EXHIBIT 10.12
FIRST AMENDMENT TO PRE-INCORPORATION AGREEMENT
BETWEEN
XXXXXX XXXXXXX AND INLAND ISLAND, INC.
AND
FIBR-PLAST CORPORATION
1. This is the First Amendment to that certain Pre-Incorporation Agreement
between and among Xxxxxx Xxxxxxx and Inland Island, Inc. ("Xxxxxxx
Group") and Fibr-Plast Corporation ("Fibr-Plast").
2. RECITALS: Whereas,
2.1 Xxxxxx Xxxxxxx and Inland Island, Inc. ("Xxxxxxx Group") and
Fibr-Plast Corporation ("Fibr-Plast") entered into a certain
Pre-Incorporation Agreement ("Agreement"), effective August
29, 2001.
2.2 Such contract provided - among other things - that Slavens
Group would receive certain capital stock, common series, from
Fibr-Plast, as follows:
Once Xxxxxxx Group has constructed, completed and equipped a
manufacturing facility as herein contemplated, then Fibr-Plast
shall issue to Xxxxxxx Group 300,000 shares of Fibr-Plast
common stock. Additionally, 12 months after such date,
Fibr-Plast shall issue to Xxxxxxx Group an additional 300,000
shares of Fibr-Plast common stock assuming the continued
compliance with the terms hereof by Xxxxxxx Group. Further,
Fibr-Plast shall deliver options to Xxxxxxx Group to purchase
250,000 shares of Fibr-Plast at $0.25 per share, to be
exercised within three years from the date of such option,
subject only to the continued compliance of Xxxxxxx Group with
the terms hereof.
2.3 That certain conditions and circumstances have changed which
make it necessary to amend the Agreement with respect to the
issuance of stock, the rights of the parties and certain
additional consideration from Fibr-Plast to Xxxxxxx Group.
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2.4 AND, Whereas, these parties have agreed upon the consideration
for, terms and conditions of such modification, all as such
are hereafter described.
3. CONSIDERATION. The consideration for this First Amendment includes the
sum of $1.00 cash in hand paid by each of these parties to the other,
the receipt of which is hereby acknowledged, and the additional
consideration of those representations, undertakings, commitments,
releases and covenants hereafter given and exchanged.
4. FIBR-PLAST ISSUANCE OF STOCK TO XXXXXXX GROUP. Paragraph 6.9 of the
Agreement is canceled and is amended by the terms and provisions
hereof.
5. NEW TERMS OF STOCK ISSUANCE AND CASH PAYMENTS. Relying upon the
representations made by Xxxxxxx Group (separately hereafter described),
Fibr-Plast shall now issue the following capital stock, common series,
to Xxxxxxx Group:
5.1 300,000 shares of Fibr-Plast stock [in lieu of 600,000 shares
of stock earlier issued for Xxxxxxx Group]; and,
5.2 Options for an additional 300,000 shares, at $1.00 per share,
to be issued within twenty-four (24) months after TJS Plastics
has first had three (3) consecutive months of positive
earnings; and,
5.3 Additionally, Fibr-Plast shall now pay to Xxxxxxx Group the
cash sum of $30,000.00, the receipt of which is hereby
acknowledged as further consideration owing hereunder; and,
5.4 On or before September 1, 2002, the additional sum of
$70,000.00.
5.5 The verbal agreement earlier made between Xxxxxxx Group and
Fibr-Plast as to the issuance of 600,000 shares is modified by
the foregoing. The only obligation of Fibr-Plast to issue
stocks shall be as above described.
6. RESTRICTIONS ON STOCK. The foregoing stock being issued to Xxxxxxx
Group shall be subject to Xxxxxxx Group's full compliance with all of
the commitments, undertakings, promises and covenants contained in the
Agreement. This includes -- but is not necessarily limited to -- all of
the representations ("Representations") hereafter set forth being now
true and being true for the
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duration of the Agreement and this First Amendment. Xxxxxxx Group shall
not have the right to mortgage, encumber, pledge, sell, transfer or
assign such stock until (a) Xxxxxxx Group shall have first fully met
all of its obligations under the Agreement and First Amendment, or (b)
the 1st day of April, 2002, whichever shall be the earlier. If for any
reason Xxxxxxx Group shall fail to perform its said obligations as
aforesaid, then Fibr-Plast shall be entitled to cancel such stock and
recover it from escrow.
