EXHIBIT 2.1
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STOCK PURCHASE AGREEMENT
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By and among
AGRIBIOTECH, INC.,
▇.▇. ▇▇▇▇▇▇▇▇▇▇ & SONS,
as the Buyer,
and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇
the ▇. ▇. ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇ Charitable Trust,
the ▇. ▇. ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇ Standard Charitable Trust,
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
as the Sellers,
and
WILLAMETTE SEED CO.
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August 21, 1998
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TABLE OF CONTENTS
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Section 1. Sale and Purchase of the Stock......................................... 5
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Section 2. Closing................................................................ 5
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Section 3. Description of Purchase Price and Payments............................. 6
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Section 4. Representations and Warranties of the Sellers and the Corporation...... 7
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Section 5. Representations and Warranties of the Buyer and ABT.................... 21
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Section 6. Survival of Representations and Warranties; Indemnification............ 23
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Section 7. Covenants of the Sellers and the Corporation........................... 25
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Section 8. Covenants of the Buyer and ABT......................................... 26
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Section 9. Conditions Precedent to the Obligations of the Buyer and ABT........... 26
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Section 10. Conditions Precedent to the Sellers' and the Corporation's Obligations. 29
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Section 11. Conditions Precedent to Obligations of the Sellers and the Buyer....... 30
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Section 12. Termination............................................................ 30
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Section 13. The Buyer's Obligations at Closing..................................... 31
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Section 14. The Sellers' Obligations at Closing.................................... 31
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Section 15. Subsequent Events...................................................... 31
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Section 16. Parties in Interest.................................................... 32
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Section 17. Entire Agreement....................................................... 32
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Section 18. Governing Law.......................................................... 32
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Section 19. Expenses............................................................... 32
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Section 20. Arbitration............................................................ 32
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Section 21. Severability........................................................... 33
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Section 22. Notices................................................................ 33
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Section 23. Non-Waivers............................................................ 35
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Section 24. Assignment............................................................. 35
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Section 25. Disclosure............................................................. 35
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Section 26. Miscellaneous.......................................................... 35
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Exhibits Description
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Exhibit 3(b) Form of Escrow Agreement
Exhibit 3(c)(i) and (ii) Form of Employment and Non-Competition Agreement; Form
of Non-Competition Agreement
Exhibit 3(e) Form of Stock Option Agreement
Exhibit 4(k) Leases of Real Property
Exhibit 9(h) Opinion of Counsel to Sellers and the Corporation
Exhibit 10(d) Opinion of Counsel to Buyer and ABT
Exhibit 15(b) Notes Payable by the Corporation
Schedules
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Schedule 4(b)(i) Consents of Other Persons
Schedule 4(b)(ii) Interest in Other Entities
Schedule 4(c)(i) Legal Proceedings, Seller and/or Corporation as Party
Schedule 4(c)(ii) Complaints, Claims, etc. from Customers, Purchasers, etc.
Schedule 4(c)(iii) Claims Related to Products or Services
Schedule 4(c)(iv) Return of Goods
Schedule 4(d) Encumbrances
Schedule 4(e) Trademarks, Trade Names
Schedule 4(f) Patents, PVPA Certificates, etc.
Schedule 4(g) Financial Statements
Schedule 4(h) Material Adverse Change
Schedule 4(j) Accounts Receivable and Inventory
Schedule 4(k) Real Property Owned or Leased; Personal Property Leased
Schedule 4(l) Material Contracts
Schedule 4(m) Violations or Restrictions
Schedule 4(p) Pension & Profit Sharing Plan
Schedule 4(q) Insurance Policies
Schedule 4(r) Rights of Third Parties
Schedule 4(s) Powers of Attorney
Schedule 4(u) Vendors and Customers
Schedule 4(w) Compensation Plans
Schedule 4(x) Governmental Licenses
Schedule 4(z) Compliance with Laws
Schedule 4(aa) Guarantees by Sellers of Obligations of the
Corporation
Schedule 4(bb) Benefits
STOCK PURCHASE AGREEMENT
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STOCK PURCHASE AGREEMENT dated August 21, 1998, by and among Willamette
Seed Co., an Oregon corporation (the "Corporation"),▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇, the ▇.▇ ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇ Charitable
Trust, the ▇.▇. ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇ Standard Charitable Trust, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (collectively, the
"Sellers"), ▇.▇. ▇▇▇▇▇▇▇▇▇▇ & Sons, an Oregon corporation and wholly-owned
subsidiary of AgriBioTech (the "Buyer") and AgriBioTech, Inc., a Nevada
corporation ("ABT").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Sellers own an aggregate of 199,750 shares of common stock, no
par value per share, of the Corporation (the "Stock"), which constitutes all of
the issued and outstanding shares of capital stock of the Corporation; and
WHEREAS, the Sellers wish to sell and the Buyer wishes to purchase the
Stock, on the terms and subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the terms,
conditions, representations, warranties and covenants appearing in this
Agreement, the parties hereto agree as follows:
SECTION 1. SALE AND PURCHASE OF THE STOCK.
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(a) Upon the terms and subject to the conditions set forth in this
Agreement, at the Closing (as hereinafter defined), the Sellers shall sell,
transfer and deliver to the Buyer, and the Buyer shall purchase from the
Sellers, the Stock, which constitutes one hundred percent (100%) of the issued
and outstanding shares of capital stock of the Corporation, free and clear of
all liens, mortgages, deeds of trust, security interests, pledges, charges,
encumbrances, liabilities and claims of every kind.
(b) The purchase price of FOURTEEN MILLION AND NO/100THS ($14,000,000.00)
DOLLARS (the "Purchase Price"), payable by the Buyer to the Sellers for the
Stock, shall be paid as described in Section 3 below.
SECTION 2. CLOSING.
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The closing of the sale and purchase of the Stock provided for in Section 1
of this Agreement (the "Closing") shall take place at the offices of
Weatherford, Thompson, Quick and Asherfelter, P.C., Albany, Oregon at 10:00 a.m.
on or before August 21, 1998 (the "Closing Date") or at such later date, time or
location as may be agreed to by the parties.
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SECTION 3. DESCRIPTION OF PURCHASE PRICE AND PAYMENTS.
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(a) Payment of Purchase Price to the Sellers at Closing. Upon the
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completion by the parties of their respective closing conditions under this
Agreement, the Buyer shall pay to the Sellers the Purchase Price in immediately
available funds by Fedwire or other method reasonably acceptable to the Sellers,
in exchange for delivery of the Stock, at the Closing.
(b) Portion of Purchase Price to be Held in Escrow. At the Closing, the
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Sellers shall set-aside and deliver to ABT, as escrow agent (the "Escrow Agent")
pursuant to an escrow agreement (the "Escrow Agreement") attached hereto as
EXHIBIT 3(B), One Million and 00/100 ($1,000,000) Dollars, for the benefit of
the Buyer as described below (the "Escrow Funds").
The Escrow Funds shall be made available to the Buyer and in the event
of any Claims arising pursuant to Section 6(b) hereof for which Buyer is
entitled to payment, subject to the thresholds set forth in Section 6(d) hereof.
All Escrow Funds in excess of any such Funds made available to the
Buyer in respect of any claims on the third anniversary of the Closing Date
shall be distributed to Sellers on such date. Interest on such funds shall
accrue at the rate of eight (8%) percent per annum payable to the Sellers
quarterly.
(c) Employment and Non-Competition Agreement; Non-Competition Agreements.
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In addition to the purchase and sale of the ABT Shares as described above, at
the Closing, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ hereby agrees to enter into an Employment and Non-
Competition Agreement with the Buyer in the form annexed hereto as EXHIBIT
3(c)(i). ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ hereby agree to enter into Non-Competition Agreements with the Buyer in
the form annexed hereto as EXHIBIT 3(c)(ii). In consideration of the foregoing
agreements, Buyer shall allocate $100,000 of the Purchase Price to each of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇ in
exchange for non-compete agreements with each of such Sellers.
(d) Effective Date of the Sale. In the event that the Closing is
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consummated, the parties hereto agree that the purchase and sale of the Stock
shall be accounted for as if such transactions had occurred at the opening of
business on April 1, 1998 (the "Effective Date"), regardless of when the Closing
in fact occurs. In the event that the Closing is consummated, the Buyer shall
realize any operating profit or loss from the operation of the business of the
Corporation after the Effective Date. Accordingly, the Sellers agree to consult
the Buyer and ABT on any material issues or contracts which relate to a period
of time beyond the Effective Date. Furthermore, the Sellers agree not to enter
into any new capital obligations or capital expenditures which relate to the
Corporation prior to the Closing.
(e) Stock Options. At the Closing ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ shall be granted three-
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year non-qualified stock options with the Buyer in the form annexed hereto as
EXHIBIT 3(e).
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SECTION 4. REPRESENTATIONS AND WARRANTIES OF THE SELLERS AND THE CORPORATION.
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The Sellers and the Corporation, jointly and severally, warrant and represent to
the Buyer and ABT as follows (as used herein, "Sellers' best knowledge"
"Corporations best knowledge" "to the best knowledge of the Sellers" or "to the
best knowledge of the Corporation" or such similar language shall mean
information actually known by the Sellers without due inquiry):
Buyer and ABT acknowledge that, except for the representations and
warranties expressly contained in this Agreement and other documents made and
delivered as part of this transaction, that neither the Corporation nor the
Sellers are making any representation or warranty to Buyer or ABT, and that
Buyer is purchasing the Stock of the Corporation "AS IS" and based upon its
independent review of the Corporation and the results of Buyer's due diligence
review of the Corporation.
(a) Ownership of Shares. The Sellers are the owners, beneficially and
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of record, of the Stock, which constitutes one hundred percent (100%) of the
issued and outstanding shares of capital stock of the Corporation. The Stock is
the sole voting stock of the Corporation and is duly authorized, validly issued,
fully paid and non-assessable. The Stock has not been pledged, mortgaged or
otherwise encumbered in any way and there is no lien, mortgage, charge, claim,
liability, security interest or encumbrance of any nature against the Stock.
