-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JXrcCQMC4e9qpxAUTcmTc8tuHa0nBJ1uFb7lxrSqgSpbDF7SvIKJu6p8BSa9N1WL CHbnbc6unjJTW4Ec0rbGnQ== 0001016504-03-000025.txt : 20031106 0001016504-03-000025.hdr.sgml : 20031106 20031106141809 ACCESSION NUMBER: 0001016504-03-000025 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20031022 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Other events ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20031106 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTEGRATED BIOPHARMA INC CENTRAL INDEX KEY: 0001016504 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 133035216 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-31668 FILM NUMBER: 03981933 BUSINESS ADDRESS: STREET 1: 201 ROUTE 22 CITY: HILLSIDE STATE: NJ ZIP: 07205 BUSINESS PHONE: 9739260816 MAIL ADDRESS: STREET 1: 201 ROUTE 22 CITY: HILLSIDE STATE: NJ ZIP: 07205 FORMER COMPANY: FORMER CONFORMED NAME: INTEGRATED HEALTH TECHNOLOGIES INC DATE OF NAME CHANGE: 20020912 FORMER COMPANY: FORMER CONFORMED NAME: CHEM INTERNATIONAL INC DATE OF NAME CHANGE: 19960716 8-K 1 inb8koct22_2003.txt FORM 8-K OCTOBER 22, 2003 UNITED STATES 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) October 22, 2003 INTEGRATED BIOPHARMA, INC. (Exact Name of Registrant as Specified in Charter) Delaware 000-28876 22-2407475 (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 225 Long Ave., Hillside, New Jersey 07205 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (973) 926-0816 NOT APPLICABLE (Former Name or Former Address, if Changed Since Last Report) ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS Acquisition of Transferred Assets On October 22, 2003, Integrated BioPharma, Inc. (the "Company") completed the acquisition of various assets related to the Naturally Aloe, Naturally Noni and Avera Sport product lines (the "Product Lines") from Aloe Commodities International, Inc. ("Aloe"). The assets included trademarks, copyrights, art work, formula for the products, labels, customer lists, goodwill, inventories and books and records (collectively hereinafter referred to as the "Transferred Assets"). Pursuant to the terms of an Asset purchase agreement dated October 22, 2003 by and between the Company and Aloe, the purchase price for the Transferred Assets was $2,597,469.83, based upon a closing inventory of the Transferred Assets with $872,469.83 paid at closing in immediately available funds by wire transfer and $1,725,000.00 to be paid in the form of 203,085 shares of the Company's common stock valued on the basis of the average closing price as reported on the American Stock Exchange for the ten (10) trading days immediately preceding the closing date. Such shares shall be held in escrow for a period of one (1) year from the closing date and released pursuant to the terms of an Escrow Agreement (the "Escrow Agreement") between and among the Company, Aloe and Vial, Hamilton, Koch & Knox, L.L.P. (the "Escrow Agent"). The Transferred Assets were used by Aloe to produce various products under the Product Lines. The Company intends to use such Transferred Assets to continue the distribution of the variuos product lines. The three brands purchased by the Company have retail distribution of Natural Juices and Sports Nutrition products in the consumer retail trade market. The Product Lines are distributed at Costco, General Nutrition Centers, Trader Joes, Vitamin Shoppe, Kroger and other leading retailers. ITEM 5. OTHER EVENTS AND REQUIRED FD DISCLOSURE. On November 6, 2003, Integrated BioPharma, Inc. issued a press release regarding the acquisition of retail brands. The press release is included as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) Exhibits 2.6 Asset Purchase Agreement dated as of October 22, 2003 by and between Integrated BioPharma, Inc. and Aloe Commodities International, Inc. 2.7 Escrow Agreement dated October 22, 2003 by and between Integrated BioPharma, Inc., Aloe Commodities International, Inc. and Vial, Hamilton, Koch & Knox, L.L.P. 10.25 Registration Rights Agreement dated as of October 22, 2003 by and between Integrated BioPharma, Inc. and Aloe commodities International, Inc. 10.26 Conversion and Supply Agreement dated as of October 22, 2003 by and between Integrated BioPharma, Inc. and Aloe Commodities International, Inc. 99.1 Press Release of Integrated BioPharma, Inc. dated November 6, 2003 reporting retail brand acquisition SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. INTEGRATED BIOPHARMA, INC. Date: November 6, 2003 By: /s/ Eric Friedman ----------------- Name: Eric Friedman Title: Chief Financial Officer Exhibit Index Exhibit Number Description - ------- ----------- 2.6 Asset Purchase Agreement dated as of October 22, 2003 by and between Integrated BioPharma, Inc. and Aloe Commodities International, Inc. 2.7 Escrow Agreement dated October 22, 2003 by and between Integrated BioPharma, Inc., Aloe Commodities International, Inc. and Vial, Hamilton, Koch & Knox, L.L.P. 10.25 Registration Rights Agreement dated as of October 22, 2003 by and between Integrated BioPharma, Inc. and Aloe commodities International, Inc. 10.26 Conversion and Supply Agreement dated as of October 22, 2003 by and between Integrated BioPharma, Inc. and Aloe Commodities International, Inc. 99.1 Press Release of Integrated BioPharma, Inc. dated November 6, 2003 reporting retail brand acquisition EX-99 2 exhibit99_1.txt PRESS RELEASE FOR NOVEMBER 6, 2003 - EXHIBIT 99.1 EXHIBIT 99.1 FOR IMMEDIATE RELEASE Contact: Jamie E. Levey November 6, 2003 Investor Relations (888)-319-6962 Integrated BioPharma Reports Acquisition of Retail Brands Naturally Aloe, Naturally Noni and Avera Sport Hillside, N.J., November 6, 2003--Integrated BioPharma, Inc. (AMEX:INB) announced the acquisition of three retail brands from Aloe Commodities International, Inc. of Dallas, Texas. The three brands purchased include Naturally Aloe, Naturally Noni and Avera Sport products and are distributed nationally through major mass marketers, grocery, drug and vitamin retailers. "The purchase of these brands is complimentary to our business. We intend to increase penetration into the retail market by expanding our product line with these new products", commented E.Gerald Kay Chief Executive Officer of Integrated BioPharma, Inc. Integrated BioPharma serves the needs of the nutraceuticals, biotech and pharmaceutical industries. Through several wholly owned subsidiaries, Integrated BioPharma develops, manufactures and distributes more than 130 products worldwide. Integrated BioPharma currently consists of eight operating units. Further information is available at www.iBioPharma.com. Statements included in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve a number of risks and uncertainties such as competitive factors, technological development, market demand, and the company's ability to obtain new contracts and accurately estimate net revenues due to variability in size, scope and duration of projects, and internal issues in the sponsoring client. Further information on potential risk factors that could affect the company's financial results can be found in the company's Reports field with the Securities and Exchange Commission. EX-10 3 exhibit10_25.txt REGISTRATION RIGHTS AGREEMENT - EXHIBIT 10.25 EXHIBIT 10.25 EXECUTION COPY REGISTRATION RIGHTS AGREEMENT This Registration Rights Agreement (this "Agreement") dated as of October 22, 2003 is by and between Integrated BioPharma, Inc, a Delaware corporation (the "Company") and Aloe Commodities International, Inc., a Texas corporation (the "Investor" or "Aloe"). WHEREAS, the Company has entered into a certain Asset Purchase Agreement dated the date hereof with Aloe (the "Purchase Agreement"; and defined terms used herein but not defined herein shall have the meanings ascribed to such terms in the Purchase Agreement); WHEREAS, pursuant to Section 2.1(c) of the Purchase Agreement, Aloe shall be entitled to certain "piggy-back" registration rights" with respect to the Share Consideration as more particularly set forth therein; NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and promises contained herein, the parties agree as follows: 1. Definitions. For the purposes of this Agreement: (a) the terms "Register," "Registered" and "Registration" refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Securities Act of 1933, as amended (the "Act"), and the declaration or ordering of the effectiveness of such registration statement or document; (b) the term "Registerable Securities" means the "BioPharma Common Stock" issued to Holder pursuant to the Purchase Agreement to which this Agreement is attached as Exhibit B, together with any Common Stock of BioPharma issued as a dividend or other distribution with respect to, or in exchange for or in replacement of, such BioPharma Common Stock; excluding, in all cases, however, any Registerable Securities sold or transferred by the Holder thereof; (c) the number of shares of "Registerable Securities Then Outstanding" shall be determined by the number of shares of Common Stock of BioPharma outstanding which are, and the number of shares of Common Stock issuable pursuant to, such Registerable Securities; (d) the term "Holder" means Aloe Commodities International, Inc. and does not and shall not include any assignee or transferee thereof. 2. Piggy-Back Registration. If (but without any obligation to do so) BioPharma proposes to register (including for this purpose a registration effected by BioPharma for shareholders other than the Holder) any of its stock or other securities under the Act in connection with a public offering of such securities solely for cash (other than a registration relating solely to the sale of securities to participants in a stock option plan or registration on any form which does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Registerable Securities), BioPharma shall, at such time, promptly give the Holder written notice of such proposed registration (the "Piggy-Back Registration Right"). Such Piggy-Back Registration Right may be exercised by Holder commencing on the one (1) year anniversary of the Closing Date. Such Piggy-Back Registration Right shall expire on the third (3rd) anniversary of the Closing Date. Upon the written request of the Holder given within fifteen (15) days after the giving of such first notice by BioPharma, BioPharma shall, subject to the provisions of this Agreement, cause to be registered under the Act all of the Registerable Securities that such Holder has requested to be registered. 3. Obligations of Holder. It shall be a condition precedent to the obligations of BioPharma to include any Registerable Securities that the selling Holder shall: (a) furnish to BioPharma such information regarding itself, Registerable Securities held by Holder and the intended method of disposition of such securities as shall be required to effect the registration of their Registerable Securities, (b) furnish to BioPharma the identity of and compensation to be paid to any proposed underwriter to be employed in connection therewith on behalf of the Holder as BioPharma, any underwriter, the Securities and Exchange Commission (the "SEC") or any other governmental regulatory agency may request, and (c) enter into and perform Holder's obligations under an underwriting agreement, in usual and customary form satisfactory to BioPharma with the managing underwriter of such offering. 4. Expenses of Piggy-Back Registration. At all times, the selling Holder shall bear the expenses of any underwriting discounts and commissions attributable to the sale of Holder's Registerable Securities. Holder shall bear and pay all those expenses attributable to the inclusion of such Holder's Registerable Securities and any registration, filing or qualification of Registerable Securities pursuant to this Agreement including (without limitation) such Holder's incremental portion of all registration, filing and qualification fees, printers and accounting fees, fees and disbursements of counsel of BioPharma and the reasonable fees and disbursements of one counsel for the Holder, but excluding BioPharma's overhead expenses and expenses related to the use of time by BioPharma's officers, directors and employees in effecting any such registration. 5. Underwriting Requirements. In connection with any offering involving an underwriting of shares being issued by BioPharma, BioPharma shall not be required under this Agreement to include any of the Holder's securities in such underwriting unless Holder accepts the terms of the underwriting as agreed upon between BioPharma and the underwriter selected by BioPharma. If the total amount of securities, including Registerable Securities, requested to be included in such offering exceeds the amount of securities that the underwriters reasonably believe compatible with the success of the offering, then BioPharma shall be required to include in the offering only that number of securities, including Registerable Securities, which the underwriters believe will not jeopardize the success of the offering (the securities so included to be apportioned pro rata among the selling Holder and any other selling shareholders according to the total amount of securities entitled to be included therein owned by each selling shareholder and the Holder or in such other portions as shall mutually be agreed by such Holder and any other selling shareholders). 6. Indemnification. In the event any Registerable Securities are included in a registration statement under this Agreement to the extent permitted by law, the Holder will indemnify and hold harmless BioPharma, each of its directors, each of its officers who have signed the registration statement, each person, if any, who controls BioPharma within the meaning of the Act, any underwriter and any other selling shareholder in such registration statement or any of its directors or officers or any person which controls any such selling shareholder against any losses, claims, damages or liabilities (joint and several) to which BioPharma or any such director, officer, controlling person or underwriter or controlling person, or other selling shareholder, director, officer or controlling person may become subject, under the Act, the Securities Exchange Act of 1934 (the "1934 Act") or other federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereto) arise out of or are based upon any of the following statements, omissions or violations (collectively, a "Violation"): (a) any untrue statement or alleged untrue statement of a material fact with respect to Holder or its Registerable Securities contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (b) the omission or alleged omission to state therein a material fact with respect to the Holder or its Registerable Securities required to be stated therein, or necessary to make the statements therein not misleading, or (c) any violation or alleged violation by Holder of the Act, the 1934 Act, any state securities law or any rule or regulation promulgated under the Act, the 1934 Act or any state securities law; in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder expressly for use in connection with such registration; and such Holder will reimburse any legal or other expenses reasonably incurred by BioPharma or any such director, officer, controlling person, underwriting or controlling person or other shareholder, officer, director or controlling person in connection with investigating or defending such loss, claim, damage, liability, or action; provided, however, that the indemnity agreement contained herein shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld. 7. Assignment of Registration Rights. The rights to cause BioPharma to register Registerable Securities pursuant to this Agreement may not be assigned by the Holder to any transferee or assignee of such securities. 