EXHIBIT 2 (f)
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of October 20, 1997, by and between
RPM Incorporated, a Delaware corporation (the "Company"), The Tirex Corporation,
a Delaware corporation (the "Tirex"), and Tirex Sub, Inc., a Delaware
corporation ("T-Sub" or the "Purchaser").
WHEREAS, the Boards of Directors of the Purchaser, Tirex and the Company
have each determined that it is in the best interests of their respective
stockholders for the Purchaser to acquire all of the issued and outstanding
shares of the Company upon the terms and subject to the conditions set forth
herein; and
WHEREAS, in furtherance of such acquisition, the Boards of Directors of
the Purchaser, Tirex, and the Company have each approved the merger of the
Company with and into the Purchaser in accordance with the General Corporation
Law of the State of Delaware (the "GCL") and on a tax free basis upon the terms
and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby, the
Purchaser and the Company hereby agree as follows:
ARTICLE I
THE MERGER
SECTION 1.01 The Merger. Upon the terms and subject to the conditions
hereof, and in accordance with the GCL, the Company shall be merged (the
"Merger") with and into the Purchaser as soon as practicable following the
satisfaction or waiver of the conditions set forth in Article VI hereof.
Following the Merger, the Purchaser shall continue as the surviving corporation
and the separate corporate existence of the Company shall cease.
SECTION 1.02 Effective Time. The Merger shall become effective upon filing
with the Delaware Secretary of State of a certificate of merger executed in
accordance with the relevant provisions of the GCL (the time the Merger becomes
effective being the "Effective Time").
SECTION 1.03 Effects of the Merger. The Merger shall have the effects set
forth in the GCL. Without limitation, upon the effectiveness of the Merger: (a)
the separate existence of the Company shall cease; (b) the Purchaser as the
surviving corporation shall possess all of the rights, privileges, powers,
immunities, purposes and franchises, both public and private, of each of the
Company and the Purchaser; (c) all real and personal property, tangible and
intangible, of every kind and description belonging to the Company and the
Purchaser shall be
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vested in the Purchaser as the surviving corporation without further act or
deed; (d) the Purchaser as the surviving corporation shall be liable for all the
obligations and liabilities of each of the Company and the Purchaser except that
the Company and the Purchaser shall each remain liable for and may enforce the
Merger and any claim existing or action or proceeding pending by or against
either the Company or the Purchaser as if the Merger had not taken place.
Notwithstanding the foregoing, the principal shareholders of the Company,
signatories to the indemnification agreement attached as Schedule 1.3(d) hereto,
will indemnify Tirex and the Purchaser and hold Tirex and the Purchaser, and
each of them, harmless from and against any and all losses, claims, damages.
liabilities, or obligations arising out of or in any way connected with any
activities of the Company, or by any person on behalf of the Company, prior to
the Merger which activity has not been previously disclosed to Tirex or the
Purchaser; (e) Tirex shall fully and absolutely assume all of the obligations
under the Debentures (as defined below); and (e) neither the rights of creditors
nor any liens upon or security interests in the property of either the Company
or the Purchaser shall be impaired by the Merger.
SECTION 1.04 Certificate of Incorporation and By-Laws. Without further
action by the Company or the Purchaser, the Certificate of incorporation and
By-laws of the Purchaser as in effect at the Effective Time shall continue to be
the Certificate of Incorporation and By-Laws of the Purchaser as the surviving
corporation.
SECTION 1.05 Directors. The directors of the Purchaser at the Effective
Time shall be the directors of the Purchaser as the surviving corporation until
their successors shall have been duly elected or appointed and qualified. The
directors of Tirex at the Effective Time shall be the directors of Tirex, until
their successors shall have been duly elected or appointed and qualified.
SECTION 1.06 Officers. The officers of the Purchaser at the Effective Time
shall be the officers of the Purchaser as the surviving corporation, until their
successors have been duly appointed.
SECTION 1.07 Conversion of Shares. At the Effective Time, each of the
issued and outstanding shares of Common Stock, par value $.001 of the Company
("Company Common Stock") shall, by virtue of the Merger and without any action
on the part of the holder thereof be changed by operation of law into one share
of Common Stock, par value $.001 per share of Tirex ("Tirex Common Stock").
SECTION 1.08 Shareholders' Consents. Each of the Company and T-Sub, acting
through their respective Boards of Directors, shall in accordance with
applicable law, obtain the written consent of the holders of a majority of its
issued and outstanding shares approving this Agreement and the transactions
contemplated hereby.
SECTION 1.09 Filing of Certificate of Merger. Upon the terms and subject
to the conditions hereof, as soon as practicable following the satisfaction or
waiver of the conditions set forth herein, the Company and the Purchaser shall
execute and file a Certificate
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of Merger in the manner required by the GCL and the parties hereto shall take
all such other and further actions as may be required by law to make the Merger
effective. Prior to the filings referred to in this Section, a closing (the
"Closing") will be held at the offices of Xxxxx X. Xxxxxxx, Esq., New York, New
York (or such other place as the parties may agree) for the purpose of
confirming all of the foregoing. The consummation of the Closing is hereinafter
referred to as the "Effective Time".
ARTICLE II
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The Company represents and warrants as follows to each of the Purchaser
and Tirex, that except as set forth in the Disclosure Schedule annexed hereto
(the "Company Disclosure Schedule"):
SECTION 2.01 Organization. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted, except where
the failure to be so existing and in good standing or to have such power and
authority would not in the aggregate have a material adverse effect on the
business operations or financial condition of the Company taken as a whole. The
Company is not by reason of the conduct of its business or the ownership of
property, or otherwise, required to qualify as a foreign corporation in any
jurisdiction. The Company has heretofore made available to the Purchaser
accurate and complete copies of the Certificate of Incorporation and By-laws, as
currently in effect, of the Company. The Company has no subsidiaries and is not
a party to any partnership, agency or joint venture agreement.
