<PAGE>
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to section 13 or 15(d) of THE SECURITIES
EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) June 16, 1995
-------------
ALOETTE COSMETICS, INC.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Pennsylvania 0-15414 23-2056003
- -------------------------------------------------------------------------------
(State or other juris- (Commission File Number) (IRS Employer Inden-
diction of incorporation) tification No.)
1301 Wright's Lane East, West Chester, PA 19380
- -------------------------------------------------------------------------------
(Address of principle executive offices) (Zip Code)
Registrant's telephone number, including area code (610) 692-0600
--------------
- -------------------------------------------------------------------------------
(Former name or former address, if changed since last report.)
Exhibit Index appears on Page 2
Page 1 of 59
<PAGE>
Item 5. OTHER EVENTS
On June 16, 1995, Aloette Cosmetics, Inc. received a cash payment of
approximately $2.1 million for the sale of certain assets of its manufacturing
operation, Superior Products Company, from Naterra International, Inc. This
consummated the agreement signed June 15, 1995 selling the land, building and
fixtures therein, and the inventory of the manufacturing operation to Naterra.
The net proceeds from the sale have been applied against the Company's
outstanding line of credit as a reduction of the credit facility. Aloette also
entered into a five year manufacturing agreement with Naterra International, a
contract manufacturer, to purchase products based on Aloette's formulas and
specifications at prices competitive in the industry. Attached hereto Exhibit A,
a press release containing the announcement.
Item 7. FINANCIAL STATEMENTS, PROFORMA FINANCIAL
INFORMATION AND EXHIBITS
(c) Exhibit Sequentially
Numbered Page
EXHIBIT A: Press Release dated June 20, 1995 4
EXHIBIT B: Proforma Financial Information 6
EXHIBIT C: Contract of Sale 7
EXHIBIT D: Asset Sale Agreement 26
Page 2 of 59
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Form 8-K to be signed on its behalf by the
undersigned, thereunto duly authorized.
ALOETTE COSMETICS, INC.
-----------------------------------
(Registrant)
-----------------------------------
Name: Jean M. Lewis
Title: Vice President of Finance
Date: July 3, 1995
Page 3 of 59
<PAGE>
EXHIBIT A
Immediate
Jean M. Lewis
(610) 692-0600
ALOETTE COSMETICS, INC.
REPORTS SALE OF MANUFACTURING OPERATION
West Chester, PA. June 20, 1995 - Aloette Cosmetics, Inc. (NASDAQ:ALET)
today announced that on June 15, 1995 they consummated the sale of certain of
the assets of its manufacturing operations including its related facility,
equipment and inventory to Naterra International, Inc. for cash of approximately
$2.1 million. Aloette also entered into a five year manufacturing agreement with
Naterra International, a contract manufacturer, to purchase products based on
Aloette's formulas and specifications at prices competitive in the industry. As
a result of the sale the Company recorded a first quarter charge of $3.75
million to write down the assets to their estimated net realizable value and to
recognize certain exit costs. The manufacturing operation contributed $2.7
million in net product sales and a loss of $1.1 million to Aloette's
consolidated earnings in 1994. Second quarter results of operations will
continue to reflect the losses incurred at the manufacturing operation through
the date of sale.
Patricia J. Defibaugh, the Company's President, Chairman and Chief
Executive Officer stated, "The sale will significantly improve the Company's
financial position and allow the Company to concentrate all of our efforts on
our core business of distributing Aloette products through our domestic and
international franchises. We look forward to
Page 4 of 58
<PAGE>
the opportunity to focus all of our resources and energy on day-to-day sales
management in order to strengthen the Aloette business and improve our long term
prospects by increasing sales. This is the first but significant step needed to
be taken on our path to return the Company to profitability."
Aloette Cosmetics, Inc., a franchisor, direct marketer, and distributor
of skin care products is located in West Chester, PA. As of June 20, 1995, the
Company's products were being sold by over 100 franchises worldwide.
(end)
<PAGE>
EXHIBIT B
It is impracticable for the Registrant to file the required pro forma
information at this time. The Registrant shall file the required pro forma
information as soon as practical, but in no event later than 60 days from the
date hereof.
Page 6 of 59
<PAGE>
EXHIBIT C
CONTRACT OF SALE
This CONTRACT OF SALE (the "Contract") is made and entered into by and
between SUPERIOR PRODUCTS COMPANY, a Texas corporation (the "Seller") and
NATERRA INTERNATIONAL, INC., a Texas corporation (the "Purchaser").
RECITALS
A. Simultaneously with the execution and delivery of this Contract, (i)
Seller and Purchaser have executed and delivered that certain Asset Sale
Agreement (herein so called) pertaining to the sale of the Assets (herein so
called and as defined in the Asset Sale Agreement) and (ii) Purchaser, Aloette
Cosmetics, Inc., a Pennsylvania corporation, Aloette Cosmetics, Inc. of
Delaware, a Delaware corporation and Aloette Cosmetics, Inc. of Pennsylvania, a
Pennsylvania corporation (collectively, "Aloette"), have executed and delivered
that certain Manufacturing Agreement (Aloette) (herein so called) pertaining to
the purchase and sale of the Products (herein so called and as defined in the
Manufacturing Agreement).
B. Seller and Purchaser acknowledge and agree that the transactions
contemplated by this Contract, the Asset Sale Agreement and the Manufacturing
Agreement are related transactions arising from, and relating to, that certain
Letter of Intent (herein so called) dated April 19, 1995, executed by Seller,
Purchaser and Aloette.
C. Notwithstanding anything herein to the contrary, the Closing (as
hereinafter defined) of this Contract is contingent on, and conditioned upon,
the full execution and delivery of the Asset Sale Agreement and the
Manufacturing Agreement.
AGREEMENTS
ARTICLE I
SALE AND PURCHASE
Section 1.1 Subject to the terms and provisions hereof, Seller agrees
to sell to Purchaser, and Purchaser agrees to purchase from Seller, the
following real and personal property (collectively, the "Property"): (a) all
that certain real property with a street address of 13525 Denton Drive, Dallas,
Texas 75234, more particularly described on Exhibit "A" attached hereto and
incorporated herein for all purposes (collectively, the "Land"); (b) all
buildings and improvements located on the Land (collectively, the
"Improvements") and all plants, trees and shrubbing now or hereafter located on
the Land; (c) all furniture, fixtures, equipment, appliances and other items of
personal property owned by Seller and used in connection with the Land or the
Improvements and not included in the Assets being purchased by Purchaser
pursuant to the Asset Sale
Page 7 of 59
<PAGE>
Agreement (collectively, the "Personal Property"); and (d) to the extent that
they are assignable, all right, title and interest of Seller, if any, in and to
the following: (i) any land lying in the bed of any street, road, avenue or
alley, open or closed, in front of or adjoining the Land, to the center line
thereof; (ii) all easements, rights of way, covenants and other rights
appurtenant to the Land and the Improvements; (iii) all licenses and franchises
relating to the operation of the Property not included in the Assets being
purchased by Purchaser pursuant to the Asset Sale Agreement (but only those
licenses and franchises which Purchaser elects to receive) (collectively, the
"Intangibles"); (iv) all site plans, maps, surveys, soil and substrata studies,
architectural drawings, plans and specifications, engineering plans and studies,
floor plans, landscape plans, environmental reports, permits, certificates of
occupancy and any other plans, studies and reports of any kind in Seller's
possession that relate to the Land or the Improvements (collectively, the "Plans
and Studies"); (v) any assignable warranties and guarantees (collectively, the
"Warranties") regarding any of the Personal Property; (vi) all oil, gas and all
other minerals in, on or under or that may be produced from the Land; (vii) all
permits, applications, rights, tax abatements, development rights, concessions,
offsets and rebate credits that relate to the Property (collectively, the
"Rights"); and (viii) all maintenance, management and service contracts and
leases and occupancy agreements relating to the operation of the Property (but
only those which Purchaser elects to assume) (collectively, the "Contracts").
ARTICLE II
PURCHASE PRICE
Section 2.1 The purchase price (the "Purchase Price") for the Property
is ONE MILLION THREE HUNDRED THOUSAND AND NO/100 DOLLARS ($1,300,000.00) payable
by certified check or federal wired funds at Closing.
ARTICLE III
CONTRACT CONSIDERATION AND EARNEST MONEY
Section 3.1
(a) Purchaser shall have three (3) business days after the
Effective Date (as hereinafter defined) to pay Seller the sum of ONE
HUNDRED AND NO/100 DOLLARS ($100.00) as the Contract Consideration
(herein so called) for the execution hereof, which Contract
Consideration shall be non-refundable to Purchaser and in no event
shall be applied against the Purchase Price. Further, as a condition
precedent to sustaining this Contract, Purchaser shall have three (3)
business days after the Effective Date to deliver the amount of TEN
THOUSAND AND NO/100 DOLLARS ($10,000.00) to the Title Company (as
hereinafter defined) as earnest money (the "Earnest Money"). In the
event Purchaser fails to deposit the Earnest Money within the time
specified herein, at Seller's option, this Contract shall terminate and
the parties hereto shall have no further obligations hereunder except
as provided herein.
<PAGE>
(b) In the event this Contract is closed, the Earnest Money
shall be applied to the Purchase Price at Closing. In the event this
Contract is not closed, then the Title Company shall disburse the
Earnest Money in the manner provided for elsewhere herein.
Section 3.2 Seller hereby authorizes Title Company, if Purchaser
elects, to invest the Earnest Money in such manner as Purchaser may direct;
provided, however, Title Company shall invest the Earnest Money only in such
manner as will allow Title Company to be in a position to disburse the Earnest
Money as herein provided upon two (2) days notice. Any interest or other income
accruing from the Earnest Money shall become a part of the Earnest Money and
shall be disbursed together with, and to the party entitled to, the Earnest
Money.
ARTICLE IV
SURVEY AND TITLE POLICY
Section 4.1 Within ten (10) days after the Effective Date, Seller, at
Seller's sole cost and expense, shall deliver or cause to be delivered to
Purchaser a current as-built survey (the "Survey") of the Property, containing a
metes and bounds description of the Property. The Survey shall be sufficient to
permit the Title Company to modify the standard printed exception in the Owner
Policy of Title Insurance (the "Title Policy") pertaining to discrepancies in
area or boundary lines, encroachments, overlapping of improvements or similar
matters (the "Survey Exception"). The Survey shall indicate the location of all
improvements on the Property and adjoining streets. Further, the Survey shall
indicate the location of all title exceptions which can be located thereon and
identify same by volume and page recording references. The Survey shall be
prepared by a duly licensed Texas land surveyor or engineer reasonably
acceptable to Title Company, Seller and Purchaser and shall be currently dated,
shall show the location on the Land of all Improvements, building and set-back
lines, fences, evidence of abandoned fences, ponds, creeks, streams, rivers,
officially designated 100-year flood plains and flood prone areas, canals,
ditches, easements, roads, rights-of-way and encroachments, and shall contain a
legal description of the boundaries of the Land by metes and bounds (which shall
include a reference to the recorded plat, if any), and a computation of the area
comprising the Land in both acres and square feet (to the nearest one-thousandth
of said respective measurement). The Survey shall also contain a Surveyor's
Certification (herein so called) to Seller, Purchaser and Title Company in a
form reasonably acceptable to Purchaser and Title Company.
Section 4.2 Within ten (10) days after the Effective Date, Seller shall
furnish to Purchaser a current commitment (the "Title Commitment") for the
issuance of the Title Policy to Purchaser from COMMONWEALTH LAND TITLE COMPANY
OF DALLAS, 1700 Pacific Avenue, Suite 4740, Dallas, Texas 75201 Attention: Ms.
Jackie Holt, Vice President [Telephone Number: (214) 855-8400; Telefax Number
(214) 754-9066] (the "Title Company"), together with legible copies of all
documents constituting exceptions to title to the Property as reflected in the
Title Commitment (collectively, the "Title Documents") and copies of the deed(s)
by which Seller took title to the Property. Purchaser shall have a period of ten
(10) days from the date of Purchaser's actual receipt of the last of the Survey,
the Title Commitment, the Title Documents and Seller's deed(s), in which to
review such items and to deliver to Seller in writing such reasonable objections
as Purchaser may have to anything contained or set forth in the Title
<PAGE>
Commitment, the Title Documents, the Survey or Seller's deed(s). Any items to
which Purchaser does not object within such ten (10) day period shall be deemed
to be permitted exceptions (the "Permitted Exceptions"). In the event Purchaser
timely objects to any matter contained in the Title Commitment, the Title
Documents, the Survey, or Seller's deed(s) as hereinabove provided, Seller shall
have a reasonable period of time, not to exceed seven (7) days, after receipt of
Purchaser's objections within which Seller may attempt to cure such objections
specified as aforesaid by Purchaser; provided; however, Seller shall be under no
obligation to incur any costs whatsoever in connection with any such cure. In
the event Seller is unable or unwilling to cure any such objections as aforesaid
within such reasonable period of time, not to exceed seven (7) days, then, and
in such event, Purchaser may, at Purchaser's option, either terminate this
Contract (whereupon the Earnest Money shall be immediately returned to
Purchaser), or Purchaser may waive any such objections and the transactions
contemplated hereby shall be consummated as provided herein.
