conditions of this investment, and to obtain
additional information necessary to verify the accuracy of the information it
desired in order to evaluate its investment, and in evaluating the suitability
of an investment in the BTI Shares has not relied upon any representations or
other information (whether oral or written) other than that furnished to it by
BTI or the representatives of BTI.
6.7. It has had the opportunity to discuss with its professional, legal, tax and
financial advisers the suitability of an investment in the BTI Shares for its
particular tax and financial situation and all information that it has provided
to BTI concerning TI and its financial position is correct and complete at the
date hereof.
6.8. In making the decision to purchase the BTI Shares it has relied solely upon
independent investigations made by it or on its behalf.
6.9. It is acquiring the BTI Shares solely for its own account, for investment
purposes only, and is not purchasing with a view to, or for, the resale,
distribution, subdivision or fractionalisation thereof.
7. Miscellaneous:
7.1. This Agreement sets forth and constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof, and supersedes any and
all prior agreements, understandings, promises, warranties, covenants and
representations made by any party to any other party concerning the subject
matter hereof and the terms applicable hereto. This Agreement may not be
released, discharged, amended or modified in any manner except by an instrument
in writing signed by duly authorised representatives of the parties hereto.
7.2. The invalidity or unenforceability of one or more provisions of this
Agreement shall not affect the validity or enforceability of any of the other
provisions hereof, and this Agreement shall be construed in all respects as if
such invalid or unenforceable provisions are omitted.
7.3. This Agreement shall be deemed to have been entered into and shall be
construed and enforced in accordance with the laws of the State of Nevada.
7.4. The failure of any party hereto to insist, in any one or more instances,
upon the performance of any of the terms, covenants or conditions of this
Agreement or to otherwise exercise any right hereunder, shall not be construed
as a waiver or relinquishment of the future performance of any such term,
covenant or condition or the future exercise of such right, but the obligations
of the party with respect to such future performance shall continue in full
force and effect.
7.5. The headings in this Agreement are included for convenience only and are
not to be used in construing or interpreting this Agreement.
7.6. All notices, demands, or requests hereunder shall be in writing and served
either personally, by certified mail, return receipt requested, by Federal
Express or other reputable overnight courier, or by facsimile, as follows;
If to BTI:
BioProgress Technology International, Inc.,
0000 Xxxxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Fax: (000) 000 0000
If to TI:
Trutona International, Inc.,
0000 Xxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Fax: (000) 000 0000
7.7. This Agreement, and each and every provision thereof, shall be binding upon
and shall inure to the benefit of the parties, their successors,
successors-in-title, heirs and assigns, and each and every successor-in-interest
to any party, whether such successor acquires such interest by way of gift,
purchase, foreclosure, or by any other legal method, who shall hold such
interest subject to all the terms and conditions of this Agreement.
7.8. This Agreement may be executed in any number of counterparts; each of which
shall be an original, but such counterparts shall together constitute one and
the same instrument.
7.9. In the event of any dispute with respect to this Agreement, the prevailing
party shall be entitled to its reasonable attorneys' fees and other costs and
expenses incurred in resolving such dispute.
7.10. Each party shall pay the expenses incurred by them under or in connection
with this Agreement, including counsel fees and expenses of their respective
representatives.
7.11. The representations, warranties and covenants of BTI and TI contained in
this Agreement shall survive the execution hereof, and shall be unaffected by
any investigation made by any party at any time.
7.12. At any time and from time to time after the date of this Agreement, each
party shall execute such additional instruments and take such other further
action as may be reasonably requested by any other party or otherwise to fulfil
the intent and purpose of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered the date first above written.
By:
Xxxxx X. Xxxxxxxxx
President and Chief Executive Officer
For and on behalf of BioProgress Technology International, Incorporated.
By:
Xxxxx Xxxxxxxx
President
For and on behalf of Trutona International, Incorporated.
SCHEDULE 1
THE ASSETS
PATENTS:
GB2295553 A Water Dispersible Bodily Liquid Absorbent Composite
PCT/GB96/00298 A Water Dispersible Bodily Liquid Absorbent Composite
PCT/GB96/01267 A Water dispersible Enclosure
TRADEMARKS:
HARMONIES
TRUTONA
TRUE TO NATURE
LICENSES:
CONSOLIDATED ECOPROGRESS TECHNOLOGIES, INC.
HOSPECO (PRIVATE LABEL)
HOSPECO (INSTITUTION)
INVENTORY:
ALL HARMONIES: SUPER NAPKINS, REGULAR NAPKINS, PANTYLINERS
ALL SIMPLICITIES: SUPER NAPKINS, REGULAR NAPKINS, PANTYLINERS
ALL TRUTONA: SUPER NAPKINS, REGULAR NAPKINS, PANTYLINERS
ALL PACKAGING AT HOSPECO AND ONTEX
RAW MATERIALS: ALL B-9 FILM AT HOSPECO. AT ONTEX: 3.67 TONNES AIR LAID PAPER,
142,260 SQUARE METRES COVERSTOCK.
SUNDRY:
EXHIBITION BOOTH
ALL CUSTOMER, BROKER AND DISTRIBUTOR RECORDS
ALL ARTWORKS, DESIGNS, PROOFS, AND ADVERTISEMENT MATERIALS.
