Transfer of Assets And Assignment of Contracts

EXHIBIT 10.30


Pages containing material for which confidential treatment has been requested are stamped "Material omitted pursuant to a request for confidential treatment and filed separately with the Commission." The appropriate sections have been marked at the appropriate places with a star [*].
TRANSFER OF ASSETS AND ASSIGNMENT OF CONTRACTS
BETWEEN
NOVUS INTERNATIONAL, INC.
AND
ALCIDE CORPORATION


This TRANSFER OF ASSETS AND ASSIGNMENT OF CONTRACTS ("Agreement") is made and entered into as of the 11th day of November 1998, by and between NOVUS INTERNATIONAL, INC., a Delaware corporation with its principal place of business at 530 Maryville Centre Drive, St. Louis, Missouri 63141 ("Novus"), and ALCIDE CORPORATION, a Delaware corporation with its principal place of business at 8561 154th Avenue NE, Redmond, Washington 98052 ("Alcide").


RECITALS


A. Novus and Alcide have entered into an Agreement, made effective as of May 21, 1997, as supplemented by a letter agreement dated May 20, 1997 and amended by a letter agreement dated August 3, 1998 (the "1997 Agreement"), with respect to commercialization of certain acidified sodium chlorite compositions to be used as an anti-microbial treatment marketed as the SANOVA-Registered Trademark- Food Quality System (the "SANOVA System") in chicken processing plants.


B. Pursuant to the 1997 Agreement, Novus has given notice of termination of the 1997 Agreement effective November 30, 1998. In anticipation of such termination, Novus has agreed to sell certain assets and assign certain customer contracts to Alcide, and Alcide has agreed to purchase, or shall have an option right to purchase, such assets and assume such contracts, upon the terms and conditions set forth herein.


NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, Novus and Alcide agree as follows:


1. TRANSFER OF ASSETS


1.1 Effective as of the close of business (5:00 p.m. St. Louis time) on November 30, 1998 (the "Effective Time"):


(i) Subject to the terms of this Agreement, Novus hereby sells and assigns to Alcide and Alcide hereby purchases all of Novus' right, title and interest in and to the equipment and other assets identified in Exhibit A (the "Assets").


(ii) The purchase price for the Assets is as set forth in Exhibit A, provided that in the event any Asset shall be materially damaged or destroyed prior to the Effective Time and Novus has not repaired or replaced the Asset (which Novus may use Spare Parts or
"Material omitted pursuant to a
request for confidential
treatment and filed separately
with the Commission."


Option Assets or other materials to effectuate), then Alcide may elect to either (a) exclude such Asset from the Assets being purchased under this Agreement or (b) purchase such Asset at a price to be equitably adjusted taking into account the damage thereto. Subject to Article 6, the purchase price for the Assets shall be paid by Alcide to Novus pursuant to the purchase terms set forth in Exhibit A, provided that, at Alcide's election, the full purchase price for any Asset may be paid by application to, and taking a current credit against, the [*] due under Section 5.1(i). At the Effective Time, Novus will provide Alcide with a Bill of Sale for the Assets in the form of Exhibit B hereto, and Alcide will execute appropriate financing statements covering all of the Assets providing a security interest therein in connection with any amounts due under this Agreement which have not been paid in full.


(iii) Alcide shall take custody of the Assets and be responsible for all costs and risk of loss as of the Effective Time, prior to which Novus shall be responsible for all risk of loss and costs shall continue to be governed by the 1997 Agreement. Any personal property taxes or other taxes or charges will be prorated as of such date (based on a year of 365 days), and Novus and Alcide will each pay to the other, within 10 calendar days of receipt of a written request accompanied by copies of appropriate tax invoices or similar documentation, such amounts as are necessary to accomplish such proration.


1.2 During the period ending at the close of business on November 30, 1999:


(i) Alcide shall have the right to purchase from time to time other parts and equipment that Novus currently owns in connection with the 1997 Agreement identified in Exhibit C hereto (the "Option Assets").


(ii) To exercise such right Alcide must provide written notice(s) to Novus no later than the close of business on November 30, 1999, specifying the Option Assets to be purchased. The Option Assets must be purchased in "unit" increments, as described in Exhibit C.