8. "Market Standoff" Agreement. The Holder hereby agrees that Holder shall not, to the extent requested by BioPharma and an underwriter of common stock (or other securities) of BioPharma, sell or otherwise transfer or dispose (other than to donees who agree to be similarly bound) of any Registerable Securities during the ninety-day period following the effective date of a registration statement of BioPharma filed under the Act; provided, however, that all officers and directors of BioPharma and all other persons with registration rights enter into similar agreements. In order to enforce the foregoing covenant, BioPharma may impose stop-transfer instructions with respect to the Registerable Securities of the Holder (and the shares of securities of every other person subject to the foregoing restriction) until the end of such ninety-day period. 9. Miscellaneous. (a) Notices. Any notice required or permitted to be given under this Agreement shall be made in writing, and shall be effective when mailed, by registered or certified mail as follows: Company: Integrated BioPharma, Inc. 225 Long Avenue Hillside, NJ 07205 Phone: (973) 926-0816 Fax: (973) 926-1735 Attn: Chief Executive Officer Copy to: St. John & Wayne, LLC Two Penn Plaza East Newark, New Jersey 07105 Phone: (973) 491-3600 Fax: (973) 491-3407 Attn: William P. Oberdorf, Esq. Aloe: Aloe Commodities International, Inc. 2161 Hutton Drive, Suite 126 Carrollton, Texas 75006 Phone: (972) 241-4251 Fax: (972) 241-4376 Attn: L. Scott McKnight, President Copy to: Vial, Hamilton, Koch & Knox, L.L.P. 1700 Pacific Avenue, Suite 2800 Dallas, Texas 75201 Phone: (214) 712-4400 Fax: (214) 712-4402 Attn: Mark W. Romney, Esq. Any party may change said address by notice to the other parties in accordance with the terms hereof. (b) Press Releases and Announcements. Neither Party shall issue any press release or public announcement relating to the subject matter of this Agreement without the prior written consent of the other Party; provided, however, that either Party may make any public disclosure it believes in good faith is required by applicable law, regulation or national exchange rule (in which case the disclosing Party shall use reasonable efforts to advise the other Party and provide it with a copy of the proposed disclosure prior to making such disclosure). (c) Entire Agreement; Amendment. This Agreement shall constitute the entire agreement between the Parties with respect to the subject matter hereof and shall supersede all previous negotiations, commitments and writings. The Parties hereto may, by mutual consent, amend or modify and supplement this Agreement in such manner as may be agreed upon in writing. (d) Captions. The captions and heading contained herein are solely for convenience of reference and will not affect the interpretation of any provision hereof. (e) Waiver, Discharge, etc. This Agreement may not be released, discharged or modified except by an instrument in writing signed on behalf of each of the Parties. The failure of a party to enforce any provision of this Agreement shall not be deemed a waiver by such party of any other provision or subsequent breach of the same or any other obligation hereunder. (f) Governing Law. This Agreement shall be construed and the rights of the Parties hereunder shall be governed by laws of the State of New Jersey. Venue for any dispute regarding this Agreement shall be in a court of competent jurisdiction in Union County, New Jersey. (g) Counterparts and Facsimile Signatures. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one Agreement. This Agreement may be executed by facsimile signature. (h) Severability. Any portion of this Agreement which a court of competent jurisdiction shall determine to be void or unenforceable against public policy, or for any other reason, shall be deemed to be severable from this Agreement and shall have no effect on the other covenants or provisions in this Agreement. It is agreed that the court shall be empowered to reform and construe any provision that would otherwise be void or unenforceable in a manner that will be valid and enforceable to the maximum extent permitted by law. [signature page follows] IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement as of the 22nd day of October, 2003. Integrated BioPharma, Inc. By: /s/ E. Gerald Kay --------------------- Name: E. Gerald Kay Title: Chief Executive Officer Aloe Commodities International, Inc. By: /s/ L. Scott McKnight ------------------------- Name: L. Scott McKnight Title: Chairman & CEO EX-10 4 exhibit10_26.txt CONVERSION AND SUPPLY AGREEMENT - EXHIBIT 10.26 EXHIBIT 10.26 EXECUTION COPY CONVERSION AND SUPPLY AGREEMENT CONVERSION AND SUPPLY AGREEMENT (this "Agreement"), dated as of October 22, 2003 (the "Effective Date") is by and between INTEGRATED BIOPHARMA, INC., a Delaware corporation, with offices at 225 Long Avenue, Hillside, New Jersey 07205 ("INB") and ALOE COMMODITIES INTERNATIONAL, INC., a Texas corporation, with offices at 2161 Hutton Drive, Suite 126, Carrollton, Texas 75006 ("Aloe"). INB and Aloe are collectively, the "Parties". WITNESSETH WHEREAS, INB develops, manufactures and distributes biopharmaceutical and nutritional supplements and related products to companies in the pharmaceutical, biotech and nutraceutical industries (the "Customers"); WHEREAS, INB and Aloe are contemporaneously herewith entering into an asset purchase agreement dated the date hereof (the "Asset Purchase Agreement") pursuant to which Aloe is selling the Transferred Assets (as such term is defined therein) to INB; WHEREAS, INB wishes to have Aloe convert existing work-in-process, raw materials and INB inventory into finished goods constituting the Products (as such term is defined below) from time to time, and Aloe is agreeable to converting such materials into the Products and supplying the Products to INB as provided herein; WHEREAS, INB wishes to have Aloe store certain INB inventory used in the conversion and supply of the Products on Aloe's premises; and Aloe has agreed to separately store and segregate such INB inventory in a conspicuous and locked enclosure on Aloe's premises prior to shipping the finished Products to INB; NOW, THEREFORE, in consideration of the foregoing premises, and the mutual covenants and obligations set forth herein, INB and Aloe hereby agree as follows: 1. DEFINITIONS. For purposes hereof the following terms shall have the meanings set forth: "Affiliates" means any person, firm, corporation (including, without limitation, service corporation and professional corporation), partnership (including, without limitation, general partnership, limited partnership and limited liability partnership), limited liability company, joint venture, business trust, association or other entity that now or in the future, directly or indirectly, controls, is controlled by or is under common control with a party. For purposes of the foregoing, "control" shall mean, with respect to: (a) a corporation, the ownership, directly or indirectly, of greater than fifty percent (50%) of the voting power to elect the directors thereof; and (b) any other entity, managerial control by virtue of a written agreement. "Confidential Information" means a party's technology, formulations, processes, data, know-how and other information, whether written or oral, technical or non-technical, including, without limitation, financial statements, reports, pricing, trade secrets, secret processes, formulas, customer data (including customer lists), business information, business methods and plans and pricing, cost, supplier and manufacturing information, but specifically excluding any of such items for which the receiving party can show by competent proof that such item: (a) was known to and existed in documentary or other physical form in the possession of the receiving party at the time of disclosure; (b) subsequent to the receipt hereunder, is made available to the receiving party by a third party which is legally entitled to make such information available; (c) was or becomes publicly known through no fault of the receiving party; or (d) is independently developed by the receiving party without access to Confidential Information disclosed hereunder. "Conversion Price" means the price to be paid by INB to Aloe for conversion of the Products as set forth on Exhibit C attached hereto. "Effective Date" is defined in the first paragraph of this Agreement. "Indemnified Party" means, collectively, the party entitled to receive indemnification as provided in this Agreement and such party's Affiliates, distributors, directors, officers, shareholders, employees, representatives, agents, sublicensees, successors and assigns. "Indemnifying Party" means the party required to provide indemnification as provided in this Agreement. "Label", "Labeled" or "Labeling" means all labels and other written, printed or graphic matter upon (i) the Products or any container or wrapper utilized with the Products or (ii) any written material accompanying the Products, including without limitation, package inserts. "Materials" means those items which form an integral and direct part of the bulk form of the Products and are necessary for its production, as well as cartons, Labels, and Packaging. "Packaging" means all primary containers, including cartons, shipping cases and other like matter used in packaging or accompanying the Products. "Products" or "Product" means, collectively, the products in such dosage and quantities as set forth in Exhibit D, manufactured in accordance with the Product Specifications hereto and any improvements and line extensions thereto. "Product Specifications" means the Product Specifications set forth in Exhibit E hereto. "Term" means the term of this Agreement as provided in Section 5.1. "Territory" means the United States of America (including all of its states, Puerto Rico, the District of Columbia, and all territories and possessions). 2. CONVERSION AND SUPPLY. 2.1 Supply Obligations; Non-Exclusivity. Aloe shall convert, package and supply to INB the Products in accordance with the Product Specifications and the terms hereof. INB and Aloe acknowledge and agree that INB shall have the right to seek other suppliers or manufacturers of the Products, in INB's sole discretion. 2.2 Work-in-Process; Raw Materials. Aloe shall first use certain work-in- process ("Work-in-Process") identified on Exhibit A attached hereto until such Work-in-Process is fully utilized in producing the Products pursuant to this Agreement. INB shall supply the raw materials (the "Raw Materials") set forth in Exhibit B attached hereto to Aloe, and Aloe shall convert such Raw Materials into the Products, in INB's sole discretion. 2.3 Product Labeling. INB shall provide trade dress, Labels, Materials and Packaging for the Products hereunder to Aloe and Aloe shall Label and Package the Products in accordance with the Product requirements. 2.4 Facility and Records Maintenance; Audit. Aloe shall, at all times, maintain and operate the manufacturing facility(ies) at which the Products are manufactured (collectively, the "Facility"), and implement and maintain such quality control procedures, so as to be able to perform its obligations hereunder in compliance with all applicable laws. Each party shall promptly notify the other upon receipt by it of any adverse notice from any governmental agency relating to the Products, employees, environmental conditions or the operation of the Facility. Aloe shall maintain true and complete books and records of all data relating to the manufacture, supply and sale of the Products to INB. Aloe shall permit quality assurance representatives of INB and representatives of applicable regulatory agencies to inspect the Facility and all books and records of Aloe relating to the production of the Products at all times upon three (3) business days' prior written notice (except in the case of emergency), during normal business hours and on a confidential basis. 2.5 Field Warehouse for INB Inventory. (a) INB and Aloe agrees to that INB may from time to time store certain INB inventory at Aloe's premises to facilitate Aloe's manufacture of the Products. Such INB inventory may include goods owned or hereafter acquired by INB for use by Aloe in manufacture of the Products, raw materials, work-in-process, product ormulas, product Labels, Materials, Packaging or materials used or consumed in the manufacture and supply of the Products. Such categories of INB inventory are listed on Exhibit F attached hereto, as amended from time to time (the "Warehoused Goods"). Such Warehoused Goods shall be located in a segregated, locked enclosure at the following location: 13500 N. Stemmons Frwy, Farmers Branch, Texas 75234 and/or 2161 Hutton Drive, Suite 126, Carrollton, Texas 75006. Such enclosure and the Warehoused Goods shall be conspicuously designated as "Property of Integrated BioPharma, Inc." (b) Aloe acknowledges that the Warehoused Goods are the property of INB and that Aloe has temporary custody of such Warehoused Goods on behalf of INB while manufacturing the Products pursuant to this Agreement. Except for such custody and possession of the Warehoused Goods, Aloe shall have no right to possess or use the Warehoused Goods. Aloe shall defend the Warehoused Goods from the claims and demands of all persons at any time claiming any interest in the Warehoused Goods adverse to INB. (c) Aloe shall at its expense keep such Warehoused Goods fully insured with insurance companies satisfactory to INB against fire, with extended coverage, including sprinkler loss and against theft. All such policies shall contain loss payable clauses to INB as its interests may appear. Aloe shall also add INB as an additional named insured on such policies. If Aloe fails to maintain such insurance, INB shall have the right to make such expenditures on behalf of Aloe and Aloe shall reimburse INB for such cost within thirty (30) calendar days of receipt of reasonable documentation from INB. 3. PACKAGING, DELIVERY AND ACCEPTANCE. 