For purposes of this Agreement, the term "subsidiary" shall mean each
corporation or other entity in which a corporation owns or controls, directly
through one or more subsidiaries, any of the stock or other interests having
general voting power in the election of directors or persons performing similar
functions.
SECTION 2.02 Capitalization. The authorized capital stock of the Company
consists of 20,000,000 shares of Company Common Stock, par value $.0001 per
share, of which 3,000,000 shares (the "Company Shares"), were issued and
outstanding as of the date hereof and 1,000,000 shares of preferred stock, none
of which have been issued and none of which shall be issued prior to the
Closing. All of the issued and outstanding Company Shares are validly issued,
fully paid and non-assessable and free of preemptive rights. Any and all sales
of the 3,000,000 currently issued and outstanding Company shares, which were
issued prior to March 31, 1997, in transactions exempt from registration under
the Securities Act of 1933, as amended (the "Securities Act"). Except for the
Company Shares, there are no shares of capital stock of the Company issued or
outstanding or any subscriptions, options, warrants, calls, rights, convertible
securities or other agreements or commitments of any character obligating the
Company to issue,
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transfer, sell or pay any amount with respect to any of its securities. The
Company may issue up to an additional 850,000 shares in of common stock prior to
the closing in connection with the private placement described herein, which,
when issued, shall be deemed to be Company Common Stock and be converted into
shares of Tirex Common Stock at the Effective Time on a one for one basis.
SECTION 2.03 Authority Relative to this Agreement. The Company has full
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly and validly authorized by the Board of Directors of the Company and
the Shareholders of the Company and no other corporate proceedings on the part
of the Company are necessary to authorize this Agreement or to consummate the
transactions so contemplated. This Agreement has been duly and validly executed
and delivered by the Company and constitutes a valid and binding agreement of
the Company, enforceable against the Company in accordance with its terms,
subject to the provisions of any bankruptcy, insolvency, moratorium or similar
law applicable to the rights of creditors generally.
SECTION 2.04 No Violations. Except for the filing and recordation of a
Certificate of Merger as required by the GCL and any and all filings required
under applicable state or federal securities laws, in the private placement
described herein or otherwise, no filing with, and no permit, authorization,
consent or approval of, any public body or authority is necessary for the
consummation by the Company of the transactions contemplated by this Agreement,
except for filings, permits, authorizations, consents or approvals, the failure
to obtain which would not in the aggregate have a material adverse effect on the
financial condition, results of operations or business of the Company taken as a
whole or which would not prevent or delay in any material respect the
consummation of the transactions contemplated hereby. Neither the execution and
delivery of this Agreement by the Company nor the consummation by the Company of
the transactions contemplated hereby nor compliance by the Company with any
provisions hereof will (i) conflict with or result in any breach of any
provision of the Certificate of Incorporation or By-laws of the Company, (ii)
result in a violation or breach of, or constitute (with or without due notice or
lapse of time or both) a 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, license, lease, contract, agreement or
other instrument or obligation to which the Company is a party or by which it or
its properties or assets may be bound or (iii) violate any order, writ,
injunction, decree, statute, rule or regulation applicable to the Company, or
any of its properties or assets, except in the case of (ii) or (iii) for
violations, breaches or defaults which would not in the aggregate have a
material adverse effect on the financial condition, results of operations or
business of the Company and its subsidiaries taken as a whole prior to the
Merger or of the Purchaser or Tirex after the Merger and which would not prevent
or delay in any material respect the consummation of the transactions
contemplated hereby (each of such effects being referred to as a "Material
Adverse Effect," provided that, for
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the purposes of Article III hereof, the term "Material Adverse Effect" shall be
deemed to refer to the occurrence of any such event with respect to the
financial condition, results of operations or business of the Purchaser, and
further provided that, for the purposes of Article IV hereof, the term "Material
Adverse Effect" shall be deemed to refer to the occurrence of any such event
with respect to the financial condition, results of operations or business of
Tirex).
SECTION 2.05 Financial Statements. Except as set forth on the Company
Disclosure Schedule, the Company has never engaged in any business or fund
raising activities and has had no income or incurred no liabilities of any kind.
The Company Disclosure Schedule sets forth a balance sheet of the Company as at
September 30, 1997 (the "Company Balance Sheet"). September 30, 1997 shall
hereinafter sometimes be referred to as the Company Balance Sheet Date. The
Purchaser has been advised that the Company has not retained independent
accountants for the purpose of conducting any audit. In the event that the
Purchaser determines that it requires an audited financial statement of the
Company, the Purchaser shall prepare the same at its own cost and expense. The
principals of the Company shall cooperate with the Purchaser in the preparation
of the such financial statements, but shall not be required to retain any
professionals or incur any out of pocket expense in connection therewith.
SECTION 2.06 Properties.
(a) The Company's only property at the time of the Closing shall be cash
and cash equivalents as set forth below in Section 6.01(c) hereof.
(b) There is no violation of any law, regulation or ordinance relating to
the properties and assets of the Company and its subsidiaries except such
violations as would not, in the aggregate, have a Material Adverse Effect.