(iii) The purchase price for the Option Assets will be as set forth in Exhibit C, and shall be paid to Novus with the written notice(s) referred to in Section 1.2(ii). Promptly after such payment, Novus shall promptly provide Alcide with a Bill of Sale similar in form to Exhibit B.


(iv) Alcide shall take custody of, arrange for the storage of, or remove any Option Assets purchased within 10 days after the date of the written notice(s) referred to in Section 1.2(ii), and Alcide shall be liable for all storage and/or warehouse costs incurred by Novus after that period, and for any packing, shipping, transportation or similar costs or charges. Any personal property taxes or other taxes or charges will be prorated as of the earlier of the date on which Alcide takes custody or is required to take custody (based on a
"Material omitted pursuant to a
request for confidential
treatment and filed separately
with the Commission."


year of 365 days), and Novus and Alcide will each pay to the other, within 10 calendar days of receipt of a written request accompanied by copies of appropriate tax invoices or similar documentation, such amounts as are necessary to accomplish such proration.


2. ASSIGNMENT OF AGREEMENTS


2.1 Subject to the terms of this Agreement, as of the Effective Time Novus hereby assigns and transfers to Alcide all of its rights and obligations under the customer contracts identified on Exhibit D hereto (the "Assigned Contracts"), to the extent such rights and obligations accrue on or after the Effective Time.


2.2 Subject to the terms of this Agreement, as of the Effective Time Alcide hereby accepts the assignment of the Assigned Contracts and agrees that it and its successors will assume and perform all obligations of Novus thereunder in accordance with the terms of the Assigned Contracts, to the extent such obligations accrue on or after the Effective Time.


2.3 Novus will use commercially reasonable efforts to obtain consent to the Assignment of the SANOVA System Agreement with [*] as soon as possible. If such consent has not been obtained by the Effective Time:


(i) Such SANOVA System Agreement shall not be included within the Assigned Contracts under this Agreement, shall be deemed deleted from Exhibit D and shall not be assigned to Alcide.


(ii) The Assets identified in Item II(iii) of Exhibit A shall be treated as Option Assets rather than Assets, with the purchase thereof (including without limitation payment of the purchase price therefore) governed by the provisions of Section 1.2 rather than by Section 1.1 at the total purchase price set forth in Item II(iii) of Exhibit A.


(iii) All references to the [*] shall be deemed deleted from this Agreement.


2.4 Notwithstanding the provisions of Sections 2.1 and 2.2, and except to the extent covered by Section 6 of the 1997 Agreement, Alcide shall not assume, succeed to and be obligated to perform, and Novus shall be responsible for, any liability or obligation, arising out of any or all of the following:


(i) any breach by Novus of the Assigned Contracts or failure by Novus to discharge or perform any liability or obligation, in each such case to the extent arising prior to the Effective Time, but not including any breach arising out of the assignment; and


(ii) any claim, demand, cause of action, suit, proceeding, arbitration or investigation resulting from any act or omission of Novus prior to the Effective Time.


2.5 Alcide will seek to replace all Assigned Contracts with agreements directly between Alcide and the customers on commercially reasonable terms as soon as possible, which agreements would terminate the replaced Assigned Contracts. Alcide will not extend or renew any Assigned Contract unless Novus receives from the customer a written full and unconditional release releasing Novus from any and all obligations and liabilities thereunder.


2.6 Within ten days after the date of this Agreement and prior to the Effective Time, John Richards from Alcide and an appropriate representative from Novus shall together seek to meet with each customer under an Assigned Contract in order to discuss and arrange for a smooth transition of service and equipment from Novus to Alcide effective November 30, 1998. In addition, prior to the Effective Time Novus shall reasonably cooperate and otherwise reasonably assist Alcide in making arrangements for the customer's transition.


3. REPRESENTATIONS AND WARRANTIES


3.1 Novus and Alcide each represent and warrant to the other that it has all necessary corporate power and authority to enter into this Agreement and carry out its obligations hereunder.