3.1 Delivery of Products. (a) From time to time, INB shall send Aloe orders stating the quantity and types of the Products that INB wishes to have converted by Aloe pursuant to this Agreement. INB shall deliver the Raw Materials for the Products to Aloe. (b) INB shall provide Aloe with appropriate instructions for each shipment of the Products to be shipped by Aloe to INB pursuant to a particular order, designating the carrier, destination, method of transport and insurance requirements. All Products supplied under this Agreement shall be shipped F.O.B. Aloe's dock/shipping destination, as may be designated by INB in the applicable order. INB shall arrange and pay for all freight, insurance charges, taxes, import and export duties, inspection fees and other charges applicable to the conversion and transport of the Products delivered to INB hereunder. Risk of loss and damages to the Products supplied by Aloe to INB shall pass to INB upon loading of such Products onto an INB-scheduled truck or transporter at Aloe's dock. All of the Products shall be Packaged, Labeled and marked in accordance with the Product Specifications and INB's instructions, and Aloe shall ship the Products under appropriate storage conditions and in accordance with INB order forms. An itemized packing list shall accompany each shipment. (c) Aloe shall convert the Raw Materials and ship the Products within fifteen (15) business days of receipt by Aloe of the Raw Materials. (d) Quality Control Measures. (i) Prior to shipment of the Products, Aloe shall fax to the INB Quality Control Director a Certificate of Analysis ("C/A") certifying that the products being shipped meet the applicable Product Specifications; (ii) On the date of production for each lot of Products, Aloe shall deliver to the INB Quality Control Director for inspection and analysis, a sample of the Products taken from the beginning, middle and end of each lot. 3.2 Acceptance and Rejection. (a) If a shipment of the Products or any portion thereof fails to conform to the Product Specifications, then INB shall have the right to reject such nonconforming shipment of the Products or the its rejection hereunder, within thirty (30) days after INB's receipt of such shipment, specifying the grounds for such rejection; provided, however, that in the event such defect is latent or was not obvious and could not be readily discovered from a physical inspection of the Products' shipment, INB may give written notice to Aloe of its rejection of such shipment within thirty (30) calendar days after INB's discovery of such non-conformance, specifying the grounds for such rejection. The non-conforming shipment of Products, or the non-conforming portion thereof, shall be held for Aloe's disposition, or shall be returned to Aloe, in each case at Aloe's expense, as directed by Aloe. Aloe shall use its commercially reasonable efforts to replace the non-conforming shipment of Products, or the non-conforming portion thereof, with conforming Products as soon as reasonably practicable after receipt of notice of rejection thereof, and in any event will do so within forty-five (45) days after receipt of notice of rejection thereof at no cost to INB. (b) In the event of a conflict regarding any nonconforming Product which Aloe and INB are unable to resolve, a sample of such Product, together with mutually agreed upon questions, shall be submitted by INB to a qualified independent laboratory reasonably acceptable to both parties for testing against the Product Specifications and the test results ("Test Results") obtained by such laboratory shall be final and binding upon the parties hereto. The fees and expenses of such aboratory testing, and all additional shipping and transportation costs incurred as a result of the dispute, shall be borne entirely by the party against whom such laboratory's findings are made. In the event the Test Results indicate that the Product in question does not conform to the Product Specifications, Aloe shall replace such Product with conforming Product in accordance with this Section 3.2. 3.3 Product Recall. (a) In the event of any recall of the Products arising out of, relating to, or occurring as a result of, any act or omission by, Aloe, Aloe shall, at the election of INB, either: (i) replace the amount of Products recalled or seized; or (ii) give credit to INB against outstanding receivables due from INB and future shipments of the Products in an amount equal to the amount paid by INB for the Products so recalled or seized or otherwise owing by INB hereunder plus reimburse (or, at INB's option, credit) INB for all transportation costs, if any, taxes, insurance, handling and out-of-pocket costs incurred by INB in respect of such recalled or seized Products, and shall promptly reimburse INB for all third party costs and expenses incurred by INB in connection with such recall. (iii)indemnify and save INB harmless from and against any and all damages to or claims by third parties associated with or resulting from any such recall. (b) In the event of any recall or seizure of the Products arising out of, relating to or occurring as a result of any act or omission of INB, INB shall remain responsible to Aloe for the price of the recalled Products, shall be solely responsible for any transportation costs, import duties, if any, taxes, insurance, handling and other costs incurred by Aloe in respect of such recalled or seized Products, and shall promptly reimburse Aloe for all third party costs and expenses incurred by Aloe in connection with such recall. (c) For purposes of this Section 3.3, "recall" shall mean (i) any action by INB and/or Aloe to recover title to or possession of the Products shipped and/or (ii) any decision by INB not to sell or ship the Products to third parties which would have been subject to recall if it had been sold or shipped, in each case taken in the good faith belief that such action was appropriate under the circumstances. "Seizure" shall mean any action by any government agency to detain or destroy the Products. (d) Each party shall keep the other fully informed of any notification or other information, whether received directly or indirectly, which might affect the marketability, safety or effectiveness of the Products, or which might result in liability issues or otherwise necessitate action on the party of either party, or which might result in recall or seizure of the Products. (e) Prior to any reimbursement pursuant to this Section 3.3 the party claiming reimbursement shall provide the other with reasonably acceptable documentation of all reimbursable costs and expenses. 4. PRICE AND PAYMENT TERMS. 4.1 Conversion Price; Additional Charges. INB shall pay Aloe for all Products which are accepted pursuant to Section 3.2 above at an amount equal to the Conversion Price for such Products. The Conversion Price for Products supplied using the existing Work-in-Process shall be adjusted downward by the amount of the value of the Work-in-Process over the value of the Raw Materials. The Conversion Price includes the shipping, handling and insurance to be arranged and paid for by Aloe as set forth in Section 3.1 hereof. Additional charges for storage of the Raw Materials and shipment are set forth on Exhibit G attached hereto. Aloe represents that the prices set forth on Exhibit C are the lowest prices charged by Aloe to supply such Products to private label customers who sell to the retail class of trade. If Aloe enters into an agreement to supply such Products to a third party, Aloe covenants that it shall not charge such third party a price lower than the prices set forth on Exhibit C. 4.2 Invoicing. Upon shipment of the Products to INB, Aloe shall submit invoices therefor to INB requesting payment of the Conversion Price for the Products shipped. INB shall pay each invoice in full within thirty (30) days after the date the Products covered by the invoice were received at INB's warehouse. All payments shall be made in U.S. Dollars. 4.3 Sales and Use Taxes. Aloe shall be solely responsible for the payment of all federal, state or local taxes, use or value-added taxes, excise or similar charges, or other tax assessments (other than that assessed against income), assessed or charged on the sale of the Products to INB pursuant to this Agreement. 5. TERM AND TERMINATION. 5.1 Term. The term of this Agreement shall commence on the Effective Date and, unless sooner terminated pursuant to Section 5.2 hereof, shall continue in full force and effect until terminated pursuant to the provisions of Section 5.2 hereof (the "Term"). This Agreement may be renewed from time to time and on the terms and conditions as the parties mutually agree. 5.2 Termination. Prior to the expiration of the Term, this Agreement may be terminated: (a) immediately by INB upon delivery of written notice to Aloe; (b) by either INB or Aloe, upon thirty (30) calendar days prior written notice if the other party materially breaches any provision of this Agreement and fails to cure such breach within thirty (30) calendar days following receipt of written notice from a non-breaching party specifying the breach to be cured; (c) in the event either party ceases conducting business in a normal course, becomes insolvent, makes a general assignment for the benefit of creditors, suffers or permits the appointment of a receiver for its business or assets, or avails itself of, or becomes subject to, any proceeding under the Federal Bankruptcy Act or any other statute of any state or country relating to insolvency or the protection of creditor rights, the other party shall have a right to terminate this Agreement, provided that in the case of an involuntary bankruptcy proceeding such right to terminate shall only become effective if the other party consents thereto or such proceeding is not dismissed within ninety (90) days after the filing thereof. The parties agree that each party may fully exercise all of its rights and elections under the U.S. Bankruptcy Code. 5.3 Post-Termination. (a) Termination of this Agreement shall not affect any payment obligations or other liabilities which have accrued as of the date of such termination, including, without limitation, any damages or liabilities resulting from a party's breach of its obligations under this Agreement. (b) If INB terminates this Agreement in accordance with Section 5.2(a), Aloe shall ship any existing work-in-process or Warehoused Goods to INB or take such other action as directed by INB, with such costs to be paid by INB. If either party terminates this Agreement pursuant to Section 5.2(b), then the costs of such shipping or handling shall be borne by the breaching party. If either party terminates this Agreement pursuant to Section 5.2(c), then the costs of such shipping, or handling shall be borne by the party seeking bankruptcy protection. 6. CONFIDENTIALITY OBLIGATIONS. 6.1 General. During the Term of this Agreement and for a period of [five (5)] years thereafter, each party agrees to treat all Confidential Information as confidential, to preserve the confidentiality of all Confidential Information, and not to disclose to third parties or use the disclosing party's Confidential Information without first obtaining the written consent of the disclosing party, except as may be otherwise provided herein. The parties agree to take all necessary steps to ensure that Confidential Information is securely maintained and to inform those who are authorized to receive such Confidential Information of their obligations under this Agreement. The parties agree to use any and all Confidential Information solely in connection with this Agreement and for no other use. Upon the termination or expiration of this Agreement for any reason, the receiving party promptly shall return all such Confidential Information, and any copies or reproductions thereof, to the disclosing party and the parties agree to make no further use of such Confidential Information. All Confidential Information shall remain the property of the disclosing party. 6.2 Right to Disclose. Nothing herein shall be construed as preventing either party from disclosing any information received from the other party to its employees, Affiliates, sublicensees and subcontractors, in each case where such person or entity has a need to know such information provided that, with respect to Affiliates, sublicensees and subcontractors, such entities have undertaken similar obligations of confidentiality with respect to the Confidential Information. In addition to the foregoing, nothing contained in this Article shall be construed to restrict the parties from disclosing Confidential Information as required: (a) for regulatory, tax or customs reasons; (b) for audit purposes; or (c) by court order or other government order or request. With respect to disclosing Confidential Information pursuant to a court order or other government order or request, prompt notice of such order or request will be provided to the disclosing party and the disclosure shall not occur until the disclosing party either approves the disclosure or has had the opportunity to seek a protective order or other appropriate remedy to curtail such disclosure. In the event that the disclosing party is unsuccessful in preventing the disclosure of Confidential Information to the court or government, the other party shall take reasonable efforts to protect the confidentiality of the Confidential Information and shall disclose only that portion of Confidential Information which it is legally required to disclose. 7. ARBITRATION. 7.1 Binding Arbitration. Except as otherwise provided in this Article 7, all disputes relating in any way to this Agreement shall be resolved exclusively through arbitration and settled by a panel of three (3) arbitrators in Newark, New Jersey, (who shall hold a hearing and make an award within sixty (60) days of the filing for arbitration). The arbitrators, who should be experienced in commercial contract disputes in the pharmaceutical industry, shall be selected and the proceedings and award conducted in accordance with the Commercial Rules of the American Arbitration Association then pertaining. The arbitrators, in addition to any award that they shall make, shall have the discretion to award the prevailing party the cost of the proceedings together with reasonable attorneys fees. Any award made hereunder may be docketed in a court of competent jurisdiction. In the event there are any issues which are not arbitrable as a matter of law, and as a condition precedent to a Court making a determination of any non arbitrable issues, any issues which may be arbitrated shall first be determined by arbitration pursuant to this section. The losing party shall pay all legal fees and costs of the arbitration. 7.2 Equitable Relief. Notwithstanding anything contained in this Agreement to the contrary, the parties shall be entitled to seek injunctive or other equitable relief whenever the facts or circumstances would permit a party to seek such equitable relief in a court of competent jurisdiction. 8. MISCELLANEOUS. 