Section 4.3 At Closing or within a reasonable period of time after
Closing, Seller shall furnish Purchaser, as Seller's sole cost and expense
(except as expressly set forth below regarding the Survey Exception), with a
Title Policy issued by the Title Company on the standard form in use in the
State of Texas, insuring good and indefeasible title to the Property in
Purchaser, subject only to the Permitted Exceptions and the standard printed
exceptions, except:
(a) The exception relating to restrictions against
the Property shall be deleted in its entirety by the Title Company
unless the restrictions are included in the Permitted Exceptions;
(b) The exception relating to ad valorem taxes shall except
only to taxes owing for the current and subsequent years and subsequent
assessments for prior years due to change in land use;
(c) The Survey Exception shall be deleted to "shortages
in area" at Purchaser's option and at Purchaser's expense;
(d) There shall be no general exception for "parties in
possession"; and
(e) There shall be no exception for any lien, for service,
labor or material heretofore or hereafter provided, imposed by law and
now shown by the public records.
Section 4.4 Within ten (10) days after the Effective Date, Seller
shall, at Seller's sole cost and expense, deliver to Purchaser copies of: (a)
the Contracts; (b) current expense information showing all expenses incurred
and/or accrued, including, but not limited to, utility, tax, insurance and
maintenance costs, associated with the ownership and operation of the Property
for the past year; (c) copies of all Plans and Studies; (d) copies of any Phase
I environmental report and any other environmental reports relating to the
Property in the possession of Seller or Aloette, or readily available to Seller
or Aloette; (e) copies of the real estate tax bills pertaining to the Property
for the current year and the two (2) prior years; (f) any and all existing soil
reports in Seller's possession or Aloette's possession or readily available to
<PAGE>
Seller or Aloette; and (g) a list of all Personal Property not included in the
Assets being purchased by Purchaser pursuant to the Asset Sale Agreement
together with copies of all Warranties.
ARTICLE V
INSPECTION AND AUDIT
Section 5.1 Purchaser, at Purchaser's sole cost and expense, shall have
through and until Closing (the "Inspection Period") within which to review the
Contracts, the Warranties, the Plans and Studies, the list of Personal Property
and all of the other items received from Seller and to conduct any and all
engineering and economic feasibility studies of the Property which Purchaser
may, at Purchaser's sole discretion, deem necessary to determine whether or not
the Property is engineeringly and economically suitable for Purchaser's intended
use. Purchaser and Purchaser's representatives may enter upon the Property for
the purposes of reviewing the books and records pertaining to the Property
onsite (or at any other office of Seller) and conducting any studies or tests,
including, without limitation, soil tests, obtaining topographical information,
structural tests, conducting engineering and economic feasibility studies and
for all other similar preliminary work; provided, however, Purchaser shall and
does hereby indemnify and hold harmless Seller from and against any claims,
costs, expenses or damages that Seller may suffer or incur as a direct result of
any such inspection, including, without limitation, (a) any and all reasonable
attorneys' fees or court costs actually incurred by Seller as a direct result of
any such claims or activities and (b) mechanic's liens or claims that may be
filed on or asserted against the Property by contractors, subcontractors or
materialmen performing such work for Purchaser. All such inspections shall be
conducted after reasonable notice to Seller and during normal business hours.
Section 5.2 In the event Purchaser shall notify Seller in writing on or
before the expiration of the Inspection Period that Purchaser, for any reason
whatsoever, does not desire to consummate this Contract, then, and in such
event, this Contract shall terminate, whereupon the Earnest Money shall be
immediately returned to Purchaser by Title Company and the parties herein shall
have no further obligations to the other hereunder except as provided herein.
Absent Purchaser's written notice to Seller prior to Closing of Purchaser's
election to so terminate this Contract as aforesaid, then, and in such event,
Purchaser shall have waived any and all claim whatsoever to terminate this
Contract pursuant to this Article, and shall proceed to Closing.
ARTICLE VI
CONDEMNATION, ASSESSMENTS AND RISK OF LOSS
Section 6.1 In the event of damage by fire or other casualty or a
taking by condemnation or similar proceedings or actions of all of the Property,
or any portion of the Property, then Purchaser shall have the option to
terminate this Contract upon written notice to Seller prior to Closing, in which
event the Earnest Money (and all earnings thereon) shall be promptly refunded by
Title Company to Purchaser, and neither Purchaser nor Seller shall have any
further right or obligation hereunder except as set forth herein. Should
Purchaser elect not to exercise Purchaser's termination option as provided
<PAGE>
herein, then this Contract shall remain in full force and effect and Seller
shall assign and/or pay to Purchaser at Closing Seller's interest in and to all
insurance proceeds, condemnation awards or proceeds from any such proceedings or
actions in lieu thereof.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
Section 7.1 Seller makes the following representations and warranties
to Purchaser, as of the Effective Date and as of the Closing Date:
(a) Seller owns good and indefeasible title to the Property,
subject to the Permitted Exceptions. Seller is duly organized, validly
existing and in good standing under the laws of the State of Texas and
has all requisite power and authority to enter into and perform this
Contract.
(b) Seller is not a "foreign person" as such term is defined
in Sections 1445 and 7701 of the Internal Revenue Code of 1986, as
amended, and the regulations promulgated thereunder (the "Code"), and
the sale of the Property is not subject to the federal income tax
withholding requirements of such Sections (or any other Section) of the
Code.
(c) Prior to Closing, Seller shall manage the Property in
substantially the same manner as the Property has been managed up to
and including the date hereof by Seller, subject, however, to all
relevant terms and provisions of this Contract.
(d) Seller is not prohibited from executing or delivering this
Contract, complying with or performing under the terms and provisions
of this Contract, or consummating the transactions contemplated by this
Contract by any Applicable Law (as hereinafter defined), agreement,
instrument, restriction, or by judgment, order or decree of any
Governmental Authority (herein so called) having jurisdiction over
Seller or Seller's properties.
(e) Seller has no knowledge of any condemnation pro-
eedings having been instituted or threatened against the Property.
(f) Seller has received no notice of, nor has Seller any
knowledge of, any violations of any federal, state, county or municipal
laws, ordinances, orders, regulations or requirements affecting the
Property or any portion thereof.
(g) To the best of Seller's knowledge, there is no action,
suit or proceeding pending or threatened against or affecting the
Property or any portion thereof or relating to or arising out of the
ownership or use of the Property or any portion thereof in any court or
before or by any federal, state, county or municipal department,
commission, board, bureau, agency or other governmental
instrumentality.
<PAGE>
(h) There are no adverse parties or other parties in
possession of the Property.
(i) At Closing, there will be no unpaid bills or claims
in connection with any work on the Property.
(j) Seller shall take no action or fail to take any action
between the Effective Date and the Closing Date or at any time
thereafter which would or could result in any lien, encumbrance or
other exception to Seller's title arising or attaching to the Property,
other than the Permitted Exceptions.
(k) The zoning for the Property permits Seller's current
use of the Property.
(l) To the best knowledge of Seller, there are no existing
violations of any Applicable Laws, including, without limitation,
Environmental Laws (herein so called) on the Property, and the
location, ownership, operation, use and occupancy of the Property for
Seller's current use of the Property do not violate any Applicable
Laws, including, without limitation, any Environmental Laws. For
purposes of this Contract, the term "Applicable Laws" (herein so
called) means any applicable federal, state, county or municipal law,
statute, ordinance, rule, regulation, order or determination of any
Governmental Authority or any board or fire underwriters (or other body
exercising similar functions) or any restrictive covenant or deed
restriction or zoning ordinance or classification affecting the
Property, including, but not limited to, all applicable codes, flood
disaster laws, health laws and Environmental Laws, rules and
regulations.
(m) Seller has no information or knowledge of any change
contemplated in any of the Applicable Laws or any judicial or
administrative action, or any action by adjacent landowners, or any
fact or condition relating to the Property which would adversely
affect, prevent or limit the use of the Property in the manner
contemplated by Purchaser.
(n) The operation of the Property has not, to the best of
Seller's knowledge during Seller's ownership of the Property, and is
not now, to the best of Seller's knowledge, the subject of any
administrative investigation, action or judicial proceeding initiated
by any Governmental Authority, or any private citizen, and no such
investigation, administrative order or judicial proceeding is now
pending, or, to the best of Seller's knowledge, threatened, nor is the
Property presently operating under any court order or administrative
agreement in regard to any violation or alleged violation of any such
law, ordinance or administrative proceeding.
(o) As of the Effective Date, Seller has not received any
notice of a proposed increase in the assessed value of the Property or
any part thereof, and in the event Seller should receive any notice
subsequent to the Effective Date, Seller shall immediately deliver a
copy of any such notice to Purchaser.
(p) Seller shall pay all bills and expenses of the Property as
of the Closing Date, and Purchaser shall be obligated for all such
<PAGE>
expenses thereafter subject to the proration requirements contained
herein; provided, however, Seller shall not voluntarily enter into or
assume any new contracts or obligations with regard to the Property
which are in addition to, or different from, those furnished or
disclosed to Purchaser and reviewed and approved pursuant to the terms
and provisions hereof and which cannot be terminated at or prior to
Closing without the prior written consent of Purchaser.
(q) Prior to Closing, Seller shall not create or voluntarily
permit to be created any liens, easements or other conditions affecting
any portion of the Property which will not be fully and effectively
released, both in fact and of record, by Seller, at Seller's sole cost
and expense, at or prior to Closing without the prior written consent
of Purchaser.
Section 7.2 Purchaser makes the following representations and
warranties to Seller, as of the Effective Date and as of the Closing Date:
(a) Purchaser is duly organized, validly existing and in good
standing under the laws of the State of Texas and has all requisite
power and authority to enter into and perform this Contract; provided,
however, in the event Purchaser assigns this Contract to a limited
partnership the phrase "and in good standing" shall be deemed deleted
from this Section 7.2(a).
(b) The execution and delivery of this Contract and the
consummation of the transactions contemplated hereunder, when effected,
will constitute the valid, legally binding obligation of Purchaser in
accordance with the terms hereof.
(c) The execution and delivery of this Contract and the
consummation of the transactions contemplated by this Contract will not
(i) result in any breach of, or constitute a default under, any
instrument or obligation to which Purchaser is a party or by which
Purchaser is bound; and (ii) to the best of Purchaser's actual
knowledge, violate any existing statute, regulation, order, writ,
injunction or decree of any court, administrative agency or
governmental body.
(d) Purchaser is not entering into this Contract based upon
any representation, promise or warranty by Seller as to the fair market
value of the Property; rather, Purchaser is purchasing the Property
based on Purchaser's determination as to the fair market value of the
Property.
(e) Purchaser is not a party to, or the subject of, any
action, suit, litigation, administrative proceeding or governmental or
quasi-governmental investigation in reference to the transactions
contemplated hereunder nor is any such action, suit, litigation,
proceeding or investigation threatened to the best actual knowledge of
Purchaser.
(f) Purchaser has the financial ability, business exper-
tise and management skill to successfully fulfill Purchaser's obliga-
tions hereunder.
This Article VII shall survive Closing for two (2) years after the Closing Date.
<PAGE>
ARTICLE VIII
CLOSING
Section 8.1 The Closing hereunder shall take place at 10:00 o'clock
a.m., Dallas, Texas time at the offices of the Title Company. The date of
Closing (the "Closing Date") shall be June 16, 1995. The Closing Date may occur
on such earlier date as may be mutually agreed to by Seller and Purchaser.
Notwithstanding anything herein to the contrary, the Closing shall be extended,
at Purchaser's sole and exclusive option, for such length of time that would
allow Purchaser to have no longer than three (3) business days to review the
Phase I environmental assessment report (the "Environmental Report") ordered by,
and to be issued to, Purchaser, from ATEC Associates, Inc.
Section 8.2 At Closing, Seller shall deliver or cause to be delivered
to Purchaser, at Seller's sole cost and expense, each of the following items:
(a) A General Warranty Deed (the "Deed") duly executed and
acknowledged by Seller, and in a form mutually and reasonable
acceptable to Purchaser and Seller, conveying good and indefeasible
title in the Land, the Improvements and the items specified in Section
1.1(d)(i), (ii) and (vi) hereof to Purchaser, subject only to the
Permitted Exceptions.
(b) A Blanket Conveyance, Bill of Sale and Assignment
conveying the Personal Property, the Warranties, the Intangibles, the
Rights and the Contracts in a form mutually and reasonably acceptable
to Purchaser and Seller [Items (a) and (b) are hereinafter sometimes
collectively referred to as the "Conveyance Documents"].
(c) The Title Policy in the form specified in Section 4.3
hereof.
(d) Certification (herein so called) as to non-foreign
status of Seller.
(e) Originals, if available of all of the Plans and Studies,
Contracts and Warranties within Seller's possession or Aloette's
possession or readily available to Seller or Aloette which have not
theretofore been delivered to Purchaser.