There are no options, warrants, rights of subscription or conversion, calls,
commitments, agreements, arrangements, understandings, plans, contracts,
proxies, voting trusts, voting agreements or instruments of any kind or
character, oral or written, to which the Sellers or the Corporation is a party,
or by which the Sellers or the Corporation is bound, relating to the issuance,
voting or sale of the Stock or any authorized but unissued shares of capital
stock of the Corporation or of any securities representing the right to purchase
or otherwise receive any such shares of capital stock. There are no
stockholders agreements, preemptive rights or other agreements, arrangements,
groups, commitments or understandings, oral or written, that have not been
disclosed to the Buyer, relating to the voting, issuance, acquisition or
disposition of shares of the Corporation or the conduct or management of the
Corporation by its Board of Directors. The Sellers have, and at the Closing
shall have, good and marketable title to the Stock and full right to transfer
title to the Stock, subject to any restrictions imposed by state or federal
securities laws, free and clear of all liens, mortgages, charges, liabilities,
claims, security interests or encumbrances of every type whatsoever. The sale,
conveyance, transfer and delivery of the Stock by the Sellers to the Buyer
pursuant to this Agreement will transfer full legal and equitable right, title
and interest in the Stock to the Buyer, free and clear of all liens, mortgages,
charges, claims, liabilities, security interests and encumbrances of any nature
whatsoever.
(b) Capacity; Organization; Standing; Capitalization. The Sellers have
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full capacity to enter into and perform under this Agreement and all other
agreements and instruments to be entered into in connection with the
transactions contemplated hereby, and to consummate such transactions, and,
except as set forth in SCHEDULE 4(b)(i) of this Agreement, no other consent or
joinder of any other persons or corporations is required to consummate such
transactions. The Corporation has no subsidiaries, except for Country Club
Lawn Seed, Inc., an Oregon corporation and wholly-owned subsidiary of the
Corporation. Except as set forth on SCHEDULE 4(b)(ii) of this Agreement,
neither
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the Sellers nor the Corporation have any interest in any entity other than the
Corporation engaged, directly or indirectly, in businesses competitive with
those of the Corporation or ABT. This Agreement has been, and each of the other
agreements and instruments executed hereunder (the "Other Agreements") will at
the Closing, be duly executed and delivered by the Sellers. This Agreement
constitutes, and each of the Other Agreements will constitute, the legal, valid
and binding obligation of the Sellers enforceable in accordance with its
respective terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting creditors'
rights generally or by general equitable principles. The Corporation is duly
organized and validly existing under the laws of the State of Oregon, has full
corporate power and authority to conduct its business as it is now being
conducted and is duly qualified to do business in each jurisdiction where the
nature of the property owned or leased, or the nature of the business conducted
by the Corporation requires such qualification. The Certificate of Incorporation
of the Corporation and all amendments certified by the Secretary of State of
Oregon and the By-laws, as amended to the date of this Agreement, certified by
the Secretary of the Corporation and the minutes and stock records of the
Corporation delivered to the Buyer are complete and correct. The Corporation has
all necessary licenses and authority to operate its business as now being
conducted and as will be conducted after the Closing assuming such business is
conducted as now operated. The authorized capital stock of the Corporation
consists of 199,750 shares of voting common stock, no par value, of which
200,000 shares are issued and outstanding. All of the issued and outstanding
shares of the Corporation are owned by the Sellers and are duly and validly
issued, fully paid and non-assessable.
(c) Legal Proceedings.
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(i) Except as set forth in SCHEDULE 4(c)(i) of this Agreement,
neither the Sellers in their capacity as stockholders and/or as
officers or directors of the Corporation, nor the Corporation is
a party to any pending litigation, arbitration or administrative
proceeding or, to the best of Sellers' knowledge, to any
investigation, and no such litigation, arbitration or
administrative proceeding or investigation that might result in
any material adverse change in the financial condition, business
or properties of the Corporation or of the Sellers is threatened.
(ii) Except as disclosed in SCHEDULE 4(c)(ii) to this Agreement, the
Sellers and the Corporation have no knowledge of and have not
received notice of any complaints, claims or threats, plans or
intentions to discontinue commercial relations or transactions
from any customer of the Corporation, any purchaser of goods or
services from the Corporation, any employee or independent
contractor significant to the conduct or operation of the
Corporation or its businesses or any party to any agreement to
which the Corporation is a party.
(iii) Except as disclosed in SCHEDULE 4(c)(iii), there is no claim
(whether based on statute, negligence, breach of warranty, strict
liability or any other theory)
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relating directly or indirectly to any product manufactured or
sold, or any services performed by the Corporation.
(iv) Except as disclosed in SCHEDULE 4(c)(iv), the Corporation is
under no obligation with respect to the return of goods in the
possession of customers.
(d) Encumbrances. Except as disclosed in SCHEDULES 4(d), 4(k) OR 4(l),
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there are no liens, mortgages, deeds of trust, claims, charges, security
interests or other encumbrances or liabilities of any type whatsoever to which
any of the assets of the Corporation are subject.
(e) Trade Names, etc. The Corporation owns the trade names, trademarks,
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service marks, assumed names, copyrights and registrations therefor, if any
(collectively "Trademarks") specified in SCHEDULE 4(e). The Trademarks have
been duly issued and have not been canceled, abandoned or otherwise terminated
except as otherwise indicated in SCHEDULE 4(e). Except as set forth in SCHEDULE
4(E), the Corporation is not in default under any of the licenses or agreements
relating to the Trademarks as listed in SCHEDULE 4(e) and all of such licenses
and agreements are in effect. The Corporation has not granted, and will not
grant prior to the Closing, licenses or other rights to use such Trademarks. No
other Trademarks are either owned or used by the Corporation. To the best of
Sellers' knowledge, the operation of the Corporation's business does not
infringe on the Trademarks of any third party. No claim has been made that
there is any such infringement. To the best of the Sellers' and the
Corporation's knowledge, no Trademark of any other person infringes the
Trademarks of the Corporation.
(f) Patents, etc. The Corporation owns the inventions, letters patent,
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applications for letters patent and patent license rights, inventions,
processes, designs, formulas, trade secrets, Plant Variety Protection Act
("PVPA") Certificates, know-how and other industrial property rights
(collectively "Patents") necessary for the conduct of its business, specified as
belonging to it in SCHEDULE 4(f). The Patents have been duly issued and have not
been canceled, abandoned or otherwise terminated except as otherwise indicated
in SCHEDULE 4(f). The Corporation is not in default under any of the licenses or
agreements relating to the Patents as listed in SCHEDULE 4(f) and all of such
licenses and agreements are in effect. The Corporation has not granted, and will
not grant prior to the Closing, licenses or other rights to use such Patents. No
other Patents are owned or used by the Corporation. To the best of Sellers'
knowledge, the operation of the Corporation's business does not infringe on the
Patent rights of any third party. No claim has been made that there is any such
infringement. To the best of the Sellers' and the Corporation's knowledge, no
Patent of any person infringes the Patents of the Corporation.
(g) Financial Statements.
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(i) The financial statements of the Corporation as of and for the
periods ended June 30, 1997, 1996, and 1995, together with the
related notes and schedules, and the unaudited financial
statements of the corporation as of and for the period ended
February 28, 1998 and March 31, 1998 together with the related
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notes and schedules (collectively, the "Financials"), true,
correct and complete copies of which are attached hereto as
EXHIBIT 4(g), (A) are in accordance with the books of account and
records of the Corporation; (B) present fairly, and are true,
correct and complete statements of the financial condition and
the results of operations of the Corporation as at and for the
periods therein specified; and (C) do not include or omit to
state any fact which renders the Financials misleading.
(ii) Except as and to the extent shown or provided for in the
Financials or the notes and schedules thereto or as disclosed in
any of the Schedules to this Agreement or such current
liabilities as may have been incurred since February 28, 1998 in
the ordinary course of business, the Corporation has no
liabilities or obligations (whether accrued, absolute, contingent
or otherwise) which might be or become a charge against the
assets or liabilities of the Corporation; as of February 28, 1998
and March 31, 1998, there was no asset used by the Corporation in
its operations that has not been reflected in the Financials,
and, except as set forth in the Financials, no assets have been
acquired by the Corporation since such date except in the
ordinary course of business.
(iii) Except as disclosed in the Financials, there has been no
decrease in stockholders' equity as compared with the amount
shown for such stockholders' equity as at February 28, 1998 and
no material adverse changes in the financial position of the
Corporation since February 28, 1998.
(iv) The Financials do not include any assets, liabilities, income or
expenses of any entity other than the Corporation. All
transactions in the years 1990 through the Closing between the
Corporation and any other entity in which either of the Sellers
is an officer, director or has an equity interest have been at
prices no less favorable to the Corporation than could have been
obtained from any independent third party.
(h) Absence of Certain Changes. Except as disclosed on SCHEDULE 4(h),
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since February 28, 1998, there has not been any material adverse change in the
condition (financial or otherwise), operations, assets, liabilities, earnings,
business, prospects or results of operations of the Corporation.
(i) Tax Matters. The Corporation has timely filed all federal, state
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and local income tax returns and has timely filed with all other appropriate
governmental agencies all sales, ad valorem, franchise and other tax (including
any real estate, personal property, or any other tax that may be due in
connection with the Fixed Assets), license, gross receipts and other similar
returns and reports required to be filed by the Corporation. The Corporation
has reported all taxable income and losses on those returns on which such
information is required to be reported, and paid or provided for the
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payment of all taxes due and payable by the Corporation on said returns or taxes
due pursuant to any assessment received by it, including without limitation, any
taxes required by law to be withheld and/or paid in connection with any
officer's or employee's compensation or due pursuant to any assessment received
by it. There are no agreements for the extension of time for the assessment or
payment of any amounts of tax. The Sellers have made available to the Buyer for
inspection copies of income tax returns that are true and complete copies of the
federal and applicable state, local or other income tax returns filed by the
Corporation for the taxable years ended June 30, 1997, 1996, and 1995, and any
other open tax periods. The Corporation shall bear all expenses and
responsibilities for the filing of federal and applicable state, local or other
income tax returns and reports of the Corporation for the taxable year ended
June 30, 1998 and for that portion of 1999 for which any short period returns
may be filed. All tax liabilities of the Corporation arising through the end of
the taxable year ended June 30, 1997 have been paid. All tax liabilities of the
Corporation arising after June 30, 1997 have been paid or adequately disclosed
and properly reserved for on the books and records and financial statements of
the Corporation. No federal or applicable state, local or other tax return of
the Sellers or the Corporation for any period has been or is currently under
audit by the Internal Revenue Service or any state, local or other tax
authorities. No claim has been made by federal, state, local or other
authorities relating to any such returns or any audit. For purposes of this
Section 4(i), the word "timely" shall mean that such returns were filed within
the time prescribed by law for the filing thereof, including the time permitted
under any applicable extensions. The Sellers and the Corporation are not aware
of any facts which they believe would constitute the basis for the proposal of
any tax deficiencies for any unexamined year. All taxes which the Corporation is
required by law to withhold and collect have been duly withheld and collected,
and has been timely paid over to the proper authorities to the extent due and
payable.