8.1 Relationship of the Parties. Aloe shall at all times be deemed to be an independent contractor, solely responsible for the manner by and the form in which it performs this Agreement. Nothing contained in this Agreement shall be construed as creating a partnership, joint venture or any other type of relationship between Aloe and INB, other than that of buyer and seller of goods. Neither party shall have the authority or obligate represent itself as having the authority to bind or obligate, the other party in any manner whatsoever. 8.2 Binding Nature and Assignment. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns. Neither party shall, without the prior written consent (not to be unreasonably withheld or delayed) of the other party having been obtained, assign or transfer this Agreement to any person; (b) INB may assign or transfer this Agreement to any Affiliate or to any successor by merger of such party of its pharmaceutical business or upon a sale of substantially all of a party's assets or the assets of its pharmaceutical business, without the prior written consent of Aloe; and (c) in the case of an assignment to an Affiliate of a party, the Affiliate shall in writing assume all the rights and obligations of the transferor under this Agreement. No permitted assignment of this Agreement or any rights hereunder shall relieve the assigning party of any of its obligations hereunder. 8.3 Force Majeure. If either party is prevented from complying, either totally or in part, with any of the terms or provisions set forth herein with respect to any of the Products by reason of force majeure including, by way of example and not of limitation, fire, flood, electrical failure, explosion, storm, strike, lockout or other labor dispute, riot, war, rebellion, accidents, acts of God, acts of terrorism, acts of governmental agencies or instrumentalities, said party shall provide written notice of same to the other party. Said notice shall be provided within five (5) business days of the occurrence of such event and shall identify the requirements of this Agreement or such of its obligations as may be affected, and to the extent so affected, said obligations shall be suspended during the period of such disability. The party prevented from performing hereunder shall use reasonable good faith efforts to remove such disability, and shall continue performance whenever such causes are removed. The party so affected shall give to the other party a good faith estimate of the continuing effect of the force majeure condition and the duration of the affected party's non-performance. When such circumstances arise, the party shall discuss what, if any, modification of the terms of this Agreement may be required in order to arrive at an equitable solution. Notwithstanding the foregoing, if the period of any previous actual non-performance of a party because of force majeure conditions plus the anticipated future period of non-performance because of such conditions will exceed an aggregate of [seventy-five (75)] days, then the party unaffected by such event may terminate this Agreement by not less than thirty (30) days written notice of termination to the other party. 8.4 Notices. Any notice required or permitted to be given under this Agreement shall be made in writing, and shall be effective when mailed, by registered or certified mail as follows: INB: Integrated BioPharma, Inc. 225 Long Avenue Hillside, NJ 07205 Phone: (973) 926-0816 Fax: (973) 926-1735 Attn: Chief Executive Officer Copy to: St. John & Wayne, LLC Two Penn Plaza East Newark, New Jersey 07105 Phone: (973) 491-3600 Fax: (973) 491-3407 Attn: William P. Oberdorf, Esq. Aloe: Aloe Commodities International, Inc. 2161 Hutton Drive, Suite 126 Carrollton, Texas 75006 Phone: (972) 241-4251 Fax: (972) 241-4376 Attn: L. Scott McKnight, President Copy to: Vial, Hamilton, Koch & Knox, L.L.P. 1700 Pacific Avenue, Suite 2800 Dallas, Texas 75201 Phone: (214) 712-4400 Fax: (214) 712-4402 Attn: Mark W. Romney, Esq. Any party may change said address by notice to the other parties in accordance with the terms hereof. 8.5 Press Releases and Announcements. Neither Party shall issue any press release or public announcement relating to the subject matter of this Agreement without the prior written consent of the other Party; provided, however, that either Party may make any public disclosure it believes in good faith is required by applicable law, regulation or national exchange rule (in which case the disclosing Party shall use reasonable efforts to advise the other Party and provide it with a copy of the proposed disclosure prior to making such disclosure). 8.6 Entire Agreement; Amendment. This Agreement, including the exhibits and schedules hereto, shall constitute the entire agreement between the Parties with respect to the subject matter hereof and shall supersede all previous negotiations, commitments and writings. The Parties hereto may, by mutual consent, amend or modify and supplement this Agreement in such manner as may be agreed upon in writing. 8.7 Captions. The captions and heading contained herein are solely for convenience of reference and will not affect the interpretation of any provision hereof. 8.8 Waiver, Discharge, etc. This Agreement may not be released, discharged or modified except by an instrument in writing signed on behalf of each of the Parties. The failure of a party to enforce any provision of this Agreement shall not be deemed a waiver by such party of any other provision or subsequent breach of the same or any other obligation hereunder. 8.9 Governing Law. This Agreement shall be construed and the rights of the Parties hereunder shall be governed by laws of the State of New Jersey. Venue for any dispute regarding this Agreement shall be in a court of competent jurisdiction in Union County, New Jersey (excluding any conflict of laws provisions of the State of New Jersey that would refer to and apply the substantive laws of another jurisdiction). 8.10 Counterparts and Facsimile Signatures. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one Agreement. This Agreement may be executed by facsimile signature. 8.11 Severability. Any portion of this Agreement which a court of competent jurisdiction shall determine to be void or unenforceable against public policy, or for any other reason, shall be deemed to be severable from this Agreement and shall have no effect on the other covenants or provisions in this Agreement. It is agreed that the court shall be empowered to reform and construe any provision that would otherwise be void or unenforceable in a manner that will be valid and enforceable to the maximum extent permitted by law. 8.12 Attorneys' Fees. In the event that any action or proceeding is brought in connection with this Agreement, the prevailing party therein shall be entitled to recover its costs and reasonable attorney's fees. 8.13 Survival. Notwithstanding anything to the contrary contained in this Agreement, the provisions of Sections 2.5, 3.3, 4.3, 5.3, 6 and 7 shall survive any termination of this Agreement. [SIGNATURE PAGE TO FOLLOW] IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed as of the Effective Date by their duly authorized representatives. INTEGRATED BIOPHARMA, INC. By: /s/ E. Gerald Kay --------------------- Name: E. Gerald Kay Title: Chief Executive Officer ALOE COMMODITIES INTERNATIONAL, INC. By: /s/ L. Scott McKnight ------------------------- Name: L. Scott McKnight Title: Chairman & CEO Exhibit A. Work-in-Process (to be attached) Exhibit B. Raw Materials All Raw Materials necessary to produce the following products, including packaging and labeling. 1. Naturally Noni(TM) , 32 ounce bottle. 2. Naturally Aloe(TM), Gallon size. 3. Naturally Aloe(TM), Quart square. 4. Naturally Aloe(TM), Quart round. 5. Avera(R) Sport Crunch 6. Avera(R) Sport Creatine Gel Pouch, 2 ounce package. 7. Avera(R) Sport Liquid Heat. 8. Avera(R) Sport Creatine Serum Exhibit C. Conversion Price for the Products MINIMUM CONVERSION PRICE PRODUCT QUANTITY (FILLING CHARGE) ------- -------- ---------------- 1. Naturally Noni(TM)-32 ounce bottle 10,000 $.85 per unit 2. Naturally Aloe(TM)--Gallon Size 5,000 $.75 per unit 3. Naturally Aloe(TM)-Quart Square 5,000 $.48 per unit 4. Naturally Aloe(TM)-Quart Round 5,000 $.45 per unit 5. Avera(R)Sport Crunch 4,500 $.18 per unit 6. Avera(R)Sport Creatine Pouch 11,000 $.05 per unit 7. Avera(R)Sport Liquid Heat 5,000 $.45 per unit 8. Avera(R)Sport Creatine Serum 5,000 $.45 per unit Exhibit D. The Products 1. Naturally Noni(TM), 32 ounce bottle. 2. Naturally Aloe(TM), Gallon size. 3. Naturally Aloe(TM), Quart square. 4. Naturally Aloe(TM), Quart round. 5. Avera(R) Sport Crunch 6. Avera(R) Sport Creatine Gel Pouch, 2 ounce package. 7. Avera(R) Sport Liquid Heat. 8. Avera(R) Sport Creatine Serum. Exhibit E. Product Specifications [To be attached] Exhibit F. Warehoused Goods (to be attached) Exhibit G. Additional Charges 1. Receiving of Raw Materials and Components: $3.00 per pallet upon arrival at Aloe Commodities International, Inc. ("ACII") dock. 2. Storage of Raw Materials, Components & Finished Goods in ACII warehouse: $6.00 per pallet per month for raw materials, components and finished goods stored at the ACII warehouse for 30 or more days, including: (i) finished goods produced by ACII and stored for 30 or more days from the date of production; (ii) raw materials and components shipped by INB to ACII more than 30 days prior to an ACII scheduled production date; provided, however, that if ACII extends a production date beyond the original scheduled production date which results in the raw materials, components or resulting finished goods to be stored 30 or more days, then no storage charge will be incurred by INB with respect to such stored raw materials, components or goods. 3. Shipping of Finished Goods per INB instructions in pallet quantities: $3.00 per pallet. - - ACII to ship the finished goods to INB's New Jersey warehouse or to INB's customers as specified by INB in the applicable invoice using palletized orders through a freight company acceptable to INB. - - ACII agrees to use "Grade A" pallets for goods to be shipped to INB customers. All other shipments of goods may be shipped using pallets which are in good and usable condition. - - All freight arrangements are to be made by INB and billed to INB directly by shipper. 4. Storage of Avera(R) Sport Crunch product: - - INB will store the Avera(R) Sport Crunch finished product in a cool warehouse located in New Jersey and pay for applicable storage costs. - INB to store the juices and raw materials used to produce the Avera(R) Sport Crunch, Noni juice, blueberry concentrate, pear concentrate, grape concentrate and raw Noni concentrate at the United States Cold Storage facility located at 5150 Pulaski, Dallas, Texas 75247 (Tel: 214-631-4863), and pay for applicable storage costs. EX-2 5 exhibit2_7.txt ESCROW AGREEMENT - EXHIBIT 2.7 EXHIBIT 2.7 EXECUTION COPY ESCROW AGREEMENT THIS ESCROW AGREEMENT (this "Agreement"), made as of October 22, 2003, among Integrated BioPharma, Inc., a Delaware corporation, having a principal place of business at 225 Long Avenue, Hillside, New Jersey 07205 ("Purchaser"), Aloe Commodities International, Inc., a Texas corporation, having a principal place of business at 2161 Hutton Drive, Suite 126, Carrollton, Texas 75006 ("Seller"), and Vial, Hamilton, Koch & Knox, L.L.P., with offices at 1700 Pacific Avenue, Suite 2800, Dallas, Texas 75201 (the "Escrow Agent"). WITNESSETH WHEREAS, Purchaser and Seller are entering into a certain asset purchase agreement dated as of the date hereof (the "Asset Purchase Agreement") pursuant to which Seller shall transfer and assign its rights in the Transferred Assets to Purchaser in consideration for receiving the Cash Consideration and the Share Consideration as provided in the Asset Purchase Agreement (terms not defined herein shall have the meaning ascribed to them in the Asset Purchase Agreement, a copy of which is attached hereto as Exhibit A); WHEREAS, Section 2.1(b) of the Asset Purchase Agreement provides that such Share Consideration shall be held in escrow and released after a period of one (1) year from the Closing Date pursuant to the terms of an escrow agreement between and among Purchaser, Seller and the firm of Vial, Hamilton, Koch & Knox, L.L.P., counsel to Seller; WHEREAS, Vial, Hamilton, Koch & Knox, L.L.P. is willing to act as escrow agent and hold and release the Share Consideration subject to the terms and conditions set forth below. NOW, THEREFORE, in consideration of the mutual covenants contained herein and for other valuable consideration, the respective receipts of which are hereby acknowledged, it is agreed as follows: 1. Escrow Agent. The firm of Vial, Hamilton, Koch & Knox, L.L.P. agrees to act as the escrow agent and to hold and deliver the Share Consideration in accordance with the terms and conditions set forth herein. 2. Escrowed Shares. In accordance with Section 2.1(b) of the Asset Purchase Agreement, Purchaser agrees to cause its transfer agent to deliver a certificate representing the shares of the Share Consideration to the Escrow Agent as soon as practicable after the Closing Date (the "Escrowed Shares"). 3. Term of Escrow. The Escrow Agent shall hold the Escrowed Shares in escrow for a one (1) year period commencing on the date hereof and expiring on the one (1) year anniversary ("Escrow Period"). 4. Release of Escrow. a. Except as provided herein, upon the termination of the Escrow Period the Escrow Agent shall release and deliver to Seller the certificate representing the Escrowed Shares upon receipt of a written notice (the "Release Notice") from both Purchaser and Seller jointly authorizing the Escrow Agent to release and deliver the Escrowed Shares to Seller. b. Notwithstanding anything to the contrary herein, if during the Escrow Period: (i) a claim is made challenging the validity of the sale of the Transferred Assets by Seller to Purchaser and the transactions contemplated in the Asset Purchase Agreement, and such claim is upheld or resolved by a judicial proceeding, arbitration or otherwise, then Purchaser and Seller agree that Purchaser shall have the option to return the Product Lines to Seller in consideration for the release from escrow of the number of Escrowed Shares equal to the amount of damages of the claim and the return of such shares to Purchaser; or (ii) a claim for damages is made by Purchaser against Seller due to a material breach of Seller's representations and warranties in the Asset Purchase Agreement and such claim is upheld or resolved by a judicial proceeding, arbitration or otherwise, then Purchaser and Seller agree that Purchaser shall have the option to return the Product Lines to Seller in consideration for the release from escrow of the number of Escrowed Shares equal to the amount of such damages and the return of such shares to Purchaser. If no claim is made against the Escrowed Shares pursuant to sub-section (i) or (ii) above, then both Purchaser and Seller shall deliver the Release Notice to the Escrow Agent upon the expiration of the Escrow Period. 