SECTION 2.07 No Undisclosed Liabilities. Except as set forth herein and on
the Company Disclosure Schedule, the Company has never engaged in any business
or fund raising activities and has had no income or incurred no liabilities of
any kind. The Purchaser acknowledges that it is aware that the Company and its
principal shareholders, Xx. Xxxxxx Xxxxxxxx and Xxxx Xxxxxxxxx have a Consulting
Agreement with Tirex pursuant to which it has provided business advice to Tirex
and has accrued and continues to accrue fees payable by Tirex at the rate of
$4,000 per month. There are no liabilities of the Company of any kind
whatsoever, whether accrued, contingent, absolute, determined, determinable or
otherwise, and there is no existing condition situation or set of circumstances
which could reasonably result in such a liability, other than:
(a) liabilities disclosed or provided for in the Company Balance
Sheet or in the notes thereto;
(b) liabilities arising under this Agreement; and
(c) liabilities which would not, in the aggregate, have a Material
Adverse Effect.
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SECTION 2.08 Litigation. There are no actions, suits, or proceedings
pending against, or to the knowledge of the Company, threatened against the
Company before any court or arbitrator or any governmental body, agency or
official.
SECTION 2.09 Taxes. The Company has duly filed with the appropriate
federal, state and local governments or governmental agencies, all federal,
state and local income tax returns and declarations of estimated tax and all
other material tax returns and reports required to be filed and has paid in full
when due all taxes, licenses and fees, including interest and penalties, shown
to be due thereon.
SECTION 2.10 Absence of Certain Changes. Except for activities preparatory
to the conduct of the private placement discussed herein, the Company has not
engaged in any business activity since the Balance Sheet Date and, except for
activities related to and preparatory to the conduct of the private placement
discussed herein, the Company shall not engage in any material business
activities prior to the Closing.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER
The Purchaser represents and warrants as follows to the Company, except as
set forth in the Disclosure Schedule annexed hereto (the "Purchaser Disclosure
Schedule"):
SECTION 3.01 Organization. The Purchaser is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted, except where
the failure to be so existing and in good standing or to have such power and
authority would not in the aggregate have a material adverse effect on the
business operations or financial condition of the Purchaser taken as a whole.
The Purchaser is not by reason of the conduct of its business or the ownership
of property, or otherwise, required to qualify as a foreign corporation in any
jurisdiction. The Purchaser has heretofore made available to the Purchaser
accurate and complete copies of the Certificate of Incorporation and By-laws, as
currently in effect, of the Purchaser. The Purchaser has no subsidiaries and is
not a party to any partnership, agency or joint venture agreement.
For purposes of this Agreement, the term "subsidiary" shall mean each
corporation or other entity in which a corporation owns or controls, directly
through one or more subsidiaries, any of the stock or other interests having
general voting power in the election of directors or persons performing similar
functions.
SECTION 3.02 Capitalization. The authorized capital stock of the Purchaser
consists of 1,000 shares of Purchaser Common Stock, par value $.0001 per share,
of which 100 shares (the "Purchaser Shares"), were issued and outstanding as of
the date hereof. All of the
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issued and outstanding Purchaser Shares are owned by Tirex and are validly
issued, fully paid and non-assessable and free of preemptive rights. Except for
the Purchaser Shares, there are no shares of capital stock of the Purchaser
issued or outstanding or any subscriptions, options, warrants, calls, rights,
convertible securities or other agreements or commitments of any character
obligating the Purchaser to issue, transfer, sell or pay any amount with respect
to any of its securities.
SECTION 3.03 Authority Relative to this Agreement. The Purchaser has full
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly and validly authorized by the Board of Directors of the Purchaser and
the shareholders of the Purchaser and no other corporate proceedings on the part
of the Purchaser are necessary to authorize this Agreement or to consummate the
transactions so contemplated. This Agreement has been duly and validly executed
and delivered by the Purchaser and constitutes a valid and binding agreement of
the Purchaser, enforceable against the Purchaser in accordance with its terms,
subject to the provisions of any bankruptcy, insolvency, moratorium or similar
law applicable to the rights of creditors generally.
SECTION 3.04 No Violations. Except for the filing and recordation of a
Certificate of Merger as required by the GCL, no filing with, and no permit,
authorization, consent or approval of, any public body or authority is necessary
for the consummation by the Purchaser of the transactions contemplated by this
Agreement, except for filings, permits, authorizations, consents or approvals,
the failure to obtain which would not in the aggregate have a material adverse
effect on the financial condition, results of operations or business of the
Purchaser taken as a whole or which would not prevent or delay in any material
respect the consummation of the transactions contemplated hereby. Neither the
execution and delivery of this Agreement by the Purchaser nor the consummation
by the Purchaser of the transactions contemplated hereby nor compliance by the
Purchaser with any provisions hereof will (i) conflict with or result in any
breach of any provision of the Certificate of Incorporation or By-laws of the
Purchaser, (ii) result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a 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, license, lease,
contract, agreement or other instrument or obligation to which the Purchaser is
a party or by which it or its properties or assets may be bound or (iii) violate
any order, writ, injunction, decree, statute, rule or regulation applicable to
the Purchaser, or any of its properties or assets, except in the case of (ii) or
(iii) for violations, breaches or defaults which would not in the aggregate have
a material adverse effect on the financial condition, results of operations or
business of the Purchaser and its subsidiaries taken as a whole and which would
not prevent or delay in any material respect the consummation of the
transactions contemplated hereby (each of such effects being referred to as a
"Material Adverse Effect," provided that, for the purposes of Article III
hereof, the term "Material Adverse Effect" shall be deemed to refer to the
occurrence of any such event with respect to the financial condition, results of
operations or business of the Purchaser).
