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SHARE EXCHANGE AGREEMENT
BY AND AMONG
BIOFARM, INC.
AND
FRIENDLYWAY, INC.
AND ITS STOCKHOLDERS:
FRIENDLYWAY AG
▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
AUGUST 13, 2004
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SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement (this "AGREEMENT") is made effective as of
August 13, 2004, by and among Biofarm, Inc., a Nevada Corporation ("BIOF"), and
friendlway, Inc. a Delaware corporation ("FWAY"), and its two stockholders,
friendlyway AG, a German corporation, and ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇ (together, the
"FWAY STOCKHOLDERS").
RECITALS
A. The Boards of Directors of each of the BIOF and FWAY believe it is in
the best interests of each company and their respective stockholders that BIOF
acquire FWAY through the acquisition of all the outstanding shares of capital
stock of FWAY from the FWAY Stockholders (the "ACQUISITION") and, in furtherance
thereof, have approved the Acquisition.
B. Pursuant to the Acquisition, the FWAY Stockholders, who in the
aggregate own all of the outstanding shares of FWAY Common Stock ("FWAY
COMMON"), shall exchange the shares of FWAY Common held by them for newly-issued
shares of BIOF Common Stock ("BIOF Common").
C. On the Closing Date, BIOF shall have either liquidated or otherwise
provided for the elimination of 100% of the current liabilities of BIOF and
shall have transferred all of its assets to a wholly-owned subsidiary, Ocwen, a
Nevada corporation ("OCWEN"), the shares of capital stock of which shall have
been transferred, as a dividend on the pre-Acquisition outstanding BIOF Common,
to a trustee to hold for the benefit of the pre-Acquisition holders of the BIOF
Common (the "SPIN-OFF").
D. In connection with the Acquisition, BIOF desires to make certain
representations and warranties to FWAY and the FWAY Stockholders, and each of
FWAY and the two FWAY Stockholders desire to make certain representations to
BIOF.
NOW, THEREFORE, in consideration of the covenants, promises and
representations set forth herein, and for other good and valuable consideration,
intending to be legally bound hereby the parties agree as follows:
SECTION 1
THE ACQUISITION.
1.1 SHARE EXCHANGE. Subject to the terms and conditions herein stated, on
the Closing Date each FWAY Stockholder shall exchange, assign, transfer and
deliver to BIOF and BIOF shall acquire such FWAY Stockholder's FWAY Common in
exchange for the issuance by BIOF of an aggregate of 18,000,000 shares of BIOF
Common (the "ACQUISITION CONSIDERATION") to the FWAY Stockholders. The number of
shares of FWAY Common to be exchanged by each FYWAY Stockholder and the number
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of shares of BIOF Common to be received by each FWAY Stockholder pursuant to
this Agreement is set forth on EXHIBIT A.
1.2 ASSUMPTION OF OPTIONS. At the Closing Date, all options to purchase
FWAY Common then outstanding under FWAY's 2003 Employee Stock Option Plan (the
"OPTION PLAN") shall be assumed by BIOF in accordance with provisions described
below.
(a) Each such option shall continue to have, and be subject to, the same
terms and conditions set forth in the Option Plan and/or as provided in the
respective option agreements governing such immediately prior to the Closing
Date, except that (A) such option shall be exercisable for that number of whole
shares of BIOF Common equal to the product of the number of shares of FWAY
Common Stock that were issuable upon exercise of such option immediately prior
to the Closing Date multiplied by quotient of (x) the number of shares of BIOF
Common constituting the Acquisition Consideration divided by (y) the number of
shares of FWAY Common to be exchanged by the FWAY Stockholders pursuant to this
Agreement, rounded down to the nearest whole number of shares of BIOF Common and
(B) the per share exercise price for the shares of BIOF Common issuable upon
exercise of such assumed option shall be equal to the quotient determined by
dividing the exercise price per share of FWAY Common at which such option was
exercisable immediately prior to the Closing Date by the quotient described in
clause (A), rounded up to the nearest whole cent.
(b) It is the intention of the parties that the options assumed by BIOF
qualify following the Closing Date as incentive stock options as defined in
Section 422 of the Internal Revenue Code to the extent such options qualified as
incentive stock options immediately prior to the Closing Date.
(c) Promptly following the Closing Date, BIOF will issue to each holder of
an assumed option a document evidencing the foregoing assumption of such option
by BIOF.
1.3 ANTIDILUTION PROVISION. In the event BIOF changes (or establishes a
record date that occurs before the Closing Date for changing) the number of
shares of BIOF Common issued and outstanding before the Closing Date as a result
of a stock split, stock dividend, recapitalization, subdivision,
reclassification, combination, exchange of shares or similar transaction with
respect to the outstanding shares as of the Closing Date, the Acquisition
Consideration shall be proportionately adjusted, as applicable, to reflect such
stock split, stock dividend, recapitalization, subdivision, reclassification,
combination, exchange of shares or similar transaction. In addition, in the
event BIOF pays (or establishes a record date that occurs before the Closing
Date for payment of) an extraordinary dividend on, or makes any other
extraordinary distribution in respect of, BIOF Common, the Acquisition
Consideration shall be appropriately adjusted to reflect such dividend or
distribution.
1.4 REORGANIZATION FOR TAX PURPOSES. The parties intend to adopt this
Agreement as a "Plan of Reorganization" and to consummate the Acquisition in
accordance with the provisions of Section 368(a)(1)(B) of the Code.
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SECTION 2
CLOSING DATES AND DELIVERY.
2.1 CLOSING. The exchange, transfer and delivery of the FWAY Common and
the issuance and delivery of the Acquisition Consideration (the "CLOSING") shall
take place at the offices of ▇▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, 4 Embarcadero Center,
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇ at 10:00 am Pacific Time on such date as is
mutually agreed upon by FWAY and BIOF but no later than 5 business days after
the satisfaction or waiver of the conditions to Closing set forth in Section 6
and Section 7 below (such date the "CLOSING DATE).
2.2 DELIVERIES BY BIOF. At the Closing, BIOF shall deliver or cause to be
delivered to FWAY and the FWAY Stockholders:
(a) a certificate executed by the Chief Executive Officer of BIOF on
behalf of BIOF, in form and substance reasonably acceptable to FWAY and the FWAY
Stockholders, certifying that the conditions to closing listed in SECTION 7 have
been satisfied.
(b) a certificate of BIOF executed by BIOF's Secretary, in form and
substance reasonably acceptable to FWAY and the FWAY Stockholders, attaching and
certifying to the truth and correctness of (1) the Certificate of Incorporation
of BIOF, (2) the Bylaws of BIOF, (3) the board resolutions adopted in connection
with the transactions contemplated by this Agreement, and (4) the composition of
the Board of Directors of BIOF.
(c) a certificate of the Secretary of State of the State of Nevada,
dated as of a date within five days of the date of the Closing, with respect to
the good standing of BIOF.
(d) an opinion from Zarwin ▇▇▇▇, counsel to BIOF, dated as of the
Closing Date, in form and substance reasonably acceptable to FWAY and the FWAY
Stockholders.
(e) certificates representing the number of shares of BIOF Common to
be received by each FWAY Stockholder as set forth on EXHIBIT A, which
certificates shall be delivered to the appropriate FWAY Stockholder.
2.3 DELIVERIES BY FWAY. At the Closing, FWAY shall deliver or cause to be
delivered to BIOF:
(a) a certificate executed by the Chief Executive Officer of FWAY on
behalf of FWAY, in form and substance reasonably acceptable to BIOF, certifying
that the conditions to closing listed in SECTION 6 other than SECTION 6.1(B)
have been satisfied.
(b) a certificate of FWAY executed by FWAY's Secretary, in form and
substance reasonably acceptable to BIOF, attaching and certifying to the truth
and correctness of (1) the Certificate of Incorporation of FWAY, (2) the Bylaws
of FWAY, (3) the board and stockholder resolutions adopted in connection with
the transactions contemplated by this Agreement, and (4) the composition of the
Board of Directors of FWAY.
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(c) a certificate of the Secretary of State of the State of Delaware,
dated as of a date within five days of the date of the Closing, with respect to
the good standing of FWAY.
(d) an opinion from ▇▇▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to FWAY, dated
as of the Closing Date, in form and substance reasonably acceptable to BIOF.
2.4 DELIVERIES BY THE FWAY STOCKHOLDERS. At the Closing, each FWAY
Stockholder shall deliver or cause to be delivered to BIOF:
(a) certificate or certificates representing the shares of FWAY Common
held by such FWAY Stockholder as indicated on EXHIBIT A either endorsed to BIOF
or accompanied by assignments separate from certificate, in either instance
containing a Medallion form of signature guaranty or a notarization by a German
notary transferring all such shares to BIOF.
(b) a certificate signed by such FWAY Stockholder certifying that the
conditions to closing set forth in SECTION 6.1(B) have been satisfied with
respect to such FWAY Stockholder.
SECTION 3
REPRESENTATIONS AND WARRANTIES OF FWAY.
Subject to such exceptions as are disclosed in the SCHEDULE OF EXCEPTIONS
attached hereto, FWAY hereby represents and warrants to BIOF as follows:
3.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. FWAY is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware. FWAY has the requisite corporate power and authority to own
and operate its properties and assets, to carry on its business as presently
conducted and as proposed to be conducted, to execute and deliver this
Agreement, and to perform its obligations pursuant to this Agreement. FWAY is
presently qualified to do business as a foreign corporation in each jurisdiction
where the failure to be so qualified could reasonably be expected to have a
material adverse effect on FWAY's financial condition or business as now
conducted and as proposed to be conducted (a "MATERIAL ADVERSE EFFECT").