(j) Accounts Receivable and Inventory.
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(i) Accounts Receivable. The accounts receivable of the Corporation
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reflected in the Financials as at February 28, 1998 and March 31,
1998, and the accounts receivable acquired by the Corporation
since such date are valid subsisting claims for the aggregate
amounts thereof reflected in the Financials net of the reserves
or allowances for doubtful receivables reflected in the
Financials or thereafter in the Corporation's books and records
uniformly maintained in accordance with the financial statements,
accounted for in accordance with generally accepted accounting
principles, and, except as set forth in SCHEDULE 4(j), the
Sellers know of no reason that would make such accounts
receivable, net of such amounts as the Corporation has reserved
on its books as of February 28, 1998 and March 31, 1998, taken as
a whole, not collectible.
(ii) Inventory. The inventory of the Corporation reflected in the
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Financials as at February 28, 1998 and March 31, 1998, and the
inventory acquired by the Corporation since such date (a) has
been purchased in the ordinary course of business, (b) has been
fully paid for unless otherwise reflected in the
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Financials, (c) is marketable or adequate provision for
obsolescence has been provided and (d) Sellers know of no reason
that would make such inventory, net of such amounts as the
Corporation has reserved on its books as of June February 28,
1998 and 30, 1998, taken as a whole, not marketable.
(k) Title and Condition of Properties. The Corporation does not own any
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real property, except as disclosed on SCHEDULE 4(k). Except as disclosed on
SCHEDULE 4(k), the Corporation has good, marketable and insurable title to all
properties and assets, real and personal, tangible and intangible, reflected in
the Financials and all properties acquired subsequent to February 28, 1998 and
March 31, 1998, which have not been disposed of in the ordinary course of
business since February 28, 1998 and March 31, 1998, which property is subject
to no mortgage, lien, deed of trust, claim, security interest, liability,
conditional sales agreement, easement, right-of-way or any other encumbrance
except as disclosed on SCHEDULE 4(k).
SCHEDULE 4(k) contains an accurate list of all leases and other
agreements under which the Corporation is lessee or lessor of any real or
personal property. Each of the real property and personal property leases and
agreements is in full force and effect and constitutes the legal, valid and
binding obligation of the parties thereto.
All personal property, machinery and equipment which are material to
the business, operations or condition (financial or otherwise) of the
Corporation is in operating condition and, subject to routine maintenance and
ordinary wear and tear, have been maintained in accordance with reasonable
industry standards and is suitable for the purpose for which it is used. Except
as disclosed in SCHEDULE 4(k), neither the Sellers nor the Corporation is aware
of or have received notice of, the violation of any applicable zoning
regulation, ordinance or other law, order, regulation or requirement in force on
the date hereof relating to the Corporation's business or its owned or leased
real or personal properties, with which the Corporation has not complied.
At the Closing, the Sellers shall provide, at their expense, an ALTA
Extended title insurance policy in the amount of the purchase price allocated to
the real property and improvements, as shown in SCHEDULE 4(k), which Buyer shall
acquire (save and except for that property listed as Locations (Nos. 1 and 3 on
SCHEDULE 4(k) ) insuring title vested in the Corporation or its nominees,
subject only to nondeliquent real property taxes and those exceptions set forth
on the preliminary title report which according to Buyer are acceptable and do
not render title unmarketable or uninsurable. Sellers agree to provide any
documentation reasonably requested which is required by the title company to
issue such title insurance.
Prior to the Closing, the Buyer or ABT may engage consultants or
engineers of the Buyer's or ABT's choosing to conduct site studies of the real
property as the Buyer deems necessary. The Buyer, ABT or its agents shall have
the right to enter the real property at reasonable times before Closing to make
such tests, inspections, studies, and other investigations as the Buyer or ABT
may require, at the Buyer's expense and risk. The Buyer shall indemnify and
hold the Sellers and
12
the Corporation harmless from any loss, damage, or claim arising out of the
Buyer's or ABT's access to or Buyer's or ABT's activities on, the real property
owned or leased by the Corporation.
(l) Description of Material Contracts. SCHEDULE 4(l) contains a complete
---------------------------------
and correct list as of the date hereof of all agreements, contracts and
commitments, obligations and understandings which are not set forth in any other
Schedule delivered hereunder, of the following types, written or, oral, to which
the Corporation is a party, under which it has any rights or by which it or any
of its properties is bound, as of the date hereof: (i) mortgages, indentures,
security agreements and other agreements and instruments relating to the
borrowing of money or extension of credit; (ii) employment and consulting
agreements with annual compensation in excess of $40,000; (iii) collective
bargaining agreements; (iv) bonus, profit-sharing, compensation, stock option,
pension, retirement, deferred compensation or other plans, agreements, trusts,
funds or arrangements for the benefit of employees (whether or not legally
binding); (v) sales agency, manufacturer's representative or distributorship
agreements; (vi) agreements, orders or commitments for the purchase by the
Corporation of materials, supplies or finished products exceeding $5,000 in the
aggregate from any one person; (vii) agreements, orders or commitments for the
sale by the Corporation of its products or services exceeding $5,000; (viii)
agreements or commitments for capital expenditures in excess of $5,000 for any
single project (it being warranted that the commitment for all unscheduled
contracts for such agreements or commitments does not exceed $5,000 in the
aggregate); (ix) agreements relating to research; (x) agreements relating to
PVPA Certificates or licenses or other rights to use PVPA Certificates; (xi)
agreements relating to the payment of royalties; (xii) seed purchase contracts
or other contracts with growers; (xiii) brokerage or finder's agreements; (xiv)
joint venture agreements; and (xv) other agreements, contracts and commitments
which individually or in the aggregate for any one party involve any expenditure
by the Corporation of more than $5,000.
The Corporation has made available to the Buyer complete and correct
copies of all written agreements, contracts, commitments, obligations and
undertakings, together with all amendments thereto, listed on the Schedules
hereto, and such Schedules contain accurate descriptions of all oral agreements
listed on such Schedules. Except as set forth in SCHEDULE 4(1), all such
agreements, contracts, commitments, obligations and undertakings are in full
force and effect and, except as disclosed in SCHEDULE 4(l), all parties to, or
otherwise bound by, such agreements, contracts, commitments, obligations and
undertakings have performed all obligations required to be performed by them to
date and the Corporation is not in default and no event, occurrence, condition
or act exists which gives rise to (or which with notice or the lapse of time, or
both, could result in) a default or right of cancellation, acceleration or loss
of contractual benefits under, any such contract, agreement, commitment,
obligation or undertaking. There has been no threatened cancellations thereof,
and there are no outstanding disputes under any such contract, agreement,
commitment, obligation or undertaking. Except as set forth in SCHEDULE 4(1), no
consent of any party is required under any such contract, agreement, commitment,
obligation or undertaking which would make such agreements not binding and in
full force and effect as of the Closing Date. Any contracts, agreements, leases
or commitments held in the name of any of the Sellers and set
13
forth in the Schedules hereto shall be assigned to either the Buyer or the
Corporation prior to the Closing Date.
Except as otherwise set forth in SCHEDULE 4(l), each contract, lease,
instrument and commitment required to be described in the Schedules hereto is,
on the date hereof, and will be at the Closing, in full force and effect and is
and will constitute a valid and binding obligation of the Corporation and the
respective parties to such agreements, and there is not, under any such
contract, lease, instrument or commitment, any existing default by the
Corporation or such other parties or any event that, with notice, lapse of time
or both, would constitute a default by the Corporation or such other parties in
respect of which adequate steps have not been taken to cure such default or to
prevent a default from occurring or continuing. Any contracts, leases or
commitments held in the names of any of the Sellers and listed on the Schedules
shall be assigned either to the Buyer or the Corporation prior to the Closing
Date.
No agreement, contract, commitment, obligation or undertaking listed
on the Schedules hereto which the Corporation is a party or by which it or any
of its properties is bound, except as specifically set forth in SCHEDULE 4(L),
contains any provision which materially adversely affects or in the future may
(so far as the Sellers and the Corporation can reasonably now foresee)
materially adversely affect the condition, properties, assets, liabilities,
business, operations or prospects of the Corporation following the date hereof
and upon the Closing Date. Furthermore, to the best of the Sellers' knowledge,
the material suppliers, customers and clients of the Corporation will continue
to supply and purchase from the Corporation after the Closing.
(m) Default; Violations or Restrictions. Except as set forth in
-----------------------------------
SCHEDULES 4(l) AND 4(m), the execution, delivery and performance of this
Agreement and of any agreement to be executed and delivered by the Corporation
in connection with the transactions contemplated hereby and the consummation of
any of the transactions contemplated hereby or thereby will not (or with the
giving of notice or the lapse of time or both would) result in the breach of any
term or provision of the Certificate of Incorporation or by-laws of the
Corporation or violate any provision of or result in the breach of, modification
of, acceleration of the maturity of obligations under, or constitute a default,
or give rise to any right of termination, cancellation, acceleration or
otherwise be in conflict with or result in a loss of contractual benefits to the
Corporation, under any law, order, writ, injunction, decree, statute, rule or
regulation of any court, governmental agency or arbitration tribunal or any of
the terms, conditions or provisions of any contract, lease, note, bond,
mortgage, deed of trust, indenture, license, security agreement, agreement or
other instrument or obligation by which the Corporation or the Sellers is a
party or by which either of them may be bound, or require any consent, approval
or notice under any law, rule or decree or any such document or instrument; or
result in the creation or imposition of any lien, claim, restriction, charge or
encumbrance upon the Corporation's assets or interfere with or otherwise
adversely affect the ability to carry on the business of the Corporation after
the Closing Date on substantially the same basis as it is now conducted by the
Corporation.