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SECTION 3.05 Financial Statements. The Purchaser Disclosure Schedule sets
forth a balance sheet of the Purchaser as at November 15, 1997 (the "Purchaser
Balance Sheet"). November 15, 1997 shall hereinafter sometimes be referred to as
the Purchaser Balance Sheet Date. The Company has been advised that the
Purchaser has not retained independent accountants for the purpose of conducting
any audit.
SECTION 3.06 Properties.
(a) As of the date hereof, the Purchaser does not, and as at the
date of the Closing, the Purchaser will not have assets of any kind
whatsoever, except for those which the Purchaser will acquire through the
Merger.
(b) There is no violation of any law, regulation or ordinance
relating to the properties and assets of the Purchaser and its
subsidiaries except such violations as would not, in the aggregate, have a
Material Adverse Effect.
SECTION 3.07 No Undisclosed Liabilities. There are no liabilities of the
Purchaser of any kind whatsoever, whether accrued, contingent, absolute,
determined, determinable or otherwise, and there is no existing condition
situation or set of circumstances which could reasonably result in such a
liability, other than:
(a) liabilities disclosed or provided for in the Purchaser Balance
Sheet or in the notes thereto;
(b) liabilities arising under this Agreement; and
(c) liabilities which would not, in the aggregate, have a Material
Adverse Effect.
SECTION 3.08 Litigation. There are no actions, suits, or proceedings
pending against, or to the knowledge of the Purchaser, threatened against the
Purchaser before any court or arbitrator or any governmental body, agency or
official. None of such matters disclosed in the Purchaser Disclosure Schedule
have a reasonable likelihood of having a Material Adverse Effect.
SECTION 3.09 Taxes. The Purchaser has duly filed with the appropriate
federal, state and local governments or governmental agencies, all federal,
state and local income tax returns and declarations of estimated tax and all
other material tax returns and reports required to be filed and has paid in full
when due all taxes, licenses and fees, including interest and penalties, shown
to be due thereon.
SECTION 3.10 Absence of Certain Changes. Except for activities preparatory
to the Merger, the Purchaser has not engaged in any business activity since the
Balance Sheet
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Date and, except for activities related to and preparatory to the Merger, the
Purchaser shall not engage in any material business activities prior to the
Closing.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF TIREX
Tirex represents and warrants to the Company as follows, except as set
forth in the Disclosure Schedule annexed hereto (the "Purchaser Disclosure
Schedule"):
SECTION 4.01 Organization. Tirex is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
all requisite corporate power and authority to own, lease and operate its
properties and to carry on its business as now being conducted, except where the
failure to be so organized, existing and in good standing or to have such power
or authority would not have a Material Adverse Effect. The Disclosure Schedule
sets forth the names and jurisdictions of incorporation of each subsidiary of
Tirex. Tirex has heretofore made available to the Company complete and correct
copies of its Certificate of Incorporation and By-laws, as in effect on the date
hereof.
SECTION 4.02 Authority Relative to this Agreement. Tirex has full
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The Company's Board of
Directors has authorized the transactions contemplated herein and have
determined that the transactions contemplated herein are in the best interests
of Tirex and its Shareholders. No other corporate proceedings on the part of
Tirex are necessary to authorize this Agreement or to consummate the
transactions so contemplated. Subject to the approval of Tirex' shareholders,
this Agreement has been duly and validly executed and delivered by Tirex and
constitutes a valid and binding agreement of Tirex, enforceable in accordance
with its terms, subject to the provision of any applicable bankruptcy,
insolvency, moratorium or similar law affecting creditors' rights generally.
SECTION 4.03 No Violations. Except for applicable requirements of the
Securities Exchange Act of 1934 (the "Exchange Act"), the Securities Act of 1933
(the "Securities Act") and the filing and recordation of a Certificate of Merger
as required by the GCL, no filing with, and no permit, authorization, consent or
approval of, any public body or authority is necessary for the consummation by
Tirex of the transactions contemplated by this Agreement, except for filings,
permits, authorizations, consents or approvals, the failure to obtain which
would not have a Material Adverse Effect. Neither the execution and delivery of
this Agreement by Tirex nor the consummation by Tirex of the transactions
contemplated hereby nor compliance by it with any of the provisions hereof will
(i) conflict with or result in any breach of any provision of its Certificate of
Incorporation or By-laws, (ii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default or give rise to
any right to termination, cancellation or acceleration under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
contract, agreement or other instrument or
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obligation to which it is a party or by which it or any of its properties or
assets may be bound or (iii) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to it or any of its properties or assets,
except in the case of (ii) and (iii) for violations, breaches or defaults which
are not in the aggregate material to the business, operations or financial
condition of Tirex and which would not prevent or delay in any material respect
the transactions contemplated hereby.
SECTION 4.04 Financial Statements. The Tirex Disclosure Schedule
incorporates by reference Tirex' Form 10-KSB (the "10-KSB") for the year ended
June 30, 1997 and the balance sheets of Tirex as at June 30, 1996 and June 30,
1997 (Tirex Balance Sheet"), together with statements of results of operations
and cash flows for the three fiscal years ended June 30, 1997 and the report of
Nevoso, Pivirotto, Xxxxxxx & Xxxxxx, LLC, certified public accountants, thereon
all of which are included in the 10-KSB as well as any and all subsequent
Exchange Act filings made by Tirex. June 30, 1997 is hereinafter referred to as
the "Tirex Balance Sheet Date." Each of the balance sheets (including the
related notes) included in Tirex Disclosure Schedule fairly presents the
consolidated financial position of Tirex as at of the respective dates thereof,
and the other related statements (including the related notes) included therein
fairly present the consolidated results of operations and the cash flows of
Tirex for the respective fiscal periods covered thereby. Each of such financial
statements has been prepared in accordance with generally accepted accounting
principles consistently applied during the periods covered, except as otherwise
noted therein.