3.2 SUBSIDIARIES. FWAY does not own or control, directly or indirectly,
any interest in any corporation, partnership, limited liability company,
association or other business entity.
3.3 CAPITALIZATION.
(a) Immediately prior to the Closing, the authorized capital stock of
FWAY will consist of 20,000,000 shares of Common Stock at $0.001 par value,
each, and 10,000,000 shares of Preferred Stock at $0.001 par value, each, of
which 10,000,000 shares of Common Stock, and no shares of Preferred Stock will
be issued and outstanding.
(b) All issued and outstanding shares of FWAY's Common (i) have been
duly authorized and are validly issued, fully paid, and nonassessable, and (ii)
were issued in compliance with all applicable state and federal laws concerning
the issuance of securities.
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(c) FWAY has reserved 2,000,000 shares of Common Stock authorized for
issuance to employees, consultants and directors pursuant to its 2003 Employee
Stock Option Plan, under which options to purchase not more than 1,200,000
shares will be issued and outstanding as of the Closing date.
(d) Except as set
forth above and in this Agreement and the SCHEDULE OF EXCEPTIONS, there are no
options, warrants, convertible securities or other rights, agreements,
commitments or arrangements of any kind to purchase, subscribe, issue, or sell
any of FWAY's authorized and unissued capital stock.
3.4 AUTHORIZATION. All
corporate action on the part of FWAY and its directors, officers and
stockholders necessary for the authorization, execution and delivery of this
Agreement by FWAY and the performance of all of FWAY's obligations under this
Agreement has been taken. The Agreement, when executed and delivered by FWAY,
shall constitute the valid and binding obligation of FWAY, enforceable in
accordance with its terms, except (i) as limited by laws of general application
relating to bankruptcy, insolvency and the relief of debtors and (ii) as limited
by rules of law governing specific performance, injunctive relief or other
equitable remedies and by general principles of equity.
3.5 FINANCIAL
STATEMENTS. FWAY has delivered to BIOF its audited balance sheet for the year
ended December 31, 2003, and statement of operations for the years ended
December 31, 2003 and 2002 and its unaudited balance sheet and statement of
operations for the six month period ended June 30, 2004 (the "FINANCIAL
STATEMENTS"). The Financial Statements are correct in all material respects and
present fairly the financial condition and operating results of FWAY as of the
date(s) and during the period(s) indicated therein. The audited Financial
Statements have been prepared in accordance with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the period
indicated, except as disclosed therein. The unaudited Financial Statements do
not contain additional financial statements and footnotes required under GAAP,
and are subject to normal year-end adjustments.
3.6 CHANGES. Since June 30, 2004 there has not been:
(a) any material adverse change in the assets, liabilities, financial
condition or operating results of FWAY from that reflected in the Financial
Statements, except changes in the ordinary course of business, which, in any
case, have not had a Material Adverse Effect;
(b) any damage, destruction or loss, whether or not covered by
insurance, that has had a Material Adverse Effect;
(c) any waiver by FWAY of a valuable right or of a material debt owed
to it;
(d) any material change or amendment to a material agreement by which
FWAY or any of its assets or properties is bound or subject;
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(e) any material change in any compensation arrangement or agreement
with any key employee;
(f) any satisfaction or discharge of any lien, claim, or encumbrance
or payment of any obligation by FWAY, except in the ordinary course of business
and that is not material to the business, properties, prospects or financial
condition of FWAY;
(g) sale, exchange or other disposal by FWAY of any of its material
assets or rights, other than the sale of its inventory in the ordinary course of
business;
(h) any declaration, setting aside or payment or other distribution in
respect of any of FWAY's capital stock, or any direct or indirect redemption,
purchase or other acquisition of any of such stock by FWAY;
(i) any material mortgage, pledge, transfer of a security interest in,
or lien, created by FWAY, with respect to any of its material properties or
assets, except liens for taxes not yet due or payable;
(j) incurring of indebtedness for money borrowed or any other
liabilities by FWAY individually in excess of $25,000 or, in the case of
indebtedness and/or liabilities individually less than $25,000, in excess of
$100,000 in the aggregate;
(k) the loaning or advancing of money by FWAY to any person other than
advancement of travel and other business expenses consistent with past practice;
(l) any receipt of notice that there has been a loss of, or material
order cancellation by, any major customer of FWAY;
(m) to its knowledge, any other event or condition of any character
with respect to FWAY that has had or could reasonably be expected to have a
Material Adverse Effect; or
(n) any agreement or commitment by FWAY to do any of the things
described in this SECTION 3.6.
3.7 INTELLECTUAL PROPERTY.
(a) To the knowledge of FWAY (without having conducted any special
investigation or patent search), FWAY owns or possesses or can obtain on
commercially reasonable terms sufficient legal rights to all patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses
(software or otherwise), information, processes and similar proprietary rights
("INTELLECTUAL PROPERTY") necessary to the business of FWAY as presently
conducted, without any conflict with or infringement of the rights of others.
FWAY has not received any written communication alleging that FWAY has violated
or, by conducting its business as currently conducted, would violate any of the
Intellectual Property of any other person or entity .
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(b) To the knowledge of FWAY, none of its employees is obligated under
any contract or other agreement, or subject to any judgment, decree or order of
any court or administrative agency, that would materially interfere with the use
of his or her efforts to promote the interests of FWAY or that would conflict
with FWAY's business as presently conducted. Neither the execution nor delivery
of this Agreement, nor the carrying on of FWAY's business by the employees of
FWAY, nor the conduct of FWAY's business as presently conducted, will, to FWAY's
knowledge, conflict with or result in a breach of the terms, conditions or
provisions of, or constitute a default under, any contract, covenant or
instrument under which any of such employees is now obligated.
3.8 MATERIAL CONTRACTS. Schedule 3.8 lists all agreements, understandings,
instruments, contracts, proposed transactions, to which FWAY is a party or by
which it is bound which involve (i) obligations of, or payments to, FWAY in
excess of $25,000 (other than obligations of, or payments to, FWAY arising from
purchase or sale agreements entered into in the ordinary course of business),
(ii) any license or transfer of Intellectual Property to or from FWAY other than
agreements with its own employees or consultants, standard end-user license
agreements, support/maintenance agreements and agreements entered into in the
ordinary course of FWAY's business, (iii) the grant of rights to manufacture,
produce, assemble, license, market or sell FWAY's products or limitations on
FWAY's exclusive right to develop, manufacture, assemble, distribute, market or
sell its products (each such contract, a "FWAY MATERIAL CONTRACT", collectively
the "FWAY MATERIAL CONTRACTS"). To FWAY's knowledge, all of the FWAY Material
Contracts are valid, binding and in full force and effect in all material
respects, subject to laws of general application relating to bankruptcy,
insolvency and the relief of debtors and rules of law governing specific
performance, injunctive relief or other equitable remedies and to general
principles of equity. Neither FWAY nor, to FWAY's knowledge, is any other party
to the FWAY Material Contracts in material default under any of such FWAY
Material Contracts. For the purposes of this section, all indebtedness,
liabilities, agreements, understandings, instruments, contracts and proposed
transactions involving the same person or entity (including persons or entities
FWAY has reason to believe are affiliated therewith) shall be aggregated for the
purpose of meeting the individual minimum dollar amounts of this section.
3.9 TITLE TO PROPERTIES AND ASSETS; LIENS. FWAY has good and marketable
title to its properties and assets, and has good title to all its leasehold
interests, in each case subject to no material mortgage, pledge, lien, lease,
encumbrance or charge, other than (i) liens for current taxes not yet due and
payable, (ii) liens imposed by law and incurred in the ordinary course of
business for obligations not past due, (iii) liens in respect of pledges or
deposits under workers' compensation laws or similar legislation, and (iv)
liens, encumbrances and defects in title which do not in any case materially
detract from the value of the property subject thereto or have a Material
Adverse Effect, and which have not arisen otherwise than in the ordinary course
of business. With respect to the property and assets it leases, FWAY is in
compliance with such leases in all material respects and, to its knowledge,
holds a valid leasehold interest free of any liens, claims or encumbrances,
subject to clauses (i)-(iv) above. All facilities, machinery, equipment,
fixtures, vehicles and other properties owned, leased or used by FWAY are in
good operating condition and repair and are reasonably fit and usable for the
purposes for which they are being used.
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3.10 COMPLIANCE WITH OTHER INSTRUMENTS. FWAY is not in violation of any
term of its Certificate of Incorporation or Bylaws, including any amendments
thereto, or, to FWAY's knowledge, in any material respect of any term or
provision of any material mortgage, indebtedness, indenture, contract,
agreement, instrument, judgment, order or decree to which it is party or by
which it is bound which would have a Material Adverse Effect. To FWAY's
knowledge, FWAY is not in violation of any federal or state statute, rule or
regulation applicable to FWAY the violation of which would have a Material
Adverse Effect. The execution and delivery of this Agreement by FWAY and the
FWAY Stockholders and the performance by FWAY of its obligations pursuant to
this Agreement will not result in any violation of, or conflict with, or
constitute a material default under, FWAY's Certificate of Incorporation or
Bylaws, each as amended to date, or any of its Material Contracts, nor, to
FWAY's or the knowledge of the FWAY stockholders, result in the creation of any
material mortgage, pledge, lien, encumbrance or charge upon any of the
properties or assets of FWAY.