(f) UCC Searches (herein so called) of the Personal Property
reflecting no security interests filed in connection with the Personal
Property or the Property or any portion thereof.
(g) Keys and any security devices to the Property in
Seller's possession or in the possession of Aloette or readily avail-
able to Seller or Aloette.
(h) An All Bills Paid Affidavit (herein so called) evidencing
and confirming the full and complete payment of any and all bills and
debts of any kind incurred in connection with the Property.
<PAGE>
(i) All additional documents and instruments as in the mutual
and reasonable opinion of Seller, Purchaser or Title Company are
reasonably necessary to the proper consummation of this Contract.
(j) Such evidence or documents as may reasonably be required
by Purchaser or Title Company evidencing the status and capacity of
Seller and the authority of the person or persons who are executing the
various documents on behalf of Seller in connection with the sale of
the Property.
Section 8.3 At Closing, Purchaser, at Purchaser's sole cost and
expense, shall deliver to Seller the following items:
(a) The Purchase Price required by Section 2.1 hereof.
(b) All additional documents and instruments as in the mutual
and reasonable opinion of Seller, Purchaser or Title Company are
reasonably necessary to the proper consummation of this Contract.
(c) Such evidence or documents as may reasonably be required
by Seller or Title Company evidencing the status and capacity of
Purchaser and the authority of the person or persons who are executing
the various documents on behalf of Purchaser in connection with the
purchase of the Property.
Section 8.4
(a) At Closing, ad valorem taxes for the Property for the
current calendar year shall be prorated to the Closing Date, and Seller
shall pay to Purchaser, as an adjustment to the Purchase Price at
Closing, Seller's pro rata portion of such taxes. Seller's pro rata
portion of such taxes shall be based upon taxes actually assessed for
the current calendar year. If, for any reason, ad valorem taxes for the
current calendar year have not been assessed on the Property, such
proration shall be estimated based upon ad valorem taxes for the
immediately preceding calendar year and such proration shall be final.
(b) At Closing, utilities, common area maintenance, insurance
and tax charges affecting the Property and charges for all Contracts
which Purchaser elects to assume shall be prorated as of the Closing
Date.
This Section shall survive Closing.
Section 8.5 Possession of the Property shall be delivered to Purchaser
by Seller at Closing, subject only to the Permitted Exceptions.
Section 8.6 Purchaser shall be responsible for all normal escrow fees
of the Title Company and the recording fee for the Deed. Except as expressly
otherwise provided herein, all costs and expenses in connection with the
<PAGE>
transactions contemplated by this Contract shall be borne by Seller and
Purchaser in the manner in which such costs and expenses are customarily
allocated between the parties at closings of real property similar to the
Property in the area in which the Property is situated.
Section 8.7 Seller agrees to indemnify and hold Purchaser harmless of
and from any and all liabilities, claims, demands and expenses, of any kind or
nature (except those items which by this Contract specifically become the
obligation of Purchaser or are expressly excluded or disclaimed by Seller)
accruing during the period of Seller's ownership whether arising before or after
the Closing Date and which are in any way related to the ownership, maintenance
or operation of the Property, and all expenses related thereto, including,
without limitation, court costs and reasonable attorneys' fees. This Section
shall survive Closing.
Section 8.8 Purchaser agrees to indemnify and hold Seller harmless of
and from any and all liabilities, claims, demands and expenses, of any kind or
nature (except those items which by this Contract specifically remain the
obligation of Seller) arising or accruing subsequent to the Closing Date and
which are in any way related to the ownership, maintenance or operation of the
Property, and all expenses related thereto, including, without limitation, court
costs and reasonable attorneys' fees. This Section shall survive Closing.
Section 8.9 In the event either Seller or Purchaser receives notice of
a claim or demand which results or may result in indemnification pursuant to
Section 8.7 hereof or Section 8.8 hereof, such party shall immediately give
written notice thereof to the other party to this Contract. The party receiving
such notice shall immediately take such measures as may be reasonably required
to properly and effectively defend any such claim or demand, and may defend same
with counsel of its own choosing. In the event the party receiving such notice
fails to properly and effectively defend such claim or demand, and in the event
such party is liable therefor, then the party so giving such notice may defend
any such claim or demand at the expense of the party receiving such notice. This
Section shall survive Closing.
ARTICLE IX
REAL ESTATE COMMISSION
Section 9.1 Each party hereto represents and warrants to the other
party that it has not employed any broker or finder in connection with the
transactions contemplated by this Contract. The parties hereto shall and do
hereby agree to indemnify and hold each other harmless against and from any
claims, costs, fees, expenses and liabilities in connection with claims to fees,
commissions or any other compensation by any broker or finder allegedly employed
by such party or arising from such party's own acts, commitments or agreements.
<PAGE>
ARTICLE X
REMEDIES OF DEFAULT
Section 10.1 In the event all conditions of this Contract are satisfied
by Purchaser (if Purchaser's obligation) or waived and in the event all
covenants and agreements to be performed by Purchaser prior to Closing are fully
performed, and in the event that performance of this Contract is tendered by
Purchaser and the sale is not consummated through default on the part of Seller
on the Closing Date, then Purchaser shall be entitled to either (a) enforce
specific performance hereunder; or (b) terminate this Contract and receive back
from Title Company the Earnest Money. Notwithstanding anything to the contrary
provided herein, should Seller cause a specific performance action to be
ineffective by virtue of any further conveyance or any encumbrances from and
after the date this Contract is executed by Purchaser, Purchaser shall be
entitled to bring a suit for damages or any other remedy available at law or in
equity. The remedies set forth in this Section shall be Purchaser's sole
remedies.
Section 10.2 Subject to Seller not being in default, in the event of
Purchaser's default hereunder, Seller may (a) avail itself of the equitable
remedy of specific performance or (b) terminate this Contract and receive the
Earnest Money from Title Company as liquidated damages for Purchaser's default.
Such amount is agreed upon by and between Seller and Purchaser as liquidated
damages, due to the difficulty and inconvenience of ascertaining and measuring
actual damages, and the uncertainty thereof. The remedies set forth in this
Section shall be Seller's sole remedies.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Effective Date. For purposes of determining the time for
performance of various obligations under this Contract, the Effective Date
(herein so called) of this Contract shall be the later of the dates this
Contract is executed by Seller or Purchaser as reflected on the signature pages
of this Contract.
Section 11.2 Time Periods. Should the calculation of any of the various
time periods provided for herein result in an obligation becoming due on a
Saturday, Sunday or legal holiday, then the due date of such obligation or
scheduled time of occurrence of such event shall be delayed until the next
business day.
Section 11.3 Further Instruments. Each party will, whenever and as
often as such party shall be reasonably requested to so do by the other party,
execute, acknowledge and deliver or cause to be executed, acknowledged and
delivered, any and all conveyances, assignments and all other instruments and
documents as may be reasonably necessary in order to complete the transactions
herein provided and to carry out the intent and purposes hereof.
Section 11.4 Notices. Any notice, request, demand, instruction or other
communication to be given to either party hereunder shall be in writing, and
<PAGE>
shall be deemed to be delivered as follows: (a) if hand delivered (including
overnight deliveries), when delivered to the address set forth herein for the
party to whom any such communication is given or (b) if mailed (except where
actual receipt is specified herein), whether actually received or not, upon
deposit of same as provided below, in a regularly maintained official depository
of the United States Mail located in the continental United States, and sent by
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
IF TO SELLER: WITH COPIES TO:
Superior Products Company Aloette Cosmetics, Inc.
1301 Wright's Lane East 1301 Wright's Lane East
West Chester, Pennsylvania 19380 West Chester, Pennsylvania 19380
Telephone: (610)692-0600 Telephone: (610)692-0600
Telefax: (610)692-2334 Telefax: (610)692-2334
Attn: Ms. Patricia J. Defibaugh,
Chairman of the Board and Leo R. Zamparelli
Chief Executive Officer Trenton, New Jersey 08638
Telephone: (609)883-6000
Telefax: (609)882-9536
IF TO PURCHASER: WITH COPY TO:
Naterra International, Inc. Gerald D. Quast, P.C.
1425 Century Drive 2301 Cedar Springs
Suite 207 Second Floor
Carrollton, Texas 75006 Dallas, Texas 75201-7802
Attn: Mr. Jin K. Song, President Attn: Gerald D. Quast,
Telephone: (214) 242-7313 President
Telefax: (214) 242-7413 Telephone: (214) 871-3121
Telefax: (214) 871-6098
The addresses and addressees for purposes of this notice provision may be
changed by either party by giving notice of such change to the other party in
the manner provided herein for giving notice. For such purpose of changing such
addresses or addressees only, unless and until such written notice is received,
the last address and addressee stated herein shall be deemed to continue in
effect for all purposes. This Section shall not be construed or interpreted in
anywise to affect or impair any waiver of notice herein provided or to require
giving of notice by one party to the other where such notice is not otherwise
required herein. The telefax and telephone numbers are included herein for
convenience only; for purposes of this Contract, official notices must be given
in accordance with the requirements of this Section.
Section 11.5 Entire Agreement. This Contract and the exhibits,
schedules, riders and/or addenda attached hereto, if any, contain and constitute
the entire agreement between the parties hereto, and no promise, statement,
agreement, representation, warranty, condition, term, provision, undertaking or
understanding, either oral or written, or any covenant, fact or circumstance not
<PAGE>
included herein or in any such referenced agreements has been, or is, relied
upon by the parties hereto except that the Asset Sale Agreement and the
Manufacturing Agreement are a part of the entire contemplated transaction
relating hereto. This Contract speaks for itself and no facts and circumstances
outside the four corners of this Contract not specifically incorporated herein
shall be used in the interpretation of this Contract. In the event of a conflict
between the terms of the body of this Contract and any exhibits, schedule, rider
or addenda attached hereto, the terms of the body of this Contract shall
control. This Contract supersedes all prior agreements and understandings, if
any, of the parties hereto relating to the subject matter hereof relating to the
sale of the Property.
Section 11.6 Reliance. Neither party has made any representation,
warranty or covenant to the other concerning any tax benefits or tax treatment
which may accrue to the benefit of, or be given to, the other party in
connection with the transactions contemplated hereby. Each party has relied upon
its own examination of the terms and provisions contained herein, and the
counsel of its own advisors, and the representations, warranties and covenants
contained herein.
Section 11.7 Amendment. No subsequent alteration, modification,
amendment, change, deletion or addition of this Contract shall be binding and of
any force or effect unless made by an instrument in writing and executed by all
the parties hereto.
Section 11.8 Applicable Law. IN THE EVENT THAT ANY LITIGATION ARISES
HEREUNDER, IT IS SPECIFICALLY STIPULATED THAT THE RIGHTS AND DUTIES OF THE
PARTIES HERETO AND THE VALIDITY, CONSTRUCTION AND THE ENFORCEMENT OF THIS
CONTRACT SHALL BE INTERPRETED AND CONSTRUED ACCORDING TO THE LAWS OF THE STATE
OF TEXAS AND OF THE UNITED STATES OF AMERICA.
Section 11.9 Venue. IN THE EVENT OF A DISPUTE INVOLVING THIS CONTRACT
OR ANY OF THE OTHER DOCUMENTS EXECUTED IN CONNECTION HEREWITH, THE PARTIES
HERETO IRREVOCABLY AGREE THAT VENUE FOR ANY SUCH DISPUTE SHALL LIE IN ANY COURT
OF COMPETENT JURISDICTION IN DALLAS COUNTY, TEXAS.
Section 11.10 Attorneys' Fees. The prevailing party in any litigation
between the parties hereto shall be entitled to recover, as a part of its
judgment, reasonable attorneys' fees and costs of suit.
Section 11.11 Headings, Captions. The article, paragraph and section
headings, captions and numbering system contained herein are inserted for
purposes of convenience and identification only and shall not be considered in
construing or interpreting this Contract.
Section 11.12 Recitals. The Recitals (herein so called), if any,
contained in this Contract are true and correct and are hereby made a part of
this Contract. The Recitals shall be considered in construing and interpreting
this Contract.
<PAGE>
Section 11.13 Time of the Essence. Time is of the essence with respect
to the performance of all obligations provided herein and the consummation of
all transactions contemplated hereby.
Section 11.14 Interpretation. Words of any gender used herein shall be
held and construed to include any other gender; words of a singular number shall
be held to include the plural and vice versa, unless the context requires
otherwise; and any reference to "including" shall mean "including, but not
limited to" unless expressly stated otherwise.
Section 11.15 Counterparts. This Contract may be executed in any number
of counterparts, each of which shall be deemed an original, but all of such
counterparts taken together shall constitute one and the same instrument.
Section 11.16 Exhibits. All exhibits, schedules and addenda described
herein are by this reference fully incorporated herein and made a part hereof by
reference for all purposes.
Section 11.17 Binding Effect. This Contract and the terms and
provisions hereof shall inure to the benefit of, and be binding upon, the
parties hereto and their respective heirs, executors, personal representatives,
successors and assigns whenever the context so requires or admits.