SECTION 4.05 Properties.
(a) Tirex and its subsidiaries have good and marketable title to, or in
the case of leased property have valid leasehold interests in (which leases are
in full force and effect and with respect to which no event of default has
occurred and is continuing), all properties and assets (whether real or
personal, and whether tangible or intangible) reflected on the Balance Sheet or
acquired after the Balance Sheet Date in the ordinary course of business
consistent with past practices and except for such defects in title and
leasehold interests (including defaults with respect thereto) as would not
materially adversely affect (or have a reasonable likelihood of so doing) Tirex'
right to continue to conduct of Tirex' business in the manner currently so
conducted.
(b) There is no violation of any law, regulation or ordinance (including
without limitation, laws, regulations or ordinances relating to zoning,
environmental, city planning or similar matters) relating to the properties and
assets of Tirex and its subsidiaries except such violations as would not, in the
aggregate, have a Material Adverse Effect.
SECTION 4.06 No Undisclosed Liabilities. There are no liabilities of Tirex
of any kind whatsoever, whether accrued, contingent, absolute, determined,
determinable or otherwise, and there is no existing condition situation or set
of circumstances which could reasonably result in such a liability, other than:
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(a) liabilities disclosed or provided for in the Tirex Balance Sheet
or in the notes thereto;
(b) liabilities incurred in the ordinary course of business
consistent with past practices since the Tirex Balance Sheet Date;
(c) liabilities arising under this Agreement; and
(d) liabilities which would not, in the aggregate, have a Material
Adverse Effect.
SECTION 4.07 Litigation. Except as are disclosed in the 10-KSB, there are
no actions, suits, or proceedings pending against, or to the knowledge of Tirex,
threatened against Tirex before any court or arbitrator or any governmental
body, agency or official. None of such matters disclosed have a reasonable
likelihood of having a Material Adverse Effect.
SECTION 4.08 Taxes. Except as disclosed in the financial statements
referred to in Section 4.04, Tirex has (i) duly filed with the appropriate
federal (US and Canadian), state and local governments or governmental agencies,
all federal, state and local income tax returns and declarations of estimated
tax and all other material tax returns and reports required to be filed and have
paid in full when due all taxes, licenses and fees, including interest and
penalties, shown to be due thereon, and (ii) has established reserves in the
Tirex Balance Sheet that, in the aggregate, are adequate for the payment of
taxes not yet due with respect to Tirex' operations through the Tirex Balance
Sheet Date. All material claims for federal, state and local taxes asserted
against Tirex have either been paid or adequately provided for on the Tirex
Balance Sheet. The federal income tax returns required to be filed by Tirex have
either been examined by the Internal Revenue Service or the period during which
any assessments may be made by the Internal Revenue Service has expired without
waiver or extension and any deficiencies or assessments asserted in writing by
the Internal Revenue Service have either been paid, settled or adequately
provided for in the Balance Sheet. Neither Tirex nor any subsidiary has filed a
consent pursuant to Section 341(f) of the Internal Revenue Code of 1986 (the
"Code"). Tirex has not agreed and has not been required to make any adjustment
under Section 481(a) of the Code by reason of a change of accounting or
otherwise. Tirex has withheld from employees and paid over to the proper
governmental authorities all amounts required to be so withheld and paid over.
SECTION 4.09 Absence of Certain Changes. Except for: (i) transactions,
changes, events, obligations and liabilities contemplated by this Agreement;
(ii) transactions, changes, events, obligations and liabilities disclosed in the
financial statements referred to in Section 4.04; (iii) transactions, changes,
events, obligations and liabilities which individually or in the aggregate, have
not had a Material Adverse Effect, since the Balance Sheet Date:
(a) there have been no changes in the business, condition (financial
or otherwise), operations, manner of conduct of business or operations,
assets or liabilities of Tirex, other than changes in the ordinary course
of business;
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(b) no liability or obligation of Tirex has been paid, discharged or
incurred other than in the ordinary course of business;
(c) there has been no damage, destruction, or loss, whether or not
covered by insurance, materially adversely affecting the business or
property of Tirex;
(d) Tirex has not sold, mortgaged, pledged or subjected to any lien
or other encumbrance or otherwise transferred any material assets or
properties used in the conduct of its business; and
(e) Tirex has not entered into any transaction other than in the
ordinary course of business.
ARTICLE V
COVENANTS
SECTION 5.01 Conduct of the Business of Tirex, the Purchaser and the
Company. Except as contemplated by this Agreement, during the period from the
date of this Agreement to the Effective Time, each of the Purchaser, the
Company, Tirex and Tirex' other subsidiaries will each conduct its respective
operations according to its ordinary course of business and consistent with past
practice, and will each use its reasonable efforts to preserve intact its
business organization, to keep available the services of its officers and
employees and to maintain satisfactory relationships with licensors, landlords,
licensees, suppliers, contractors, distributors, customers and others having
business relationships with it. Without limiting the generality of the
foregoing, and except as otherwise expressly provided in this Agreement, prior
to the Effective Time, the Purchaser, the Company, Tirex (and each of its other
subsidiaries) will not, without the prior written consent of the other:
(a) amend its Certificate of Incorporation or By-laws;
(b) authorize for issuance, issue, sell, deliver or agree or commit
to issue, sell or deliver (whether through the issuance or granting of
options, warrants, commitments, subscriptions, rights to purchase or
otherwise) any shares of stock of any class or any other securities,
except (i) as required by non-employee and Employee Option or compensation
agreements in effect on the date hereof; (ii) in connection with an
offering of up to 28 Units for a maximum aggregate of $700,000 with X.X.