14
(n) Court Orders and Decrees. The Corporation has not received written
------------------------
or oral notice that there is outstanding, pending, or threatened any order,
writ, injunction or decree of any court, governmental agency or arbitration
tribunal against or affecting the Corporation, the Stock or any of the
Corporation's assets. The Corporation is in compliance in all material respects
with all applicable Federal, state, county, municipal (or of any subdivision
thereof) laws, regulations and administrative orders in force at any applicable
time to which the Corporation may be subject.
(o) Books and Records. The books and records of the Corporation are, in
-----------------
all material respects, complete and correct and have been maintained in
accordance with good business practice. True and complete copies of the
Certificate of Incorporation and By-laws of the Corporation and all amendments
thereto and true and complete copies of all minutes, resolutions, stock
certificates and stock transfer records of the Corporation are contained in the
minute books and stock transfer books that have been delivered to the Buyer for
inspection and will be delivered to the Buyer at the Closing. The minute books,
stock certificate books, stock transfer records and such other books and records
as may be requested by the Buyer or ABT, as made available to the Buyer and its
representatives, are complete and correct in all material respects.
(p) Pension and Welfare Plans.
-------------------------
(i) Pension and Profit Sharing Plans. Except as disclosed in
--------------------------------
SCHEDULE 4(p), the Corporation does not have in effect any
pension, profit sharing or other employee benefit plan described
under Section 3(2)(A) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"). All benefits payable under
any terminated employee pension benefit plan (as such term is
defined in Section 3(2)(A) of ERISA) previously maintained by the
Corporation or to which it has previously contributed have been
paid in full and/or that the Corporation does not have any
unfunded liability in respect of any such plan to the Pension
Benefit Guaranty Corporation or to the participants in such plan
or to the beneficiaries of such participants. Each such
terminated plan was terminated substantially in accordance with
the applicable provisions of law or any agreement or contract
relating to any such plan and has been terminated without
liability to the Corporation.
(ii) Welfare Plans. Except as set forth in Schedule 4(p), for each
-------------
plan, fund, or arrangement of the Corporation which is an
employee welfare benefit plan, whether or not currently
maintained (within the meaning of ERISA Section 3(1)) (a "Welfare
Plan"), the following is true:
(A) each such Welfare Plan intended to meet the requirements for
tax-favored treatment under Subchapter B of Chapter 1 of the
Code meets such requirements;
15
(B) there is no voluntary employees' beneficiary association
(within the meaning of Section 501(c)(9) of the Code)
maintained with respect to any such Welfare Plan;
(C) there is no disqualified benefit (as such term is defined in
Code Section 4976(b)) which would subject the Corporation or
the Buyer to a tax under Code Section 4976(a);
(D) each such Welfare Plan which is a group health plan complies
and has complied with the applicable requirements of Code
Section 4980B, and would comply with Sections 9801 through
9806 if such provisions were now in effect, Title XXII of
the Public Health Service Act, and the applicable provisions
of the Social Security Act and is not and has not been a
nonconforming group health plan under Section 5000(c) of the
Code;
(E) each such Welfare Plan may be amended or terminated by the
Corporation or the Buyer, on or at anytime after, the
Closing Date and after any advance notice to participants or
similar measures required by law which are non-waivable
under the Welfare Plan;
(F) no such Welfare Plan provides for continuing benefits or
coverage for any participant (including past, present or
future retirees) or such participant's beneficiary after
termination of employment except as required by the
Consolidated Omnibus Reconciliation Act of 1985 ("COBRA") or
any other state or Federal law; and
(G) no claims have been made and no other events have occurred
that might form the basis of a claim which has substantially
increased or based on customary insurance industry practice
might substantially increase, the premiums or other charges
of the Corporation under any Welfare Plan.
(q) Insurance. SCHEDULE 4(q) contains a correct and complete
---------
description of all policies of insurance by or on behalf of the Corporation in
which the Corporation is named as an insured party or beneficiary. The
Corporation has at all times prior to the date hereof maintained and will at all
times prior to the Closing Date maintain insurance coverage with respect to its
properties, in respect of liabilities and risks prudently insured against. The
policies described in SCHEDULE 4(q) are outstanding and in force as of the date
hereof, cover risks normally insured against and are in amounts normally carried
and there is no default notice of cancellation or non-renewal with respect to
any material provision contained in any such policy.
16
SCHEDULE 4(q) contains a correct and complete description of all such
policies of insurance held by or on behalf of the Corporation, premiums paid for
such insurance during the last three years and all outstanding insurance claims
in excess of $5,000 made by or against the Corporation for damage to or loss of
property or income which have been referred to insurers or which the Sellers
believe to be covered by commercial insurance. SCHEDULE 4(q) also contains a
list of all general comprehensive liability policies carried by the Corporation
for the past three years, including excess liability policies and any
agreements, arrangements or commitments under which the Corporation indemnifies
any other person or is required to carry insurance for the benefit of any other
person.
(r) Rights of Third Parties. Other than as disclosed in SCHEDULES 4(k),
-----------------------
4(l) AND 4(r) attached, or specifically provided for in this Agreement, the
Corporation has not entered into any leases, licenses, easements or other
agreements, recorded or unrecorded, granting rights to third parties in any real
or personal property of the Corporation, and no person or other corporation has
any right to possession, use or occupancy of any of the property of the
Corporation.
(s) Powers of Attorney. Except as disclosed in SCHEDULE 4(s), there are
------------------
no persons, firms, associations, corporations or business organizations holding
general or special powers of attorney from the Corporation.
(t) Labor Matters. The Corporation is not a party to any collective
-------------
bargaining agreement with any labor union or association. There are no
discussions, negotiations, demands or proposals that are pending or have been
conducted or made with or by any labor union or association, and there are not
pending or threatened any labor disputes, strikes or work stoppages that may
have a material adverse effect upon the continued business or operation of the
Corporation. To the best of Sellers' knowledge, the Corporation (i) is in
compliance with all federal and state laws respecting employment and employment
practices, terms and conditions of employment and wages and hours, and (ii) is
not engaged in any unfair labor practices.
(u) Relationships with Vendors and Customers. Except as set forth in
----------------------------------------
SCHEDULES 4(c)(i),(ii), (iii), AND (iv), 4(j), 4(l) AND 4(u), the Corporation
and the Sellers have no knowledge of any condition or state of facts or
circumstances which would materially adversely affect the Corporation after the
Closing Date. The Corporation's relationships with its customers, clients and
vendors are satisfactory, and the Corporation and the Sellers have no knowledge
of any facts or circumstances which might materially alter, negate, impair or in
any way materially adversely affect the continuity of any such relationships.
The Corporation and the Sellers` have no knowledge of any material outstanding
claims of any of its customers or clients presently outstanding, pending or
threatened against the Corporation. The Corporation and the Sellers have no
knowledge of any condition or state of facts or circumstances which would
prevent the business of the Corporation from being carried on by the Buyer after
the Closing Date in essentially the same manner as it is presently being carried
on.
17
(v) Approvals and Authorizations. Except as disclosed in SECTION 4(l),
----------------------------
the Corporation has obtained all necessary consents, approvals and
authorizations in connection with the transactions contemplated hereby which are
required by law or otherwise in order for the Corporation to continue all of its
present business following the Closing Date.
(w) Compensation Plans. SCHEDULE 4(w) contains a correct and complete
------------------
description of all current compensation plans and arrangements; bonus and
incentive plans and arrangements; deferred compensation plans and arrangements;
stock purchase and stock option plans and arrangements; hospitalization and
other life, health or disability insurance or reimbursement programs; holiday,
sick leave, severance, vacation, tuition reimbursement, personal loan and
product purchase discount policies and arrangements, policy manuals and any
other plans or arrangements providing for benefits for employees of the
Corporation.
(x) Governmental Licenses. SCHEDULE 4(x) contains a correct and
---------------------
complete list of all material governmental and administrative consents, permits,
appointments, approvals, licenses, certificates and franchises which are (i)
necessary for the operation of the Corporation, and (ii) required in connection
with Sellers' execution, delivery or performance of this Agreement, all of which
have been obtained by the Corporation and are in full force and effect.
(y) Brokers. No agent, broker, investment banker, person, or firm
-------
acting on behalf of any of the Sellers, the Corporation or any firm or
corporation affiliated with any of them, or under its authority, is or will be
entitled to a financial advisory fee, brokerage commission, finder's fee or
other like payment in connection with the transactions contemplated hereby.
(z) Compliance With Laws. Except as set forth in SCHEDULES 4(c)(i),(ii),
--------------------
(iii), AND (iv), 4(j), 4(k), 4(l), 4(m) or 4(z):
(i) The operations and activities of the Corporation have previously
and continue to comply with all applicable Federal, state and
local laws, statutes, codes, ordinances, rules, regulations,
permits, judgments, orders, writs, awards, decrees or injunctions
(collectively, the "Laws"), as in effect on or before the date of
this Agreement, including, without limitation, all Laws relating
to seed labeling and all rules and regulations of the
Occupational Safety and Health Administration. Neither the
ownership of the Corporation nor the conduct of the business of
the Corporation as presently conducted conflicts with the rights
of any other person, firm or corporation or violates, or with or
without the giving of notice or the passage of time, or both,
will violate, conflict with or result in a default, right to
accelerate or loss of rights under, any terms or provisions of
its Certificate of Incorporation or By-laws as presently in
effect, or any lien, encumbrance, mortgage, deed of trust, lease,
license, agreement, understanding, or Laws to which the
Corporation is a party or by which it may be bound or affected.
The Corporation has received no notice of communication from any
third party asserting a failure to
18
comply with any Laws, nor has the Corporation received any notice
that any authority or third party intends to seek enforcement
against the Corporation to compel compliance with any such Laws.