3.11 LITIGATION. There are no actions, suits, proceedings or
investigations pending against FWAY or its properties (nor has FWAY received
written notice of any threat thereof) before any court or governmental agency.
FWAY is not a party or subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or instrumentality.
3.12 GOVERNMENTAL CONSENT; THIRD PARTY APPROVALS.
(a) No consent, approval or authorization of or designation,
declaration or filing with any governmental authority on the part of FWAY is
required in connection with the valid execution and delivery of this Agreement,
or the consummation of any other transaction contemplated by this Agreement.
(b) No consent, approval or authorization of any third party is
required in connection with the consummation by FWAY of the transactions
contemplated hereunder.
3.13 PERMITS. FWAY has all franchises, permits, licenses, and any similar
authority necessary for the conduct of its business as now being conducted by
it, the lack of which would have a Material Adverse Effect, and believes it can
obtain, without undue burden or expense, any similar authority for the conduct
of its business as presently planned to be conducted. FWAY is not in default in
any material respect under any of such franchises, permits, licenses or other
similar authority
3.14 REGISTRATION AND VOTING RIGHTS. FWAY is presently not under any
obligation and has not granted any rights to register under the Securities Act
any of its presently outstanding securities or any of its securities that may
hereafter be issued. To FWAY's knowledge, no stockholder of FWAY has entered
into any agreements with respect to the voting of capital shares of FWAY.
3.15 BROKERS OR FINDERS. Schedule 3.15 describes any liability of FWAY for
brokerage or finders' fees or agents' commissions or any similar charges in
connection with this Agreement or any of the transactions contemplated hereby.
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3.16 TAX RETURNS AND PAYMENTS. FWAY has timely filed all tax returns
required to be filed by it with appropriate federal, state and local
governmental agencies. These returns and reports are true and correct in all
material respects. All taxes shown to be due and payable on such returns, any
assessments imposed, and, to FWAY's knowledge, all other taxes due and payable
by FWAY on or before the Closing have been paid or will be paid prior to the
time they become delinquent. FWAY has not been advised in writing (i) that any
of its returns have been or are being audited as of the date hereof, or (ii) of
any deficiency in assessment or proposed judgment with respect to its federal,
state or local taxes
3.17 EMPLOYEES. To FWAY's knowledge, there are no strike, labor dispute or
union organization activities pending or threatened between it and its
employees. To FWAY's knowledge, none of its employees belongs to any union or
collective bargaining unit. FWAY is not a party to or bound by any currently
effective employment contract, deferred compensation agreement, bonus plan,
incentive plan, profit sharing plan, retirement agreement, or other employee
compensation agreement. FWAY is not aware that any officer or key employee
intends to terminate his employment with FWAY, nor does FWAY have a present
intention to terminate the employment of any officer or key employee. Subject to
general principles related to wrongful termination of employees, the employment
of each officer and employee of FWAY is terminable at the will of FWAY.
3.18 EMPLOYEE BENEFIT PLANS. FWAY is in substantial compliance with its
"employee benefit plans" as defined in the Employee Retirement Income Security
Act of 1974, as amended.
3.19 OBLIGATIONS TO RELATED PARTIES. (a) No employee, officer, or director
or member of his or her immediate family is indebted to FWAY, nor is FWAY
indebted (or committed to make loans or extend or guarantee credit) to any of
them other than (i) for payment of salary for services rendered, (ii)
reimbursement for reasonable expenses incurred on behalf of FWAY and (iii) for
other standard employee benefits made generally available to all employees
(including stock option agreements outstanding under any stock option plan
approved by FWAY's Board of Directors and stock purchase agreements approved by
FWAY's Board of Directors). To FWAY's knowledge, none of its officers, directors
or employees has any direct or indirect ownership interest in any firm or
corporation with which FWAY is affiliated or with which FWAY has a business
relationship, or any firm or corporation that competes with FWAY, except in
connection with the ownership of stock in publicly-traded companies. To FWAY's
knowledge, no employee, officer or director nor any member of their immediate
families, is, directly or indirectly, interested in any FWAY Material Contract.
3.20 ENVIRONMENTAL AND SAFETY LAWS. To its knowledge, FWAY is not in
violation of any applicable statute, law, or regulation relating to the
environment or occupational health and safety, and to its knowledge, no material
expenditures are or will be required in order to comply with any such existing
statute, law, or regulation.
3.21 CORPORATE DOCUMENTS. The Restated Certificate and Bylaws of FWAY are
in the form provided to counsel for BIOF. The copy of the minute books of FWAY
provided to BIOF's counsel contains complete and correct minutes of all meetings
of directors and stockholders and all actions by written consent without a
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meeting by the directors and stockholders since the date of incorporation and
accurately reflects all actions by the directors (and any committee of
directors) and stockholders with respect to all transactions referred to in such
minutes.
SECTION 4
REPRESENTATIONS AND WARRANTIES OF THE FWAY STOCKHOLDERS.
Each FWAY Stockholder, severally and not jointly, represents and warrants
to the BIOF as follows:
4.1 OWNERSHIP. Such FWAY Stockholder is the lawful owner of the number of
shares of FWAY Common listed opposite the name of such FWAY Shareholder on
Exhibit A, free and clear of all preemptive or similar rights, liens,
encumbrances, restrictions and claims of every kind. Such FWAY Stockholder has
full legal right, power and authority to enter into this Agreement and to
exchange, assign, transfer and convey the FWAY Common so owned by such FWAY
Stockholder pursuant to this Agreement. The delivery to BIOF of the FWAY Common
held by such FWAY Stockholder pursuant to the terms of this Agreement will
transfer to BIOF valid title thereto, free and clear of all liens, encumbrances,
restrictions and claims of every kind.
4.2 AUTHORITY TO EXECUTE AND PERFORM AGREEMENT; NO BREACH. Such FWAY
Stockholder has the full legal right and power and all authority and approval
required to enter into, execute and deliver this Agreement, and to assign,
transfer and convey the FWAY Common owned by such FWAY Stockholder and to
perform fully its respective obligations hereunder. The Agreement, when executed
and delivered by such FWAY Stockholder, shall constitute the valid and binding
obligation of such FWAY Stockholder, enforceable in accordance with its terms,
except (i) as limited by laws of general application relating to bankruptcy,
insolvency and the relief of debtors and (ii) as limited by rules of law
governing specific performance, injunctive relief or other equitable remedies
and by general principles of equity.
4.3 GOVERNMENTAL CONSENT. No consent, approval or authorization of or
designation, declaration or filing with any governmental authority on the part
of the FWAY Stockholders is required in connection with the valid execution and
delivery of this Agreement, or the consummation of any other transaction
contemplated by this Agreement.
4.4 NO REGISTRATION. Such FWAY Stockholder understands that the shares
constituting the Acquisition Consideration, have not been, and will not be,
registered under the Securities Act by reason of a specific exemption from the
registration provisions of the Securities Act, the availability of which depends
upon, among other things, the bona fide nature of the investment intent and the
accuracy of such Investor's representations as expressed herein or otherwise
made pursuant hereto.
4.5 INVESTMENT INTENT. Such FWAY Stockholder is acquiring the BIOF Common
for investment for its own account, not as a nominee or agent, and not with the
view to, or for resale in connection with, any distribution thereof, and such
FWAY Stockholder has no present intention of selling, granting any participation
in, or otherwise distributing the same.
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4.6 INVESTMENT EXPERIENCE. Such FWAY Stockholder has such knowledge and
experience in financial and business matters such that such Investor is capable
of evaluating the merits and risks of its investment in BIOF and protecting its
own interests in the transactions contemplated by this Agreement.
4.7 RESTRICTED SECURITIES. (a) Such FWAY Stockholder acknowledges that the
shares constituting the Acquisition Consideration must be held indefinitely
unless subsequently registered under the Securities Act or an exemption from
such registration is available.
4.8 BROKERS OR FINDERS. Such FWAY Stockholder has not engaged any brokers,
finders or agents, and will not incur any liability for brokerage or finders'
fees or agents' commissions or any similar charges in connection with the
Agreements.
4.9 LEGENDS. Such FWAY Stockholder understands and agrees that the
certificates evidencing the Acquisition Consideration shall bear the following
legend (in addition to any legend required by applicable laws or as BIOF may
reasonably request):
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE, AND
MAY NOT BE SOLD, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER SUCH ACT AND/OR APPLICABLE STATE SECURITIES LAWS, OR UNLESS THE
COMPANY HAS RECEIVED AN OPINION OF COUNSEL OR OTHER EVIDENCE, REASONABLY
SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT
REQUIRED."
SECTION 5
REPRESENTATIONS AND WARRANTIES OF BIOF.
Subject to such exceptions as are disclosed in the SCHEDULE OF EXCEPTIONS
attached hereto, BIOF hereby represents and warrants to FWAY and the FWAY
Stockholders as follows:
5.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. BIOF is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Nevada. BIOF has the requisite corporate power and authority to own and
operate its properties and assets, to carry on its business as presently
conducted and as proposed to be conducted, to execute and deliver this
Agreement, to issue and deliver the Acquisition Consideration, and to perform
its obligations pursuant to this Agreement. BIOF is presently qualified to do
business as a foreign corporation in each jurisdiction where the failure to be
so qualified could reasonably be expected to have a material adverse effect on
BIOF's financial condition or business as now conducted and as proposed to be
conducted (a "MATERIAL ADVERSE EFFECT").
