SEPARATION, TRANSFER AND DISTRIBUTION AGREEMENT
This
Separation, Transfer and Distribution Agreement (this "Agreement")
is
made and entered into effective as of June
11, 2004 ("Effective Date") among
BioFarm, Inc., a Nevada corporation
("BIOF"), Ocwen Corp., a Nevada corporation
("Ocwen") and Herbert McDonald, David R.
Stith and Allan Esrine (collectively,
the "Trustees") with reference to the
material facts set forth in the Recitals
below.
RECITALS
A. The
Boards of Directors of each of BIOF and Ocwen have determined
that
it is appropriate and desirable for BIOF to
contribute and transfer to Ocwen,
and for Ocwen to receive and assume,
directly or indirectly, substantially all
of the assets and liabilities of BIOF (the
"Separation");
B. BIOF
has previously caused Ocwen to be incorporated and BIOF
currently
owns all of the issued and outstanding
capital stock of Ocwen;
C. The
Board of Directors of BIOF has determined that it is
appropriate
and desirable on the terms and conditions
contemplated hereby to transfer to the
Trustees all of the shares of Ocwen Common
Stock (the "Ocwen Shares") held by
BIOF (the "Transfer") to hold for the
benefit of the holders of BIOF Common
Stock pursuant to the Trust Agreement
attached hereto as EXHIBIT A (the "Trust
Agreement");
D. The
Board of Directors of BIOF intends that the Ocwen Shares shall
be
distributed by the Trustees to the
stockholders of BIOF as a dividend;
E. The
Trustees have agreed to hold the Ocwen Shares pursuant to the
terms
of the Trust Agreement and distribute the
Ocwen Shares to the shareholders of
BIOF (the "Distribution") or otherwise
dispose of the same.
F. BIOF
and Ocwen intend that the Separation, Transfer and Distribution
will qualify as a tax-free reorganization
under Sections 368(a)(1)(D) and 355 of
the Internal Revenue Code of 1986, as
amended (the "Code"), and that this
Agreement is intended to be, and is hereby
adopted as, a plan of reorganization
under Section 368 of the Code; and
G. The
parties intend in this Agreement, including the exhibits hereto,
to
set forth the principal arrangements
between them regarding the Separation.
NOW,
THEREFORE, for and in consideration of the foregoing, the
premises
and the mutual covenants contained herein,
and for other good and valuable
consideration, the receipt, adequacy and
legal sufficiency of which are hereby
acknowledged, the parties hereto, intending
to be legally bound, agree as
follows:
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ARTICLE I.
SEPARATION
1.1.
Separation Date. The effective time and date of each transfer
of
property, assumption of liability, license,
undertaking, or agreement in
connection with the Separation shall be
June 11, 2004 or such other date as may
be fixed by the Board of Directors of BIOF
(the "Separation Date").
1.2.
Closing of Transactions. The closing of the Separation shall occur
by
the lodging of each of the executed
instruments of transfer, assumptions of
liability, undertakings, agreements,
instruments or other documents described in
Article II hereof at the offices of BIOF.
Provided that all such documents are
delivered on or before the Separation Date,
the Separation and the related
transactions shall deemed to have occurred
on the Separation Date.
ARTICLE II.
DOCUMENTS AND ITEMS TO BE DELIVERED ON OR BEFORE
THE SEPARATION DATE
2.1 Documents to be
Delivered by BIOF. On or before the Separation Date,
BIOF will deliver to Ocwen all of the
following items and agreements:
(a) A duly executed General Assignment and Assumption Agreement
(the
"Assignment Agreement") substantially in
the form attached hereto as EXHIBIT B;
(b) Stock certificates representing all of the outstanding shares
of
Underwater Technics, Inc., and any other
subsidiary of BIOF (whether or not
active) and all shares of Artwork and
Beyond, Inc. owned by BIOF duly endorsed
to transfer the shares represented by such
certificate(s) to Ocwen;
(c) $149,000 principal amount of subscription receivables (the
proceeds of which shall be used to pay the
liabilities assumed by Ocwen); and,
(c) Such other agreements, documents or instruments as the
parties
may agree are necessary or desirable in
order to achieve the purposes hereof.
2.2
Documents To Be Delivered By Ocwen. As of the Separation Date,
Ocwen
will deliver to BIOF all of the
following:
(a) A duly executed Assignment Agreement; and,
(b) Such other agreements, documents or instruments as the
parties
may agree are necessary or desirable in
order to achieve the purposes hereof.
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<PAGE>
ARTICLE III.
THE TRANSFER AND DISTRIBUTION
3.1 The
Transfer. As soon as practicable after the Separation Date and
subject to Section 3.2 hereof, the parties
shall effect the Transfer by taking
the following actions:
(a) BIOF, Ocwen and each of the Trustees will deliver to each
other
duly executed Trust Agreements; and,
(b) BIOF will deliver to the Trustees a stock certificate or
certificate(s) representing all of the
outstanding shares of capital stock of
Ocwen owned by BIOF duly endorsed to the
Trustees to hold pursuant to the terms
of the Trust Agreement.