Section 11.18 Invalidity. In case any one or more of the terms or
provisions contained in this Contract shall be held to be invalid, illegal,
unenforceable or inapplicable in any respect under any present or future laws,
such invalidity, illegality, unenforceability or inapplicability shall not
affect any other provision hereof and this Contract shall be construed as if
such invalid, illegal, unenforceable or inapplicable provisions had never been
contained herein. In lieu of any illegal, invalid, unenforceable or inapplicable
provision herein, there shall be automatically added as a part of this Contract
a provision as similar in its terms to such illegal, invalid, unenforceable or
inapplicable provision as may be possible and which such provision shall be
legal, valid, enforceable and applicable.
Section 11.19 Waiver. The parties hereto may waive any of the
conditions, terms or provisions contained herein, or any of the duties or
obligations of the other party hereunder, but any such waiver shall be effective
only if in writing and signed by the party waiving any such item.
Section 11.20 Authority. Each person executing this Contract, by such
person's execution hereof, represents and warrants that such person is fully
authorized to execute this Contract on behalf of the party such person is
executing this Contract on behalf of, and that no further action or consent on
the part of the party for whom such person is acting is required to the
effectiveness and enforceability of this Contract against such party following
the execution hereof. This Section shall survive Closing.
Section 11.21 Construction. The parties hereto acknowledge that each
party and their counsel have reviewed and revised this Contract and that each
party was represented by competent counsel in connection with the preparation of
<PAGE>
this Contract and each party hereto has been advised by their counsel as to the
ramifications hereof. In this regard, the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of this Contract or any amendments,
schedules, riders, addenda and/or exhibits hereto.
Section 11.22 Exclusive Benefit. This Contract shall be for the sole
and exclusive benefit of the parties hereto and shall not be construed to confer
any right upon any third party, unless so expressly stated herein.
Section 11.23 Conflict. Notwithstanding anything herein to the
contrary, in the event of a conflict between the Letter of Intent and this
Contract, this Contract shall govern and control.
Section 11.24 Survival of Representations and Warranties. All
representations, warranties, covenants and agreements made by each party in this
Contract or in any schedule, certificate, document or list delivered by any
authority hereto pursuant to this Contract, shall survive the Closing, subject
to the limitations contained in this Section, and notwithstanding any
investigation conducted before or after the Closing or the decision of any party
to complete the Closing, each party hereto shall be entitled to rely solely on
the representations, warranties, covenants and agreements of the other party
contained in this Contract or in any writing delivered pursuant to the terms and
provisions of this Contract and each party may not rely upon any representation,
warranty, agreement, provision or information, written or oral, made by any
person other than as specifically set forth herein or therein. Notwithstanding
anything herein to the contrary, all claims for breach of any representation and
warranty made by any party hereto must be asserted prior to the second
anniversary of the Closing Date, and no party hereto shall be entitled to
indemnity hereunder or any other relief at law or in equity for any such claims
asserted after that date. Therefore, the representations and warranties of
Seller and Purchaser shall survive the Closing for two (2) years.
Notwithstanding the foregoing, the representations, warranties, covenants and
agreements contained in the Conveyance Documents to be executed by the parties
hereto at Closing shall not be limited by the two (2) year period described in
this Section.
Section 11.25 Asset Sale Agreement and Manufacturing Agreement. As an
express and prime inducement for the parties hereto to enter into this Contract,
Seller and Purchaser agree to execute the Asset Sale Agreement and Purchaser
agrees to execute the Manufacturing Agreement with Aloette concurrent with the
execution of this Contract. Notwithstanding anything herein to the contrary,
this Contract shall be deemed null and void and of no further effect in the
absence of the execution and delivery of the Asset Sale Agreement and the
Manufacturing Agreement and their continuing effect. Further, the parties hereto
and Aloette contemplate the simultaneous consummation and Closing of this
Contract, the closing of the Asset Sale Agreement and the commencement of the
Manufacturing Agreement. In the event the Contract and the Asset Sale Agreement
do not close, then the Manufacturing Agreement shall be deemed null and void and
of no further effect.
Section 11.26 Assignment. Notwithstanding anything herein to the
contrary, Purchaser may assign this Contract at or prior to Closing provided
Purchaser remains liable for the performance of this Contract.
<PAGE>
EXECUTED on this the 2nd day of June, 1995, by Seller.
"SELLER":
Superior Products Company,
a Texas corporation
By: Aloette Cosmetics, Inc. of Delaware,
a Delaware corporation
Its: Sole Shareholder
By: ___________________________
Jean M. Lewis
Its: Vice President-Finance
EXECUTED on this the 2nd day of June, 1995, by Purchaser.
"PURCHASER":
Naterra International, Inc.,
a Texas corporation
By: __________________________________
Jin K. Song
Its: President
<PAGE>
TITLE COMPANY RECEIPT
The Contract has been received by the Title Company this the 5th day
of June, 1995.
COMMONWEALTH LAND TITLE COMPANYOF DALLAS
By: _______________________________
Jackie Holt
Its: Vice President
<PAGE>
EXHIBIT "A"
BEGINNING at the Northeast corner of a 5.31 acre tract conveyed to Thompson Can
Company by A. Webb Roberts by deed filed December 9, 1950 and recorded in Volume
3421, Page 563, Deed Records, Dallas County, Texas, said point being 105.2 feet
Westerly, measured at right angles from the center line of M.L. and T.R.R.
(Denton Branch) Railway tract in place;
THENCE South 74 degrees 45 minutes West and along the Northerly line of said
Thompson Can Company tract, at 284.7 feet pass its Northwest corner, in all
299.9 feet to a point for corner in the center line of M.K. & T.R.R. spur tract,
and said point being in the center line of a 30 foot wide easement to said
railway as recorded in Volume 3460, Page 51, Deed Records, Dallas County, Texas;
THENCE North 10 degrees 36 minutes West and with the center line of said 30 foot
easement and said railway tract in place, a distance of 501.65 feet;
THENCE North 74 degrees 45 minutes East and parallel to the Northerly line of
said Thompson Can Company tract, a distance of 259.09 feet to a point for corner
in the Westerly line of Denton Drive or Road;
THENCE South 15 degrees 16 minutes East and with the Westerly line of said
Denton Drive or Road, as marked on the ground, a distance of 500.0 feet to the
PLACE OF BEGINNING.
EXHIBIT "A" - Solo Page
<PAGE>
EXHIBIT D
ASSET SALE AGREEMENT
This Asset Sale Agreement ("Agreement"), entered into this 2nd day of
June, 1995, by and among:
NATERRA INTERNATIONAL, INC., a Texas corporation, having a place of
business at 1425 Century Drive, Suite 207, Carrollton, Texas 75006
("Purchaser");
SUPERIOR PRODUCTS COMPANY, a Texas corporation, having a place of
business at 13525 Denton Drive, Dallas, Texas 75234 ("Seller"); and
ALOETTE COSMETICS, INC., a Pennsylvania corporation, ALOETTE COSMETICS,
INC. OF PENNSYLVANIA, a Pennsylvania corporation, and ALOETTE COSMETICS, INC. OF
DELAWARE, a Delaware corporation ("ACID"), all having a place of business at
1301 Wright's Lane East, West Chester, Pennsylvania 19380 (collectively,
"Aloette").
Purchaser, Seller and Aloette are hereinafter sometimes collectively referred as
the "Parties" and hereinafter sometimes referred to singularly as a "Party" to
this Agreement.
BACKGROUND OF AGREEMENT
Aloette is in the business of the sale of cosmetics. ACID is the sole
shareholder of Seller. Seller is the owner of a manufacturing facility located
in Dallas, Texas, and is a manufacturer of cosmetic products for, among others,
Aloette. Purchaser is a manufacturer of cosmetic products.
Purchaser, Seller and Aloette have executed a Letter of Intent (herein so
called) dated April 19, 1995. The Letter of Intent contemplates the simultaneous
execution and consummation of three agreements, namely (i) this Agreement; (ii)
a real estate purchase agreement titled Contract of Sale (herein so called); and
(iii) a Manufacturing Agreement (herein so called). Pursuant to these
agreements, Purchaser will acquire the Property (herein so called and as defined
in the Contract of Sale) pursuant to the Contract of Sale, acquire the Assets
(as hereinafter defined) pursuant to this Agreement and enter into the
Manufacturing Agreement with Aloette.
RECITALS
WHEREAS, Seller is the owner of the assets identified on the attached Exhibit A
("Assets"); and
WHEREAS, Seller is desirous of selling and conveying all of the Assets; and
WHEREAS, Purchaser is desirous of acquiring said Assets; and
Page 26 of 59
<PAGE>
WHEREAS, Purchaser and Seller intend to enter into the Contract of Sale for
the sale and purchase of the Property; and
WHEREAS, Purchaser and Aloette intend to enter into the Manufacturing Agreement;
and
WHEREAS, the Parties have reached a conceptual understanding with respect to the
terms and conditions of the foregoing which are set forth in the Letter of
Intent and now desire to enter into this Agreement as part of the contemplated
transactions.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements set forth herein, and in reliance upon the representations,
warranties and covenants contained herein, the Parties agree as follows:
1. Definitions.
1.1. For the purpose of this Agreement, in addition to the definitions
set forth hereinabove, the defined terms contained herein shall have the
following meanings:
"Accounts Receivable" shall mean the list of then-existing accounts
receivable of Seller to be delivered to Purchaser by Seller on the Closing Date
(as hereinafter defined).
"Articles of Amendment" shall have the meaning as set forth in Section
7.2.1.7. hereof.
"Closing" shall mean the consummation of the transactions contemplated
by this Agreement.
"Closing Date" shall mean June 16, 1995, subject to the three (3) day
review period pertaining to the Environmental Report (as defined, and as set
forth in Section 8.1 of the Contract of Sale).
"Confidentiality Letter" shall have the meaning as set forth in Section
16.1 of this Agreement.
"Employee Plans" shall mean any and all employee benefit plans,
compensation plans, stock ownership plans, insurance plans, all other plans and
benefits of Seller and all tax-related obligations and liabilities relating
thereto and/or as required by applicable law, including, but not limited to, the
plans described in Section 12.1 of this Agreement.
"Indemnified Party" shall have the meaning as set forth in Section
13.1.1. of this Agreement.
"Indemnifying Party" shall have the meaning as set forth in Section
13.1.1. of this Agreement.
"Inspection" shall have the meaning as set forth in Section 3.3. of
this Agreement.
<PAGE>
"Inspection Date" shall mean May 20, 1995, the day on which an actual
physical inventory was taken; nevertheless, Seller and Purchaser each reserve
the right to conduct a spot inventory in order to perform test counts or a full
inventory prior to the Closing Date.
"Inventory Value" shall mean the value as agreed to by Purchaser and
Seller of the inventory constituting part of the Assets.
"Products" shall mean the products as d efined in the Manufacturing
Agreement.
"Proprietary Information" shall have the meaning as set forth in
Section 16.1 of this Agreement.
"Purchase Price" shall mean the compensation paid for the Assets, as
adjusted by the difference between the Inventory Value on the Statement Date (as
hereinafter defined) and the Inventory Value on the Inspection Date, as modified
by any Roll Forward Calculation (as hereinafter defined), after the close of
business on the day preceding the Closing Date.
"Purchaser's Transaction Documents" shall have the meaning as set
forth in Section 11.1.2. of this Agreement.
"Roll Forward Calculation" shall mean any adjustment to the Purchase
Price made after the close of business on the day preceding the Closing Date
mutually acceptable to the Parties in accordance with this Agreement.
"Seller's Transaction Documents" shall have the meaning set forth in
Section 10.1.2. of this Agreement.
"Statement Date" shall mean March 31, 1995.
"Transaction" shall mean, collectively, this Agreement, the Contract of
Sale, and the Manufacturing Agreement and all agreements related to any of the
foregoing.
"UCC Searches" shall have the meaning as set forth in Section 7.2.1.8.
hereof.
2. Sale of Assets.
2.1. Seller agrees to sell and Purchaser agrees to purchase and acquire
from Seller, at Closing, free and clear of all claims, lawsuits, causes of
action, liens, debts, mortgages, security interests, and any other liens and
encumbrances, the Assets listed in the attached Exhibit A.
2.2. Seller, Aloette and Purchaser agree that all of Seller's formulas,
component information, specifications, financial and billing information, sales
information, customer lists, accounting information, operations information,
<PAGE>
computer files and other information of Seller (collectively, the "Computer
Information") are contained in Aloette's Computer System (herein so called).
Seller and Aloette agree that said Computer Information is being conveyed to
Purchaser as part of the Assets pursuant to this Agreement and that such
Computer Information is presently contained in Aloette's Computer System. Seller
and Aloette agree that Purchaser shall have the unrestricted and unfettered
right to access and use the Computer Information through Aloette's Computer
System for a period of one hundred eighty (180) days from the Closing Date (the
"Transition Period"). During the Transition Period, Purchaser shall have the
right from time to time to copy any or all of the Computer Information. During
said Transition Period, Purchaser shall also have the right to use all of (a)
the software programs and (b) computer equipment owned by Aloette and currently
being used by Seller in connection with the Computer Information and Aloette's
Computer System. After Closing, neither Seller nor Aloette (or any other party
other than Purchaser) shall have any right to use or access the Computer
Information except for any historical financial information for time periods
prior to the Closing Date and except as required by applicable law and with
prior written notice to Purchaser. Upon receipt of written notice from Purchaser
to destroy said Computer Information, Aloette agrees to promptly destroy all of
said Computer Information and totally remove said Computer Information from
Aloette's Computer System. Aloette and Seller agree to take all steps and
precautions to protect the Computer Information and to keep said Computer
Information strictly confidential in the manner set forth in Section 16 hereof.