3.2 Novus represents and warrants to Alcide that on the date hereof and, with respect to specific Assets, Option Assets and Assigned Contracts, the date of transfer of such Assets, Option Assets and Assigned Contracts: (a) it holds good and marketable title in and to the Assets and the Option Assets, free and clear of any liens, encumbrances, claims or other restrictions; (b) the sale, assignment and transfer of the Assets, Option Assets and Assigned Contracts will not result in any lien, claim or encumbrance arising out of any action taken by Novus and will not violate, conflict with, result in a breach of, or constitute a default under any contract or judgment to which Novus is a party; (c) true and complete copies of the Assigned Contracts, including all amendments or modifications thereof through the date of this Agreement, are attached as Exhibit D hereto, and Novus will not further amend or modify any of the Assigned Contracts prior to the Effective Time without Alcide's prior written consent (which will not be unreasonably withheld); and (d) Novus has not received any written notice of any claim under any of the Assigned Contracts.


3.3 EXCEPT AS SET FORTH IN THIS AGREEMENT, NOVUS MAKES NO OTHER WARRANTIES OR REPRESENTATIONS WITH RESPECT TO THE ASSETS, THE OPTION ASSETS OR THE ASSIGNED CONTRACTS, EXPRESS OR IMPLIED, INCLUDING WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. THE ASSETS AND THE OPTION ASSETS ARE BEING SOLD AND ASSIGNED TO ALCIDE "AS IS, WHERE IS".


"Material omitted pursuant to a
request for confidential
treatment and filed separately
with the Commission."


4. INDEMNIFICATION


It is recognized and agreed that the indemnification provisions of Section 6 of the 1997 Agreement survive.


5. ADDITIONAL MATTERS RELATED TO 1997 AGREEMENT


5.1 Certain disagreements have arisen between Alcide and Novus with respect to the 1997 Agreement. In order to settle such disagreements, the parties have agreed as follows:


(i) Novus shall pay Alcide the [*] minimum payment due for the period ending August 31, 1998 upon the earlier of (a) satisfaction of all "COP Conditions" (as defined in Article 6) or (b) November 30, 1999.


(ii) Alcide shall pay to Novus the amount due Novus as reflected in item II(b) of Exhibit E upon the earlier of (a) satisfaction of all COP Conditions or (b) November 30, 1999, which amount will be offset against the payment due pursuant to Section 5.1(i).


(iii) On November 30, 1998, (a) Novus shall pay to Alcide the sum of all amounts due Alcide as reflected in item I of Exhibit E, which amounts relate to raw materials, and (b) Alcide will pay Novus for raw materials pursuant to item III of Exhibit A and its share of cost of goods sold pursuant to item II(a) of Exhibit E. Such payments shall be subject to reconciliation pursuant to Section 5.2.


(iv) As soon as practicable following the Effective Time, Novus will provide to Alcide copies of the reports, dossiers and translations associated with items II (b) (4) and (5) of Exhibit E. In the event any applications or dossiers relating to use of the Assets or the performance of the Assigned Contracts are pending with any governmental authorities as of the Effective Time, Novus will use commercially reasonable efforts to assign such applications and dossiers to Alcide, and following the Effective Time Alcide will assume all responsibility for them.


5.2 As soon as practicable, and in any event within 30 days following the Effective Time, the parties will determine the actual costs incurred with respect to items III and IV of Exhibit A and items I(b) and II (a) on Exhibit E, and Novus will pay to Alcide or Alcide will pay to Novus, as appropriate, the difference between the estimated amounts noted on Exhibit A and E and the actual costs incurred.


"Material omitted pursuant to a
request for confidential
treatment and filed separately
with the Commission."


5.3 On November 30, 1998, Novus will deliver to Alcide executed assignments in the forms attached hereto as Exhibit F, transferring to Alcide rights to the SANOVA-Registered Trademark- trademark, and Alcide shall pay Novus the sum of [*]. Such assignment will be pursuant to the following terms and conditions:


(i) Novus will assign to Alcide all of Novus' ownership rights in the trademark "SANOVA" for anti-microbial treatment for meats, poultry, fish, eggs, fruits and vegetables and related products and services throughout the world, and the goodwill associated with such trademark, including U.S. Trademark Registration No. 2,182,024 and all foreign trademark applications and registrations.


(ii) Novus and Alcide will execute any other documents which the other might reasonably request to effect the above described transfer of the trademarks in the appropriate Trademark Offices or to otherwise reflect this Agreement.


(iii) Novus will retain all rights to the "SANOVA" ...