Xxxxxx & Co., Inc. as placement agent (the "Concurrent Offering");
(c) split, combine or reclassify any shares of its capital stock,
declare, set aside or pay any dividend or other distribution (whether in
cash, stock or property or any combination thereof) in respect of its
capital stock, or redeem or otherwise acquire any of its securities or any
securities of its subsidiaries;
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(d) except in the ordinary course of business consistent with past
practices or in connection with the Financing contemplated hereby (i)
incur or assume any long-term or short-term debt; (ii) assume, guarantee,
endorse or otherwise become liable or responsible (whether directly,
contingently or otherwise) for the obligations of any other person, except
wholly-owned subsidiaries of the Company; or (iii) make any loans,
advances or capital contributions to, or investments in, any other person;
(e) except pursuant to written agreements in effect on the date
hereof, acquire, sell, lease, create liens with respect to or dispose of
any material assets outside the ordinary course of business or enter into
any material commitment or transaction outside the ordinary course of
business;
(f) except as may be required by law, take any action to initiate,
terminate or amend any of its employee benefit plans; and
(g) take, or agree in writing or otherwise to take, any of the
foregoing actions or any action which would make any representation or
warranty of the Company contained in this Agreement untrue or incorrect in
any material respect as of the date when made or as of a future date.
SECTION 5.02 Access to Information.
(a) Between the date of this Agreement and the Effective Time, each of the
Company, Tirex, and the Purchaser will give the other and its authorized
representatives, and potential sources of financing for the transactions
contemplated hereby and their authorized representatives, access to its
respective facilities, books and records as the other may reasonably request,
will permit the other to make such inspections as it may reasonably require and
will cause its officers and those of its subsidiaries to furnish the other with
such financial and operating data and other information with respect to its
business and properties as the other may from time to time reasonably request.
(b) Each of Purchaser and the Company will hold and will cause its
affiliates, associates and representatives to hold in strict confidence all
documents and information concerning the other furnished in connection with the
transactions contemplated by this Agreement (except to the extent that such
information can be shown to have been (i) in the public domain through no fault
of the disclosing party, or (ii) later lawfully acquired by the disclosing party
(or its affiliates) from other sources) and will not release or disclose such
information to any other person, except in connection with this Agreement to (i)
its representatives and (ii) financing sources, after such financing sources
have agreed to be bound by the terms of confidentiality agreements substantially
equivalent to the provisions of this Section 5.02(b) (it being understood that
such persons shall be informed by Purchaser of the confidential nature of such
information and shall be directed by Purchaser to treat such information
confidentially); provided that each party and its representatives may provide
such documents or information in response to judicial or administrative process
or applicable governmental laws, rules, regulations,
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orders or ordinances, but only that portion of the documents or information
which, on the advice of counsel, is legally required to be furnished. If the
transactions contemplated by this Agreement are not consummated, such confidence
shall continue to be maintained in accordance with the terms and conditions
above set forth.
SECTION 5.03 Best Efforts. Subject to the terms and conditions herein
provided, each of the parties hereto agrees to use its best efforts to take, or
cause to be done, all things necessary, proper or advisable under applicable
laws and regulations to consummate and make effective the transactions
contemplated by this Agreement. In case at any time after the Effective Time any
further action is necessary or desirable to carry out the purposes of this
Agreement, the proper officers and directors of each party to this Agreement
shall take all such necessary action.
SECTION 5.04 Consents. The parties each will use their respective best
efforts to obtain consents of all third parties and governmental authorities
necessary to the consummation of the transactions contemplated by this
Agreement, unless the failure to obtain such consents will not, in the
aggregate, have a Material Adverse Effect on any party.
SECTION 5.05 Public Announcements. The parties will consult with each
other before issuing any press release or otherwise making any public statements
with respect to the Merger and shall not issue any such press release or make
any such public statement prior to mutual agreement upon the text hereof, except
as may be required by law.
SECTION 5.06 Notification of Certain Matters. Each of the Company, the
Purchaser and Tirex agree to give prompt notice to each other of (i) the
occurrence, or failure to occur, of any event which occurrence or failure to
occur would be likely to cause any representation or warranty contained in this
Agreement to be untrue or inaccurate in any material respect at any time from
the date hereof to the Effective Time (including any such occurrence or failure
of which either party is or becomes aware with respect to the other) and (ii)
any material failure on its part to comply with or satisfy any covenant,
condition or agreement to be complied with or satisfied by it hereunder;
provided, however, that the delivery of any notice pursuant to this Section 5.06
shall not limit or otherwise affect the remedies available hereunder to the
party receiving such notice.
SECTION 5.07 Assumption of Debt, Issuance of Shares. Tirex covenants
agrees with the Company that it will fully and unconditionally assume the
indebtedness and other obligations represented by the Debentures and that it
will issue the shares of Tirex Common Stock required to be issued to the holders
of the Company's common stock pursuant to the terms of the Certificate of Merger
and the subscription document in the private placement within five business days
of each closing in the private placement.
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ARTICLE VI
CONDITIONS TO CONSUMMATION
OF THE MERGER
SECTION 6.01 Conditions to the Obligations of the Purchaser and Tirex. The
obligations of the Purchaser and Tirex are, at the Purchaser's and Tirex'
option, subject to the fulfillment of the conditions hereinafter set forth:
(a) The Company shall have performed and complied with all of the
conditions and agreements required by this Agreement to be performed or
complied with by it prior to the Effective Time in all material respects.