Seller and Aloette represent and warrant to Purchaser that Seller and Aloette
will not use any of the Computer Information except as otherwise provided
herein. Purchaser agrees that the dedicated telephone line for Purchaser
connecting into the Computer System shall be Purchaser's sole cost and expense.
Notwithstanding the foregoing, as a condition to Seller and Purchaser's
obligation to proceed to Closing, the parties hereto agree that prior to Closing
the parties will obtain a mutually acceptable agreement with Sexton Corp.,
successor to MAI Systems ("Sexton"), regarding Purchaser's use of the existing
software programs (and any other information and programs the subject of an
existing agreement between Aloette and Sexton) presently utilized by Seller and
Aloette with respect to the Computer Information.
2.3. Seller and Aloette agree that the books and records of Seller are
being conveyed to Purchaser as part of the Assets pursuant to this Agreement. In
this regard, Purchaser shall maintain the books and records for seven (7) years.
During said seven (7) year period, Aloette shall be permitted reasonable access
to said books and records with reasonable prior notice to Purchaser and at
mutually acceptable times so long as Purchaser's business is not unduly
interrupted; provided, however, Aloette shall not be permitted access to
Purchaser's books and records other than Seller's books and records being
conveyed herewith; provided further, however, copies of said books and records
shall promptly be made available to Aloette as reasonably required from time to
time by Aloette.
<PAGE>
3. Purchase Price and Payment.
3.1. The Purchase Price for all of the Assets shall be Eight Hundred
Fifty Thousand Dollars ($850,000.00), subject to the adjustments outlined in
this Agreement including, but not limited to, Section 3.2. hereof, and payable
at Closing by federal wire transfer.
3.2. The Purchase Price is based on the Balance Sheet dated March 31,
1995 attached as Exhibit B. The Purchase Price may be adjusted upward or
downward on a dollar for dollar adjustment based on any changes in the Assets
occurring in the ordinary course of Seller's business from the Statement Date to
the Closing Date.
3.3. An actual physical inventory (the "Inspection") will be taken by
the Parties on the Inspection Date in accordance with the inventory procedures
established in Section 4 hereof. In the event that the Inventory Value
determined as of the Inspection Date is greater than the Inventory Value
determined on the Statement Date, then the Purchase Price shall be increased by
the difference between the two (2) Inventory Values. Any such increase in the
Purchase Price shall be paid in the same manner and on the same terms and
conditions as the Purchase Price.
If the Inventory Value as of the Inspection Date is less than the
Inventory Value determined on the Statement Date, then the Purchase Price shall
be decreased by the difference between the two (2) Inventory Values.
A standard Roll Forward Calculation shall be done at the close of
business on the day preceding the Closing Date based upon any transactions
occurring between the Inspection Date and the Closing Date and based on the
calculations, assumptions and notes set forth on Exhibit "C" attached hereto. It
being understood and agreed that the only transactions that will occur between
those dates are transactions in the ordinary course of Seller's business.
Commencing with the date hereof, Seller agrees to make available to Purchaser,
on a daily basis, all the computer-generated reports, all production reports,
all other reports and all shipping and receiving invoices that clearly reflect
the receipt of any new inventory and the delivery of any inventory of Seller.
Seller represents and warrants to Purchaser that the reports described in the
immediately preceding sentence shall be true, accurate and complete in every
respect. Said representation and warranty of Seller shall survive the Closing.
At Purchaser's option, Purchaser may have a representative at the Property [as
defined in the Contract of Sale] at any time and from time to time to observe,
verify and confirm the incoming inventory and the outgoing inventory.
3.4. All new purchase orders received or issued by Seller after the
Inspection Date and before the Closing Date shall be subject to the approval of
Purchaser, which approval shall not be unreasonably withheld. Purchaser shall be
deemed to have approved any new purchase orders of Seller if Purchaser does not
disapprove the new purchase order in writing within two (2) business days after
Purchaser's actual receipt of any new purchase order. Until Closing or the
<PAGE>
earlier termination of this Agreement, Seller agrees to provide Purchaser with a
temporary office at the Property so Purchaser can observe, verify and confirm
the various items set forth in Sections 3.3. and 3.4. hereof.
3.5. Simultaneously with the execution and delivery of this Agreement by
Seller, Seller shall deliver to Purchaser all new purchase orders received or
issued by Seller since the Statement Date but prior to the date of Seller's
execution and delivery of this Agreement.
3.6. Notwithstanding anything herein to the contrary, prior to Closing,
Seller shall notify all of Seller's vendors and any other applicable parties
that Aloette is fully responsible for all purchase orders existing as of the
Closing Date issued in connection with Aloette and Living Younger Longer. Prior
to Closing, Seller and Purchaser shall agree in writing as to all non-Aloette
and non-Living Younger Longer (a) purchase orders that Seller will terminate and
for which Purchaser will simultaneously have said purchase orders reissued in
Purchaser's name and (b) purchase orders that Seller will terminate and
Purchaser will not have reissued. As to those purchase orders in Section 3.6.(b)
hereof, Seller shall be fully responsible and liable for same and Seller agrees
at Closing to so notify all of the applicable vendors and any other applicable
parties of the foregoing and provide evidence of same to Purchaser.
3.7. At Closing, Seller and Purchaser agree to prorate all taxes and
assessments against the Assets and Seller shall pay to Purchaser, in cash at
Closing, Seller's pro-rata portion of all such taxes and assessments. In this
regard, on or before June 5, 1995, Seller agrees to deliver tax statements for
the Assets for 1995, if available, and for 1993 and 1994 for Purchaser's review.
Seller's pro-rata portion of such taxes and assessments shall be based upon
taxes and assessments actually assessed for 1995. If, for any reason, taxes and
assessments for 1995 have not been assessed on the Assets, such proration shall
be estimated based upon taxes and assessments for 1994 as adjusted as agreed to
by Seller and Purchaser and such proration shall be final.
3.8. Seller and Purchaser agree to a reduction to the Purchase Price of
an amount equal to the following: (a) the net book value as of March 31, 1995,
of Seller's Ricoh copier (which such Ricoh copier was contemplated to be
included in the Assets to be purchased by Purchaser pursuant to this Agreement);
(b) one-half (1/2) of the remaining lease and purchase obligations on the
existing leases for the three (3) fork lifts described on Exhibit "A" attached
hereto; and (c) one-half (1/2) of the remaining lease and purchase obligations
on the existing lease for the floor cleaner/scrubber described on Exhibit "A"
attached hereto.
<PAGE>
4. Inventory Procedure.
4.1. On the Inspection Date, the Parties, or their duly authorized
agent, shall have completed the Inspection of the inventory (including a review
of purchases and sales of the inventory between the Statement Date and the
Inspection Date) in order to determine the Inventory Value as of the Inspection
Date. In the event that the Inspection Date is prior to the close of business on
the day before the Closing Date, then, at the close of business on the day
before the Closing Date, a Roll Forward Calculation shall be done, if necessary,
to adjust for any transactions that have occurred between the Inspection Date
and the Closing Date.
4.2. Seller hereby represents, warrants and agrees that all purchases
and sales of inventory prior to the Statement Date and from such date through
the Closing Date have been and shall have been not materially inconsistent with
Seller's historic operations and purchases and sales of inventory in accordance
with Seller's ordinary course of business.
5. Conditions Precedent.
5.1. The sale of Assets to Purchaser pursuant to this Agreement and the
Closing hereunder is expressly contingent upon the following unless expressly
waived or modified by the Parties in writing:
5.1.1. Satisfactory review by Purchaser of the Assets, and
third-party agreements affecting the sale of Assets;
5.1.2. Completion of all necessary governmental filings
by Seller and Aloette and receipt by Seller and Aloette of all necessary
governmental approvals;
5.1.3. The financial and business conditions of Seller
and the results of the operations of Seller not being materially differ-
ent from those reflected in Exhibit B attached hereto;
5.1.4. Prior to Closing, receipt of all necessary consents
from third parties including, but not limited to, the consents of any
lending institutions; provided, however, the Parties shall use their
respective commercially reasonable efforts to obtain promptly all necessary
third party consents;
5.1.5. Seller's review of Purchaser's current Financial
Statements and Financial Statements for the year ended December 31, 1994,
bank statements supporting the cash balances provided in the Financial
Statements and any additional information that may be reasonably required
by the Seller; and
5.1.6. Compliance with all applicable regulations, statutes
and laws by Seller, Purchaser and Aloette in connection with the Transact-
ion.
<PAGE>
It is understood and agreed that, if the foregoing contingencies are
not satisfied or expressly waived by the Parties, in writing, within ten (10)
days of the execution hereof, then, in such event, either Party may elect to
terminate this Agreement and effectuate the return of all documents, in which
event the obligations of the Parties hereto shall become null, void and of no
effect.
The Parties hereby agree to use their commercially reasonable efforts
to furnish all information required hereunder in a timely fashion and to
otherwise satisfy the conditions precedent to Closing.
6. Items Excluded From Sale; Liabilities.
6.1. Expressly excluded from the sale and purchase of Assets
contemplated hereby are the following:
(a) Cash on hand and in banks of Seller;
(b) Accounts Receivable of Seller;
(c) Prepaid expenses of Seller;
(d) Prepaid inventory of Seller;
(e) Deferred income taxes of Seller;
(f) Aloette's work in process inventory as specified on Exhibit A
attached hereto;
(g) Aloette's packaging components and finished goods inventory excluding
the chemicals and raw material specified on Exhibit C attached hereto;
(h) Aloette's and Living Younger Longer formulas;
(i) Benefits and burdens from any litigation now commenced or hereafter
arising of Seller from conditions existing prior to the Closing Date;
(j) Employee Plans and all assets thereof;
(k) Any employment contracts, agreements or arrangements (whether oral or
written) between Seller and Seller's current or past employees,
agents or representatives;
(l) All Obsolete Items as defined in Section 6.6 hereof; and
<PAGE>
(m) All inventory of Living Younger Longer
including, but not limited to, all work in
process, finished goods, components and
packaging.
6.2. Notwithstanding anything herein to the contrary, Purchaser shall
not assume and shall not be subject to any accounts payable or any other
liabilities of Seller or Aloette arising or relating to any conditions or
matters occurring prior to or on the Closing Date, even if any such liabilities
do not surface or become known until after the Closing Date, of whatever kind or
nature and whether or not currently existing or contingent, disclosed or
undisclosed, known or unknown, including, without limitation, accounts payable,
notes payable, product liabilities, environmental liabilities and liabilities
for federal, state and local taxes.
6.3. Notwithstanding anything herein to the contrary, Purchaser will
assume no accounts payable or any other liabilities of Seller, except for
Seller's obligations under executory third-party customer contracts that are
assumed by Purchaser. Purchaser hereby agrees to indemnify and hold Seller
harmless from and against any costs, damages, fees and expenses, including
reasonable attorney's fees, actually incurred by Seller and arising out of, or
resulting from a breach by Purchaser, of Purchaser's undertaking of Seller's
obligations and/or Purchaser's performance or failure to perform the assumed
contracts. Simultaneously with the execution and delivery of this Agreement by
Seller, Seller shall deliver to Purchaser, for Purchaser's review, any and all
service contracts and third-party agreements relating to the Assets; provided
however that such third-party agreements shall not include any contract between
Seller or Aloette and Living Younger Longer (herein so called). Purchaser shall
notify Seller in writing on or before June 6, 1995, which of the third-party
agreements or contracts Purchaser desires to assume and Seller agrees to obtain
any consents pertaining to same and to comply with all notice requirements of
any of said third-party agreements or contracts Purchaser desires to assume
prior to Closing. At Closing, Seller shall terminate all third-party contracts
and agreements not assumed by Purchaser.
6.4. Seller shall be responsible for and shall timely pay for all
Employee Plans and the employee-related agreements described in Section 6.1.(k)
hereof.
6.5. Excluded herefrom is any litigation or claims by or against Seller
or Aloette.
6.6. Notwithstanding anything herein to the contrary, prior to Closing,
Seller and Purchaser shall agree in writing on all of the obsolete,
discontinued, contaminated, spoiled or unusable assets of Seller, including, but
not limited to, chemicals and components (collectively, the "Obsolete Items")
that are not part of the Assets being purchased by Purchaser. Prior to Closing,
Seller and Aloette agree to remove from the Property, and dispose of, all of
such Obsolete Items. Further, prior to Closing, Seller and Aloette agree to
relocate from the Property all of Aloette's and Living Younger Longer's
fulfillment operations.