7. STOCK LEGEND. Each of said shares shall bear the following legends:
[On the front side] These shares are subject to the restrictions and
limitations shown on the reverse side hereof.
[Reverse side] These shares of stock cannot be encumbered, transferred
or assigned until (a) April 1, 2002 or (b) that earlier date when
Fibr-Plast shall certify in writing that Xxxxxxx Group has fully met
all conditions and requirements of the Agreement and of the First
Amendment.
8. REPRESENTATIONS AND PERFORMANCE BY XXXXXXX GROUP.
8.1 (Representations by Slavens).
8.1.1 Xxxxxxx represents that he has acquired a plant
facility which equals or exceeds that described by
the Agreement and which is in fact suitable for the
manufacture of the Fibr-Plast(C) product line and
additionally office, warehousing and storage areas,
patents covering Fibr-Plast or related products
and/or procedures for manufacturing products.
8.1.2 Slavens represents that he has invested an equity
amount in such plant facility which equals or exceeds
that required by the Agreement, and subject to the
following:
Plant cost $235,000;
Equity down payment $ 20,000;
Original total mortgage $215,000;
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Monthly mortgage payment $ 1,909;
-----------
Mortgage balance as of 12/31/2001 $192,089.36;
-----------
Total escrow [if any] $ 0;
-----------
In hands of mortgage holder as of
12/31/2001 $ 0;
-----------
Deferred or delinquent amount owed
[if any] to mortgage holder $ 0;
-----------
Second Mortgage $ 0;
-----------
Additional Loans $ 245,000;
-----------
BAL
Equipment Lease Payments $ 2,806.72/month; ($101,041.92)
-----------
Real Estate Taxes $ 1,152.42;
-----------
Personal Property Taxes $ ; and
-----------
Income Taxes $
-----------
8.1.3 Separate from the real estate above described Xxxxxxx
Group represents that they have further modified the
plant (including structure, equipment and machinery),
to allow for the expansion of manufacturing
capabilities and products;
8.1.4 Xxxxxxx Group has acquired additional equipment and
machinery in the plant beyond that originally
contemplated in the Agreement;
8.1.5 Xxxxxxx Group has done research to develop an
improved formula and mixture of certain of the
Fibr-Plast products;
8.1.6 Xxxxxxx Group has solicited letters of intent from
prospective dealers (i.e.: fencing companies); and,
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8.1.7 By developing and entering into an amended option
with Fibr-Plast for the sale of the plant and
facilities (as such is separately hereafter set
forth).
8.2 (TJS Plastics Stock of Xxxxxxx Group). Xxxxxxx Group
represents that its stock and interest in TJS Plastics is now
free, clear and unencumbered and the same will be free, clear
and unencumbered during the term of this First Amendment and
the option given by Slavens Group to Fibr-Plast in these
agreements.
8.3 (Transfers to TJS Plastics). Notwithstanding anything else
herein, Xxxxxxx Group shall now transfer all assets
and liabilities in the manufacturing facility which are herein
described, either specifically or otherwise, to TJS Plastics
in exchange for a full, undivided one-half (1/2) of TJS
Plastics capital stock. At that time, Xxxxxxx Group shall have
satisfied the provisions of Section 9 above.
9. CLOSING. At closing, the following documents shall be prepared, signed
and exchanged;
[BY BOTH]
9.1 An agreed closing statement, covering all of the credits and
debits due by each party to the other.
Oklahoma law shall
control as to documentary stamps and the practices and
procedures of business closings shall control as to the
allocation and payment of any necessary abstracting, filing
fees, curative documents and of assignments and transfers.
9.2 Such disclosures and declarations by Seller and Buyer as shall
then be required by controlling law.
9.3 Minutes of such meetings of shareholders and of directors of
TJS Plastics as shall be necessary to approve all loans and to
disclose actions of Xxxxxx Xxxxxxx properly done on behalf of
TJS Plastics, to accept his resignation as an officer and
director of TJS Plastics and to elect such successors as shall
be designated by Fibr-Plast.