(b) The representations and warranties of the Company contained
herein shall have been true and correct in all material respects as of the
date hereof and shall be true and correct as of the Effective Time, except
for changes contemplated by this Agreement, and the Purchaser shall have
received a certificate of the President of the Company to such effect.
(c) The Company shall have completed at least the minimum amount of
a private placement on a "best efforts, 30 Units or none basis" of 85
Units each comprised of one $10,000 principal amount 10% convertible
debenture each convertible into a Common Share at the rate of $.20 (the
"Debenture") and 10,000 Common Shares pursuant to the terms and conditions
of a Private Placement Memorandum to be dated November , 1997 and any and
all supplements and amendments thereto . The Company shall have assets
comprised of the gross proceeds of the private placement less a placement
agent's commission of 10%, attorney's fees of no more than $5,000 and
attorneys reasonable disbursements. In the event that the closing is
effected after the sale of the minimum amount of the private placement,
but before the completion of the private placement, then the private
placement shall continue and the Units shall thereafter be comprised of a
$10,000 Tirex debenture with terms and conditions identical to the
Debentures and 10,000 shares of Tirex common stock.
(d) There shall have been no Material Adverse Change in the
business, properties or financial condition of the Company from such
condition on the date hereof.
(e) On the Closing Date (i) there shall be no injunction,
restraining order, or order of any nature issued by a court of competent
jurisdiction which directs that any transaction contemplated by this
Agreement shall not be consummated and (ii) there shall be no suit,
action, investigation or other proceeding pending or threatened by any
governmental agency or private party seeking to restrain or prohibit the
consummation of any material transaction contemplated hereby or the
obtaining of any material amount of damages from any party hereto or any
officer or director of any such party, in connection with the Merger.
(f) The issued and outstanding shares of the Company's Common Stock
shall consist of not more than: (i) the number of shares sold in the
private placement (from 300,000 to 850,000) plus (ii) the 3,000,000 shares
issued and outstanding on the date hereof.
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(g) Purchaser shall have received an opinion from Xxxxx X. Xxxxxxx,
Esq., reasonably satisfactory to Purchaser and its counsel which shall
state, among other things, that all issuances of the Company's Common
Stock occurred no less than six months prior to the effective date of the
Merger and that, upon the filing of a Form D by the Purchaser and/or
Tirex, the merger of the Company and Purchaser will qualify under Rule 506
of Regulation D.
(h) The principal shareholders will have provided the Company with
the Indemnification Agreement required under Section 1.03(d) hereof.
SECTION 6.02 Conditions to the Obligations of the Company. The obligations
of the Company are, at the Company's option, subject to the fulfillment of the
conditions hereinafter set forth.
(a) The Purchaser and Tirex shall have each performed and complied with
all of the conditions and agreements required by this Agreement to be performed
or complied with by it prior to the Effective Time in all material respects.
(b) The representations and warranties of each of the Purchaser and Tirex
contained herein shall have been true and correct in all material respects as of
the date hereof and shall be true and correct as of the Effective Time and the
Company shall have received a certificate of the President of each of the
Purchaser and Tirex to such effect.
(c) There shall have been no Material Adverse Change in the business,
properties or financial condition of the Purchaser or Tirex from such condition
on the date hereof.
(d) The Letter of Intent, dated August 13, 1997, between Tirex and X.X.
Xxxxxx & Co., Inc., relating to a public offering of Tirex' securities, shall
not have been abandoned or materially modified.
(e) On the Closing Date (i) there shall be no injunction, restraining
order, or order of any nature issued by a court of competent jurisdiction which
directs that any transaction contemplated by this Agreement shall not be
consummated and (ii) there shall be no suit, action, investigation or other
proceeding pending or threatened by any governmental agency or private party
seeking to restrain or prohibit the consummation of any material transaction
contemplated hereby or the obtaining of any material amount of damages from any
party hereto or any officer or director of any such party, in connection with
the consummation of the Merger.
(f) The Company shall have received an opinion from Xxxxxxx Xxxx Xxxxxx,
Esq., reasonably satisfactory to the Company and its counsel.
(g) Tirex and the Company shall have agreed that certain consulting
agreement by and among them and Xx. Xxxxxx Xxxxxxxx and Xxxx Xxxxxxxxx, dated as
of June 9, 1997, pursuant to which the Company has rendered services to Tirex
and pursuant to which the Company has accrued all fees which have been due and
payable, shall continue in effect
169
notwithstanding the merger. The parties acknowledge that the Company's
shareholders prior to the private placement are receiving 3,000,000 shares of
Tirex common stock in the Merger in consideration of all consulting fees
heretofore and hereafter accrued.
ARTICLE VII
TERMINATION; AMENDMENT; WAIVER
SECTION 7.01 Termination. This Agreement may be terminated and the Merger
contemplated hereby may be abandoned at any time prior to the Effective Time:
(a) by mutual written consent of the Purchaser and the Company;
(b) by the Purchaser or the Company if the Effective Time shall not
have occurred on or before December 31, 1997; provided, however, that the
right to terminate this Agreement under this Section 7.01(b) shall not be
available to any party whose failure to fulfill any obligation under this
Agreement has been the cause of, or resulted in, the failure of the
Effective Time to occur on or before such date; or
(c) by the Purchaser or the Company if any United States, Canada or
state or provincial governmental authority or other agency or commission
or United States, Canada, or state or provincial court of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered
any statute, rule, regulation, injunction or other order which is in
effect and is permanent and non-appealable and has the effect of
prohibiting consummation of the Merger or the provision of the financing
necessary for such transactions.