(ii) There are no existing claims or to the best of Seller's
knowledge, potential claims which may exist against the
Corporation, for, with respect to, or as direct or indirect
result of, the presence on or under, or the escape, seepage,
leakage, spillage, discharge, or emission discharging, from the
real property of the Corporation of any "Hazardous Material,"
including, without limitation, any losses, liabilities, damages,
injuries, costs, expenses, reasonable fees of counsel or claims
asserted or arising under the Comprehensive Environmental
Response, Compensation and Liabilities Act ("CERCLA"), any so-
called "Super Fund" or "Super Lien" law or any other applicable
federal, state or local statute, law, ordinance, code, rule,
regulation, order or decree now or at any time hereafter in
effect, regulating, relating to or imposing liability or
standards of conduct concerning any Hazardous Material.
(iii) Since the date first acquired or leased by the Sellers or the
Corporation, Sellers and Corporation have not placed any
"Hazardous Material" on or under the real property owned or
leased by the Corporation and, to the best of Sellers' knowledge,
there has been no "Hazardous Material" on or under the real
property owned or leased by the Corporation.
(iv) Sellers have commissioned investigation and reports by Cascade
Earth Sciences, dated July 29 and 30, 1998 (the CES reports) of
11 facilities operated by Willamette Seed Co. (WSC); specifically
Locations 1, 2, 3, 4, 5, 8, 9, 10, 10A, 12 and 13 as described in
Schedule 4(k). This report is described in Schedule 4(z).
As to these facilities, Sellers shall indemnify buyer ABT and WSC
for all response costs, removal costs, and remedial action costs
expended in order to remove and/or remediate all Hazardous
Materials and Hazardous Waste contamination and conditions
identified in the CES reports in order to meet all clean-up
levels and standards required by the Oregon Department of
Environmental Quality (DEQ) or the U.S. Environmental Protection
Agency (EPA) during the time period of such removal and/or
remediation. The parties agree the required action shall be
clean-up of Dieldrin, Aldrin, and hydrocarbons at the Albany
facility and clean-up of Dieldrin and Aldrin at the West ▇▇▇▇▇▇▇
facility. These clean-up costs shall be paid in full from the
Escrow Funds, without being subject to the minimum claim
limitation of Section 6(d). Sellers shall be responsible for
management of these clean-up activities, subject to review and
approval of Buyer.
19
As to these 11 facilities, Sellers shall also indemnify Buyer,
ABT and WSC for all expenses incurred in meeting future,
stricter, DEQ and/or EPA clean-up level and standards, provided
that either (a) the clean-up to stricter standards is required by
DEQ or EPA; or (b) there is a legal duty on the part of ABT, WSC
or their directors, officers or employees to report known
conditions in exceedence of such levels and standard.
In the event Hazardous Waste or Hazardous Material contamination
is discovered on or emanating from any of the 11 facilities
described in the CES report of a nature not identified in the CES
Report, or at a level in exceedence of levels reported in the CES
report, there shall be a rebuttable presumption that the
contamination results from releases occurring after the Closing
Date. Buyer, ABT and/or WSC may overcome this presumption by
establishing that they did not, after the Closing Date, use the
Hazardous Substances or release the Hazardous Wastes discovered.
In that event, clean-up costs shall be paid from Escrow Funds.
In the event Hazardous Waste or Hazardous Material contamination
is discovered on or emanating from any of WSC facilities not
described in the CES report, there shall be a rebuttable
presumption that the contamination results from releases
occurring after the Closing Date. Buyer, ABT and/or WSC may
overcome this presumption by establishing that they did not,
after the Closing Date, use the Hazardous Substances or release
the Hazardous Wastes discovered. In that event, clean-up costs
shall be paid from Escrow Funds.
(v) Neither the Corporation nor the Sellers, nor to the best
knowledge and belief of the Sellers, any officer, employee or
agent of the Corporation acting on its behalf, nor any other
person acting on its behalf, has, directly or indirectly, within
the past three (3) years given or received or agreed to give or
receive any gift or similar benefit to any customer, supplier,
governmental employee or other person who is or may be in a
position to help or hinder the Corporation (or assist the
Corporation in connection with any actual or proposed
transaction) which (i) might subject the Corporation to any
damage or penalty in any civil, criminal or governmental
litigation or proceeding, (ii) if not given or received in the
past might have had an adverse effect on the assets, business or
operation of the Corporation, or (iii) if not continued in the
future, might adversely affect the assets, the business or the
operations or prospects of the Corporation, or which might
subject the Corporation to suit or penalty in any private or
governmental litigation or proceeding.
20
(aa) Guarantees. Except as disclosed in SCHEDULE 4(aa), the Sellers
----------
have not personally guaranteed any of the obligations of the business of the
Corporation.
(bb) Benefits. All accrued holiday, vacation or other compensation or
--------
benefits to which employees of the Corporation are entitled to receive from the
Corporation is set forth on SCHEDULE 4(bb). The Corporation has an employee
manual which sets forth the Corporation's policies with respect to its
employees, and there are no policies other than as set forth in SCHEDULE 4(bb).
(cc) Schedules. The Sellers and the Corporation have delivered to the
---------
Buyer complete and correct schedules (the "Schedules"), in form and substance
reasonably acceptable to the Buyer, as of the date of this Agreement, specifying
with respect to the business, properties, assets and obligations of the
Corporation each and every item in the categories listed as Schedules hereunder,
and complete and correct copies of the documents and other material from which
such Schedules were compiled.
(dd) No Legal or Tax Advice. Sellers are not relying on any legal or tax
----------------------
advice from the Buyer in connection with the transactions contemplated by this
Agreement.
(ee) Accuracy. No representation, warranty, covenant or statement by
--------
the Sellers or the Corporation in this Agreement, including the Schedules and
Exhibits attached hereto and the certificates furnished or to be furnished to
the Buyer pursuant hereto, contains or will contain any untrue statement of a
material fact, or omits or will omit to state a material fact required to be
stated herein or therein or necessary to make the statements contained herein or
therein in light of the circumstances under which they were made, not false or
materially misleading.
SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE BUYER AND ABT. Each of the
----------------------------------------------------
Buyer and ABT jointly and severally warrants and represents to the Sellers as
follows (as used herein, "Buyer's or ABT's best knowledge" or "to the best
knowledge of the Buyer or ABT" shall mean information actually known by the
Buyer or ABT without due inquiry):
(a) Capacity. Each of the Buyer and ABT has full right, power and
--------
capacity to execute, deliver and perform its obligations under this Agreement
and the other documents required to be executed by the Buyer or ABT in
connection herewith and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement does not, and the consummation of the
transactions contemplated by this Agreement will not, constitute a breach of any
term or provision of the Certificate of Incorporation or By-laws of the Buyer or
ABT or constitute a default under any material law, rule, regulation, indenture,
instrument, mortgage, deed of trust, or other agreement or instrument to which
the Buyer or ABT is a party or by which either is bound.
21
(b) Organization.
------------
(i) The Buyer is a corporation duly organized, validly existing and
in good standing under the laws of the State of Oregon, and the
Buyer has corporate power and authority to carry on its business
as now conducted and to own, lease or operate the properties and
assets now used by it in connection therewith. The Buyer is duly
qualified and in good standing to do business in each
jurisdiction in which the nature of its business or the ownership
or leasing of its properties make such qualification necessary.
(ii) ABT is a corporation duly organized, validly existing and in good
standing under the laws of the State of Nevada, and ABT has
corporate power and authority to carry on its business as now
conducted and to own, lease or operate the properties and assets
now used by it in connection therewith. ABT is duly qualified
and in good standing to do business in each jurisdiction in which
the nature of its business or the ownership or leasing of its
properties make such qualification necessary.
(c) Consents and Approvals. No governmental license, permit or
----------------------
authorization, and no registration or filing with any court, governmental
authority or regulatory agency, is required in connection with the execution,
delivery or performance of this Agreement by the Buyer or ABT. Each of the
Buyer and ABT shall execute, deliver and perform its obligations under this
Agreement, and no consent or other approval of any other party is required to be
obtained by the Buyer or ABT in connection with the transactions contemplated
hereby.
(d) Legal Proceedings. Neither the Buyer nor any of its executive
------------------
officers or directors, nor ABT or any of its officers or directors, is a party
to or affected by any pending litigation, arbitration or any governmental
proceeding or investigation that would in any manner affect its entering into
this Agreement or performing the transactions contemplated hereby or that might
result in any material adverse change in the financial condition, business or
properties of the Buyer or ABT, and to the best of each of Buyer's and ABT's
knowledge, no such litigation, arbitration, proceeding or investigation is
threatened.
(e) Binding Obligation. This Agreement has been duly executed and
------------------
delivered by the Buyer and ABT and constitutes the legal, valid and binding
obligation of the Buyer and ABT, enforceable against the Buyer and ABT in
accordance with its terms, except to the extent that such enforceability may be
limited by general principles of equity or bankruptcy, insolvency and other
similar laws affecting the enforcement of creditors' rights generally. All
action of the Board of Directors of the Buyer and ABT and all other corporate
action necessary to authorize the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby has been
duly and validly taken.
22
(f) Brokers; Finders. No agent, broker, investment banker, person or
----------------
firm acting on behalf of the Buyer or ABT or any firm or corporation affiliated
with the Buyer or ABT or under the authority of the Buyer or ABT is or will be
entitled to any brokers' or finders' fee or any other commission or similar fee
in connection with any of the transactions contemplated hereby.
(g) Accuracy. No representation, warranty, covenant or statement by the
--------
Buyer or ABTin this Agreement, including the Schedules and Exhibits attached
hereto and the certificates furnished or to be furnished to the Sellers pursuant
hereto, contains or will contain any untrue statement of a material fact, or
omits or will omit to state a material fact required to be stated herein or
therein or necessary to make the statements contained herein or therein in light
of the circumstances under which they were made, not false or materially
misleading.
SECTION 6. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION.