5. Rights of Escrow Agent. In the event that the Escrow Agent shall be uncertain as to its duties or actions hereunder or shall receive instructions or a notice from either Purchaser or Seller which is in conflict with instructions or a notice from the other or which, in the reasonable opinion of the Escrow Agent, conflicts with the provisions of this Agreement, it shall be entitled to take any of the following courses of action: a. Hold the Escrowed Shares and decline to take any further action until the Escrow Agent receives joint written instructions from the disputing parties or an order of a court of competent jurisdiction directing it to continue to hold or to deliver the same, in which case the Escrow Agent shall then continue to hold or deliver the Escrowed Shares, as the case may be, in accordance with such direction; b. In the event of litigation between Purchaser and Seller with respect to the subject matter of the Asset Purchase Agreement or the Transferred Assets, the Escrow Agent may deliver the Escrowed Shares to the clerk of any court in which such litigation is pending; c. The Escrow Agent may deliver the Escrowed Shares to a court of competent jurisdiction and therein commence an action for interpleader, the cost thereof to the Escrow Agent to be borne by whichever of Purchaser or Seller does not prevail in the litigation. d. The Escrow Agent shall not receive any fee for acting as the escrow agent. In addition, the Escrow Agent shall not be liable for any action taken or omitted in good faith and believed by it to be authorized or within the rights or powers conferred upon it by this Agreement and may rely, and shall be protected in acting or refraining from acting in reliance, upon an opinion of counsel and upon any directions, instructions, notice, certificate, instrument, request, paper or other document believed by it to be genuine and to have been made, sent, signed or presented by the proper party or parties. e. Purchaser and Seller shall jointly and severally indemnify and hold harmless the Escrow Agent against any loss, liability or expense (including legal fees) incurred in good faith in the performance of its services hereunder including the cost and expense of defending itself against any claim or liability. f. Purchaser and Seller acknowledge that the Escrow Agent has acted as counsel to Seller in connection with the Asset Purchase Agreement and other agreements and documents being executed in connection therewith. Purchaser and Seller agree that in the event of any disputes thereunder, the Escrow Agent may continue to represent Seller, and Purchaser and Seller hereby waive any claim of conflict of interest which they may otherwise have. 6. Miscellaneous. a. Notices. Any notice required or permitted to be given under this Agreement shall be made in writing, and shall be effective when mailed, by registered or certified mail as follows: Purchaser: Integrated BioPharma, Inc. 225 Long Avenue Hillside, NJ 07205 Phone: (973) 926-0816 Fax: (973) 926-1735 Attn: Chief Executive Officer Copy to: St. John & Wayne, LLC Two Penn Plaza East Newark, New Jersey 07105 Phone: (973) 491-3600 Fax: (973) 491-3407 Attn: William P. Oberdorf, Esq. Seller: Aloe Commodities International, Inc. 2161 Hutton Drive, Suite 126 Carrollton, Texas 75006 Phone: (972) 241-4251 Fax: (972) 241-4376 Attn: L. Scott McKnight, President Copy to: Vial, Hamilton, Koch & Knox, L.L.P. 1700 Pacific Avenue, Suite 2800 Dallas, Texas 75201 Phone: (214) 712-4400 Fax: (214) 712-4402 Attn: Mark D. Chambers, Esq. Escrow Agent: Vial, Hamilton, Koch & Knox, L.L.P. 1700 Pacific Avenue, Suite 2800 Dallas, Texas 75201 Phone: (214) 712-4400 Fax: (214) 712-4402 Attn: Mark D. Chambers, Esq. Any party may change said address by notice to the other parties in accordance with the terms hereof. b. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. c. Entire Agreement; Amendment. This Agreement, including any exhibits, shall constitute the entire agreement between the parties hereto with respect to the subject matter hereof and shall supersede all previous negotiations, commitments and writings. The parties hereto may, by mutual consent, amend or modify and supplement this Agreement in such manner as may be agreed upon in writing. d. Captions. The captions and heading contained herein are solely for convenience of reference and will not affect the interpretation of any provision hereof. e. Governing Law. This Agreement shall be construed and the rights of the parties hereunder shall be governed by laws of the State of Texas. Venue for any dispute regarding this Agreement shall be in a court of competent jurisdiction in Dallas County, Texas. f. Counterparts and Facsimile Signatures. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one Agreement. This Agreement may be executed by facsimile signature. g. Severability. Any portion of this Agreement which a court of competent jurisdiction shall determine to be void or unenforceable against public policy, or for any other reason, shall be deemed to be severable from this Agreement and shall have no effect on the other covenants or provisions in this Agreement. It is agreed that the court shall be empowered to reform and construe any provision that would otherwise be void or unenforceable in a manner that will be valid and enforceable to the maximum extent permitted by law. h. Attorneys' Fees. In the event that any action or proceeding is brought in connection with this Agreement, the prevailing party therein shall be entitled to recover its costs and reasonable attorney's fees. i. Further Assurances. Purchaser and Seller shall, and shall cause their respective affiliates to, execute and deliver all other documents and instruments and take all other actions reasonably requested by Escrow Agent at any time to effect the release and delivery of the Escrowed Shares in accordance with this Agreement. [signature page follows] IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. INTEGRATED BIOPHARMA, INC. By: /s/ E. Gerald Kay Name: E. Gerald Kay Title: Chief Executive Officer ALOE COMMODITIES INTERNATIONAL, INC. By: /s/ L. Scott McKnight Name: L. Scott McKnight Title: Chairman & CEO VIAL, HAMILTON, KOCH & KNOX, L.L.P., As Escrow Agent By: /s/ Mark D. Chambers Name: Mark D. Chambers, Jr. Title: Authorized Exhibit A. Asset Purchase Agreement (copy to be attached) EX-2 6 exhibit2_6.txt ASSET PURCHASE AGREEMENT - EXHIBIT 2.6 EXHIBIT 2.6 EXECUTION COPY ASSET PURCHASE AGREEMENT THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made as of the date on the signature page hereto, by and between Integrated BioPharma, Inc., a Delaware corporation ("Purchaser") and Aloe Commodities International, Inc., a Texas corporation ("Seller"). Purchaser and Seller are collectively, the "Parties". RECITALS WHEREAS, Seller is the owner of various assets related to the Naturally Aloe(TM), Naturally Noni(TM) and Avera(R) Sport product lines (the "Product Lines"); and WHEREAS, the assets specifically and directly related to the Product Lines include, but are not limited to, the following: trademarks, art work, formula for the products, customer list, goodwill, and inventory; and WHEREAS, the Parties desire to evidence an agreement for Purchaser to purchase all of the assets related to the Product Lines from Seller, on the terms and conditions set forth herein; WHEREAS, Purchaser and Seller intend to enter into the transactions as of the date hereof (the "Effective Date"); and NOW, THEREFORE, in consideration of the premises and the mutual covenants, agreements and representations herein contained, Purchaser and Seller agree as follows: Article I Purchase and Sale 1.1 Purchase and Sale of Transferred Assets. On the terms and subject to the conditions herein expressed, Seller agrees to sell, convey, transfer, assign, and deliver to Purchaser, and Purchaser agrees to purchase, good and marketable title to all of the assets, properties, and business of Seller of every nature, and description, whether tangible or intangible, contingent or otherwise, wherever so located and whether or not reflected on the books and records of Seller related to the Naturally Aloe(TM), Naturally Noni(TM) and Avera(R) Sport product lines, including, without limitation, all copyrights, trademarks, and trade names and associated goodwill, inventories, product formulas, product labels, customer lists and books and records (collectively hereinafter referred to as the "Transferred Assets"). Without limiting the generality of the foregoing, it is agreed that the Transferred Assets shall include, without limitation, all of the assets listed on Schedule "A" to this Agreement and shall be deemed transferred to Purchaser in their respective amounts existing on the Effective Date. No other assets of Seller are being transferred other than the Transferred Assets. 1.2 No Assumption of Liabilities. Purchaser shall in no event assume or be responsible for any liabilities, liens, security interests, claims, obligations, or encumbrances of Seller, contingent or otherwise, and the Transferred Assets shall be sold and conveyed to Purchaser free and clear of all liabilities, liens, security interests, claims, obligations, and encumbrances and arising out of the conduct to the business relating to the Transferred Assets by Seller prior to the Closing (as defined herein). Without limiting the generality of the foregoing, in no event shall Purchaser assume or be responsible for: (i) any income, property, franchise, sales, use or other tax of Seller or any filing requirements or obligations with respect thereto arising out of or resulting from the sale of the Transferred Assets hereunder (all such taxes to be paid by Seller) or any transaction of Seller prior to or subsequent to the execution of this Agreement; and (ii) any liabilities, obligations, or costs resulting from any claim or lawsuit or other proceeding relating to the Transferred Assets or naming Seller or any successor thereof as a party and arising out of events, transactions, or circumstances occurring or existing prior to the Closing Date. 1.3 Assignment of Contracts. Seller does hereby assign to Purchaser all of Seller's right, title and interest in and to the contracts and agreements listed on Schedule 1.3 attached hereto (the "Assigned Contracts"), free and clear of all claims, liens, pledges, encumbrances, mortgages, taxes and equities of any kind whatsoever. 1.4 Delivery of Know-How. At Closing, Seller shall furnish to Seller copies of the documents that listed on Schedule 1.4 attached hereto that relate to the Product Line Intellectual Property. 1.5 Excluded Assets. Notwithstanding anything to the contrary, the following assets related to the Product Lines are being retained by Seller and are not being assigned, transferred or sold to Purchaser: a. All bank accounts, demand accounts, deposit accounts, cash on hand and all accounts receivable arising from the operation of the Product Lines prior to the Closing Date (as defined herein) except for the General Nutrition Centers, Inc. account receivable listed on Schedule A. b. All other assets of Seller not used in connection with the Product Lines which are not specifically listed on Schedule A. c. Manufacturing equipment that is used in connection with the Product Lines. 1.6 Product Labels. Part of the Transferred Assets include existing product labels printed with the name of Seller. Seller authorizes Purchaser to use such labels until such supplies are exhausted. Article II Purchase Price 2.1 Purchase Price. The purchase price for the Transferred Assets shall be $2,597,469.83 payable as follows: a. Cash Consideration. Purchaser shall pay to Seller $872,469.83 upon Closing ("Cash Consideration") in immediately available funds by wire transfer. b. Common Stock. Purchaser shall issue to Seller shares of common stock of Purchaser representing that number of shares equal to (I) $1,725,000.00 divided by (II) the average closing price for Purchaser's common stock as reported on the American Stock Exchange for the last ten (10) business days prior to the Closing Date (the "Share Consideration"), as set forth on Schedule 2.1(b) attached hereto. Such Share Consideration shall be held in escrow for a period of one (1) year from the Closing Date and released pursuant to the terms of an Escrow Agreement (the "Escrow Agreement") between and among Purchaser, Seller and Vial, Hamilton, Koch & Knox, L.L.P. (the "Escrow Agent") in the form of Exhibit A attached hereto. Purchaser will cause its Transfer Agent to deliver a certificate representing such shares to the Escrow Agent as soon as practicable after the Closing Date. Such shares shall be restricted stock and shall bear the restrictive legend set forth in Section 4.2(o) herein. c. Registration Rights. Seller shall be entitled to the "piggy back" registration rights to said shares in accordance with the Registration Rights Agreement attached hereto as Exhibit "B." 2.2 Purchase Price Allocation. Seller and Purchaser agree to allocate the purchase price among the Transferred Assets including the items listed on Schedule A as set forth on Schedule 2.2 attached hereto. 2.3 Purchase Price Adjustment; Inventory and Valuation of Inventory. a. Purchaser shall cause a physical inventory of the Products to be taken by Purchaser's representative at Seller's premises after the close of business on the day immediately prior to the Closing Date (the "Closing Inventory"). The items to be included in this physical inventory shall include all finished goods, work-in-process, raw materials, bottles, labels, prepaid expenses and specified intellectual property. Seller may have a representative present during the Closing Inventory. At Closing, Seller and Purchaser shall prepare an inventory schedule attached hereto as Schedule 2.3 detailing all inventory items. No inventory items shall have an expiration date which expires within six (6) months from the Closing Date. The inventory shall be valued consistent with generally accepted accounting principles as agreed by the Parties and establish the value of such inventory as of the Closing (the "Inventory Value"). b. If the Inventory Value is less than $597,470 the Purchase Price and the Share Consideration shall be reduced by the difference between the Inventory Value and $597,470 up to a maximum of $75,000 and if the difference is greater than $75,000, then the Purchase Price and the Cash Consideration shall be reduced by the difference between the Inventory Value and $522,470. 