EXHIBIT 10(e)
ADDENDUM TO AGREEMENT FOR PURCHASE OF COMMON STOCK
This Addendum hereby modifies, amends and supplements the Agreement for
Purchase of Common Stock (hereinafter referred to as "Purchase Agreement")
made as of the 1st day of April, 1998, by and between Xxxxxxx XxXxxxx, Xxxxxxx
X. XxXxxxx, Tech Technology Services, LLC, Xxxxxx XxXxxxx 1998 Trust and McClere
Family Trust, (hereinafter collectively referred to as "Sellers") and
Southeast Tire Recycling, Inc. (hereinafter referred to as "Buyer" or
"Southeast").
RECITALS
Whereas, since the date that the Sellers and Buyer entered into the
Purchase Agreement, the Sellers have conducted a due diligence examination into
the assets and liabilities, including known and unknown claims, undisputed and
contingent claims, of the Buyer; and,
Whereas, such examination has indicated that Buyer may have contingent
liabilities, including and potential claims, whether asserted or unasserted,
which may be in excess of the assets presently possessed by the Buyer; and,
Whereas, Buyer and certain of its present Shareholders have agreed to
provide a mechanism for the administration, handling and distribution by an
Escrow Agent of One Hundred Thousand (100,000) shares of Southeast Tire
Recycling, Inc., stock to use as the Escrow Agent sees fit in order to pay,
satisfy, defend, compromise, negotiate and/or settle the Debts of Southeast Tire
Recycling, Inc., whether known, or unknown; liquidated or unliquidated; just or
unjust; or disputed or undisputed which exist or which arose against the
Corporation as of the date of Closing. Such shares of stock, or the proceeds
thereof, are sometimes referred to hereinafter as the "Subject matter of the
Shareholders' Escrow Agreement" or the "Escrow Fund"; and,
Whereas, the Buyer has offered to Sellers as an inducement to consummate
the Purchase Agreement and to provide additional funds in the event that the
Seller needs them for its continued growth and development, warrants to purchase
additional common stock of the Seller, as set forth below: and
Whereas, certain of Buyer's present Shareholders have agreed to indemnify
the Buyer from any debt, liability or obligation of any nature, whether accrued,
absolute, contingent or otherwise, and whether due or to become due, in order
for the Buyer to comply with the provisions of Section 3.05 of the Purchase
Agreement.
Whereas, the Sellers have agreed that they will consummate the Purchase set
forth in Purchase Agreement subject to the provisions, agreements and conditions
set forth herein;
Now, therefore, in consideration of the mutual promises and agreements set
forth herein and in the Purchase Agreement, the Parties hereto agree as follows:
AGREEMENT
1. The Parties hereby adopt and agree to the Recitals set forth above.
2. The Buyer shall deliver to Sellers at closing hereof, executed
counterpart originals of the documents attached hereto, if not exactly the same
as attached hereto, then substantially similar in form and substance thereto,
subject to approval of Sellers' Counsel:
a. Cancellation Agreement and Release (Mutual Release of All Claims)
between National Tire Recycling, Inc., and Seller; and,
b. Shareholders' Escrow Agreement; and,
c. Indemnity Agreement; and,
d. Release of all claims against Buyer executed by Reco Tricote,
Inc., the Lessor of the real property (hereinafter referred to as the
"Site") located in Mulberry, Florida. Reco Tricote, Inc., claims that
Buyer owes it $86,481.80 as of March 31, 1998 including land rental and
trailer rental and ad valorem property taxes, although there is no written
or verbal agreement between Lessor and Buyer.
1
e. Release of that certain Promissory Note in the original principal
sum of Forty-One Thousand Dollars and No Cents ($41,000.00) executed by the
Buyer payable to the order of National Tire Recycling, Inc.
f. Release of that certain Promissory Note in the original principal sum of
Fourteen Thousand Five Hundred Seventy-Eight Dollars and No Cents ($14,578.00)
executed by the Buyer payable to the order
of ____________________________________.
g. Release of that certain Promissory Note in the original principal sum of Ten
Thousand Six Hundred Twenty-Five Dollars and No Cents ($10,625.00), executed by
the buyer payable to the order
of ____________________________________.
h. One Thousand (1000) Certificates for Class A Warrants, each certificate
providing for the purchase of up to One Thousand (1000) shares of authorized
common stock of Southeast Tire Recycling, Inc., a Florida Business Corporation,
having a par value of $0.0001 per share, which Warrants shall provide for an
exercise price of Three Dollars and No Cents ($3.00) per common share and shall
expire on or before five (5) years from the date of Closing. Each Class A
Warrant shall provide that they shall be cancelable at the sole discretion of
Southeast on or before thirty days after written notice upon payment of a
cancellation price of One Dollar and No Cents ($1.00) per share. Each such Class
A Warrant shall be subject to the terms, conditions and provisions of the Stock
Warrant Plan attached hereto. Each Seller shall receive One Hundred Class A
Warrants for each Millennium Common Share appearing opposite the Seller's name
on Exhibit "A" to the Purchase Agreement.
i. One Thousand (1000) Certificates for Class B Warrants, each certificate
providing for the purchase of up to One Thousand (1000) shares of the authorized
common stock of Southeast Tire Recycling, Inc., a Florida Business Corporation,
having a par value of $0.0001 per share, which Warrants shall provide for an
exercise price of Six Dollars and No Cents ($6.00) per common share and shall
expire on or before ten (10) years from the date of Closing. Each Class B
Warrant shall provide that they shall be cancelable at the sole discretion of
Southeast on or before thirty days after written notice upon payment of a
cancellation price of One Dollar and 20 Cents ($1.20) per share. Each such Class
B Warrant shall be subject to the terms, conditions and provisions of the Stock
Warrant Plan attached hereto. Each Seller shall receive One Hundred Class B
Warrants for each Millennium Common Share appearing opposite the Seller's name
on Exhibit "A" to the Purchase Agreement.