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5.2 SUBSIDIARIES. BIOF does not own or control, directly or indirectly,
any interest in any corporation, partnership, limited liability company,
association or other business entity, other than its ownership of Ocwen.
5.3 CAPITALIZATION.
(a) Immediately prior to the Closing, the authorized capital stock of
BIOF will consist of 25,000,000 shares of Common Stock, of which no more than
6,000,000 shares will be issued and outstanding and 5,000,000 shares of
Preferred Stock none of which will be issued outstanding.
(b) All issued and outstanding shares of BIOF Common (i) have been
duly authorized and are validly issued, fully paid, and nonassessable, and (ii)
were issued in compliance with all applicable state and federal laws concerning
the issuance of securities.
(c) Except as set forth above and in this Agreement, there are no
options, warrants, convertible securities or other rights, agreements,
commitments or arrangements of any kind to purchase, subscribe, issue, or sell
any of BIOF's authorized and unissued capital stock.
5.4 AUTHORIZATION. All corporate action on the part of BIOF and its
directors and officers necessary for the authorization, execution and delivery
of this Agreement by BIOF, the delivery and issuance of the Acquisition
Consideration, and the performance of all of BIOF's obligations under the
Agreements has been taken. No action on the part of the stockholders of BIOF is
required for any of the foregoing actions. The Agreement, when executed and
delivered by BIOF, shall constitute the valid and binding obligation of BIOF,
enforceable in accordance with its terms, except (i) as limited by laws of
general application relating to bankruptcy, insolvency and the relief of debtors
and (ii) as limited by rules of law governing specific performance, injunctive
relief or other equitable remedies and by general principles of equity. When
issued, the shares constituting the Acquisition Consideration will be duly and
validly issued, fully paid and non-assessable, and not subject to any liens or
encumbrances other than restrictions on transfer arising from federal and state
securities laws.
5.5 SEC REPORTS. BIOF has on a timely basis filed all forms, reports,
certifications and documents required to be filed by it with the United States
Securities and Exchange Commission (the "SEC") since January 1, 2002. All such
forms, reports, certifications and documents (collectively, the "BIOF SEC
DOCUMENTS") are available in full without redaction on the SEC's web site
through the Electronic Data Gathering, Analysis and Retrieval System. BIOF has
supplied to FWAY's counsel all comment letters received by the Company from the
staff of the SEC since January 1, 2002 and all responses to such comment letters
by or on behalf of BIOF. The BIOF SEC reports were prepared in accordance with
the requirements of the Securities Act of 1933 (as amended) and the Securities
Exchange Act of 1934 (as amended) (the "EXCHANGE ACT"), as applicable, and the
rules and regulations thereunder, and did not at the time they were filed with
the SEC contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements made therein, in the light of the circumstances under which they were
made, not misleading. To the knowledge of BIOF, each director and executive
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officer of BIOF has filed with the SEC on a timely basis all statements required
by Section 16(a) of the Exchange Act and the rules and regulations thereunder
since January 1, 2002. As used in this SECTION 5.5, the term "file" shall be
broadly construed to include any manner in which a document or information is
furnished, supplied or otherwise made available to the SEC.
5.6 FINANCIAL STATEMENTS.
(a) The financial statements of BIOF included in the BIOF SEC
Documents (including the related notes) complied as to form, as of their
respective dates of filing with the SEC, in all material respects with
applicable accounting requirements and the published rules and regulations of
the SEC with respect thereto (including, without limitation, Regulation S-X),
have been prepared in accordance with generally accepted accounting principles
in the United States ("GAAP") (except, in the case of unaudited statements, to
the extent permitted by Regulation S-X for Quarterly Reports on Form 10-Q)
applied on a consistent basis during the periods and at the dates involved
(except as may be indicated in the notes thereto), and fairly present the
consolidated financial condition of BIOF at the dates thereof and the
consolidated results of operations and cash flows for the periods then ended
(subject, in the case of unaudited statements, to notes and normal year-end
audit adjustments that were not, or with respect to any such financial
statements contained in any Company SEC Documents to be filed subsequent to the
date hereof are not reasonably expected to be, material in amount or effect).
Except as reflected in BIOF's audited balance sheet as of October 31, 2003 or in
liabilities described in any notes thereto (or liabilities for which neither
accrual nor footnote disclosure is required pursuant to GAAP), BIOF does not
have any liabilities or obligations of any nature. ▇▇▇▇▇ & Company Ltd., which
has expressed its opinion with respect to the audited financial statements of
BIOF and its subsidiaries included in BIOF SEC Documents (including the related
notes), is and has been throughout the periods covered by such financial
statements (x) a registered public accounting firm (as defined in Section
2(a)(12) of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002) and (y) "independent" with respect
to the Company within the meaning of Regulation S-X.
(b) As of the Closing, BIOF will not have any liability, indebtedness,
obligation, expense, claim, deficiency, guaranty or endorsement of any type,
whether accrued, absolute, contingent, matured, unmatured or other.
5.7 CHANGES. Since October 31, 2003 there has not been:
(a) any material adverse change in the assets, liabilities, financial
condition or operating results of BIOF from that reflected in the financial
statements contained in the latest BIOF SEC Document;
(b) any damage, destruction or loss, whether or not covered by
insurance, that has had a Material Adverse Effect;
(c) any waiver by BIOF of a valuable right or of a material debt owed
to it;
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(d) any material change or amendment to a material agreement by which
BIOF or any of its assets or properties is bound or subject ;
(e) any material change in any compensation arrangement or agreement
with any employee, officer, director or consultant;
(f) any satisfaction or discharge of any lien, claim, or encumbrance
or payment of any obligation by BIOF;
(g) any sale, exchange or other disposal by BIOF of any of its
material assets or rights.
(h) any declaration, setting aside or payment or other distribution in
respect of any of BIOF's capital stock, or any direct or indirect redemption,
purchase or other acquisition of any of such stock by BIOF;
(i) any material mortgage, pledge, transfer of a security interest in,
or lien, created by BIOF, with respect to any of its material properties or
assets, except liens for taxes not yet due or payable;
(j) incurring of indebtedness for money borrowed or any other
liabilities by BIOF individually in excess of $5,000 or, in the case of
indebtedness and/or liabilities individually less than $5,000, in excess of
$10,000 in the aggregate,
(k) loaning or advancing of money by BIOF to any person other than
advancement of travel and other business expenses consistent with past practice;
or
(l) to its knowledge, any other event or condition of any character
with respect to BIOF that has had or could reasonably be expected to have a
Material Adverse Effect; or
(m) any agreement or commitment by BIOF to do any of the things
described in this SECTION 5.7.
5.8 INTELLECTUAL PROPERTY. BIOF has not received any written communication
alleging that BIOF has violated or, by conducting its business as currently
conducted, would violate any of the Intellectual Property of any other person or
entity.
5.9 MATERIAL CONTRACTS. Schedule 5.7 to the BIOF Disclosure Letter lists
all agreements, understandings, instruments, contracts, proposed transactions,
to which BIOF is a party or by which it is bound which involve (i) obligations
of, or payments to, BIOF in excess of $5,000 (ii) any license or transfer of
Intellectual Property to or from BIOF or (iii) any other contract that would
materially affect BIOF or would materially affect the business, financial
condition or operations of FWAY after the acquisition, (each such contract, a
"BIOF MATERIAL CONTRACT", collectively the "BIOF MATERIAL CONTRACTS"). To BIOF's
knowledge, all of the BIOF Material Contracts are valid, binding and in full
force and effect in all material respects, subject to laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of law governing specific performance, injunctive relief or other
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equitable remedies and to general principles of equity. Neither BIOF nor, to
BIOF's knowledge, is any other party to the Material Contracts in material
default under any of such BIOF Material Contracts. For the purposes of this
section, all indebtedness, liabilities, agreements, understandings, instruments,
contracts and proposed transactions involving the same person or entity
(including persons or entities BIOF has reason to believe are affiliated
therewith) shall be aggregated for the purpose of meeting the individual minimum
dollar amounts of this section.
5.10 TITLE TO PROPERTIES AND ASSETS; LIENS. BIOF has good and marketable
title to its properties and assets, and has good title to all its leasehold
interests, in each case subject to no material mortgage, pledge, lien, lease,
encumbrance or charge, other than (i) liens for current taxes not yet due and
payable, (ii) liens imposed by law and incurred in the ordinary course of
business for obligations not past due, (iii) liens in respect of pledges or
deposits under workers' compensation laws or similar legislation, and (iv)
liens, encumbrances and defects in title which do not in any case materially
detract from the value of the property subject thereto or have a Material
Adverse Effect, and which have not arisen otherwise than in the ordinary course
of business. With respect to any property and assets it leases, BIOF is in
compliance with such leases in all material respects and, to its knowledge holds
a valid leasehold interest free of any liens, claims or encumbrances, subject to
clauses (i)-(iv) above. All facilities, machinery, equipment, fixtures, vehicles
and other properties owned, leased or used by BIOF are in good operating
condition and repair and are reasonably fit and usable for the purposes for
which they are being used.