------------------------------------------------------------
(a) Survival of Representations and Warranties. All representations
------------------------------------------
and warranties made by the Sellers and the Corporation or the Buyer and ABT in
this Agreement, including without limitation all representations and warranties
made in any Exhibit or Schedule hereto or certificate delivered hereunder, shall
survive the Closing until the second anniversary of the Closing Date (the
"Survival Date"); provided, however, that all representations and warranties
made by the Sellers in Sections 4(i) and 4(p) hereof shall survive the Closing
until and through one (1) year after the expiration of the applicable statute of
limitations and all representations and warranties made by the Sellers in
Sections 4(z)(ii), 4(z)(iii) and 4(z)(iv) hereof shall survive the Closing until
and through three (3) year after the Closing Date (the "Extended Survival
Date").
(b) Indemnification by Sellers. Provided that the transaction
--------------------------
contemplated by this Agreement is closed, the Sellers hereby agree to indemnify,
defend and hold harmless the Buyer from and against all liabilities, losses,
costs or damages whatsoever (including expenses and reasonable fees of legal
counsel) ("Claims") arising out of or relating to Claims made prior to the
Survival Date or the Extended Survival Date, if applicable, in the event that it
is determined that such Claims arise out of or from or are based upon (i) the
inaccuracy in any material respect of any representation or warranty contained
in Section 4 made by the Sellers; (ii) the non-performance by the Sellers in
any material respect of any covenant, agreement or obligation to be performed by
the Sellers under this Agreement; or (iii) the assessment of any federal, state
local or other tax liabilities due and payable by the Corporation for all
periods through June 30, 1998.
(c) Indemnification by Buyer and ABT. Provided that the transaction
--------------------------------
contemplated by this Agreement is closed, the Buyer and ABT hereby agree to
indemnify, defend and hold harmless the Sellers from and against all Claims
arising out of or from or based upon (i) the inaccuracy in any material respect
of any representation or warranty contained in Section 5 by the Buyer and ABT;
(ii) the non-performance by the Buyer and ABT in any material respect of any
covenant, agreement or obligation to be performed by the Buyer under this
Agreement; and (iii) any liabilities arising out of the operation of the
business of the Corporation by Buyer and ABT after the Closing Date.
23
(d) Defense of Claims. Whenever any Claim shall arise for indemnification
-----------------
hereunder, the party entitled to indemnification (the "Indemnitee") shall
notify the indemnifying party (the "Indemnitor") in writing within 30 days after
the Indemnitee has actual knowledge that it is entitled to indemnification of
such Claim constituting the basis for such Claim (the "Notice of Claim"). The
Notice of Claim shall specify all facts known to the Indemnitee giving rise to
such indemnification claim and the amount or an estimate of the amount of the
liability arising therefrom.
If the facts giving rise to any such indemnification shall involve any
actual, threatened or possible Claim or demand by any person against the
Indemnitee, the Indemnitor shall be entitled (without prejudice to the right of
the Indemnitee to participate at its expense through co-counsel of its own
choosing) to contest or defend such Claim at his expense and through counsel of
his own choosing if he gives written notice of his intention to do so to the
Indemnitee within 10 days after receipt of the Notice of Claim and provided that
Indemnitor then diligently prosecutes or defends such Claim. In the event that
Indemnitor elects not or fails to diligently prosecute or defend such Claim, the
Indemnitee shall diligently prosecute or defend such Claim.
The Indemnitee shall not settle any claim which would give rise to
liability on the part of the Indemnitor under the indemnity contained in this
Section without the written consent of the Indemnitor, which consent shall not
unreasonably be withheld. If a firm offer is made to settle a claim or
litigation defended by the Indemnitee and the Indemnitor refuses to accept such
offer within 20 days after receipt of written notice from the Indemnitee of the
terms of such offer, then, in such event, the Indemnitee shall continue to
contest or defend such claim and shall be indemnified pursuant to the terms
hereof. Provided, however, that in the event the Indemnitor refuses to accept
such offer to settle a claim as described above and the Indemnitee continues to
contest or defend such claim, the indemnification provided for herein shall be
deemed to include the value of management's time spent in connection with the
defense of such claim. If a firm offer is made to settle a claim or litigation
and the Indemnitor notifies the Indemnitee in writing that the Indemnitor
desires to accept and agree to such settlement, but the Indemnitee elects not to
accept or agree to it, the Indemnitee may continue to contest or defend such
claim or litigation and, in such event, the total maximum liability of the
Indemnitor to indemnify or otherwise reimburse the Indemnitee hereunder with
respect to such claim or litigation shall be limited to and shall not exceed the
amount of such settlement offer, plus reasonable out-of-pocket costs and
expenses (including reasonable attorneys' fees and disbursements) to the date of
notice that the Indemnitor desires to accept such settlement.
Notwithstanding any provision of this Agreement to the contrary, no
claim for indemnification pursuant to this Section 6, by the Indemnitee shall be
asserted or claimed except to the extent any Claim exceeds, in the aggregate,
(i) the sum of $50,000 for Claims arising out of representations contained in
Section 4(z) and (ii) the sum of $25,000 for all other Claims.
Notwithstanding any provision of this Agreement to the contrary (i)
Buyer's maximum liability for indemnification shall not exceed the Purchase
Price, (ii) Seller's maximum liability for indemnification (a) shall not exceed
the Purchase Price for all Claims arising out of inaccuracies of representations
and warranties contained in Sections 4(a) and (b), and (b) shall not
24
exceed $3,000,000 for all other Claims provided, however, that Claims arising
out of inaccuracies of representations and warranties contained in Sections
4(z)(ii), 4(z)(iii), and 4(z)(iv), shall not exceed $3,000,000.00 for such
Claims made with the first year following the closing date, reduced to
$2,000,000.00 the second year following the Closing Date, and further reduced to
$1,000,000.00 the third year following the Closing Date, with the maximum, total
cumulative indemnification for breaches of representations and warranties (other
than those in 4(a) & 4(b) ) being $3,000,000.00.
SECTION 7. COVENANTS OF THE SELLERS AND THE CORPORATION. The Sellers and the
--------------------------------------------
Corporation hereby covenant and agree as follows:
(a) Further Assurances. The Sellers hereby agree that, from time to
------------------
time at the reasonable request of the Buyer and ABT, and without further
consideration, they shall execute and deliver such additional instruments and
take such other action as the Buyer and ABT may reasonably require to convey,
assign, transfer and deliver the Stock and otherwise to carry out the terms of
this Agreement.
(b) Access to the Corporation; Confidentiality.
------------------------------------------
(i) Subsequent to the date hereof and prior to the Closing Date, the
Sellers will continue to give to the Buyer, ABT, and its
counsel, accountants, and other representatives, full and free
access to all properties, books, contracts, commitments and
records of the Corporation so that the Buyer and ABT may have
full opportunity to make such investigation as they shall desire.
(ii) From and after the date of this Agreement until the Closing or
the termination of this Agreement, the Sellers and the
Corporation and their representatives will maintain the
confidentiality of all documents and information of a
confidential nature disclosed to the other party in the course of
their negotiations and the Buyer's and ABT's due diligence review
and will in no event use any confidential information for any
purpose other than for the evaluation of the transactions
contemplated herein and in the event of termination of this
Agreement will destroy all copies of documentation which each
party may have delivered to the other party and will not use any
confidential information from the Buyer or ABT for their own
benefit.
(c) Conduct of Business Pending Closing. From the date of this
-----------------------------------
Agreement to the Closing Date, except as expressly disclosed in this Agreement
or in the Schedules to this Agreement, the Corporation shall conduct its
operations as engaged in at the date of this Agreement according to its ordinary
course of business, shall maintain its records and books of account in a manner
that fairly and currently reflects its financial condition and results of
operations and shall not engage in any transactions other than as contemplated
by this Agreement.
25
(d) Closing Documents. Provided that the Buyer and ABT have fully
-----------------
performed their obligations and Sellers' conditions have been satisfied, the
Sellers and the Corporation shall execute and deliver all instruments and
documents required as a condition precedent to the Closing and take all action
required to carry out the terms of this Agreement and to consummate the
transactions contemplated hereby.
SECTION 8. COVENANTS OF THE BUYER AND ABT. The Buyer and ABT hereby covenant
------------------------------
and warrant as follows:
(a) Closing Documents. The Buyer and ABT shall execute and deliver all
-----------------
instruments and documents required as a condition precedent to Closing and take
all actions required to carry out the terms of this Agreement and to consummate
the transactions contemplated hereby.
(b) Noninterference. The Buyer and ABT shall not take or omit to take
---------------
any action that (i) if taken or omitted on or before the date of this Agreement,
would make untrue any of the representations and warranties contained in Section
5 of this Agreement, or (ii) would interfere with the Buyer's ability to perform
or would prevent performance of any of its obligations under this Agreement or
any of the other agreements or instruments provided for herein.
(c) Confidentiality. From and after the date of this Agreement until
---------------
the Closing or the termination of this Agreement, the Buyer, ABT and their
representatives will maintain the confidentiality of all documents and
information of a confidential nature disclosed by the Sellers in the course of
their negotiations and the Buyer's and ABT's due diligence review, and will in
no event use any confidential information for any purpose other than for the
evaluation of the transactions contemplated herein and the financing of this
transaction. In the event this Agreement is terminated, the Buyer and ABT will
destroy all copies of documentation which they received from Sellers and will
not use any confidential information for their own benefit.
SECTION 9. CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE BUYER AND ABT. The
------------------------------------------------------------
obligations of the Buyer and ABT under this Agreement are subject to the
following conditions:
(a) There shall not have been any breach of the representations,
warranties, covenants and agreements of the Sellers or the Corporation contained
in this Agreement or the Schedules and Exhibits hereto, and all such
representations and warranties shall be true at all times on and before the
Closing as if given at such times, except to the extent that any such
representation or warranty is expressly stated to be true as of some other time.
(b) The Sellers and the Corporation shall have performed and complied with
all covenants, agreements and conditions required by this Agreement to be
performed or complied with by them prior to or at the Closing Date. All
documents and instruments required in connection with this Agreement shall be
reasonably satisfactory in form and substance to the Buyer.
26
(c) There shall have been no material adverse change in the condition
(financial or otherwise), business, assets, liabilities, properties, results of
operations, or earnings of the Corporation.