Any unilateral termination of this Agreement permitted by this Section
6.01 shall be effective upon the giving of the written notice by the terminating
party in the manner provided herein.
SECTION 7.02 Effect of Termination. In the event of the termination and
abandonment of this Agreement pursuant to Section 7.01 hereof, this Agreement
shall forthwith become void and have no effect, without any liability on the
part of any party or its directors, officers or shareholders, other than the
provisions relating to confidentiality and non-disclosure of information.
Nothing contained in this Section 7.02 shall relieve any party from liability
for any breach of this Agreement.
SECTION 7.03 Amendment. This Agreement may be amended by action taken by
the Company and the Purchaser at any time before or after adoption of the
Effective Date, no amendment shall be made which changes the amount or form of
consideration to be paid in the Merger or adversely affects the rights of the
Company's or Purchaser's shareholders hereunder without the approval of such
shareholders. It is acknowledged and agreed that an amendment which extends the
time by which the Effective Time must occur in order to obtain any required
170
third party or governmental consent or to comply with any judicial or
administrative ruling or order shall not be deemed to adversely affect such
rights. This Agreement may not be amended except by an instrument in writing
signed on behalf of the parties.
SECTION 7.04 Extension; Waiver. At any time prior to the Effective Time,
the parties may (i) extend the time for the performance of any of the
obligations or other acts of the other party hereto, (ii) waive any inaccuracies
in the representations and warranties contained herein or in any document,
certificate or writing delivered pursuant hereto or (iii) waive compliance with
any of the agreements or conditions contained herein. Any agreements on the part
of any party to any such extension or waiver shall be valid only if set forth in
an instrument in writing signed on behalf of such party.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Survival. The representations and warranties made herein
shall not survive beyond the Effective Time. The covenants and agreements of the
parties in this Agreement shall survive in accordance with their terms, and when
no term is specified, shall survive indefinitely.
SECTION 8.02 Brokerage Fees and Commissions. Except for placement agent
fees in connection with the private placement described herein, each of the
Purchaser and Tirex hereby represents and warrants to the Company with respect
to the Purchaser and Tirex and the Company hereby represents and warrants to
each of the Purchaser and Tirex with respect to the Company, that no person or
entity is entitled to receive from the Company, Tirex or the Purchaser,
respectively, any investment banking, brokerage or finder's fee or fees for
financial consulting or advisory services in connection with this Agreement or
the transactions contemplated hereby.
SECTION 8.03 Entire Agreement; Assignment. This Agreement (including any
other agreements referred to herein) (a) constitutes the entire agreement among
the parties with respect to the subject matter hereof and supersedes all other
prior agreements and understandings, both written and oral, between the parties
with respect to the subject matter hereof and (b) shall not be assigned by
operation of law or otherwise, provided that the Purchaser may assign its rights
and obligations to any subsidiary of the Purchaser or of Tirex, but no such
assignment shall relive the Purchaser of its obligations hereunder if such
assignee does not perform such obligations.
SECTION 8.04 Validity. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
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SECTION 8.05 Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by cable,
telegram or telex, or by recognized overnight courier (including, but not
limited to Federal Express, Airborne Express, D.H.L. and UPS) to the respective
parties as follows:
If to the Company: RPM Incorporated
000 Xxxx 00xx Xxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Xx. Xxxxxx Xxxxxxxx, President
With a copy to: Xxxxx X. Xxxxxxx, Esq. at
1350 Avenue of the Americas - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Through October 30, 1997 and thereafter at
Suite 3000
The Empire State Building
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
If to Tirex: The Tirex Corporation
000 Xx. Xxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxx X0X 0X0
Attn: Xxxxxxx X. Xxxxx, President
With a Copy to: Xxxxxxx Xxxx Xxxxxx, Esq.
000 Xxxxx Xxxx
Xxxxxx Xxxxxx, Xxx Xxxx 00000
If to the Purchaser: Tirex Sub, Inc.
c/o The Tirex Corporation
000 Xx. Xxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxx X0X 0X0
Attn: Xxxxxxx X. Xxxxx, President
With a Copy to: Xxxxxxx Xxxx Xxxxxx, Esq.
000 Xxxxx Xxxx
Xxxxxx Xxxxxx, Xxx Xxxx 00000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
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SECTION 8.06 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, regardless of
the laws that might otherwise govern under applicable principles of conflicts of
laws, provided, however, that the consummation and effectiveness of the merger
shall be governed by and construed in accordance with the laws of the State of
Delaware.
SECTION 8.07 Descriptive Headings. The descriptive headings herein are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
SECTION 8.08 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any other person any
rights, benefits or remedies of any nature whatsoever under or by reason of this
Agreement.
SECTION 8.09 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be an original, but all of which shall
constitute one and the same agreement.
SECTION 8.10 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event any of the provisions of this
Agreement were not to be performed in accordance with the terms hereto and that
the parties shall be entitled to specific performance of the terms hereof, in
addition to any other remedy at law or equity.
IN WITNESS WHEREOF, the undersigned has executed this Agreement and Plan
of Merger as of the 20th day of October, 1997.
RPM INCORPORATED
By: /s/ Xx. Xxxxxx Xxxxxxxx
-----------------------------------
Xx. Xxxxxx Xxxxxxxx, President
THE TIREX CORPORATION TIREX SUB, INC
By: /s/ Xxxxxxx X. Xxxxx By: /s/ Xxxxxxx X. Xxxxx
------------------------------- -----------------------------------
Xxxxxxx X. Xxxxx, President Xxxxxxx X. Xxxxx, President
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