3. To compensate Sellers for their costs and expenses, including unforseen
attorneys' fees and accountants fees and travel costs, necessarily incurred to
conduct and complete their due diligence investigation and to assure themselves
of the debts and liabilities of Buyer, Buyer agrees to reimburse Sellers for
such fees and costs incurred by Sellers from and after April 19, 1998.
4. All documents shall be subject to the approval by Counsel for the Buyer
and Sellers.
5. Arbitration.
A. BINDING ARBITRATION. Any dispute, controversy or claim (including any
claim based on or arising out of an alleged tort) between Sellers and the Buyer,
including but not limited to, (i) those arising out of or relating to the
Purchase Agreement or any document or other agreement made in connection with or
with reference to this Agreement [including any settlement or compromise;
promissory note or security agreement signed pursuant to this Agreement]
(collectively, the "CONTRACT DOCUMENTS") and (ii) those in connection with or
pertaining to the Assets or Properties of any Party hereto, shall be determined
by binding Arbitration in accordance with the Federal Arbitration Act ("FAA")
and the rules for the Arbitration of commercial disputes of the American
Arbitration Association (the "AAA RULES"), and the "Special Rules" set forth
in Section B of this Agreement. The law of the State of Texas shall be
applicable as to all substantive matters. In the event of any conflict between
Texas substantive law and the Special Rules, or between the FAA or AAA Rules and
the Special Rules, the Special Rules shall control. In the event of any conflict
between the FAA or AAA Rules, the FAA Rules shall control. Judgment upon any
Arbitration award may be entered in any court having jurisdiction. Any person
bound by this agreement to Arbitrate
2
may bring an action, including a summary or expedited proceeding, to compel
Arbitration of any controversy or claim to which this Section applies in any
court having jurisdiction over such action.
B. SPECIAL RULES. All Arbitrations shall be conducted in the City of
Houston, Xxxxxx County, Texas and shall be administered by the American
Arbitration Association ("AAA") who will administer the process of appointing
three Arbitrators, at least one of which shall be a licensed attorney with at
least five (5) years judicial experience, or equivalent experience as a trial
attorney, to preside over any claim or controversy submitted to Arbitration. All
Arbitration hearings will be commenced within One Hundred Twenty (120) days
after the written demand for Arbitration; the Arbitrators may, upon a showing of
cause, extend the commencement of such hearing for up to an additional Ninety
(90) days.
C. RESERVATION OF RIGHTS. Nothing in this Section C or in any of the
provisions of this Agreement or the other Contract Documents pertaining to
Arbitration shall be deemed to (i) limit the applicability of any statutes of
limitation on or repose or any waivers contained in this Agreement or any other
Contract Document, (ii) limit Escrow Agent's rights, powers and authority to
continue in office handling matters within the provisions of this Shareholders'
Escrow Agreement, and (iii) limit the right to obtain provisional or ancillary
remedies from a court of law, such as (but not limited to) injunctive relief or
the appointment of a receiver, provided, however, the right to pursue a remedy
referred to in clauses (i, ii or iii) preceding shall not apply to the extent
the right to pursue such remedy itself is the subject of an Arbitration
proceeding. A party may obtain such provisional or ancillary remedies before,
during or after the pendency of any Arbitration proceeding brought pursuant to
this Agreement or any Contract Document. Neither the exercise of self-help
remedies nor the institution and/or maintenance of an action seeking provisional
or ancillary remedy shall constitute a waiver of the right of any party,
including the claimant in any such action, to Arbitrate the merits of the
controversy or claim occasioning resort to such remedies.
D. ATTORNEYS FEES. In the event of a dispute or breach or default of the
Purchase Agreement or any Contract Document which result in the commencement of
judicial litigation or commercial Arbitration, the successful party shall be
entitled to receive from the unsuccessful party, any and all reasonable
attorneys fees, court costs and expenses incurred in determination of the
dispute or breach or default, including recovery of any Arbitrators' fees or
costs.
E. SURVIVAL. The provisions of this Article shall survive the closing
under the Purchase Agreement, and shall be incorporated (either specifically or
by reference) in each Contract Document.
F. BINDING EFFECT. This Article and the terms, provisions and conditions
hereof, shall be binding upon and shall inure to the benefit of the parties,
their respective legal representatives, heirs, successors and assigns; provided,
however, that nothing contained herein shall negate or diminish the restrictions
set forth in this Article. This Article shall not be for the benefit of any
third party who is not a signatory hereof or assignee by written instrument.
6. ENTIRE AGREEMENT. The Purchase Agreement and this Addendum to
Agreement for Purchase of Common Stock contain the entire agreement between the
parties hereto relating to the subject matter hereof and all prior agreements
relative hereto which are not contained herein are terminated, cancelled and
superseded. THIS WRITTEN AGREEMENT AND ALL DOCUMENTS EXECUTED IN CONNECTION
HEREWITH OR CONTEMPLATED HEREBY REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
3
7. Except as modified above, the Purchase Agreement shall remain in full
force and effect.
AGREED AND ACCEPTED AS OF APRIL 24, 1998.
For SELLERS: SOUTHEAST RECYCLING, INC.
By:
Xxxxxxx X. XxXxxxx, Individually Its Authorized Officer and Agent
and as Designated Agent for Sellers:
Xxxxxxx XxXxxxx; Tech Technology Services, LLC; Xxxxxx XxXxxxx 1998 Trust;
McClere Family Trust
MILLENNIUM INTEGRATION TECHNOLOGIES, INC.
By: ____________________________________
Its Authorized Officer and Agent
4
