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LOCH -- Loch Harris, Inc.
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LOCH HARRIS INC - Asset Purchase Agreement with CDEX
Vancouver, BC, Aug 13, 2001 (Market News Publishing via COMTEX) -- Loch Harris Inc., a Nevada corporation and
CDEX-Inc., a Nevada corporation (CDEX) are pleased to announce the finalization and execution of an Asset Purchase
Agreement (Agreement) on Aug. 4, 2001.
Under the Agreement, Loch transferred to CDEX all its ownership (including revenue interests) in certain assets and
technologies, including its chemical and explosives detection technologies. Loch warranted to CDEX that its ownership
interests in the assets and technologies would be unencumbered by competing claims and debts against ownership,
including those associated with Coldwater Capital LLC, and potential claims to ownership and royalties related to the
previous funding provided by it to Loch for development of the technologies. In exchange, CDEX agreed to issue at
Loch's direction 69,350,000 shares of the approximately 80,000,000 shares of CDEX common stock that is anticipated to
be issued per events surrounding this Agreement.
Of the 69,350,000 CDEX shares issued at Loch's direction, based upon the number of Loch shares currently outstanding,
it is anticipated that approximately 48,000,000 CDEX shares will be distributed directly to holders of Loch stock (one
share of CDEX stock will be distributed for every ten shares of Loch stock owned as of the record date). The record date
for Loch stock ownership determination is to be announced in the near future. These shares of CDEX stock to be
distributed to Loch shareholders are currently being retained by Loch until distribution.
In addition, it is anticipated that approximately 13,000,000 shares of CDEX stock will be retained as part of Loch's assets.
The final 8,350,000 shares were issued at Loch's direction to resolve any obligations, loans, or royalties, which could result
in potential claims of parties against the assets or technologies transferred. These obligations, loans, and potential claims
include those of Coldwater Capital LLC, Rodney Boone and Mark Baker, both of whom are officers and directors of
Loch, and who have rendered services and made, guaranteed and/or pledged collateral for loans to or on behalf of Loch in
connection with the assets and technologies.
Of the remaining approximately 10,650,000 shares of CDEX that were or may be issued pursuant to events surrounding
this Agreement, 7,200,000 have been issued to or at the direction of the six member operating team of CDEX, including
Malcolm H. Philips, Jr., Timothy D. Shriver and Dr. Wade Poteet. In addition, 1,850,000 shares were issued to
consultants of CDEX, including 500,000 and 750,000 shares to secure the services of Baker and Boone, respectively, for
transition and consulting services to CDEX.
It should be noted that all shares issued to the CDEX Operating Team and to CDEX consultants, have stock repayment
provisions in the event that certain types of termination of services occurs prior to the scheduled end of the respective
contracts. Finally, consideration is being given to issuing 1,600,000 shares of CDEX to procure additional funding for
CDEX.
In accordance with the Agreement, the voting rights of shares received by any officer or director of Loch as a result of the
Agreement, as well as the voting rights to the 13,000,000 shares currently anticipated to be retained by Loch after the
distribution, have been assigned by proxy to the CDEX Board of Directors.
In addition, the voting rights of shares currently intended for distribution to Loch shareholders (approximately
48,000,000) will be assigned by proxy to the CDEX Board of Directors, if such distribution has not occurred by Oct. 1,
2001. The proxies on all the foregoing shares will lapse upon the transfer of the respective shares to a party not controlled
by Loch or Loch's officers or directors.
Loch anticipates that the shares retained by it will be used in connection with addressing general corporate purposes. As
previously announced, Loch believes the transfer of the technology to CDEX and anticipated spin-off of CDEX shares is
in accordance with its long-range objectives.
In addition, on Aug. 4, 2001, new management (completely separate from Loch's management) assumed control of all
CDEX operations. As previously reported, the new management consists of Malcolm H. Philips, Jr., president and CEO
and Timothy D. Shriver, senior vice president of operations (biographical summaries, as well as other information
regarding CDEX are contained on the CDEX Web site located at www.CDEX-Inc.com). The new CDEX Board consists
of Malcolm H. Philips, Jr., Chairman and George E. Dials.
"We now have agreements with each member of the CDEX operations team, including Dr. Wade Poteet," commented
Philips. "It is time for CDEX to focus on developing the technologies into marketable products and marketable products
into revenue. CDEX remains a very speculative, high-risk venture, and there is no assurance that we can obtain our
objectives. If we are successful, however, we believe that this will fuel interest in the technology and create the opportunity
of beneficial partnering relationships."
Loch will be filing a Form 8-K with the Securities and Exchange Commission soon regarding the Agreement and any
statements made herein regarding the Agreement, which are merely summaries, are qualified in their entirety by reference
to the Form 8-K and the Agreement.
Loch has moved its corporate offices to 8303 N. Mopac, Suite A-101, Austin, Texas 78759. Its telephone number remains
the same: 512/328-7808. Forward-looking statements made herein are based on current expectations of Loch and CDEX
and involve a number of significant risks and uncertainties and should not be considered as guarantees or assurances of
future performance. The factors that could cause actual results to differ materially include, but are not limited to:
interruptions, breach or cancellation of existing contracts, impact of competitive products and pricing, product demand and
market acceptance risks, the presence of competitors with greater financial or other resources than Loch or CDEX, product
development and commercialization risks, an inability to arrange additional debt or equity financing or to retain or procure
necessary personnel and an inability to obtain necessary governmental or other approvals for proposed or anticipated
transactions. |