<PAGE>
6.7. Notwithstanding anything herein to the contrary, Seller and
Purchaser agree that the inventories of Beauty Control, TIGI, Originail and
Ashaway (collectively, the "Third Party Inventories") located in Seller's
warehouse at the Property are not part of the Assets being purchased by
Purchaser. Seller shall indemnify and hold Purchaser harmless from any and all
discrepancies in said Third Party Inventories and any and all costs and expenses
incurred in connection with the defense, settlement or any dispute relating to
any such discrepancies. On or before June 6, 1995, Seller agrees to send letters
to Beauty Control, TIGI, Originail and Ashaway notifying each of them (a) of
Purchaser's purchase of the Assets and the Property, (b) the exact quantities of
the inventory of each such third party held by Seller and (c) to notify Seller
(not Purchaser) with respect to any questions or comments about such third
party's inventory. In the event any of said third parties dispute or raise any
discrepancies with regard to such inventory information, then Seller shall
promptly notify any such third party that Seller (not Purchaser) is responsible
for any such dispute and/or discrepancy and Seller agrees to resolve any such
dispute and/or discrepancy. Seller represents and warrants to Purchaser that
Seller does not have any other inventories at the Property of any third parties
other than Beauty Control, TIGI, Originail and Ashaway.
6.8. This Section 6 shall survive Closing.
7. The Closing.
7.1. Time and Place of Closing. The Closing of the Transaction shall
take place on the Closing Date at Commonwealth Land Title Company of Dallas,
1700 Pacific Avenue, Suite 4740, Dallas, Texas 75201, or at such other place
upon which the Parties hereto shall mutually agree in writing.
7.2. Deliveries at Closing. At the Closing:
7.2.1. Seller and Aloette shall deliver, or cause to be
delivered, to Purchaser the items described below:
7.2.1.1. A fully executed, original Bill of Sale
(herein so called) substantially in the form attached as Exhibit D;
7.2.1.2. Certified Resolutions of Seller and
Aloette's Board of Directors and Shareholders approving the
Transaction;
7.2.1.3. Opinion of counsel for Seller and Aloette
dated the Closing Date, in the form contained in Exhibit E hereto;
7.2.1.4. Such other instruments of transfer and other
documents as shall be reasonably necessary or appropriate to
effectuate the Transaction;
<PAGE>
7.2.1.5. The originals of the third-party agreements
and all original related materials which Purchaser elects to assume
pursuant to Section 6.3. hereof;
7.2.1.6. Possession of the Assets together with all
certificates of title and any other evidence of title thereto;
7.2.1.7. Articles of Amendment (herein so called) of
Seller changing Seller's name to a name that is not similar to
"Superior Products Company," which such Articles of Amendment shall be
filed by Seller at Seller's sole cost with the Texas Secretary of State
(and any other state where Seller has qualified to do business or
otherwise filed its name) immediately after Closing and which Seller
shall deliver a certified filed copy of said Articles of Amendment to
Purchaser within fifteen (15) days of the Closing Date; and
7.2.1.8. UCC Searches (herein so called) of the
Assets reflecting said Assets to be free and clear of all liens and
security interests.
7.2.2. Purchaser shall deliver, or cause to be delivered, to
Seller and Aloette the items described below:
7.2.2.1. Certified Resolutions of Purchaser's Board
of Directors approving the Transaction;
7.2.2.2. Opinion of counsel for Purchaser dated the
Closing Date, in the form contained in Exhibit F hereto; and
7.2.2.3. Such other instruments of transfer and other
documents as shall be reasonably necessary or appropriate to
effectuate the Transaction.
8. Contract of Sale; Manufacturing Agreement.
8.1. As an express and prime inducement for the Parties to enter into
this Agreement, Seller and Purchaser agree to execute the Contract of Sale and
Aloette and Purchaser agree to execute the Manufacturing Agreement concurrent
with the execution of this Agreement. Notwithstanding anything herein to the
contrary, this Agreement shall be deemed null and void and of no further effect
in the absence of the execution of the Contract of Sale and the Manufacturing
Agreement and their continuing effect.
9. Accounts Receivable of Seller.
<PAGE>
9.1. Seller's Accounts Receivable and other receivables shall remain
the property of the Seller. At Closing, Seller shall provide Purchaser with a
list of all the then-existing Accounts Receivable of Seller. For a period of 90
days, commencing on the Closing Date, Purchaser, as Seller's agent, shall
collect said Accounts Receivable in the ordinary course of Purchaser's business,
provided, however, that Purchaser shall not be obligated to send any demand or
collection letters or seek collection of the Accounts Receivable by litigation
or otherwise or to expend any money whatsoever in order to collect the Accounts
Receivable or incur any liability therefor.
9.2. Purchaser shall deposit in Seller's bank account #018-073-404-6 at
NationsBank of Texas, N.A., located at 1401 Elm Street, Dallas, Texas 75202, on
Thursday, all Accounts Receivable collected and received by Purchaser during the
previous week.
9.3. Purchaser shall provide Seller with monthly statements as to the
aggregate amount of Accounts Receivable collected, the names of the account
debtors, the amount collected, and the total amount due with respect to each
such Account Receivable. Unless an invoice is specifically disputed by a debtor
or the debtor otherwise notifies Purchaser, Purchaser shall apply payments to
the oldest invoice first. Purchaser also agrees to provide to Seller on a weekly
basis copies of all deposit slips and customer checks relating to the Accounts
Receivable collected by Purchaser.
9.4. From and after the Closing Date, Purchaser shall maintain a
separate schedule of all Accounts Receivable and payments thereof, which
schedule shall be available for inspection by Seller upon request.
9.5. Seller agrees to provide Purchaser with any assistance reasonably
requested by Purchaser relating to the Accounts Receivable within such 90 day
period. At the conclusion of such 90 day period, Purchaser shall provide a
schedule to Seller and Aloette of the Accounts Receivable received by Purchaser
and the outstanding Accounts Receivable and, thereafter, Purchaser shall have no
further responsibility therefor. Up until 90 days after Closing, at the request
of Purchaser, Seller and Aloette agree to provide Purchaser with information
relating to the payment history of various customers of Seller and Aloette who
are also customers or potential customers of Purchaser.
9.6. Notwithstanding anything to the contrary contained in this Section
9, Seller may demand the immediate return of the Accounts Receivable supporting
documentation at any time within the 90 day period whereupon Purchaser shall,
without delay, turn over all of said Accounts Receivable supporting
documentation; provided, however, Purchaser shall be permitted to make copies of
all of such supporting documentation; provided further, however, Seller agrees
not to proceed with Seller's own collection efforts with respect to any Accounts
Receivable until Seller demands the immediate return of the Accounts Receivable
documentation as provided in this Section 9.6.
<PAGE>
9.7. It is understood and agreed that Purchaser is not a surety, debt
collector, factoring company or guarantor of, or with respect to, the Accounts
Receivable and Seller and Aloette agree to indemnify Purchaser and hold
Purchaser harmless for any and all claims, causes of action, lawsuits and costs
and expenses actually incurred by Purchaser relating to Purchaser acting as an
agent for Seller in collecting and receiving the Accounts Receivable in
accordance with this Section 9. This Section 9.7. shall survive the Closing.
10. Seller's Representations, Warranties and Covenants.
10.1. As a material inducement to Purchaser's purchase, Seller
represents, warrants and covenants unto Purchaser as set forth below and
acknowledges that Purchaser is relying upon such representations, warranties and
covenants in connection with Purchaser's entering into the Transaction
including, without limitation, the purchase by Purchaser of the Assets.
Seller represents, warrants and covenants to Purchaser as follows on
and as of the date hereof and on and as of the Closing Date:
10.1.1. Corporate Status. Seller is a corporation, duly
organized and existing and in good standing under the laws of the State of
Texas, is duly authorized to carry on its business, that all necessary
corporate actions to authorize the execution of this Agreement and to
consummate the Transaction have been taken, and this Agreement constitutes
a valid and binding obligation of Seller enforceable in accordance with its
terms.
10.1.2. Power and Authority. Seller has the power and
authority to execute, deliver and perform this Agreement and the other
instruments required to be delivered by Seller to Purchaser at Closing
(collectively, the "Seller's Transaction Documents").
10.1.3. Absence of Conflicting Agreements. Neither the
execution nor delivery of this Agreement or any of Seller's Transaction
Documents by Seller nor the performance by Seller of the transactions
contemplated herein conflicts with or constitutes a breach of or a default
under (i) any material applicable law or any material applicable rule,
judgment, order, writ, injunction or decree of any court; (ii) any material
applicable rule or regulation of any administrative agency or other
governmental authority; or (iii) any material agreement, indenture,
instrument or contract to which Seller is now a party or by which Seller is
bound.
10.1.4. Binding Agreement. Seller has duly executed and
delivered this Agreement. This Agreement is and, when executed and
delivered by Seller at the Closing, and the Seller's Transaction Documents
will be (assuming the due authorization, execution and delivery hereof by
Purchaser) the legal, valid and binding obligations of Seller, enforceable
against Seller in accordance with their respective terms, subject to the
effect of applicable bankruptcy, insolvency, reorganization, moratorium and
<PAGE>
similar laws affecting creditors' rights and remedies generally and of
general principals of equity and public policy (regardless of whether
enforcement is sought in a proceeding at law or in equity).
10.1.5. No Finders. No broker or finder has acted for Seller
or Aloette in connection with the Transaction, and no broker or finder is
entitled to any broker's or finder's fee or other commission in respect
thereof based in any way on agreements, understandings or arrangements with
Seller or Aloette.
10.1.6. Consents and Notices. Except as set forth in Section
5.1.4. hereof as of the date hereof, no consent or approval of any
governmental agency or other person is required and no notice to any
governmental agency or other person need be given in connection with
Seller's or Aloette's execution and delivery of this Agreement or for the
consummation by Seller or Aloette of the Transaction.
10.1.7. Marketable Title. The Seller shall, at Closing, have
good and marketable title to all of the Assets to be sold, transferred and
assigned to Purchaser pursuant to this Agreement, subject to no claims,
lawsuits, causes of action, liens, security interests, debts, mortgages and
encumbrances of any kind other than those to be satisfied at Closing from
the proceeds of the sale or otherwise provided for herein.
10.1.8. Operation in the Ordinary Course of Business. Until
Closing, Seller will continue the operation of Seller's business in the
ordinary course and will continue to do business in the same manner and
during the same hours as heretofore, including exercising best efforts to
preserve intact Seller's business, organizations and the goodwill of
Seller's customers, suppliers, employees, lessors and others having
business relations with the Seller and Seller and/or Aloette shall not
purchase, sell, lease or dispose of any property or assets, or incur any
liability or make any commitment to enter into other transactions, except
in the ordinary and usual course of business, consistent with practice and
pending consummation of the Transaction by Purchaser, or as otherwise set
forth in this Agreement. Seller represents and warrants to the best of
Seller's knowledge that all documentation, books and records delivered or
made available to Purchaser are true, accurate and complete and that Seller
has disclosed all material information relating to the Assets to Purchaser.
10.1.9. Insurance. Until Closing, Seller shall maintain
Seller's current insurance coverages in full force and effect insuring the
Property to be sold to Purchaser pursuant to the Contract of Sale and the
Assets to be sold to Purchaser pursuant to this Agreement; and Seller will
promptly notify Purchaser, in writing, of any loss and/or damage. In the
event of damage or loss by fire or other casualty of the Assets, or any
material portion of the Assets, then Purchaser shall have the option to
terminate this Agreement upon written notice to Seller prior to Closing, in
which event neither Purchaser nor Seller shall have any further right or
obligation hereunder except as set forth herein. Should Purchaser elect not
to exercise Purchaser's termination option as provided herein, then this
Agreement shall remain in full force and effect and Seller shall assign
and/or pay to Purchaser, at Closing, Seller's interest in and to all
insurance proceeds.
<PAGE>
10.1.10. Tangible Assets. The tangible Assets are in good
operating condition, order and repair, subject to ordinary wear and tear
and have been maintained in accordance with standard industry practice.
10.1.11. No Litigation; No Judgments. There are no judgments
outstanding or any suits or proceedings, whether in equity or at law, or
governmental or administrative investigations or proceedings pending or, to
the knowledge of Seller, threatened against Seller or any of the Assets. To
the best of Seller's knowledge, there are no claims or actions outstanding
against Seller or any of the Assets.
10.1.12. Taxes. To the best of Seller's knowledge, Seller has
duly filed, when due, including any extensions, all tax reports and tax
returns in connection with and in respect of Seller's business, Assets and
employees, and Seller has timely paid and discharged all such taxes and tax
obligations.
10.1.13. Environmental Laws. To the best of Seller's
knowledge, neither Seller nor any of the Assets or Property are in
violation of, or has violated, or has been in non-compliance with any
applicable environmental laws in connection with the ownership, use,
maintenance or operation of, or conduct of business related to Seller, the
Assets or the Property; provided, however, Seller acknowledges that in 1993
it was cited for exceeding effluent standards for oil and grease ("Fog"). A
waste filtration system was installed by Seller in 1994 which brought
Seller into compliance with the applicable Fog standards.