2.4 Conversion and Supply Agreement. Concurrently herewith, Seller and Purchaser shall enter into a Conversion and Supply Agreement in the form of Exhibit C attached hereto. Article III Closing 3.1 Time and Place of Closing. The transactions contemplated by this Agreement shall be consummated (the "Closing") on the date hereof at 11:00 a.m. (New Jersey time), simultaneously with the execution of this Agreement by the Parties, at the offices of St. John & Wayne, L.L.C., Newark, New Jersey or on such other date, or at such other time or place, as shall be mutually agreed upon by the Parties hereto (the "Closing Date"). Article IV Representations and Warranties 4.1 General Statement. The Parties make the representations and warranties to each other which are set forth in this Article IV, elsewhere in this Agreement, and in any financial statement, schedule or exhibit delivered with this Agreement to the other party. All such representations and warranties shall survive for a period of twelve (12) months only following Closing, regardless of any investigation or lack of investigation by any of the parties to this Agreement. No specific representation and warranty shall limit the generality or applicability of a more general representation or warranty. No representations or warranties of either of the Parties will be considered incorrect or breached unless the inaccuracy of the representation or warranty has a material impact upon that Party's ability to perform its obligations under this Agreement. 4.2 Representations and Warranties of Seller. Seller represents and warrants to Purchaser that: (a) Organization; Authorization. Seller is a corporation duly organized, validly existing and in good standing under the laws of the Texas. Seller has all requisite corporate power and authority to own or lease and operate its properties and to carry on its business and is qualified or licensed to do business and is in good standing in every jurisdiction where the nature of its business or the properties owned, leased or operated by it requires qualification or licensure, except where the failure to be so qualified or licensed would not have a material adverse effect on the ability of Seller to perform its obligations under this Agreement. (b) Authority. Seller has full power and authority to execute and deliver this Agreement, the other agreements contemplated herein, and to consummate the transactions contemplated hereby. (c) Enforceability. This Agreement has been duly executed and delivered by Seller and constitutes Seller's legal, valid and binding obligation, enforceable in accordance with its terms, except as limited by applicable bankruptcy, insolvency or other similar laws relating to creditors' rights generally, now or hereafter in effect, and general principles of equity. Seller need not give any notice to, make any filing with, or obtain any authorization, consent, or approval of any court, government or governmental agency, or third person in order to consummate the transactions contemplated by this Agreement except for certain bank authorizations which have been obtained. Schedule 4.2 (c) attached hereto contains a list of such required consents. (d) Ownership; Title. Seller is the owner of, and has good, valid and marketable title to, the Transferred Assets, free and clear of all encumbrances including any taxes, security interests, purchase rights, contracts, commitments, equities, claims, demands, liens, encumbrances, or other restrictions whatsoever in law or in equity (the "Encumbrances"). Except for this Agreement, Seller is not a party to any purchase right, or other contract or commitment that could require Seller to sell, transfer, or otherwise dispose of the Transferred Assets. The trademarks conveyed hereunder are not registered trademarks. (e) Capacity. Seller has full legal power, right and authority and all authorizations and approvals required by law to enter into and perform this Agreement and to sell, transfer and deliver good, valid and marketable title to the Transferred Assets free and clear of any and all liens, claims, encumbrances, or rights of third parties whatsoever in accordance with the terms of this Agreement. (f) Nonviolation. The execution and delivery of this Agreement and the consummation of the Transactions by Seller do not and will not (a) violate or conflict with the provisions of the Articles of Incorporation or Bylaws, or other charter documents, of Seller, (b) constitute a default under, violate, conflict with, or result in the termination of, any contract, agreement, judgment, order, injunction or decree to which any Seller is a party, or by which Seller is bound or to which Seller, or any of the Transferred Assets is subject, (c) conflict with or violate any law, rule or regulation of any governmental authority having jurisdiction over Seller or any of the Transferred Assets, or (d) result in the creation or imposition of any Encumbrance on the Transferred Assets. (g) Litigation. There is no pending or, to the knowledge of Seller, threatened, litigation or judicial, administrative or arbitration claim, action or proceeding with respect to the Transferred Assets nor are there any judgments, orders, writs, injunctions or decrees currently in effect involving or affecting any of the Transferred Assets. (h) Inventory. All the Inventory including finished goods, goods under open purchase orders or invoices on the Effective Date, work-in-process and raw materials is in good condition, not obsolete or defective, and is usable and saleable in the ordinary course of Seller's business as presently conducted and does not have an expiration date which expires within six (6) months from Closing. All the items making up the Closing Inventory (as conducted during the Closing Date Inventory from October 15-16, 2003, and set forth Schedule 2.3) have not been used or sold by Seller since the dates of the Closing Inventory. (i) Warranty or Product Liability Claims. There are no pending or, to the knowledge of Seller, threatened warranty or product liability claims against Seller with respect to the finished goods. Schedule 4.2(i) attached hereto contains a list of all warranty or product liability claims against such goods made against Seller within the last year. (j) Return Policy. A copy of Seller's return policy with respect to the finished goods is attached hereto as Schedule 4.2(j). (k) Compliance with Laws. Seller is in compliance with all federal, state, local, municipal and foreign laws, rules, regulations, statutes and ordinances applicable to Seller as they relate to the Transferred Assets. (l) Purchase Orders. Schedule 4.2(l) attached hereto contains a list of open purchase orders and invoices ("Purchase Orders") specifically identifying the goods and quantifies under such open orders. Such Purchase Orders and the goods which are the subject of such orders are being transferred to Purchaser herewith free of any Encumbrances or third party claims and are for the benefit of Purchaser. (m) Permits and Licenses. Schedule 4.2(m) sets forth a list of all permits, licenses or authorizations held by Seller (collectively, the "Permits") required for sale of the Products. Each such Permits is in full force and effect and Seller is in compliance with such Permit. Such listed Permits are the only Permits required for Purchaser to utilize the Transferred Assets. To Seller's nowledge, no suspension or cancellation of a Permit is threatened and Seller has no basis for believing that such Permit will not be assignable to Purchaser or renewable upon expiration, as the case may be. To Seller's knowledge, each such Permit will continue in full force and effect immediately following the Closing. (n) Intellectual Property. Schedule 4.2(n) lists (a) all trademarks, trade names, logos, patents, if any, service marks, designs and specifications, copyrights, data, formulas, processes, inventions nd other intellectual property and all applications therefor related to the Transferred Assets (collectively, "Intellectual Property"), owned, licensed or used by Seller (and discloses whether such Intellectual Property is owned by Seller and any agreements which license such Intellectual Property to Seller or otherwise allows Seller to use such Intellectual Property) and (b) all licenses granted by Seller, if any, with regard to Intellectual Property. To the knowledge of Seller, Seller owns or has the right to use all Intellectual Property owned, licensed or used by it, and such rights will be owned, licensed or made available for use by Purchaser after the Closing on terms and conditions identical to those under which Seller owned, licensed or used such rights prior to the Closing. To the knowledge of Seller, no Intellectual Property owned, licensed or used by Seller violates or infringes on any rights of any third parties. There is no pending or, to the knowledge of Seller, threatened, claim or litigation contesting the right of Seller to own, license or use such Intellectual Property. To the knowledge of Seller, no third party is presently infringing any Intellectual Property owned, licensed or used by Seller. Seller has filed certain trademark applications with the United States Patent and Trademark Office with respect to Naturally Aloe(TM) and Naturally Noni(TM); however, Seller can give no assurance that it will be granted a registered trademark with respect to such marks. (o) Accredited Investor; Investment Representation. (i) Seller is acquiring the Share Consideration for its own account for investment only, and not with a view to, or for sale in connection with, any distribution of such shares in violation of the Securities Act of 1933, as amended (the "Securities Act"), or any rule or regulation under the Securities Act. (ii) Seller has had adequate opportunity to obtain from representatives of Purchaser such information, in addition to the representations set forth in this Agreement, as is necessary to evaluate the merits and risks of such Seller's acquisition of the Share Consideration. (iii) Seller has sufficient experience in business, financial and investment matters to be able to evaluate the risks involved in the acquisition of the Share Consideration and to make an informed investment decision with respect to such acquisition. (iv) Seller understands that the shares representing the Share Consideration have not been registered under the Securities Act and are "restricted securities" within the meaning of Rule 144 under the Securities Act; and that until such shares are so registered, the shares representing the Share Consideration cannot be sold, transferred or otherwise disposed of unless they are subsequently registered under the Securities Act or an exemption from registration is then available. (v) Seller agrees and understands that until the shares representing the Share Consideration are sold under an effective registration statement pursuant or sold pursuant to Rule 144 under the Securities Act, a legend substantially in the following form may be placed on the certificate representing the Share Consideration to be issued to Seller: "The shares represented by this certificate have not been registered under the Securities Act of 1933, as amended (the "Act"), and may not be sold, transferred or otherwise disposed of in the absence of an effective registration statement under such Act or an opinion of counsel satisfactory to the Integrated BioPharma, Inc. to the effect that such registration is not required." (vi) Seller represents that it (i) is an "accredited investor" within the meaning of Rule 501(a) under the Act or (ii) has utilized a purchaser representative in accordance with Regulation D under the Act. (p) Brokers or Finders Fees. No agent, broker, investment banker or other firm, entity or individual is entitled to any broker's or finder's fee or any other commission or similar fee from Seller in connection with the transactions contemplated pursuant to this Agreement. (q) Disclosure of Material Facts. None of the representations and warranties contained in this Agreement contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements contained herein or therein not misleading. (r) Financial Statements. Attached hereto as Schedule 4.2(r) is a true and correct copy of the following financial statements of Seller (collectively, the "Financial Statements"): a balance sheet as of the end of Seller's last fiscal year and the related statement of income and retained earnings for the fiscal year then ended, together with a balance sheet as of August 31, 2003 and the related statement of income and retained earnings for the eight (8) months then ended (the "Interim Statements"). The Financial Statements fairly present, in all material respects, the financial condition, assets and liabilities, results of operations and related costs and expenses of Seller as of the dates or for the periods presented in the Financial Statements, as applicable, in each case, in conformity with generally accepted accounting principles, applied on a consistent basis during the period involved, subject in the case of the Interim Statements, to normal year-end and audit adjustments. The Financial Statements are in accordance with Seller's books and records. (s) Solvency. As of the Closing Date, Seller is able to pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business. (t) Validity of Sale. The sale of the Transferred Assets by Seller to Purchaser is a sale made for fair and valid consideration and the sale and the transactions contemplated pursuant to this Agreement have not been entered into by Seller with an intent to hinder, delay or defraud its creditors. (u) Sales. Seller's sales in 2001, 2002 and 2003 for the products Avera(R) Sport-Protein Crunch, Avera(R) Sport-Distributor/Other, Naturally Noni(TM) and Naturally Aloe(TM) are set forth on Schedule 4.2(u) attached hereto, and Seller represents that Schedule 4.2(u) accurately represents the sales of such products during those periods. 