5.11 COMPLIANCE WITH OTHER INSTRUMENTS. BIOF is not in violation of any
term of its Certificate of Incorporation or Bylaws, including any amendments
thereto, or, to BIOF's knowledge, in any material respect of any term or
provision of any material mortgage, indebtedness, indenture, contract,
agreement, instrument, judgment, order or decree to which it is party or by
which it is bound which would have a Material Adverse Effect. To BIOF's
knowledge, BIOF is not in violation of any federal or state statute, rule or
regulation applicable to BIOF the violation of which would have a Material
Adverse Effect. The execution and delivery of this Agreement by BIOF and the
performance by BIOF of its obligations pursuant to this Agreement will not
result in any violation of, or conflict with, or constitute a material default
under, BIOF's Certificate of Incorporation or Bylaws, each as amended to date,
or any of its Material Contracts, nor, to BIOF's knowledge, result in the
creation of any material mortgage, pledge, lien, encumbrance or charge upon any
of the properties or assets of BIOF.
5.12 LITIGATION. There are no actions, suits, proceedings or
investigations pending against BIOF or its properties (nor has BIOF received
written notice of any threat thereof) before any court or governmental agency.
BIOF is not a party or subject to the provisions of any order, writ, injunction,
judgment or decree of any court or government agency or instrumentality.
5.13 GOVERNMENTAL CONSENT; THIRD PARTY APPROVALS.
(a) No consent, approval or authorization of or designation,
declaration or filing with any governmental authority on the part of BIOF is
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required in connection with the valid execution and delivery of this Agreement,
or the consummation of any other transaction contemplated by this Agreement.
(b) No consent, approval or authorization of any third party is
required in connection with the consummation of the transactions contemplated
hereunder.
5.14 PERMITS. BIOF has all franchises, permits, licenses, and any similar
authority necessary for the conduct of its business as now being conducted by
it, the lack of which would have a Material Adverse Effect, and believes it can
obtain, without undue burden or expense, any similar authority for the conduct
of its business as presently planned to be conducted. BIOF is not in default in
any material respect under any of such franchises, permits, licenses or other
similar authority
5.15 REGISTRATION AND VOTING RIGHTS. BIOF is presently not under any
obligation and has not granted any rights to register under the Securities Act
any of its presently outstanding securities or any of its securities that may
hereafter be issued. To BIOF's knowledge, no stockholder of BIOF has entered
into any agreements with respect to the voting of shares of Common Stock of
BIOF.
5.16 BROKERS OR FINDERS. Schedule 5.16 describes any liability of BIOF for
brokerage or finders' fees or agents' commissions or any similar charges in
connection with this Agreement or any of the transactions contemplated hereby.
5.17 TAX RETURNS AND PAYMENTS. BIOF has timely filed all tax returns
required to be filed by it with appropriate federal, state and local
governmental agencies. These returns and reports are true and correct in all
material respects. All taxes shown to be due and payable on such returns, any
assessments imposed, and, to BIOF's knowledge, all other taxes due and payable
by BIOF on or before the Closing have been paid or will be paid prior to the
time they become delinquent. BIOF has not been advised in writing (i) that any
of its returns have been or are being audited as of the date hereof, or (ii) of
any deficiency in assessment or proposed judgment with respect to its federal,
state or local taxes
5.18 REAL PROPERTY HOLDING CORPORATION. BIOF is not a "real property
holding corporation" within the meaning of Section 897(c)(2) of the Internal
Revenue Code of 1986, as amended and BIOF has never owned any real property
other than indirectly through subsidiaries.
5.19 EMPLOYEES. BIOF has no employees.
5.20 EMPLOYEE BENEFIT PLANS. BIOF has no "employee benefit plans" as
defined in the Employee Retirement Income Security Act of 1974, as amended.
5.21 OBLIGATIONS TO RELATED PARTIES. (a) No employee, officer, or director
or member of his or her immediate family is indebted to BIOF, nor is BIOF
indebted (or committed to make loans or extend or guarantee credit) to any of
them other than (i) for payment of salary for services rendered, (ii)
reimbursement for reasonable expenses incurred on behalf of BIOF and (iii) for
other standard employee benefits made generally available to all employees
(including stock option agreements outstanding under any stock option plan
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approved by BIOF's Board of Directors and stock purchase agreements approved by
BIOF's Board of Directors). To BIOF's knowledge, none of its officers, directors
or employees has any direct or indirect ownership interest in any firm or
corporation with which BIOF is affiliated or with which BIOF has a business
relationship, or any firm or corporation that competes with BIOF, except in
connection with the ownership of stock in publicly-traded companies. To BIOF's
knowledge, no employee, officer or director nor any member of their immediate
families, is, directly or indirectly, interested in any Material Contract.
5.22 ENVIRONMENTAL AND SAFETY LAWS. To its knowledge, BIOF is not in
violation of any applicable statute, law, or regulation relating to the
environment or occupational health and safety; and to its knowledge no material
expenditures are or will be required in order to comply with any such existing
statute, law, or regulation. There are no fact or circumstances relating to BIOF
which could involve BIOF in any environmental litigation or impose upon BIOF any
environmental liability.
5.23 CORPORATE DOCUMENTS. The Certificate of Incorporation and Bylaws of
BIOF are in the form provided to counsel for the FWAY. The copy of the minute
books of BIOF provided to FWAY's counsel contains complete and correct minutes
of all meetings of directors and stockholders and all actions by written consent
without a meeting by the directors and stockholders since the date of
incorporation and accurately reflects all actions by the directors (and any
committee of directors) and stockholders with respect to all transactions
referred to in such minutes.
5.24 SPIN-OFF. The Spin-Off will be effected by BIOF in accordance with
all applicable laws, including, without limitation, federal and state securities
laws and regulations. The Spin-Off will not result in any tax or tax withholding
liability for BIOF whether at the time of the Spin-Off or in the future.
5.25 REPRESENTATIONS WITH RESPECT TO COMPANY AS A WHOLE. The foregoing
representations and warranties, excluding Sections 5.1, 5.2, 5.3 and 5.23, are
also true and correct with respect to BIOF when taken together with its
subsidiaries (including, without limitation, those subsidiaries listed on the
BIOF Disclosure Schedule) as a whole.
SECTION 6
CONDITIONS TO BIOF'S OBLIGATIONS TO CLOSE.
BIOF's obligation to issue the Acquisition Consideration at the Closing is
subject to the fulfillment on or before the Closing Date of each of the
following conditions, unless waived in writing by BIOF:
6.1 Representations and Warranties.
(a) The representations and warranties made by FWAY in SECTION 3 (as
modified by the disclosures in the SCHEDULE OF EXCEPTIONS) shall be true and
correct in all material respects as of the date of such Closing except for
representations or warranties which are modified by materiality or by a Material
-17-
Adverse Affect clause, which representations and warranties shall be true and
correct in all respects.
(b) The representations and warranties made by the FWAY Stockholders
in SECTION 4 (as modified by the disclosures in the SCHEDULE OF EXCEPTIONS)
shall be true and correct in all material respects as of the date of such
Closing except for representations or warranties which are modified by
materiality or by a Material Adverse Affect clause, which representations and
warranties shall be true and correct in all respects.
6.2 COVENANTS. All covenants, agreements and conditions contained in this
Agreement to be performed by FWAY or by the FWAY Stockholders on or prior to the
Closing shall have been performed or complied with in all material respects.
6.3 BLUE SKY. BIOF shall have obtained all necessary Blue Sky law permits
and qualifications, or have the availability of exemptions therefrom, required
by any state for the issuance of the Acquisition Consideration.
6.4 BOARD APPROVAL. BIOF shall have obtained all necessary approval for
the transactions contemplated by this Agreement by BIOF's Board of Directors.
6.5 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
required to be taken by FWAY or by the FWAY Stockholders to carry out the
transactions contemplated by this Agreement, and all instruments and other
documents relating to such transactions, shall be reasonably satisfactory in
form and substance to BIOF, and BIOF shall have been furnished with such
instruments and documents as it shall have reasonably requested.
SECTION 7
CONDITIONS TO FWAY'S AND THE FWAY STOCKHOLDER'S OBLIGATION TO CLOSE.
Each FWAY Stockholder's obligation to deliver and transfer such FWAY's
Stockholder's FWAY Common Stock to BIOF and FWAY's obligations to make the
deliveries described in Section 2 are subject to the fulfillment on or before
such Closing of the following conditions, unless waived in writing by each of
FWAY and the FWAY Stockholders:
7.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties
made by BIOF in SECTION 5 (as modified by the disclosures in the SCHEDULE OF
EXCEPTIONS) shall be true and correct in all material respects as of the date of
such Closing except for representations or warranties which are modified by
materiality or by a Material Adverse Affect clause, which representations and
warranties shall be true and correct in all respects.
7.2 SPIN OFF. BIOF shall have concluded the Spin-Off in form as reasonably
acceptable to the FWAY Stockholders.
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7.3 DUE DILIGENCE. FWAY shall have completed to its satisfaction its
business and legal due diligence investigation of BIOF, its property, business
and subsidiaries, shall not have discovered any facts, circumstances,
liabilities or conditions that, in FWAY Stockholders' sole discretion, may
adversely affect the value or prospects of BIOF, that are inconsistent with any
factor, assumption or methodology that FWAY Stockholders used to determine the
Acquisition Consideration or that may expose BIOF to any liability not
heretofore fully disclosed to FWAY Stockholders.