3.2
Conditions to Transfer. The obligations of the parties to
consummate
the Transfer shall be conditioned on the
satisfaction of the following
conditions:
(a) Government Approvals. Any governmental approvals and
consents
necessary to consummate the Transfer shall
have been obtained and be in full
force and effect;
(b) No Legal Restraints. No order, injunction or decree issued
by
any court or agency of competent
jurisdiction or other legal restraint or
prohibition preventing the consummation of
the Transfer or any of the other
transactions contemplated by this Agreement
shall be in effect;
(c) Compliance with Laws. The Transfer shall not violate any
applicable law, regulation or statute,
including, without limitation, the
securities laws of any jurisdiction;
(d) Separation. The Separation shall have become effective as
described in Articles I and II hereof;
(e) Other Actions. Such other actions as the parties hereto
may,
based upon the advice of counsel,
reasonably request to be taken prior to the
Transfer in order to assure the successful
completion of the Transfer shall have
been taken; and,
(f) No Termination. This Agreement shall not have been
terminated.
3.3
Actions in Connection with the Distribution. Consistent with
the
provisions of the 1933 Act, BIOF and Ocwen
will take all necessary and
appropriate actions to prepare for the
Distribution including, without
limitation:
(a) BIOF shall declare a dividend with respect to its issued
and
outstanding shares of Common Stock
entitling the holders of record of such
shares to receive a pro-rata distribution
(based on their ownership of BIOF's
outstanding Common Stock) of the Ocwen
Shares held by the Trustees subject to
the terms of the Trust Agreement;
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<PAGE>
(b) BIOF shall ensure that such declaration shall be made in
accordance with all applicable corporate
and securities laws, and shall make all
required or appropriate filings with and
notifications to the United States
Securities and Exchange Commission and any
exchange or bulletin board on which
shares of BIOF's Common Stock is traded;
and,
(c) BIOF and Ocwen shall take all reasonable steps necessary
and
appropriate to cause the conditions set
forth in Section 3.2 to be satisfied.
ARTICLE IV.
COVENANTS AND OTHER MATTERS
4.1 Other
Agreements. In addition to the specific agreements, documents
and instruments that are Exhibits to this
Agreement, BIOF and Ocwen agree to
execute or cause to be executed by the
appropriate parties and deliver, as
appropriate, such other agreements,
instruments and other documents as may be
necessary or desirable in order to effect
the purposes of this Agreement and the
agreements included as exhibits hereto.
4.2
Further Instruments.
(a) At the request of Ocwen and without further consideration,
BIOF
will execute and deliver, to Ocwen such
other instruments of transfer,
conveyance, assignment, substitution and
confirmation and take such action as
Ocwen may reasonably deem necessary or
desirable in order to more effectively
transfer, convey and assign to Ocwen and to
confirm Ocwen's title to all of the
assets, rights and other things of value
contemplated to be transferred to Ocwen
pursuant to this Agreement and the
agreements attached as exhibits hereto, to
put Ocwen in actual possession and
operating control thereof, and to permit
Ocwen to exercise all rights with respect
thereto (including, without
limitation, rights under contracts and
other arrangements as to which the
consent of any third party to the transfer
thereof shall not have previously
been obtained).
(b) At the request of BIOF and without further consideration,
Ocwen
will execute and deliver, to BIOF all
instruments, assumptions, novations,
undertakings, substitutions or other
documents and take such other action as
BIOF may reasonably deem necessary or
desirable in order to have Ocwen fully and
unconditionally assume and discharge the
liabilities contemplated to be assumed
by Ocwen under this Agreement or the
exhibits hereto, and to relieve BIOF and
its affiliates, directors, officers,
agents, employees and representatives of
any liability or obligation with respect
thereto and evidence the same to third
parties.
(c) Each party, at the request of another party hereto, shall
execute and deliver such other instruments
and do and perform such other acts
and things as may be necessary or desirable
for effecting completely the
consummation of the transactions
contemplated hereby.
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<PAGE>
(d) Neither BIOF nor Ocwen shall be obligated, in connection
with
their respective obligations, to deliver
further documents or, to expend money
other than reasonable out-of-pocket
expenses, attorneys' fees and recording or
similar fees.
4.3
Agreement for Exchange of Information. Each of BIOF and Ocwen
agrees
to provide, or cause to be provided, to
each other, at any time before or after
the Separation Date, as soon as reasonably
practicable after written request
therefor, any information in the possession
or under the control of such party
that the requesting party reasonably needs
(i) to comply with reporting,
disclosure, filing or other requirements
imposed on the requesting party
(including under applicable securities
laws) by a governmental authority having
jurisdiction