(d) There shall be no outstanding actions or threats of action by any party
that may materially adversely effect the condition (financial or otherwise),
business, assets, liabilities, properties, results of operations, or earnings of
the Corporation.
(e) The Buyer and ABT shall have received certificates dated the Closing
Date and signed by the Sellers and the Corporation, certifying that the
conditions specified in subsections (a), (b), (c) and (d) above have been
fulfilled except to the extent that any nonfulfillment was disclosed in writing
to the Buyer prior to the Closing Date.
(f) The Corporation and the Sellers shall have obtained and delivered to
the Buyer and ABT any required consents or approvals of any third parties whose
consent is required to the transactions contemplated hereunder.
(g) The Buyer and ABT shall have received originals or certified copies,
reasonably satisfactory in form and substance to the Buyer, of all such
corporate documents of the Corporation as the Buyer shall reasonably require,
including without limitation the following:
(i) the Certificate of Incorporation of the Corporation and all
amendments thereto and restatements thereof certified as of a
recent date by the Secretary of State of Oregon;
(ii) the By-laws of the Corporation and all amendments thereto and
restatements thereof certified as of the Closing Date by an
officer of the Corporation;
(iii) certificate of existence of the Secretary of State of Oregon,
certifying as of a recent date that the Corporation is duly
organized, validly existing and in good standing under the laws
of that State;
(iv) copies of the minutes and resolutions of the Board of Directors
and stockholders of the Corporation showing the authorization and
approval by such Boards of the execution and delivery by the
Corporation to the Buyer of this Agreement and of the agreements
and instruments provided for herein and of the performance of the
obligations of the Corporation under this Agreement and such
other instruments and agreements, certified as of a recent date
by the Secretary or another officer of the Corporation; and
(v) a certificate of incumbency identifying the officers and
directors of the Corporation immediately before Closing.
27
(h) The Buyer and ABT shall have received a written opinion of counsel for
the Sellers and the Corporation dated as of the Closing Date, in the form of
EXHIBIT 9(h) hereto.
(i) The Corporation and the Sellers shall have executed and delivered to
the Buyer any required assignment or consent to any of the leases described in
SCHEDULE 4(k).
(j) The Sellers shall have executed and delivered to the Buyer and ABT any
required assignment or endorsement in favor of the Buyer of coverage under the
insurance policies maintained by the Sellers covering the Corporation described
to in SCHEDULE 4(q) to this Agreement.
(k) The Buyer and ABT shall have received from ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ the
Employment Agreement and Non-Competition Agreement referred to Section 3(c)(i)
and the Non-Competition Agreements referred to Section 3(c)(ii) from ▇▇▇▇▇▇ ▇.
▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇▇.
(l) The Buyer shall have entered into employment agreements or otherwise
made arrangements that they deem satisfactory with such "key personnel" of the
Sellers as Buyer deems necessary.
(m) Prior to August 21, 1998, Buyer shall have received financial
statements for the period ending March 31, 1998, prepared according to GAAP.
(n) On or prior to the Closing, the Sellers, at the Sellers' cost and
expense, shall cause the Title Company (which title company shall be chosen by
the Buyer or Buyer's attorney) to issue to the Buyer its preliminary title
report on the real property (the "Preliminary Commitment"), along with copies of
all documents that give rise to exceptions listed in the report, provided all
exceptions contained therein are acceptable to the Buyer.
(o) The Buyer shall have received from those Sellers wishing to purchase
their life insurance policy held by the Corporation the purchase price for such
policy in an amount equal to the cash value of the policy plus any unearned
premiums at the Closing Date less any policy loans.
(p) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇
shall have executed and delivered Guaranties guaranteeing 50% of Key Bank
National Association Installment Note (Obligation #9001) dated October 7, 1994.
(q) The Buyer shall have received a final environmental report prepared by
Cascades Earth Science and such report shall be in form satisfactory to Buyer.
(r) The Buyer shall have received payment from the Sellers for the
following accounts receivable, ▇▇▇▇▇ & ▇▇▇▇▇ Farms Collection matter; and
▇▇▇▇▇▇▇ ▇▇▇▇ and ▇▇▇▇ Case, dba ▇▇▇▇ Case Farms Collection matter.
28
(s) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇
shall have executed and delivered Guaranties guaranteeing certain loans to third
parties in accordance with the schedule EXHIBIT 15(b).
SECTION 10. CONDITIONS PRECEDENT TO THE SELLERS' AND THE CORPORATION'S
----------------------------------------------------------
OBLIGATIONS. The obligations of the Sellers and the Corporation under this
-----------
Agreement are subject to the following conditions:
(a) There shall not have been any breach of the representations,
warranties, covenants and agreements of the Buyer and ABT contained in this
Agreement, and all such representations and warranties shall be true at all
times at and before the Closing, except to the extent that any such
representation or warranty is expressly stated to be true as of some other time.
(b) The Buyer and ABT shall have performed and complied with all agreements
and conditions required by this Agreement to be performed or complied with by
them. All documents and instruments required in connection with this Agreement
shall be reasonably satisfactory in form and substance to the Sellers.
(c) The Sellers shall have received certificates dated the Closing Date and
signed by the Buyer and ABT, certifying that the conditions specified in
Paragraphs 10(a) and 10(b) above have been fulfilled.
(d) The Sellers shall have received a written opinion of Snow ▇▇▇▇▇▇ ▇▇▇▇▇▇
P.C., counsel for the Buyer and ABT, dated as of the Closing Date, in the form
of EXHIBIT 10(d) hereto.
(e) The Sellers shall have received originals or certified copies,
reasonably satisfactory in form and substance to the Sellers, of the following
corporate documents of the Buyer:
(i) a certificate of existence certifying as of a recent date that
each of the Buyer and ABT is a corporation in good standing under
the laws of its state of incorporation;
(ii) copies of the minutes and resolutions of the Board of Directors
of the Buyer and ABT showing the authorization and approval by
the Board of the execution and delivery by the Buyer and ABT of
this Agreement and the agreements and instruments provided for
herein and of the performance of the obligations of the Buyer and
ABT under this Agreement and such other instruments and
agreements, certified as of a recent date by the Secretary or
another officer of the Buyer and ABT; and
(iii) a certificate of incumbency identifying the officers and
directors of the Buyer and ABT immediately before Closing.
29
(f) Buyer, ABT, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ Seeds, Inc., ▇▇▇▇▇ Performance Seeds,
Oregon LLC and Corporation shall have executed and delivered those security
documents required to secure certain loans made to third parties in accordance
with the schedule set forth in Exhibit 15(b).
SECTION 11. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE SELLERS AND THE BUYER.
-----------------------------------------------------------------
The obligations of the Sellers and the Buyer to complete this transaction shall
be subject to the fulfillment at or prior to the Closing Date of the following
conditions:
(a) Due Diligence. The Sellers and the Buyer and ABT shall have been
-------------
afforded the opportunity to complete their due diligence and conduct a review of
the business and prospects of the other, and shall be reasonably satisfied as to
such business and prospects.
(b) No Injunctions. No action or proceeding shall have been instituted or
--------------
threatened by any public authority or private person prior to the Closing before
any court or administrative body to restrain, enjoin or otherwise prevent the
consummation of this transaction or to recover any damages or obtain other
relief as a result of this transaction.
(c) Consents. Any consent to the transaction considered by the Sellers or
--------
the Buyer to be necessary or advisable under any agreement or contract, the
withholding of which might have, in the judgment of the Sellers or the Buyer or
ABT, a material adverse effect on the financial condition of the other party,
shall have been obtained.
(d) Corporate Proceedings. All corporate and other proceedings in
---------------------
connection with the transactions contemplated by this Agreement, and all
documents and instruments incident thereto, shall be reasonably satisfactory in
substance and form to the Sellers, the Buyer, ABT and their counsel, and the
Sellers, the Buyer, ABT and their counsel shall have received all certificates,
documents and instruments, or copies thereof, certified if requested, as may be
reasonably requested.
SECTION 12. TERMINATION. This Agreement may be terminated at any time prior
-----------
to the Closing Date:
(a) By mutual written consent of the Sellers, the Buyer, ABT and the
Corporation properly authorized by their respective Boards of Directors.
(b) By the Buyer, ABT or the Sellers if this transaction is not completed
by August 26, 1998, unless extended by mutual consent.
(c) By the Buyer or ABT if since June 30, 1998 there has been a material
adverse change in the condition (financial or otherwise), business, assets,
liabilities properties, results of operations, or earnings of the Corporation.
(d) By the Buyer or ABT if Sellers are unable to deliver good marketable
and insurable title to the real property.
30
SECTION 13. THE BUYER'S OBLIGATIONS AT CLOSING.
----------------------------------
At the Closing, in addition to fulfilling the conditions to closing
appearing in this Agreement, the Buyer shall deliver to the Sellers the Purchase
Price as more specifically described in Section 3 hereof, together with all
other documents and agreements required to be delivered by it hereunder.
SECTION 14. THE SELLERS' OBLIGATIONS AT CLOSING. At the Closing, in
-----------------------------------
addition to fulfilling the conditions to closing appearing herein, the Sellers
shall deliver to the Buyer:
(a) stock certificate(s) representing the Stock free of all liens, claims
and encumbrances properly endorsed, or with stock powers executed in blank, and
with any and all transfer, stamp or similar taxes upon the transfer of the
shares to the Buyer paid in full by the Sellers;
(b) all original minute books, stock books, stock transfer ledger, canceled
stock certificates, corporate seals and financial records and statements of the
Corporation.
SECTION 15. SUBSEQUENT EVENTS.
-----------------
(a) After the Closing, the Buyer may receive, at its own expense, audited
financial statements, of the Corporation ("Audited Financial Statements"),
certified by KPMG Peat Marwick LLP, independent certified public accountants,
for all periods required of the Buyer under the rules and regulations of the
Securities and Exchange Commission (the "Rules"). The Corporation and the
Sellers hereby agree to provide the Buyer and their accountants with full and
free access to the books and records of the Corporation and to cooperate fully
with all such representatives of the Buyer so that the Audited Financial
Statements may be prepared on a timely basis.