7.4 COVENANTS. All covenants, agreements and conditions contained in this
Agreement to be performed by BIOF on or prior to the Closing shall have been
performed or complied with in all material respects.
7.5 BLUE SKY. BIOF shall have obtained all necessary Blue Sky law permits
and qualifications, or have the availability of exemptions therefrom, required
by any state for the issuance of the Acquisition Consideration.
7.6 BOARD AND STOCKHOLDER APPROVAL. FWAY and friendlyway AG shall have
obtained all necessary approvals for the transactions contemplated by this
Agreement by their respective Boards of Directors and stockholders.
7.7 PROCEEDINGS AND DOCUMENTS. All corporate and other proceedings
required to be taken by BIOF to carry out the transactions contemplated by this
Agreement, and all instruments and other documents relating to such
transactions, shall be reasonably satisfactory in form and substance to the FWAY
Stockholders, and the FWAY Stockholders shall have been furnished with such
instruments and documents as it shall have reasonably requested.
7.8 BIOF'S BOARD OF DIRECTORS. At the Closing, BIOF's Board of Directors
shall consist of six (6) members, including ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
and ▇▇▇▇▇ ▇▇.
7.9 VOTING AGREEMENT. BIOF and the FWAY Stockholders shall have entered
into a Voting Agreement in form and substance reasonably acceptable to the FWAY
Stockholders providing (a) that, after the Closing, friendlyway AG shall be
entitled to one (1) seat on BIOF's Board of Directors, if BIOF has not more than
five (5) Directors on its Board, and to two (2) seats on the Board, if BIOF has
more than five (5) Directors on its Board, and (b) that friendlyway AG shall
have a veto right for any corporate or business acquisition in Europe.
7.10 INDEMNIFICATION AGREEMENT. BIOF, the FWAY Stockholders, Ocwen, and
the trustee holding the Ocwen shares shall have entered into an Indemnification
Agreement in form and substance reasonably acceptable to the FWAY Stockholders,
which shall provide (i) that the trustees shall not distribute the Ocwen shares
except in accordance with SEC regulations, (ii) that Ocwen shall indemnify BIOF
with respect to any liability arising from the Spin-Off, and the initial
transfer or subsequent distribution of the Ocwen shares, (iii) that Ocwen shall
indemnify the FWAY Stockholders with respect to any breach of the
representations and warranties of BIOF, (iv) that Ocwen shall indemnify BIOF
with respect to any liabilities arising from the Artwork Obligation (as defined
below), BIOF's ownership (prior to conclusion of the Spin-Off) of a certain
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property located in Camden, New Jersey, and the S-8 Shares (as defined below),
and (iv) for a general release by Ocwen of BIOF for all liabilities transferred
to Ocwen or in conjunction with the Spin-Off and the transactions related
therewith.
7.11 LOCK-UP AGREEMENT. Each holder, if any, holding 5% or more of the
pre-Acquisition BIOF Common shall have entered into a Lock-Up Agreement
providing for a market stand-off of not less than 12 months after Closing upon
terms and conditions reasonably acceptable to the FWAY Stockholders.
7.12 CANCELLATION OF SHARES. BIOF shall have (i) taken all appropriate
corporate action to cancel the shares issued pursuant to those certain
Registration Statements on Form S-8 putatively filed by BIOF as described in the
BIOF SEC Documents (the "S-8 SHARES"), (ii) notified its transfer agent for the
BIOF Common, of such cancellation and (iii) received confirmation from said
transfer agent that the cancellation of the shares has been recorded in the BIOF
Common ledgers maintained by said transfer agent.
7.13 ELIMINATION OF LIABILITIES. As of the Closing, BIOF will not have any
liability, indebtedness, obligation, expense, claim, deficiency, guaranty or
endorsement of any type, whether accrued, absolute, contingent, matured,
unmatured or other.
7.14 RELEASE FROM LAWSUIT. Hermes Kreditversicherungs AG and any other
plaintiff, shall have completely, finally and irrevocably removed BIOF as a
defendant in that certain lawsuit initiated by Hermes Kreditversicherungs AG and
shall have released BIOF from any liabilities relating to the matters described
in such lawsuit. Such removal and release shall be in customary form and
reasonably acceptable to counsel to FWAY.
7.15 REGISTRATION RIGHTS. BIOF shall have entered into a Registration
Rights Agreement with the FWAY Stockholders in form and substance reasonably
acceptable to the FWAY Stockholders, which will provide the FWAY Stockholders
the right to include their shares on any registration statement filed by BIOF;
PROVIDED, HOWEVER that the FWAY Stockholders' registration rights may be cut
back to 25% of the total registration if required by marketing conditions.
7.16 CERTAIN CORPORATE ACTIONS. BIOF shall have amended its Bylaws in form
and substance reasonably acceptable to FWAY Stockholders.
SECTION 8
COVENANTS
8.1 OPERATION OF FWAY BUSINESS BEFORE CLOSING DATE. Except as otherwise
contemplated by this Agreement or the transactions contemplated hereby, between
the date hereof and the Closing Date FWAY will operate its business in the
ordinary course of business and, to the extent consistent therewith, with no
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less diligence and effort than would be applied in the absence of this
Agreement, use all commercially reasonable efforts to seek to preserve intact
its current business organization, keep available the service of its current
officers and employees and preserve its relationships, as applicable, with
customers, suppliers, distributors, lessors, creditors, employees, contractors
and others having business dealings with it with the intention that its goodwill
and ongoing businesses shall be unimpaired at the Closing Date. Without limiting
the generality of the foregoing, except as otherwise expressly provided in this
Agreement, before the Closing Date:
(a) FWAY shall not do any of the following without the prior written
consent of BIOF:
(i) amend its Certificate of Incorporation or Bylaws (or other
similar governing instrument);
(ii) split, combine or reclassify any shares of its capital
stock, declare, set aside or pay any dividend or other distribution (whether in
cash, stock or property or any combination thereof) in respect of its capital
stock, make any other actual or constructive distribution in respect of its
capital stock or otherwise make any payments to stockholders in their capacity
as such, or redeem or otherwise acquire any of its securities or any securities
other than shares repurchased from employees at their original cost;
(iii) adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other
reorganization of FWAY or any of its subsidiaries or otherwise permit the
corporate existence of FWAY to be suspended, lapsed or revoked;
(iv) create or form any subsidiary;
(v) (A) incur or assume any long-term or short-term debt or issue
any debt securities; (B) assume, guarantee, endorse or otherwise become liable
or responsible (whether directly, contingently or otherwise) for the obligations
of any other person; (C) make any loans, advances or capital contributions to or
investments in any other person; or (D) pledge or otherwise encumber shares of
capital stock of the Company;
(vi) (A) acquire, sell, lease, license, transfer or otherwise
dispose of any assets in any single transaction or series of related
transactions having a fair market value in excess of $25,000 in the aggregate or
that are otherwise material to FWAY other than sales of its products (other than
exclusive licenses) in the ordinary course of business, or (B) enter into any
exclusive license, distribution, marketing, sales or other similar exclusive
agreement;
(vii) (A) acquire (by merger, consolidation or acquisition of
stock or assets) any corporation, partnership or other entity or division
thereof or any equity interest therein; (B) amend, modify, waive or terminate
any right under any material contract in any material way; or (C) authorize any
new capital expenditure or expenditures that individually is in excess of
$25,000 or in the aggregate are in excess of $100,000;
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(viii) enter into any agreement that would constitute a FWAY
Material Contract other than in the ordinary course of business;
(ix) make any material change with respect to the compensation or
benefits of any officer, director or key employee.
(b) FWAY shall:
(i) comply in all material respects with all applicable laws;
(ii) file all tax returns required to be filed and make timely
payment of all applicable Taxes when due and payable (other than where the
Company is disputing any such obligation in good faith);
(iii) notify BIOF of any action, event, condition or
circumstance, or group of actions, events, conditions or circumstances, relating
to the FWAY that results in, or would reasonably be expected to have a Material
Adverse Effect on the Company;
(iv) notify BIOF in writing of the commencement of any material
legal actions or governmental proceedings against FWAY; and
(v) pay accounts payable and pursue collection of its accounts
receivable consistent with past practice.
8.2 OPERATION OF BIOF BUSINESS BEFORE CLOSING DATE. Except as otherwise
contemplated by this Agreement or the transactions contemplated hereby, between
the date hereof and the Closing Date BIOF will operate its business in the
limited fashion that it has been operated during the last year. Without limiting
the generality of the foregoing, except as otherwise expressly provided in this
Agreement, before the Closing Date:
(a) BIOF shall not do any of the following without the prior written
consent of FWAY and FWAY Stockholders:
(i) amend its Certificate of Incorporation or Bylaws (or other
similar governing instrument);
(ii) split, combine or reclassify any shares of its capital
stock, declare, set aside or pay any dividend or other distribution (whether in
cash, stock or property or any combination thereof) in respect of its capital
stock, make any other actual, constructive or deemed distribution in respect of
its capital stock or otherwise make any payments to stockholders in their
capacity as such, or redeem or otherwise acquire any of its securities or any
securities other than shares repurchased from employees at their original cost;
(iii) adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other
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reorganization of the Company or any of its subsidiaries or otherwise permit the
corporate existence of the Company to be suspended, lapsed or revoked;
(iv) create or form any subsidiary;
(v) (A) incur or assume any long-term or short-term debt or issue
any debt securities; (B) assume, guarantee, endorse or otherwise become liable
or responsible (whether directly, contingently or otherwise) for the obligations
of any other person; (C) make any loans, advances or capital contributions to or
investments in any other person; or (D) pledge or otherwise encumber shares of
capital stock of the Company;
(vi) acquire, sell, lease, license, transfer or otherwise dispose
of any assets in any single transaction or series of related transactions having
a fair market value in excess of $1,000 in the aggregate or that are otherwise
material to BIOF or (B) enter into any exclusive license, distribution,
marketing, sales or other similar exclusive agreement;
(vii) (A) acquire (by merger, consolidation or acquisition of
stock or assets) any corporation, partnership or other entity or division
thereof or any equity interest therein; (B) amend, modify, waive or terminate
any right under any material contract in any material way; or (C) authorize any
new capital expenditure or expenditures that individually or in aggregate
$1,000;
(viii) enter into any agreement that would constitute a BIOF
Material Contract;
(ix) make any material change with respect to the compensation or
benefits of any officer, director or key employee or hire any employee or
consultant.