10.1.14. Seller's Name. To the best of Seller's knowledge, the
use of the name of "Superior Products Company" does not infringe the right
of any third party. After the Closing Date, no one other than Purchaser
will be authorized by Seller to use the name "Superior Products Company."
10.1.15. Governmental Filings. Prior to Closing, Seller and
Aloette (a) will have completed all necessary governmental filings and
received all necessary approvals pertaining to, and of, the Transaction and
(b) will have complied with all applicable regulations, statutes and laws
in connection with the Transaction.
10.1.16. Ability to Complete Transaction. Seller and Aloette
have the financial ability, business expertise, and management skill to
successfully fulfill Seller's and Aloette's obligations hereunder.
10.1.17. Uniform Fraudulent Transfer Act. The execution and
delivery of this Agreement and the Closing of the Transaction does not
violate, in any way, the Uniform Fraudulent Transfer Act as enacted in the
State of Texas.
11. Purchaser's Representations, Warranties and Covenants.
<PAGE>
11.1. As a material inducement to Seller and Aloette to enter into this
Agreement, Purchaser represents, warrants and covenants unto Seller and Aloette
as set forth below and acknowledges that Seller and Aloette are relying upon
such representations and warranties in connection with the sale of Assets
pursuant to this Agreement.
Purchaser represents and warrants to Seller and Aloette as follows on
and as of the date hereof and on and as of the Closing Date:
11.1.1. Corporate Status. Purchaser is a corporation, duly
organized and existing and in good standing under the laws of the State of
Texas, is duly authorized to carry on its business, that all necessary
corporate actions to authorize the execution of this Agreement and to
consummate the Transaction have been taken, and this Agreement constitutes
a valid and binding obligation of Purchaser enforceable in accordance with
its terms.
11.1.2. Power and Authority. Purchaser has the power and
authority to execute, deliver and perform this Agreement and the other
instruments required to be delivered by Purchaser to Seller at the Closing
(collectively, the "Purchaser's Transaction Documents").
11.1.3. Absence of Conflicting Agreements. Neither the
execution nor delivery of this Agreement or any of Purchaser's Transaction
Documents by Purchaser nor the performance by Purchaser of the transactions
contemplated herein conflicts with or constitutes a breach of or a default
under (i) any material applicable law or any material applicable rule,
judgment, order, writ, injunction or decree of any court; (ii) any material
applicable rule or regulation of any administrative agency or other
governmental authority; or (iii) any material agreement, indenture,
instrument or contract to which Purchaser is now a party or by which
Purchaser is bound.
11.1.4. Binding Agreement. This Agreement has been duly
executed and delivered by Purchaser. This Agreement is and, when executed
and delivered by Purchaser at Closing, and the Purchaser's Transaction
Documents will be (assuming the due authorization, execution and delivery
of this Agreement by Seller) the legal, valid and binding obligations of
Purchaser, enforceable against Purchaser in accordance with their
respective terms, subject to the effect of applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and of general principals of
equity and public policy (regardless of whether enforcement is sought in a
proceeding of law or in equity).
11.1.5. No Finders. No broker or finder has acted for
Purchaser in connection with the Transaction, and no broker or finder is
entitled to any broker's or finder's fee or other commission in respect
thereof based in any way on agreements, understandings or arrangements with
Purchaser.
<PAGE>
11.1.6. Consents and Notices. No consent or approval of any
governmental agency or other person is required and no notice to any
governmental agency or other person need be given in connection with
Purchaser's execution and delivery of this Agreement or for the
consummation by Purchaser of the Transaction.
11.1.7. Bankruptcy. Purchaser has not committed an act of
bankruptcy, proposed a compromise or arrangement to Purchaser's creditors
generally, had any petition for a receiving order in bankruptcy filed
against Purchaser, taken any proceeding with respect to a compromise or
arrangement, taken any proceeding to have itself declared bankrupt or
wound-up, taken any action to have a receiver appointed for any part of
Purchaser's assets, had any encumbrancer take possession of any of
Purchaser's property, or had any execution or distress become enforceable
or become levied upon any of Purchaser's property.
11.1.8. Ability to Complete Transaction. Purchaser has the
financial ability, business expertise, and management skill to successfully
fulfill Purchaser's obligations hereunder.
12. Employee Plans.
12.1. Seller shall remain fully responsible for any and all benefits
due to employees for Seller's 401K/Profit Sharing Plan and Seller's Employee
Stock Ownership Plan and all other Employee Plans and all other employee-related
agreements. Purchaser understands that Purchaser has no rights to any of the
Employee Plans or any portion thereof or any assets thereof. Seller shall have
the right to dissolve the corporation and/or the existing Employee Plans and to
distribute to the appropriate parties the present vested interest in such
Employee Plans and any over-funding thereof as deemed necessary and appropriate
by Aloette on the advice of its advisors.
13. Obligations of the Parties After Closing.
<PAGE>
13.1. Indemnification.
13.1.1 Each party hereto agrees to indemnify and hold harmless
(such party is hereinafter referred to as the "Indemnifying Party") the
other party against any and all reasonable losses, costs, expenses, claims,
damages or liabilities (including the amount of any settlement approved by
such Indemnifying Party and expense of enforcing this Agreement), which
such other party (the "Indemnified Party") may actually suffer, incur or
become subject to, and to reimburse the Indemnified Party for any
reasonable legal, audit or other expenses actually incurred by the
Indemnified Party in connection with investigating any claims and defending
any actions, insofar as such losses, costs, expenses, claims, damages,
liabilities or action arise out of or are based upon (i) the breach of any
warranty made by the Indemnifying Party herein or in any schedule, written
statement, list, certificate or other instrument delivered to the
Indemnified Party by the Indemnifying Party, or (ii) any breach or default
in performance by the Indemnifying Party of any of the Indemnifying Party's
covenants or agreements with the Indemnified Party contained herein.
13.1.2. A party seeking indemnification hereunder shall
promptly notify the party from whom it is seeking indemnification of the
assertion of any claim or the discovery of any fact upon which the party
seeking indemnification intends to base a claim made by a third party
against which a party hereto is seeking indemnification hereunder, the
party from whom indemnification is sought shall have the right, at its own
expense, to participate in or assume control of the defense of such claim,
and the party seeking indemnification shall fully cooperate with the party
from whom indemnification is sought subject to reimbursement for actual
reasonable out-of-pocket expenses incurred as the result of such request by
the party from who indemnification is sought either does not elect to
assume control or otherwise participate in the defense of any third-party
claim, and in such event, that party shall be bound by the results obtained
by the other with respect to such claim.
13.2. Limitations. Notwithstanding anything herein to the contrary, all
claims for breach of any representation or warranty made by any Party herein
must be asserted prior to the second anniversary of the Closing Date, and no
Party shall be entitled to indemnity hereunder or other relief at law or in
equity for any such other claims asserted after that date. Therefore, the
representations and warranties of Seller and Purchaser shall survive Closing for
two (2) years; provided, however, the representations and warranties contained
in the Bill of Sale and the Deed (as defined in the Contract of Sale) shall not
be limited in any way by the terms and provisions of this Agreement.
14. Termination.
14.1. This Agreement may be terminated at any time prior to the time
of Closing:
14.1.1. by Purchaser if the representations, warranties,
covenants and conditions set forth in Section 10 have not be satisfied by
the Closing Date;
<PAGE>
14.1.2. by Seller if the representations, warranties,
covenants and conditions set forth in Section 11 have not been satisfied by
the Closing Date;
14.1.3. by either Seller or Purchaser, as applicable, if the
conditions precedent set forth in Section 5 hereof have not been met or
satisfied; or
14.1.4. by either Seller or Purchaser if the Closing has not
occurred on or before the Closing Date, provided, however, that the right
to terminate this Agreement under this Section shall not be available to
any party whose failure to fulfill any obligation under this Agreement has
been the cause of, or resulted in, the failure of the Closing to occur on
or before such date.
14.2. Effect of Termination. If a party terminates this Agreement
because one of its or their conditions precedent has not been fulfilled, or if
this Agreement is terminated by mutual consent or pursuant to this Section, this
Agreement shall become null and void without any liability of any party to the
other; provided however, that if such termination is by Purchaser pursuant to
Sections 14.1.1., 14.1.3. or 14.1.4. hereof as a result of a breach by Seller of
any of Seller's representations, warranties or covenants in this Agreement, of
if such termination is by Seller pursuant to Sections 14.1.2. or 14.1.4. hereof
as a result of a breach by Purchaser of any of Purchaser's representations,
warranties or covenants in this Agreement, nothing herein shall affect the
non-breaching party's right to damages on account of such other party's breach.
15. Seller's Indemnity for Seller's Accounts Payable and Other Liabilities
and Obligations Not Assumed by Purchaser.
15.1. Seller shall indemnify and hold Purchaser harmless from all of
Seller's accounts payable (Purchaser is not assuming any of said accounts
payable) and all other liabilities and obligations of Seller which are not
assumed by Purchaser under this Agreement, and from any and all liabilities,
including, but not limited to, all costs and expenses incurred in connection
with the defense or settlement of any such liability or obligation. In regard to
Seller's accounts payable, Seller agrees to pay all of said accounts payable
within thirty (30) days of the Closing Date or such later date within thirty
(30) days after any of said accounts payable become due; provided, however, any
of such accounts payable shall be paid or satisfied no later than ninety (90)
days after the Closing Date. This Section shall survive Closing.
16. Confidentiality; Due Diligence.
16.1. Prior to entering into the negotiating process, Purchaser and
Aloette executed a Confidentiality Letter (herein so called) dated April 3,
1995. Thereafter, there was an exchange of information resulting in the
execution of the Letter of Intent. The Letter of Intent contemplated additional
disclosures and a further exchange of information. This information includes,
but is not limited to, confidential business, financial and technical
information (collectively, the "Proprietary Information"). The Parties hereto
agree to be mutually bound to the following:
<PAGE>
16.1.1. The terms of the Confidentiality Letter remain in full
force and are incorporated herein as if set forth at length.
16.1.2. From and since the inception of the negotiating
process, a confidential relationship has arisen and exists among the
Parties.
16.1.3. During the term of this Agreement and, in the event
this Agreement is terminated, thereafter, in perpetuity, the Parties shall
hold in confidence any Proprietary Information disclosed to or exchanged by
the Parties (whether received orally, in writing, in print or by any other
method of communication) and shall not disclose that information to any
third party and shall not use that information for a purpose not covered by
this Agreement. Specifically, the Proprietary Information should be used
for no purpose other than the contemplated transaction.
16.1.4. The Parties agree that the Proprietary Information
shall be provided to employees and agents only on an "as-needed" basis.
16.1.5. In the event of termination of this Agreement, each
Party shall return to the disclosing Party all information which has been
disclosed to it, together with all copies, summaries and extracts of that
information and otherwise comply with Section 14 hereof. In addition, each
Party shall, on the termination of this Agreement, instruct that Party's
respective agent(s) and employee(s) to whom the information was disclosed
to continue to hold that information in perpetuity or until such
information is made available, other than by breach of this Agreement, to
the public generally.
16.1.6. The purpose of this Section 16 is to reaffirm, expand
and clarify the terms of the Confidentiality Letter and should not be
construed as a limitation thereof.
17. Miscellaneous Provisions.
17.1. Survival of Representations and Warranties. All representations,
warranties, covenants and agreements made by each Party in this Agreement or in
any schedule, certificate, document or list delivered by any such Party pursuant
hereto, shall survive the Closing, subject to the limitations in Section 13.2.
hereof, and notwithstanding any investigation conducted before or after the
Closing or the decision of any Party to complete the Closing, each Party hereto
shall be entitled to rely solely upon the representations, warranties, covenants
and agreements of any other Party contained in this Agreement or in any writing
delivered pursuant to the provisions of this Agreement and may not rely upon any
representation, warranty, agreement, provision or information, written or oral,
made by any person other than as specifically set forth herein or therein.
17.2. Public Announcements. Unless required by a Party's obligations of
public disclosure under applicable securities laws or other applicable laws and
only after prior written notice to the other Parties, (a) no Party hereto will
make any public announcement regarding the Transaction; and (b) no Party will
<PAGE>
issue any press releases or make any disclosures relating to the Transaction
without the prior written approval of the other Parties, which such approval
shall not be unreasonably withheld or delayed. Nothing in this Section shall be
construed to preclude or condition any public disclosure required by law.
17.3. Costs and Expenses. Purchaser and Seller shall each pay their own
fees and expenses and those of its or their agents and advisors in connection
with the consummation of the Transaction.
17.4. Performance. In the event of a default on the part of any Party
hereto, any other Party shall have the right, in addition to any other remedies
which may be available, to obtain specific performance of the terms of this
Agreement, and the defaulting party hereby waives the defense that there may be
an adequate remedy at law.
17.5. Benefit and Assignment. This Agreement will be binding upon the
respective successors and assigns of the Parties hereto. This Agreement and the
rights, obligations, and liabilities hereunder may not be assigned by any Party
without the Seller's prior written consent of the other Parties. No such
assignment by any Party shall relieve any Party of its obligations hereunder.