4.3 Purchaser's Representations and Warranties. Purchaser represents and warrants to Seller that: Organization. Purchaser is a corporation duly organized, (a) validly existing and in good standing under the laws of the Delaware. (b) Authority. Purchaser has full power and authority to execute and deliver this Agreement and other agreements contemplated herein, to issue the Share Consideration and to consummate the transactions contemplated hereby. (c) Authorization; Enforceability. The execution and delivery by Purchaser of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized by the Board of Directors of Purchaser and no other corporate proceedings on the part of Purchaser or its stockholders are necessary to authorize the execution and delivery by Purchaser of this Agreement or the consummation of the transactions contemplated hereby. This Agreement has been duly executed and delivered by Purchaser and constitutes Purchaser's legal, valid and binding obligation, enforceable in accordance with its terms, except as limited by applicable bankruptcy, insolvency or other similar laws relating to creditors' rights generally, now or hereafter in effect, and general principles of equity. Purchaser need not give any notice to, make any filing with, or obtain any authorization, consent, or approval of any court, government or governmental agency, or third person in order to consummate the transactions contemplated by this Agreement. (d) Capitalization. The authorized capital stock of Purchaser consists of 26,000,000 shares of stock, comprised of Stock") and 1,000,000 shares of preferred stock, with a par value of $.002 per share (the "Preferred Stock"). As of September 30, 2003, there were issued and outstanding 10,321,839 shares of Common Stock and 9,500 shares of Series A Convertible Preferred Stock. All outstanding sharesof Common Stock that make up the Share Consideration, when issued, will be validly issued, fully paid and non-assessable. Other than this Agreement or the Escrow Agreement, there is no subscription, option, warrant, call, right, agreement or commitment relating to the issuance, sale, delivery or transfer by Purchaser (including any right of conversion or exchange under any outstanding security or other instrument) of the shares of Common Stock that make up the Share Consideration. Upon consummation of the transactions contemplated hereby, Seller shall acquire good title to the shares of the Common Stock that make up the Share Consideration, free and clear of all pledges, security interests, liens, charges, encumbrances, equities, claims and options of whatever nature arising prior to the deliver of the Share Consideration to Seller, subject to the provisions of Article VIII herein. (e) Nonviolation. The execution and delivery of this Agreement and the consummation of the transactions contemplated herein by Purchaser do not and will not (a) violate or conflict with the provisions of the Articles of Incorporation or Bylaws, or other charter documents, of Purchaser, (b) constitute a default under, violate, conflict with, or result in the termination of, any contract, agreement, judgment, order, injunction or decree to which Purchaser is a party, or by which Purchaser is bound, or (c) conflict with or violate any law, rule or regulation of any governmental authority having jurisdiction over Purchaser. There is no requirement applicable to Purchaser to make any filing with, or to obtain any permit, authorization, consent or approval of, any governmental or regulatory authority as a condition to the lawful consummation by Purchaser of the delivery of the Share Consideration pursuant to this Agreement. Neither the execution and delivery of this Agreement by Purchaser nor delivery by Purchaser of the Share Consideration pursuant to this Agreement will: (a) conflict with or result in a breach of any provision of its Certificate of Incorporation, as amended or its By-laws; (b) result in any default (or give rise to any right of termination, cancellation or acceleration) under any of the terms, conditions or provisions of any note, bond, mortgage, indenture, agreement, lease or other instrument or obligation of Purchaser; or (c) violate any order, writ, injunction or decree applicable to Purchaser. (f) Brokers or Finders Fees. No agent, broker, investment banker or other firm, entity or individual is entitled to any broker's or finder's fee or any other commission or similar fee from Purchaser in connection with the transactions contemplated pursuant to this Agreement. (g) Disclosure of Material Facts. None of the representations and warranties contained in this Agreement or in any report or form filed with the Securities and Exchange Commission by Purchaser contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements contained herein or therein not misleading. 4.4 Survival. The representations and warranties of Seller and Purchaser, respectively, contained in this Agreement shall survive the Closing for a twelve (12) month period. Article V Conditions Precedent 5.1 Conditions Precedent to Purchaser's Obligations. The obligation of Purchaser to close the transactions contemplated by this Agreement is subject to the satisfaction or the fulfillment of all of the following conditions on or prior to the Closing Date, upon non-fulfillment of any of which, this Agreement may, at Purchaser's option, be terminated pursuant to and with the effect set forth in Article X: a. Each and every representation and warranty made by Seller shall have been true and correct when made and shall be true and correct as if originally made on the Closing Date. b. All obligations of Seller to be performed hereunder through, and including on, the Closing date (including, without limitation, all obligations which Seller would be required to perform at the Closing if the transactions contemplated hereby were consummated) shall have been performed. c. No suit, proceeding or investigation shall have been commenced or threatened by any governmental authority or private person on any grounds to restrain, enjoin or hinder, or to seek material damages on account of, the consummation of the transactions contemplated hereby. d. Seller shall deliver all of the Transferred Assets to Purchaser on the Closing Date, or shall take such other action with respect to the Transferred Assets as agreed between the Parties. 5.2 Conditions Precedent to Seller's Obligations. The obligation of Seller to close the transactions contemplated by this Agreement is subject to the satisfaction or the fulfillment of all of the following conditions on or prior to the Closing Date, upon non-fulfillment of any of which, this Agreement may, at Seller's option, be terminated pursuant to and with the effect set forth in Article X: a. Each and every representation and warranty made by Purchaser shall have been true and correct when made and shall be true and correct as if originally made on the Closing Date. b. All obligations of Purchaser to be performed hereunder through, and including on, the Closing Date (including, without limitation, all obligations which Purchaser would be required to perform at the Closing if the transactions contemplated hereby were consummated) shall have been performed. c. No suit, proceeding or investigation shall have been commenced or threatened by any governmental authority or private person on any grounds to restrain, enjoin or hinder, or to seek material damages on account of, the consummation of the transactions contemplated hereby. Article VI Closing and Closing Deliveries 6.1 Form of Documents. At the Closing, the parties shall deliver the documents, and shall perform the acts, which are set forth in this Article VI. All documents to be delivered shall be in form and substance reasonably satisfactory to the party to whom such documents are to be delivered. 6.2 Purchaser's Deliveries. Subject to the fulfillment or written waiver of the conditions set forth in Section 5.1, Purchaser shall execute and/or deliver to Seller all of the following: (a) Counterpart of this Agreement duly executed by Purchaser. (b) A wire transfer of immediately available funds in the amount of the Cash Consideration as defined hereinabove. (c) As soon as practicable after the Closing Date, Purchaser shall cause its transfer agent to deliver a certificate representing the Share Consideration to the Escrow Agent pursuant to Section 2.1(b). (d) Counterpart of an Escrow Agreement by and between Purchaser, Seller and Escrow Agent duly executed by Purchaser in the form attached hereto as Exhibit A; (e) Counterpart of a Registration Rights Agreement by and between Purchaser and Seller duly executed by Purchaser in the form attached hereto as Exhibit B; (f) Counterpart of a Conversion and Supply Agreement by and between Purchaser and Seller duly executed by Purchaser in the form attached hereto as Exhibit C; (g) A Proprietary Rights Assignment duly executed by Purchaser in the form attached hereto as Exhibit E; (h) Any other instruments that Seller may reasonably deem necessary or desirable to effect or evidence the transactions contemplated hereby, including, but not limited to, the following: (i) Certificate of Good Standing in Purchaser's jurisdiction of organization; (ii) Certificates as to the incumbency of Purchaser's officers; (iii)Certificate of an officer of Purchaser as to the representations and warranties of Purchaser; and (iv) Board resolutions approving this Agreement and the transactions contemplated herein. 6.3 Seller's Deliveries. Subject to the fulfillment or written waiver of the conditions set forth in Section 5.2, Seller shall execute and/or deliver to Purchaser all of he following: (a) Counterpart of this Agreement duly executed by Seller; (b) Counterpart of an Escrow Agreement by and between Purchaser, Seller and Escrow Agent duly executed by Seller in the form attached hereto as Exhibit A; (c) Counterpart of a Registration Rights Agreement by and between Purchaser and Seller duly executed by Seller in the form attached hereto as Exhibit B; (d) Counterpart of a Conversion and Supply Agreement by and between Purchaser and Seller duly executed by Seller in the form attached hereto as Exhibit C; (e) Bill of Sale for the Transferred Assets duly executed by Seller in the form attached hereto as Exhibit D; (f) A Proprietary Rights Assignment duly executed by Seller in the form attached hereto as Exhibit E; (g) Any and all consents and/or approval required in order for Seller to transfer the Transferred Assets to Purchaser and to complete the transactions contemplated by this Agreement. (h) Any other instruments that Purchaser may reasonably deem necessary or desirable to effect or evidence the transactions contemplated hereby, including, but not limited to, the following: (i) Certificate of Good Standing in Seller's jurisdiction of organization; (ii) Certificates as to the incumbency of Seller's officers; (iii)Certificate of an officer of Seller as to the representations and warranties of Seller; and (iv) Shareholder and board resolutions approving this Agreement and the transactions contemplated herein. Article VII Post-Closing Covenants 7.1 Licenses and Permits. Seller shall cooperate with Purchaser in all commercially reasonable respects in connection with Purchaser's application or the transfer, renewal, or issuance of any Permit. 7.2 Delivery of Stock Certificate. Purchaser shall cause its transfer agent to deliver a certificate representing the Share Consideration to the Escrow Agent within five (5) business days after the Closing Date. 7.3 Assistance with Preparation of Financial Statements. In the event Purchaser is required to prepare financial statements including information relating to the Transferred Assets in accordance with applicable laws, Seller shall use commercially reasonable efforts to assist Purchaser and make available such information deemed necessary by Purchaser to prepare such statements, at Purchaser's expense. 7.4 Remittance of Receipts. Any receipts collected by or paid to Seller after the Closing Date with regard to sale of Products after the Closing Date will be duly endorsed or assigned by Seller to Purchaser and promptly remitted to Purchaser in the same form as received by Seller. 7.5 Returned Goods. Seller acknowledges and agrees that the following category of goods returned by customers to Purchaser after the Closing Date shall remain the responsibility of Seller and Purchaser shall have no obligations thereby for: (i) defective goods which were sold by Seller prior to the Closing Date; and (ii) defective goods which were subsequently manufactured by Seller for Purchaser from works-in-process existing on the Closing Date. Seller shall reimburse Purchaser for any such amounts within five (5) business days upon receipt of reasonably acceptable documentation of Purchaser's costs and expenses incurred to replace such customer's returned goods. 7.6 Confidentiality. Seller will keep confidential and will not directly or indirectly disseminate, disclose, use, communicate, divulge or otherwise appropriate any of the Confidential Information (as defined below). Seller will take all steps necessary or requested by Purchaser to ensure that all of the Confidential Information is kept secret and confidential for the sole use and benefit of Purchaser. All Confidential Information will be the exclusive property of Purchaser, and Seller will promptly deliver to Purchaser all Confidential Information, including all copies thereof, which is in Seller's possession or under Seller's control, without making or retaining any copies or extracts thereof. As used in this Agreement, "Confidential Information" means the information set forth on Schedule 7.6 attached hereto. 7.7 Limited Non-Compete; Non-Solicitation. As a condition to Purchaser's willingness to enter into this Agreement and consummate the transactions contemplated herein, following the Closing Seller and its officers, directors and Affiliates shall not directly or indirectly: (a) own, manage, control, participate in, consult with, render services for, or in any manner engage in any business within the United States of America engaged in the business of manufacturing, marketing, distributing any product bearing the name Naturally Aloe(TM), Naturally Noni(TM) and Avera(R) Sport; or (b) for a period of five (5) years thereafter, (i) sell, market, or provide any same or similar product to a retail class of trade in the following categories: mass market, groceries, drugstores, clubs, convenience stores or independents, or to Costco Wholesale Corporation locations worldwide; (ii) own any portion of a private label customer that sells to the retail class of trade or a private label brand that is sold in the retail class of trade; or (iii) induce or attempt to induce Costco Wholesale Corporation or General Nutrition Centers, Inc. to cease doing business with Purchaser, or in any way interfere with the relationship Costco Wholesale Corporation or General Nutrition Centers, Inc. and Purchaser. Purchaser acknowledges and agrees that Seller is a contract manufacturer of aloe and noni juice products for private label customers. Purchaser acknowledges that Seller has no control over such private label customers or whether such private label customers may distribute such aloe and noni juice products to a retail class of trade. If, at the time of enforcement of this Section, a court holds that the restrictions stated herein are unreasonable under circumstances then existing, the Parties hereto agree that the maximum period, scope or geographical area reasonable under such circumstances shall be substituted for the stated period, scope or area. For the purposes of this Agreement, "Affiliates" means any person, firm, corporation, partnership, limited liability company, joint venture, business trust, association or other entity that now or in the future, directly or indirectly, controls, is controlled by or is under common control with Seller. For the purposes of this Agreement, "control" shall mean engage or participate in the ownership, operation or management of the foregoing, "control" shall mean, with respect to: (a) corporation, the ownership, directly or indirectly, of greater than fifty percent (50%) of the voting power to elect the directors thereof and "own" shall include any ownership by way of capital stock, partnership interests, or any other equity ownership. Any transactions with Purchaser or its Affiliates pursuant to this Agreement or pursuant to their written approval or direction shall not be deemed in violation of this Section 7.7. 