(b) BIOF shall:
(i) comply in all material respects with all applicable laws
including, without limitation, making all required filings with the SEC;
(ii) file all tax returns required to be filed and make timely
payment of all applicable Taxes when due and payable (other than where the
Company is disputing any such obligation in good faith);
(iii) notify FWAY of any action, event, condition or
circumstance, or group of actions, events, conditions or circumstances, relating
to the BIOF that results in, or would reasonably be expected to have a Material
Adverse Effect on BIOF;
(iv) notify FWAY in writing of the commencement of any material
legal actions or governmental proceedings against BIOF; and
(v) use commercially reasonable efforts to amend its obligation
to issue shares to a certain third party in conjunction with BIOF's acquisition
of a certain art framing business (the "ARTWORK OBLIGATION") as further
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described in BIOF SEC Documents, such that all shares due under the Artwork
Obligation are issued prior to Closing .
8.3 PUBLIC ANNOUNCEMENTS. None
of BIOF, FWAY or the FWAY Stockholders shall issue any press release or
otherwise make any public statements with respect to the transactions
contemplated by this Agreement without the prior consent of BIOF (in the case of
FWAY or FWAY Stockholders) or FWAY and FWAY Stockholders (in the case of BIOF),
except as may be required by applicable law, including any determination by BIOF
that a press release or other public statement is required under applicable
securities or regulatory rules. If any party determines, with the advice of
counsel, that it is required by applicable law to make this Agreement or any
terms thereof public, it shall consult with the other parties regarding such
disclosure and seek confidential treatment for such terms or portions of this
Agreement as may be requested by the other parties.
8.4 NOTIFICATION OF CERTAIN MATTERS.
(a) FWAY and the FWAY Stockholders shall give prompt notice to BIOF of
(i) the occurrence or nonoccurrence of any event the occurrence or nonoccurrence
of which has caused or would be likely to cause any representation or warranty
by FWAY or any of the FWAY Stockholders contained in this Agreement to be untrue
or inaccurate at or before the Closing Date and (ii) any failure by FWAY or any
of the FWAY Stockholders to comply with or satisfy in any material respect any
covenant, condition or agreement to be complied with or satisfied by it
hereunder; provided, however, that the delivery of any notice pursuant to this
SECTION 8.4(a) shall not cure such breach or non-compliance by FWAY or any FWAY
Stockholder, limit or otherwise affect the remedies available hereunder to BIOF,
or constitute an amendment of any representation, warranty or statement in this
Agreement or the Company Disclosure Schedule.
(b) BIOF shall give prompt notice to FWAY and the FWAY Stockholders of
(i) the occurrence or nonoccurrence of any event the occurrence or nonoccurrence
of which has caused or would be likely to cause any representation or warranty
contained in this Agreement by BIOF to be untrue or inaccurate at or before the
Closing Date and (ii) any failure by BIOF to comply with or satisfy in any
material respect any covenant, condition or agreement to be complied with or
satisfied by it hereunder; provided, however, that the delivery of any notice
pursuant to this SECTION 8.4(B) shall not cure such breach or non-compliance by
BIOF, as the case may be, limit or otherwise affect the remedies available
hereunder to the FWAY or the FWAY Stockholders, or constitute an amendment of
any representation, warranty or statement in this Agreement.
8.5 BIOF STOCKHOLDERS' MEETING. BIOF shall, as promptly as practicable
after the Closing, duly give notice of, convene and hold a meeting (the "BIOF
STOCKHOLDERS' MEETING") of its stockholders entitled to vote thereat (or take
action by written consent in lieu thereof) in accordance with Nevada laws and
its Certificate of Incorporation and Bylaws for the purpose of obtaining the
approval of BIOF's stockholders of the (i) Amended and Restated Certificate of
Incorporation in form and substance reasonably acceptable to the FWAY
Stockholders, (ii) election of five nominees to the Board of Directors of BIOF,
including ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇, and one additional
person nominated by ▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, (iii) change in the name of BIOF to
International Interactive Technologies, Corp, (iv) approval of assumption of
FWAY's 2003 Employee Stock Option Plan or a similar BIOF Stock Option Plan and
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the reservation of 3,600,000 shares thereunder, (v) increase of BIOFs capital
stock to 50,000,000 shares of Common Stock and 10,000,000 shares of Preferred
Stock, and (vi) approval of such other matters that FWAY shareholders may
reasonably request. BIOF shall use commercially reasonable efforts to solicit
from its stockholders proxies (or written consents, as the case may be) in favor
of the adoption and approval of the foregoing proposals and shall take all other
actions necessary or advisable to secure the vote or consent of its stockholders
required by NASDAQ to obtain such approvals. BIOF's Board of Directors shall
recommend to BIOF's stockholders that they vote in favor of the foregoing
resolutions.
8.6 COMMERCIALLY REASONABLE EFFORTS. Subject to the terms and conditions
provided in this Agreement, each of the parties hereto shall use its
commercially reasonable efforts to take promptly, or cause to be taken, all
actions, and to do promptly, or cause to be done, all things necessary, proper
or advisable to consummate and make effective the transactions contemplated
hereby, to obtain all necessary waivers, consents and approvals and to effect
all necessary registrations and filings, and to avoid the entry or remove any
injunctions, temporary restraining orders or other impediments or delays, legal
or otherwise, in order to consummate and make effective the transactions
contemplated by this Agreement for the purpose of securing to the parties hereto
the benefits contemplated by this Agreement. In addition, each of the parties
hereto agrees, and agrees to instruct its respective counsel, to cooperate with
each other to facilitate and to obtain all necessary waivers, consents and
approvals at the earliest practicable date. Notwithstanding anything herein to
the contrary, no party hereto nor any of their representatives will communicate
with any governmental or regulatory authority (except on insubstantial
procedural issues) without giving the other parties a reasonable opportunity to
participate in such communication to the extent permitted by the governmental or
regulatory Authority.
8.7 REORGANIZATION MATTERS. None of BIOF, FWAY or the FWAY Stockholders,
or any of their respective Affiliates shall take any action or fail to take any
commercially reasonable action before or following the Closing, which action or
failure to act would cause the Acquisition to fail to qualify as a
reorganization within the meaning of Section 368(a)(1)(B) of the Internal
Revenue Code. SECTION 9
TERMINATION
9.1 TERMINATION. This Agreement may be terminated and the Acquisition may
be abandoned at any time before the Closing Date:
(a) by written consent of BIOF, FWAY and the FWAY Stockholders;
(b) by either FWAY or BIOF on written notice to the others if (i) any
court of competent jurisdiction in the United States or other United States
federal or state governmental entity shall have issued a final order, decree or
ruling, or taken any other final action, restraining, enjoining or otherwise
prohibiting the Acquisition and such order, decree, ruling or other action is or
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shall have become non-appealable, or (ii) the Acquisition has not been
consummated by September 30, 2004; provided that no party may terminate this
Agreement pursuant to this clause (ii) if such party's failure to fulfill any of
its obligations under this Agreement shall have been a principal reason that the
Closing Date shall not have occurred on or before said date;
(c) by BIOF on written notice to FWAY if (i) there shall have been a
material breach of any representations or warranties on the part of FWAY or the
FWAY Stockholders set forth in this Agreement or if any representations or
warranties of FWAY or the FWAY Stockholders shall have become untrue in any
material respect and such breach is not cured within 10 business days after
notice by BIOF thereof, provided that BIOF has not breached any of its
obligations hereunder in any material respect; or (ii) there shall have been a
breach by FWAY or the FWAY Stockholders of any of their respective covenants or
agreements hereunder in any material respect or materially adversely affecting
(or materially delaying) the ability of the parties to consummate the
Acquisition, and such breach has not been cured within ten business after notice
by BIOF thereof, provided that BIOF has not breached any of its obligations
hereunder in any material respect; or
(d) by FWAY or by the FWAY Stockholders on written notice to BIOF if
(i) there shall have been a material breach of any representations or warranties
on the part of BIOF set forth in this Agreement or if any representations or
warranties of BIOF shall have become untrue in any material respect and such
breach is not cured within 10 business days after notice by FWAY thereof,
provided that FWAY has not breached any of its obligations hereunder in any
material respect; or (ii) there shall have been a breach by BIOF of any of its
covenants or agreements hereunder in any material respect or materially
adversely affecting (or materially delaying) the ability of the parties to
consummate the Acquisition, and such breach has not been cured within ten
business after notice by FWAY thereof, provided that FWAY has not breached any
of its obligations hereunder in any material respect.