(b) The Buyer shall cause the Corporation to pay off any loans made by
third person's (other than commercial financial institutions) to the Corporation
in accordance with the schedule set forth in EXHIBIT 15(b).
(c) The Buyer agrees to acknowledge the Corporation's vacation plan which
is currently in effect, and the vacation days shown on SCHEDULE 4(aa) as accrued
by the employees of the Corporation, and acknowledge that the Corporation's
employees have a vested right in such vacation days as shown, and agrees to not
take any action to divest the Corporation's current employees from entitlement
to such vacation days as accrued at Closing by each employee of the Corporation.
(d) The Buyer and ABT shall cause the Corporation to pay year-end employee
bonus and make year-end contributions to the Corporation's Profit Sharing Plan
for the period of July 1, 1997 through June 30, 1998 according to the resolution
adopted by the Board of Directors of the Corporation on June 12, 1996 adopting a
"Year-End Bonus Formula" (and the Year-End Bonus Formula attached thereto), a
copy of which has been provided to Buyer and ABT, for the
31
approximate sum of $219,000.00 to be paid within 15 days of Closing, the exact
figure to be provided within 5 days of Closing and mutually agreed on.
SECTION 16. PARTIES IN INTEREST. This Agreement shall be binding upon and
-------------------
shall inure to the benefit of the parties and their successors and assigns.
Nothing herein expressed or implied is intended or shall be construed to confer
upon or to give any person, firm, or corporation other than the parties hereto
any rights or remedies under or by reason hereof.
SECTION 17. ENTIRE AGREEMENT. This Agreement, including the Schedules
----------------
and Exhibits hereto, contains the entire agreement and understanding among the
parties hereto with respect to the subject matter hereof and shall not be
modified or affected by any offer, proposal, statement or representation, oral
or written, made by or for any party in connection with the negotiation of the
terms hereof. All references herein to this Agreement shall specifically
include, incorporate and refer to the Schedules and Exhibits attached hereto
which are hereby made a part hereof. There are no representations, promises,
warranties, covenants, undertakings or assurances (express or implied) other
than those expressly set forth or provided for herein and in the other documents
referred to herein. This Agreement may not be modified or amended orally, but
only by a writing signed by all the parties hereto.
SECTION 18. GOVERNING LAW. This Agreement and all rights and obligations
-------------
hereunder shall be governed by, and construed in accordance with, the laws of
the State of Nevada, applicable to agreements made and to be performed wholly
within said State, without regard to the conflicts of laws principles of such
State.
SECTION 19. EXPENSES. The Buyer and the Sellers shall each pay their own
--------
expenses incidental to the preparation of this Agreement, the carrying out of
the provisions of this Agreement and the consummation of the transactions
contemplated hereby, except that the expenses incurred by the Sellers on or
before January 30, 1998 shall be paid by the Corporation without reimbursement
from the Sellers.
The Sellers shall pay for the ALTA Extended coverage title insurance
policy, one-half of all recording charges, real estate escrow fees and costs,
and the Sellers' customary share of prorations. The Buyer shall pay one-half of
all recording charges, real estate escrow fees and costs, and the Buyer's
customary share of prorations.
SECTION 20. ARBITRATION. Any dispute with respect to this Agreement shall be
-----------
resolved by mediation and, if mediation is not successful, then by arbitration
as provided herein.
The parties agree first to endeavor to settle the dispute in an
amicable manner by mediation administered by the American Arbitration
Association (the "AAA") or such other mediation service as is mutually agreeable
to the parties to the dispute under either the AAA's Commercial Mediation Rules
or such other commercial mediation rules as is mutually agreeable to the parties
to the dispute. The mediation shall take place in Las Vegas, Nevada with
representatives
32
of the parties present with full authority to negotiate a settlement. The
parties must participate in the Mediation process with a neutral mediator for at
least 10 hours over at least 2 days prior to commencement of any arbitration. If
a party to the dispute refuses to participate in the mediation, the party
demanding mediation may either compel mediation by seeking an appropriate order
from a court of competent jurisdiction or proceed immediately to arbitration.
Thereafter, any unresolved dispute shall be settled by arbitration administered
by the AAA or such other arbitration service as is mutually agreeable to the
parties to the dispute in accordance with the AAA's Commercial Arbitration Rules
or such other commercial arbitration rules as is mutually agreeable to the
parties to the dispute. Judgment upon the award rendered by the arbitrator(s)
may be entered in any court having jurisdiction thereof, and the resolution of
the disputed matter as determined by the arbitrator(s) shall be binding on the
parties. Any such mediation or arbitration shall be conducted in Las Vegas,
Nevada.
Any party may, without inconsistency with this Agreement, seek from a
court any interim or provisional relief that may be necessary to protect the
rights or property of that party pending the establishment of the arbitral
tribunal, or pending the arbitral tribunal's determination of the merits of the
controversy.
The arbitrator(s) may award costs and fees to the prevailing party if,
in his/her (their) discretion, the non-prevailing party did not prosecute the
arbitration or settlement of the dispute in good faith. "Costs and fees" for
this purpose shall mean reasonable pre-award expenses of the arbitration,
including fees for the arbitrator(s), administrative fees, travel expenses, out-
of-pocket expenses such as copying and telephone, court costs, witness fees and
attorneys' fees. Except as otherwise awarded by the arbitrator(s), all costs
and fees shall be borne by the party incurring such costs and fees.
The award shall be in writing and shall be signed by the arbitrator(s)
and shall include a statement regarding the disposition of any statutory claim.
SECTION 21. SEVERABILITY . If any part of this Agreement is held to be
------------
unenforceable or invalid under, or in conflict with, the applicable law of any
jurisdiction, the unenforceable, invalid or conflicting part shall, to the
extent permitted by applicable law, be narrowed or replaced, to the extent
possible, with a judicial construction in such jurisdiction that effectuates the
intent of the parties regarding this Agreement and such unenforceable, invalid
or conflicting part. To the extent permitted by applicable law, notwithstanding
the unenforceability, invalidity or conflict with applicable law of any part of
this Agreement, the remaining parts shall be valid, enforceable and binding on
the parties.
SECTION 22. NOTICES.
-------
(a) All notices, requests, consents and demands by the parties hereunder
shall be delivered by hand, by recognized national overnight courier or by
deposit in the United States mail,
33
postage prepaid, by registered or certified mail, return receipt requested,
addressed to the party to be notified at the addresses set forth below:
(a)(i) if to the Corporation to:
Willamette Seed Co.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to the Sellers to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
with a copy to:
Weatherford, Thompson, Quick & ▇▇▇▇▇▇▇▇▇▇▇, P.C.
▇.▇. ▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
(iii) if to ABT or the Buyer to:
AgriBioTech, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
Telecopier No.: (▇▇▇)▇▇▇-▇▇▇▇
with a copy to:
Snow ▇▇▇▇▇▇ ▇▇▇▇▇▇ P.C.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
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(b) Notices given by mail shall be deemed effective on the earlier of the
date shown on the proof of receipt of such mail or, unless the recipient proves
that the notice was received later or not received, three (3) days after the
date of mailing thereof. Other notices shall be deemed given on the date of
receipt. Any party hereto may change the address specified herein by written
notice to the other parties hereto.
SECTION 23. NON-WAIVERS. Neither any failure nor any delay on the part of
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any party to this Agreement in exercising any right, power or privilege
hereunder shall operate as a waiver of any rights of such party, unless such
waiver is made by a writing executed by the party and delivered to the other
parties hereto; nor shall a single or partial exercise of any right preclude any
other or further exercise of any other right, power or privilege accorded to any
party hereto.
SECTION 24. ASSIGNMENT. This Agreement may not be assigned by any party
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without the prior consent of the other parties.
SECTION 25. DISCLOSURE. From and after the date of this Agreement until the
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Closing or the termination of this Agreement, the Sellers will not (i) solicit
or encourage inquiries or proposals with respect to, or furnish any information
relating to, or participate in any negotiations or discussions concerning the
sale of the Stock or the sale of all or a substantial portion of the assets of
the Corporation with anyone other than the Buyer; or (ii) discuss the sale of
the Stock with anyone other than the Buyer and other officers, directors and
shareholders of the Corporation and the Sellers' advisors and (iii) unless
otherwise required by law or the requirements of any applicable stock exchange,
make any public announcement without prior approval of the language of such
announcement by the Buyer.
SECTION 26. MISCELLANEOUS.
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(a) Further Assurances: Each of the parties hereto shall use its best
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efforts to take or cause to be taken, and to cooperate with the other party
hereto to the extent necessary with respect to, all action, and to do, or cause
to be done, consistent with applicable law, all things necessary, proper or
advisable to consummate and make effective the transactions contemplated by this
Agreement. Without limiting the generality of the foregoing, the Sellers and
Buyer shall cooperate with and provide assistance to the other in connection
with the preparation and filing of all federal, state, local and foreign income
tax returns which relate to the Corporation and relate to pre-Closing periods
but which are not required to be filed until after the Closing, and shall also
cooperate with and provide assistance to the other or the Corporation with
respect to any audit of any tax returns filed prior to the Closing.
(b) Headings. The headings contained herein are for reference purposes
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only and shall not affect the meaning or interpretation of this Agreement.
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(c) Counterparts. This Agreement may be executed and delivered in
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multiple counterpart copies, each of which shall be an original and all of which
shall constitute one and the same agreement.
36
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the date first above written.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------- --------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Seller) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (Seller)
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------ ---------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (Seller) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Seller)
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------ ------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (Seller) ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (Seller)
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------- -----------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Seller) ▇▇▇▇▇ ▇. ▇▇▇▇▇ (Seller)
THE ▇. ▇. ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇ THE H. G. & ▇▇▇ ▇▇▇▇▇ STANDARD
CHARITABLE TRUST (Seller) CHARITABLE TRUST (Seller)
By: /s/ ▇▇▇ ▇▇▇▇▇ By: /s/ ▇▇▇ ▇▇▇▇▇
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▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
Independent Special Trustee Independent Special Trustee
WILLAMETTE SEED CO.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇
AGRIBIOTECH, INC. ▇.▇. ▇▇▇▇▇▇▇▇▇▇ & SONS (Buyer)
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------- -------------------------
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇,
Vice President Vice President
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