7.8 Remedies. Seller acknowledges and agrees that its obligations under Section 7.6 and 7.7 above are of a special, unique and extraordinary character, that they are reasonably related to the legitimate business interests of Purchaser, and that a failure to perform any such obligation or a violation of such obligations will cause irreparable injury to Purchaser, the amount of which would be impossible to estimate or determine and for which adequate compensation could not be fashioned. Therefore, Seller agrees that Purchaser will be entitled, as a matter of right, and without the need to prove irreparable injury or to post bond, to an injunction, restraining order, writ of mandamus or other equitable relief (including specific performance) from any court of competent jurisdiction, restraining any violation or threatened violation of any term of such Section 7.6 or 7.7, or requiring compliance with or performance of any obligation thereunder, by Seller and such other persons as the court will order. The rights and remedies provided Purchaser hereunder are cumulative and will be in addition to the rights and remedies otherwise available to Purchaser under any other agreement or applicable law, including the right to require Seller to account for and pay over to Purchaser all compensation, profits, moneys, accruals, increments or other benefits derived or received as a result of any transactions constituting a breach of the covenants contained therein. 7.9 Bulk Transfer Laws. The Parties do not believe that any laws relating to bulk sales or bulk transfers (including any such laws under the Uniform Commercial Code) are applicable to any of the transactions contemplated under this Agreement. Notwithstanding the foregoing, and in order to induce Purchaser to execute this Agreement and consummate these transactions, Seller will indemnify and defend Purchaser and its Affiliates and hold them harmless (in accordance with Article VIII below) from and against any claim or other expense arising out of, resulting from or relating to, any determination of the applicability to any of the transactions of, or failure to comply with in connection with any of the transactions of, any of such laws. Article VIII Indemnification Agreement 8.1 General. From and after the Closing, the parties shall indemnify each other as provided in this Article VIII. For the purposes of this Article VIII, each party shall be deemed to have remade all of its representations and warranties contained in this Agreement at the Closing with the same effect as if originally made at the Closing. As used in this Agreement, the term "Damages" shall mean all liabilities, demands, claims, actions or causes of action, regulatory, legislative or judicial proceedings or investigations, assessments, levies, losses, fines, penalties, damages, costs and expenses, including, without limitation reasonable attorneys', accountants', investigators', and experts' fees and expenses, sustained or incurred in connection with the defense or investigation of any such claim. 8.2 Seller's Indemnification Obligations. Seller shall defend, indemnify, save and keep harmless Purchaser, its Affiliates and their respective representatives, officers, directors, shareholders, agents, employees, successors and assigns against and from all Damages sustained or incurred by any of them resulting from or arising out of: (a) any material inaccuracy in or any material breach of any representation and warranty made by Seller in this Agreement or in any closing document delivered to Purchaser in connection with this Agreement; (b) any failure by Seller to perform or observe any covenant or agreement to be performed or observed by it or on its behalf under this Agreement or under any certificates or other documents or agreements executed by Seller in connection with this Agreement; (c) any of Seller's debts, liabilities, taxes, obligations, contracts or commitments of any nature or kind whatsoever, whether existing as of the Closing or arising thereafter, known or unknown, contingent or otherwise; (d) any agreements, contracts, negotiations or other dealings by Seller or any of its shareholders with any person concerning the sale of the Transferred Assets. 8.3 Setoff. Purchaser shall have the right to set-off any amounts owed by Seller to Purchaser pursuant to this Agreement (including any amounts owed pursuant to Section 8.2) against any amounts owed by Purchaser to Seller pursuant to this Agreement or against the Share Consideration. 8.4 Valid Transfer. Notwithstanding anything to the contrary contained herein, if after the Closing Date, a claim is made challenging the validity of the sale of the Transferred Assets by Seller to Purchaser and the transactions contemplated in this Agreement and such claim is upheld or resolved by a judicial proceeding, arbitration or otherwise, during the time the Share Consideration is held in escrow, then the Parties agree that Purchaser shall have the option (the "Option") to return the Product Lines to Seller in consideration for the release of the Share Consideration from escrow and return of the such Share Consideration to Purchaser. Purchaser and Seller agree that Purchaser's exercise of the Option constitutes an election of remedies and waiver of all causes of action pertaining to representations, warranties, and indemnification obligations related to the validity of the sale of the Transferred Assets. 8.5 Purchaser's Indemnification Obligations. Purchaser shall defend, indemnify, save and keep harmless Seller, and its representatives, officers, directors, agents, employees, successors and assigns against and from all Damages sustained or incurred by any of them resulting from or arising out of or by virtue of any inaccuracy in or breach of any representation and warranty made by Purchaser in this Agreement or in any closing document delivered to Seller in connection with this Agreement. 8.6 Expiration of Indemnification /Time and Manner of Claim. Purchaser or Seller shall be indemnified only to the extent that notice of a claim therefor is asserted by the other in writing and delivered prior to the expiration of twelve (12) months from the Closing Date of this Agreement. Any notice of a claim by reason of any of the representations and warranties contained in this Agreement shall state specifically the representation or warranty with respect to which the claim is made, the facts giving rise to an alleged basis for the claim, and the amount of liability asserted against the other party by reason of the claim. Any claim made by Purchaser or Seller against the other for a default or breach of any covenant or agreement contained in this Agreement must be made by written notice which shall state specifically the covenant or agreement with respect to which the claim is made, the facts giving rise to an alleged basis for such claim and the amount of liability asserted against the other party by reason of such claim. Article IX Employee Matters 9.1 Employee Matters; Hiring of Employees. Purchaser may, in its sole discretion, offer employment as of the Closing to the following employees of Seller: Kurt Cahill, Cheryl Richitt and Bob Clark. All such employees so hired, if any, will be considered "new hires" by Purchaser, and Purchaser will establish all terms and conditions relating to their employment in its sole discretion. Purchaser shall have no obligation to any employee of Seller not hired by Purchaser. Nothing contained in this Section 9.1 shall obligate Purchaser to employ any of such employees of Seller or a Transferred Employee for any length of time and the employment of any such employees by Purchaser, if any, shall be terminable at will at any time. Article X Miscellaneous 10.1 Expenses. Each party shall be responsible and pay for its respective expenses, in connection with the authorization, preparation, execution and performance of this Agreement, including without limitation, all fees and expenses of agents, representatives, counsel, accountants and consultants. 10.2 Right to Terminate. Anything to the contrary herein notwithstanding, this Agreement and the transactions contemplated hereby may be terminated at any time prior to the Closing by: (a) the mutual written consent of Purchaser and Seller; (b) either Purchaser or Seller, if the Closing shall not have occurred at or before 11:59 p.m. on October 24, 2003; provided, however, that the right to terminate this Agreement under this Section shall not be available to any party whose failure to fulfill any material obligation under this Agreement has been the cause of or resulted in the failure of the Closing to occur on or prior to the aforesaid date; or (c) Seller, on the one hand, or by Purchaser, on the other hand, if a material breach or default shall be made by the other party in the observance or in the due and timely performance of any of the covenants or agreements contained herein. 10.3 Notices. Any notice required or permitted to be given under this Agreement shall be made in writing, and shall be effective when mailed, by registered or certified mail as follows: Purchaser: Integrated BioPharma, Inc. 225 Long Avenue Hillside, NJ 07205 Phone: (973) 926-0816 Fax: (973) 926-1735 Attn: Chief Executive Officer Copy to: St. John & Wayne, LLC Two Penn Plaza East Newark, New Jersey 07105 Phone: (973) 491-3600 Fax: (973) 491-3407 Attn: William P. Oberdorf, Esq. Seller: Aloe Commodities International, Inc. 2161 Hutton Drive, Suite 126 Carrollton, Texas 75006 Phone: (972) 241-4251 Fax: (972) 241-4376 Attn: L. Scott McKnight, President Copy to: Vial, Hamilton, Koch & Knox, L.L.P. 1700 Pacific Avenue, Suite 2800 Dallas, Texas 75201 Phone: (214) 712-4400 Fax: (214) 712-4402 Attn: Mark W. Romney, Esq. Any party may change said address by notice to the other parties in accordance with the terms hereof. 10.4 Press Releases and Announcements. Neither Party shall issue any press release or public announcement relating to the subject matter of this Agreement without the prior written consent of the other Party; provided, however, that either Party may make any public disclosure it believes in good faith is required by applicable law, regulation or national exchange rule (in which case the disclosing Party shall use reasonable efforts to advise the other Party and provide it with a copy of the proposed disclosure prior to making such disclosure). 10.5 Representations as to Compliance with Law. Whenever a representation or warranty is made herein with respect to compliance with any law, that representation means the applicable subject matter is in compliance with applicable statutes, regulations and ordinances as in existence on the date hereof and on the Closing Date and does not extend to any amendments or revisions of such laws adopted subsequent to such dates. 10.6 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns. Seller may not assign its rights, interests or obligations hereunder. 10.7 Entire Agreement; Amendment. This Agreement, including the exhibits and schedules hereto, shall constitute the entire agreement between the Parties with respect to the subject matter hereof and shall supersede all previous negotiations, commitments and writings. The Parties hereto may, by mutual consent, amend or modify and supplement this Agreement in such manner as may be agreed upon in writing. 10.8 Captions. The captions and heading contained herein are solely for convenience of reference and will not affect the interpretation of any provision hereof. 10.9 Waiver, Discharge, etc. This Agreement may not be released, discharged or modified except by an instrument in writing signed on behalf of each of the Parties. The failure of a party to enforce any provision of this Agreement shall not be deemed a waiver by such party of any other provision or subsequent breach of the same or any other obligation hereunder. 10.10 Governing Law. This Agreement shall be construed and the rights of the Parties hereunder shall be governed by laws of the State of New Jersey. Venue for any dispute regarding this Agreement shall be in a court of competent jurisdiction in Union County, New Jersey. 10.11 Counterparts and Facsimile Signatures. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one Agreement. This Agreement may be executed by facsimile signature. 10.12 Severability. Any portion of this Agreement which a court of competent jurisdiction shall determine to be void or unenforceable against public policy, or for any other reason, shall be deemed to be severable from this Agreement and shall have no effect on the other covenants or provisions in this Agreement. It is agreed that the court shall be empowered to reform and construe any provision that would otherwise be void or unenforceable in a manner that will be valid and enforceable to the maximum extent permitted by law. 10.13 Attorneys' Fees. In the event that any action or proceeding is brought in connection with this Agreement, the prevailing party therein shall be entitled to recover its costs and reasonable attorney's fees. 10.14 Further Assurances. Seller shall, and shall cause its officers, directors and Affiliates to, execute and deliver all other documents and instruments of conveyance, transfer or assignment and take all other actions reasonably requested by Purchaser at any time before or after the Closing Date to effect the sale and transfer to Purchaser of the Transferred Assets in accordance with this Agreement. Purchaser shall, and shall cause its officers, directors and Affiliates to, execute and deliver all other documents and instruments of conveyance, transfer or assignment and take all other actions reasonably requested by Seller at any time before or after the Closing Date to effect the sale and transfer to Seller of the Cash Consideration and the Share Consideration in accordance with this Agreement. [signature page follows] IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement as of the 22nd day of October, 2003. Seller: Aloe Commodities International, Inc. By: /s/ L. Scott McKnight - ------------------------- L. Scott McKnight, Chairman & CEO Purchaser: Integrated BioPharma, Inc. By: /s/ E. Gerald Kay - --------------------- E. Gerald Kay, Chief Executive Officer And with respect to the provisions of Section 7.7 only: /s/ L. Scott McKnight - --------------------- L. Scott McKnight /s/ Mark McKnight - ----------------- Mark McKnight /s/ Fred Lauderbach - ------------------- Fred Lauderbach /s/ Jennifer M. Larsen - ---------------------- Jennifer M. Larsen Exhibit A. Escrow Agreement (to be attached) Exhibit B. Registration Rights Agreement (to be attached) Exhibit C. Conversion and Supply Agreement (to be attached) Exhibit D. Bill of Sale (to be attached) Exhibit E. Proprietary Rights Agreement (to be attached) Schedules (to be attached) -----END PRIVACY-ENHANCED MESSAGE-----