17.6. Effect and Construction. This Agreement, the Contract of Sale,
the Manufacturing Agreement, the Confidentiality Letter, the Letter of Intent,
and the exhibits and schedules hereto and thereto embody the entire agreement
and understanding of the Parties and supersede any and all prior agreements,
arrangements, and understandings relating to matters provided for herein. To the
extent of a conflict between this Agreement and the Letter of Intent or the
Confidentiality Letter, this Agreement shall govern and control. The captions
are for convenience only and will not control or affect the meaning or
construction of the provisions of this Agreement.
17.7. Background, Recitals and Exhibits. The background, recitals
and the Exhibits attached hereto are hereby incorporated herein and made a part
hereof.
17.8. After the passage of any applicable notice and cure period, any
controversy, dispute or claim arising out of, or relating to, this Agreement
which cannot be resolved informally shall be settled by arbitration in Dallas,
Texas, or such other place as may be mutually agreed upon in writing by the
parties hereto in accordance with the rules of the American Arbitration
Association then existing (unless the parties hereto otherwise agree in writing)
except with respect to the selection of arbitrators, as hereinafter set forth.
This Agreement to arbitrate and the decision of the arbitrators shall be final
and binding and specifically enforceable under the prevailing arbitration law of
the State of Texas or such other jurisdiction as may be mutually agreed in
writing by the parties hereto. When a matter has been submitted for arbitration,
each party hereto shall choose an arbitrator and the two (2) arbitrators
selected will mutually agree upon a third (3rd) independent arbitrator. Any such
controversy, dispute or claim shall then be resolved by a majority vote of the
three (3) arbitrators. Nothing set forth in this Section shall preclude the
parties from seeking an equitable remedy from a court of competent jurisdiction
in an emergent matter.
<PAGE>
17.9. Cooperation. Subject to the terms and conditions herein provided,
each of the Parties hereto shall use its commercially reasonable efforts to
take, or cause to be taken, such action, to execute and deliver, or cause to be
executed and delivered, such additional documents and instruments and to do, or
cause to be done, all things reasonably necessary, proper or advisable under the
provisions of this Agreement and under applicable law to consummate and make
effective the Transaction.
17.10. Notices. Any notice, request, demand, instruction or other
communication to be given to either party hereunder shall be in writing, and
shall be deemed to be delivered as follows: (a) if hand delivered (including
overnight deliveries), when delivered to the address set forth herein for the
party to whom any such communication is given or (b) if mailed (except where
actual receipt is specified herein), whether actually received or not, upon
deposit of same as provided below, in a regularly maintained official depository
of the United States Mail located in the continental United States, and sent by
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
If to Seller: Superior Products Company
c/o Aloette Cosmetics, Inc.
1301 Wright's Lane East
West Chester, PA 19380
Telephone (610) 692-0600
Telefax (610) 692-2334
Attn: Ms. Tricia Defibaugh
Chairman of the Board and
Chief Executive Officer
If to Aloette: Aloette Cosmetics, Inc.
1301 Wright's Lane East
West Chester, PA 19380
Telephone (610) 692-0600
Telefax (610) 692-2334
Attn: Ms. Tricia Defibaugh
Chairman of the Board and
Chief Executive Officer
With copies to: Leo R. Zamparelli, Esquire
1440 Parkside Avenue
Trenton, New Jersey 08638
Telephone (609) 883-6000
Telefax (609) 882-9536
<PAGE>
If to Purchaser: Naterra International, Inc.
Attn: Mr. Jin K. Song, President
1425 Century Drive, Suite 207
Carrollton, Texas 75006
Telephone (214) 242-7313
Telefax (214) 242-7413
With copies to: Gerald D. Quast, P.C.
2301 Cedar Springs, Second Floor
Dallas, Texas 75201-7802
Telephone (214) 871-3121
Telefax (214) 871-6098
The addresses and addressees for purposes of this notice provision may be
changed by any Party by giving notice of such change to the other Parties in the
manner provided herein for giving notice. For such purpose of changing such
addresses or addressees only, unless and until such written notice is received,
the last address and addressee stated herein shall be deemed to continue in
effect for all purposes. This Section shall not be construed or interpreted in
anywise to affect or impair any waiver of notice herein provided or to require
giving of notice by one Party to the other Parties where such notice is not
otherwise required herein. The telefax and telephone numbers are included herein
for convenience only; for purpose of this Agreement, official notices must be
given in accordance with the requirements of this Section.
17.11. Waiver, Discharge, Etc. This Agreement may not be released,
discharged, abandoned, changed or modified in any manner, except by an
instrument in writing signed by each of the Parties hereto by their duly
authorized officers or representatives. The failure of any Party hereto to
enforce at any time any of the provisions of this Agreement shall in no way be
construed to be a waiver of any such provision, nor in any way to affect the
validity of this Agreement or any part hereof or the right of any Party
hereafter to enforce any and every such provision. No waiver of any breach of
this Agreement shall be held to be a waiver of any other or subsequent breach.
17.12. Rights of Persons Not Parties. Nothing contained in this
Agreement shall be deemed to create rights in persons not Parties hereto, other
than the permitted successors and assigns of the Parties hereto pursuant to
Section 17.5. hereof.
17.13. Severability. If any term or provision of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Agreement shall be valid and in force to the fullest
extent permitted by law.
17.14. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which,
together, shall constitute one and the same document.
<PAGE>
17.15. Time Periods. Should the calculation of any of the various time
periods provided for herein result in an obligation becoming due on a Saturday,
Sunday or legal holiday, then the due date of such obligation or scheduled time
of occurrence of such event shall be delayed until the next business day.
17.16. Reliance. No Party hereto has made any representation, warranty
or covenant to the other Parties concerning any tax benefits or tax treatment
which may accrue to the benefit of, or be given to, the other Parties in
connection with the Transaction. Each Party has relied upon its own examination
of the terms and provisions contained herein, and the counsel of its own
advisors, and the representations, warranties and covenants contained herein.
17.17. Venue. IN THE EVENT OF A DISPUTE INVOLVING THIS AGREEMENT OR ANY
OF THE OTHER DOCUMENTS EXECUTED IN CONNECTION HEREWITH, THE PARTIES HEREBY
IRREVOCABLY AGREE THAT VENUE FOR ANY SUCH DISPUTE SHALL LIE IN ANY COURT OF
COMPETENT JURISDICTION IN DALLAS COUNTY, TEXAS.
17.18. Attorneys' Fees. The prevailing Party in any litigation between
the parties hereto shall be entitled to recover, as a part of its judgment,
reasonable attorneys' fees and costs of suit.
17.19. Time of the Essence. Time is of the essence with respect to the
performance of all obligations provided herein and the consummation of all
transactions contemplated hereby.
17.20. Authority. Each person executing this Agreement, by such
person's execution hereof, represents and warrants that such person is fully
authorized to execute this Agreement on behalf of the Party such person is
executing this Agreement on behalf of, and that no further action or consent on
the part of the Party for whom such person is acting is required to the
effectiveness and enforceability of this Agreement against such Party following
the execution hereof. This Section shall survive Closing.
17.21. Construction. The Parties hereto acknowledge that each Party and
their counsel have reviewed and revised this Agreement and that each Party was
represented by competent counsel in connection with the preparation of this
Agreement, and each Party hereto has been advised by their counsel as to the
ramifications hereof. In this regard, the normal rule of construction to the
effect that any ambiguities are to be resolved against the drafting party shall
not be employed in the interpretation of this Agreement or any amendments,
schedules, riders, addenda and/or exhibits hereto.
17.22. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Texas.
17.23. Joint and Several Liability. Notwithstanding anything herein to
the contrary, Seller and Aloette agree that the agreements, covenants,
<PAGE>
representations, warranties and obligations contained herein of Seller and/or
Aloette are the joint and several liability and responsibility of Seller and
Aloette regardless of whether any such agreements, covenants, representations,
warranties and obligations contained herein are made by Seller herein or by
Aloette herein.
EXECUTED on this 2nd day of June, 1995, by Seller.
Superior Products Company,
a Texas corporation
By: Aloette Cosmetics, Inc.
of Delaware,
a Delaware corporation
Its: Sole Shareholder
By:_____________________________
Jean M. Lewis
Its: Vice President-Finance
EXECUTED on this 2nd day of June, 1995, by Aloette
Aloette Cosmetics, Inc.,
a Pennsylvania corporation
By: ___________________________
Jean M. Lewis
Its: Vice President-Finance
Aloette Cosmetics, Inc. of Delaware,
a Delaware corporation
By: Aloette Cosmetics, Inc.,
a Pennsylvania corporation
Its: Sole Shareholder
By: ___________________________
Jean M. Lewis
Its: Vice President-Finance
<PAGE>
Aloette Cosmetics, Inc. of Pennsylvania,
a Pennsylvania corporation
By: Aloette Cosmetics, Inc.,
a Pennsylvania corporation
Its: Sole Shareholder
By:___________________________
Jean M. Lewis
Its: Vice President-Finance
Naterra International, Inc.,
a Texas corporation
By: ________________________________
Jin K. Song
Its: President
<PAGE>
Exhibit A
Schedule of Tangible Assets Sold
Consisted of all the tangible and intagible Assets acquired.
<PAGE>
Exhibit B
Consisted of Seller's balance sheet as of March 31, 1995
<PAGE>
Exhibit C
Consisted of calculation of inventory roll forward and adjustments.
<PAGE>
Exhibit D
Bill of Sale
KNOW ALL MEN BY THESE PRESENTS, that pursuant to a certain Asset Sale
Agreement, dated as of June 2, 1995, (the "Agreement") by and between NATERRA
INTERNATIONAL, INC., a Texas corporation, having a place of business at 1425
Century Drive, Suite 207, Carrollton, Texas 75006 ("Purchaser"), D.D. COSMETIC
SALES COMPANY, INC., formerly known as SUPERIOR PRODUCTS COMPANY, a Texas
corporation, having a place of business at 13525 Denton Drive, Dallas, Texas
75234 ("Seller") and Aloette, Cosmetics, Inc., a Pennsylvania corporation,
Aloette Cosmetics, Inc. of Delaware, a Delaware corporation and Aloette
Cosmetics, Inc. of Pennsylvania, a Pennsylvania corporation (collectively,
"Aloette"), having a place of business at 1301 Wrights Lane East, West Chester,
Pennsylvania 19380, for and in consideration of One Dollar ($1.00) and other
good and valuable consideration paid by the Purchaser to the Seller, the
receipt, adequacy and sufficiency of which are hereby acknowledged, the Seller
does hereby GRANT, BARGAIN, SELL, CONVEY, TRANSFER, ASSIGN AND DELIVER unto the
Purchaser, Purchaser's successors and assigns forever all of the Assets (herein
so called and as defined in the Agreement), wherever located and identified on
Exhibit A attached hereto and incorporated herein by reference for all purposes.
TO HAVE AND TO HOLD, all and singular, the above described Assets unto
the Purchaser and Purchaser's successors and assigns forever to WARRANT AND
FOREVER DEFEND, all and singular the Assets unto Purchaser and Purchaser's
successors and assigns against every person whomsoever lawfully claiming or to
claim to same, or any part thereof.
The Seller hereby covenants and agrees, from and after the date hereof,
to execute and deliver to the Purchaser such further instruments of sale,
conveyance, transfer, assignment and consent and to take such other actions as
the Purchaser reasonably may request from time to time in order more effectively
to sell, convey, transfer and assign to the Purchaser the Assets conveyed by
this Bill of Sale (herein so called), to confirm the title and possession of the
Purchaser thereto and to assist the Purchaser in exercising rights with respect
thereto.
IN WITNESS WHEREOF, the Seller has executed and delivered this Bill of
Sale to Purchaser on June 15th, 1995.
D.D. Cosmetic Sales Company, Inc.,
formerly known as
Superior Products Company,
a Texas corporation
By: Aloette Cosmetics, Inc.
of Delaware,
a Delaware corporation
Its: Sole Shareholder
By:__________________________
Jean M. Lewis
Its: Vice President-Finance
STATE OF TEXAS ss.
COUNTY OF DALLAS ss.
Before me, the undersigned, on this day personally appeared Jean M.
Lewis, Vice President-Finance of Aloette Cosmetics, Inc. of Delaware, a Delaware
corporation, as the sole shareholder of D.D. Cosmetic Sales Company, Inc.,
formerly known as Superior Products Company, a Texas corporation, known to me to
be the person and officer whose name is subscribed to the foregoing instrument
and acknowledged to me that she executed the same as the act of such
corporation, and in the capacity therein stated.
Given under my hand and seal this 15th day of June, 1995.
-------------------------------
NOTARY PUBLIC
Printed Name:__________________
My Commission Expires:_________
<PAGE>
EXHIBIT A
Assets
EXHIBIT "A" - Solo Page
<PAGE>
Exhibit E
Opinion Letter of Seller's Counsel
<PAGE>
Exhibit F
Opinion Letter of Purchaser's Counsel