9.2 EFFECT OF TERMINATION. In the event of the termination of this
Agreement or abandonment of the Acquisition pursuant to SECTION 9.1 above, this
Agreement shall forthwith become void and have no effect and there shall be no
liability on the part of any party hereto or its Affiliates, directors, officers
or stockholders; provided that if this Agreement is terminated by BIOF pursuant
to SECTION 9.1(C) or by FWAY pursuant to SECTION 9.1(D) then the terminating
party shall retain all rights to seek damages or other relief from the breaching
party for any losses arising from or related to such party's breach; and
provided further that SECTION 10 shall continue in full force and effect.
SECTION 10
SPECIAL REMEDIES
10.1 RESCISSION. If the representations and warranties of BIOF are not
true and correct and such failure or failures taken together have a Material
Adverse Effect on BIOF and its subsidiaries taken as a whole then the FWAY
Stockholders shall have a right of recession with respect to this transaction.
Such right may be exercised by the FWAY Stockholders delivering to BIOF a signed
written notice (the "RESCISSION NOTICE") stating (i) the breaches of the BIOF
representations and warranties which constitute a material adverse effect and
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(ii) the date (the "RESCISSION CLOSING") on which the closing of the rescission
shall take place, which date shall be no less than 14 days and no more than 30
days after the date of the Rescission Notice. To the extent that any assets of
FWAY have been transferred to BIOF or a subsidiary or affiliate of BIOF after
the Closing without the transfer to FWAY of assets or services of equivalent
value, such assets (or the monetary equivalent thereof) shall be transferred
back to FWAY at the Rescission Closing. At the Rescission Closing, BIOF shall
deliver to the FWAY Stockholders (in the same proportion as their current
ownership of FWAY) duly endorsed share certificates representing all of the
issued and outstanding shares of FWAY (including any options, warrants or other
rights with respect to FWAY), which shares shall be free and clear of all liens
or encumbrances. At the Rescission Closing, each of the FWAY Stockholders shall
deliver to BIOF duly endorsed share certificates representing the number of
shares of BIOF Common issued to such FWAY Stockholder pursuant to the terms of
this Agreement (as appropriately adjusted for stock splits, stock dividends,
reverse stock splits, recapitalizations and similar events). The foregoing right
of rescission shall expire, if not exercised, at the end of the survival of
BIOF's representations and warranties.
10.2 ADJUSTMENT OF SHARE ISSUANCES. If at any time, and from time to time,
after the Closing, the sum of (i) the number of shares of BIOF Common issued and
outstanding as of the Closing (including the number of S-8 Shares, if any, that
are subsequent to the Closing determined to have been issued and outstanding as
of the Closing), (ii) the number of shares of BIOF Common issued with respect to
any claims relating to the cancellation of the S-8 Shares, (iii) the number of
shares of BIOF Common issued in connection with the Artwork Obligation after the
Closing, and (iv) the number of shares of BIOF Common issued with respect to any
claims arising out of events or circumstances occurring prior to the Closing
which are issued subsequent to the Closing (such sum the "ADJUSTED
CAPITALIZATION"), exceeds 6,000,000 (as appropriately adjusted for stock splits,
stock dividends, recapitalizations and like events) then BIOF shall, as soon as
practicable, issue to the FWAY Stockholders (in the same proportions as the
Acquisition Consideration was issued to them) such additional number of shares
of BIOF Common such that the total number of shares of BIOF Common issued to the
FWAY Stockholders pursuant to this Agreement equals three (3) times the Adjusted
Capitalization. Such shares shall be deemed to be additional shares of
Acquisition Consideration and an adjustment to the acquisition price.
SECTION 11
MISCELLANEOUS.
11.1 AMENDMENT. Except as expressly provided herein, neither this
Agreement nor any term hereof may be amended, waived, discharged or terminated
other than by a written instrument referencing this Agreement and signed by
FWAY, each FWAY Stockholder and BIOF.
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11.2 NOTICES. All notices and other communications required or permitted
hereunder shall be in writing and shall be sent overnight courier, by facsimile
or otherwise delivered by hand or by messenger addressed:
(a) if to BIOF: To the CEO or President of BIOF at the
address stated in the then most current
BIOF SEC Document
(b) if to FWAY: friendlyway, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(c) If to the FWAY Stockholders:
friendlyway AG
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ - ▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇
Attn: Vorstand
Facsimile: 011-49-89-95979140
▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Each such notice or other communication shall for all purposes of this
Agreement be treated as effective or having been given when delivered if
delivered personally, or, if sent by courier, at the earlier of its receipt or
48 hours after the same has been given to a reputable courier service, addressed
and mailed as aforesaid, if sent by facsimile, upon confirmation of facsimile
transfer.
11.3 GOVERNING LAW. This Agreement shall be governed in all respects by
the internal laws of the State of California as applied to agreements entered
into among California residents to be performed entirely within California,
without regard to principles of conflicts of law.
11.4 EXPENSES. FWAY, the FWAY Stockholders and BIOF shall each pay their
own expenses in connection with the transactions contemplated by this Agreement.
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11.5 SURVIVAL. The representations, warranties, covenants and agreements
made in this Agreement shall survive any investigation made by any party hereto
and the closing of the transactions contemplated hereby for two years from the
date of the Closing Date.
11.6 SUCCESSORS AND ASSIGNS. This Agreement, and any and all rights,
duties and obligations hereunder, shall not be assigned, transferred, delegated
or sublicensed by any party without the prior written consent of the other
parties. Any attempt by a party without such permission to assign, transfer,
delegate or sublicense any rights, duties or obligations that arise under this
Agreement shall be void. Subject to the foregoing and except as otherwise
provided herein, the provisions of this Agreement shall inure to the benefit of,
and be binding upon, the successors, assigns, heirs, executors and
administrators of the parties hereto.
11.7 ENTIRE AGREEMENT. This Agreement, including the exhibits attached
hereto, constitute the full and entire understanding and agreement among the
parties with regard to the subjects hereof and thereof. No party shall be liable
or bound to any other party in any manner with regard to the subjects hereof or
thereof by any warranties, representations or covenants except as specifically
set forth herein or therein.
11.8 DELAYS OR OMISSIONS. Except as expressly provided herein, no delay or
omission to exercise any right, power or remedy accruing to any party to this
Agreement upon any breach or default of any other party under this Agreement
shall impair any such right, power or remedy of such non-defaulting party, nor
shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter
occurring, nor shall any waiver of any single breach or default be deemed a
waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any
party of any breach or default under this Agreement, or any waiver on the part
of any party of any provisions or conditions of this Agreement, must be in
writing and shall be effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement (including, without
limitation, the remedies described in Section 10) or by law or otherwise
afforded to any party to this Agreement, shall be cumulative and not
alternative.
11.9 SEVERABILITY. If any provision of this Agreement becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, portions of such provision, or such provision in its entirety, to the
extent necessary, shall be severed from this Agreement, and such court will
replace such illegal, void or unenforceable provision of this Agreement with a
valid and enforceable provision that will achieve, to the extent possible, the
same economic, business and other purposes of the illegal, void or unenforceable
provision. The balance of this Agreement shall be enforceable in accordance with
its terms.
11.10 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
11.11 TELECOPY EXECUTION AND DELIVERY. A facsimile, telecopy or other
reproduction of this Agreement may be executed by one or more parties hereto and
delivered by such party by facsimile or any similar electronic transmission
-29-
device pursuant to which the signature of or on behalf of such party can be
seen. Such execution and delivery shall be considered valid, binding and
effective for all purposes. At the request of any party hereto, all parties
hereto agree to execute and deliver an original of this Agreement as well as any
facsimile, telecopy or other reproduction hereof.
11.12 JURISDICTION; VENUE. With respect to any disputes arising out of or
related to this Agreement, the parties consent to the exclusive jurisdiction of,
and venue in, the state courts in San Francisco County in the State of
California (or in the event of exclusive federal jurisdiction, the courts of the
Northern District of California).
11.13 CONSTRUCTION. No provision of this Agreement shall be construed in
favor of or against any party on the ground that such party or its counsel
drafted the provision. Any remedies provided for herein are not exclusive of any
other lawful remedies which may be available to either party, except as
otherwise provided in this Agreement. This Agreement shall at all times be
construed so as to carry out the purposes stated herein. Time shall be of the
essence.
11.14 ATTORNEY'S FEES. In the event that any suit or action is instituted
to enforce any provisions in this Agreement, the prevailing party in such
dispute shall be entitled to recover from the losing party all fees, costs and
expenses of enforcing any right of such prevailing party under or with respect
to this Agreement, including without limitation all fees, costs and expenses of
appeals.
(THE REMAINDER OF THIS PAGE IS LEFT INTENTIONALLY BLANK.)
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IN WITNESS WHEREOF, this Share Exchange Agreement is executed as of the
date first written above.
BIOFARM, INC.
a Nevada corporation
By: ______________________________________
Name: _______________________________
Title: _______________________________
friendlyway, Inc.
a Delaware corporation
By: ______________________________________
Name: _______________________________
Title: _______________________________
friendlyway AG
a German corporation
By: ______________________________________
Name: _______________________________
Title: _______________________________
___________________________________________
▇▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
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EXHIBIT A
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