[BY SELLER]
9.4 A statutory xxxx of sale as to any personal property then
owned by or titled in Xxxxxxx Group [as opposed to TJS
Plastics];
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9.5 A statutory general warranty deed covering all real property
and improvements which is then owned by Xxxxxxx Group [as
opposed to TJS Plastics], provided, however, the agreed
exception thereto shall be the mortgage balance brought
current on such real property and improvements and the
installment balance brought current on any personal property
financed by Slavens Group with the joint approval of these
parties;
9.6 An affidavit as to labor and materials, which shall state in
substance that Xxxxxxx Group has not contracted for nor
allowed any third party to add any labor and/or materials to
the real property and improvements either for their
maintenance or improvement which has not been fully paid
or -- contrary wise -- to disclose any such unpaid
obligations.
9.7 Any delinquent amounts owing on any accepted real estate
mortgage or purchase money obligation for machinery and
equipment (which represents prior obligations not timely paid)
shall be deducted from the monies owing to Seller. In this
connection, Buyer will take title to the real property and
improvements and also to the personal property subject to all
proper and agreed mortgages, liens and encumbrances. Within
this connection, Seller at closing shall deliver a full
receipt and release for payment of the agreed purchase price
in exchange for the appropriate payment from Buyer. The
current balances owing on such real estate mortgage and
purchase money security interests shall be assumed by TJS
Plastics.
9.8 Assignments by Xxxxxxx Group to Fibr-Plast of any and all
easements, rights of way, prepaid insurance, maintenance
agreements, servicing agreements, utility deposits, licenses,
permits, or the like, which have been obtained during and used
during the term of the Agreement, whether by TJS Plastics or
Xxxxxxx Group.
9.9 An unconditional release by Xxxxxx Xxxxxxx, Inland Island,
Inc. and its shareholders, directors and officers, of any
claims or causes of action for salary, wages, compensation,
reimbursement, personal injury, property damage or other
claims of any nature based upon contract, quasi-contract or
tort.
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[BY BUYER]
9.10 Such documents as shall be reasonably necessary for Buyer to
become jointly liable with TJS Plastics to any record real
estate holder or the holder of any purchase money security
interest for the brought-current balances owed; provided, that
Fibr-Plast shall not be required to pay any sums required by
such creditors for any transfer of the obligations,
documentation fees or like charges. The sole obligation of
Fibr-Plast is to be added as a co-obligor if such is
absolutely necessary to obtain the release of Xxxxxxx Group
therefrom.
10. TJS CORPORATE MEETINGS. The initial and organizational meeting of
subscribers and shareholders and the initial and organizational meeting
of the Board of Directors of TJS Plastics shall be held at 4:30 p.m. on
Friday, January 4, 2002, at the offices of TJS Plastics. At that time,
the parties shall elect four (4) directors, two of whom shall be
selected from Fibr-Plast management and two of whom shall be selected
from Xxxxxxx Group management. The initial meeting of the Board of
Directors shall then elect a chairman of the Board, president, vice
president, secretary and treasurer. Such other acts as are necessary,
usual and customary shall also be done at these meetings.
11. RECORDS AND ACCESS TO RECORDS. Following Fibr-Plast's exercise of its
option as aforesaid, Fibr-Plast shall make available to Xxxxxxx Group
during normal business hours and upon reasonable notice all of the
books and records of TJS Plastics to and through the date of closing
for Xxxxxxx Group to review and copy in connection with any tax audit,
tax review or the like by either Federal or State tax authorities.
12. MISCELLANEOUS.
12.1 (Cancellation of Letter Notice). Xxxxxxx Group herewith
rescinds and cancels the Letter Notice dated September 12,
2001, and reaffirms the
Pre-Incorporation Agreement and this
First Amendment as the binding agreements between these
parties.
12.2 (Access to Facilities). Xxxxxxx Group will provide not less
than three (3) offices at the plant for the officers of
Fibr-Plast and also the officers of Fibr-Plast will have full
access to the plant and facilities. This includes but is not
limited to furnishing keys to the plant and facilities.
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12.3 (Closing). The closing shall be held at 11:00 o'clock a.m., on
the 10th business day following that on which the purchase
price shall be resolved and agreed upon or on any other agreed
date, either at the offices of Xxxxxx & March, 0000 X. 00xx
Xxxxxx, Xxxxx, Xxxxxxxx or at the offices of that lender (if
any) being utilized by Fibr-Plast in funding its exercise of
this option.
12.4 (Interpretation). The captions on the various provisions are
for convenience only and this entire agreement shall be
construed as a whole. If any provision shall be determined to
be invalid or ineffective, then this agreement shall be
interpreted to otherwise give maximum effect to the intent of
these parties.
12.5 (Future Disputes). If either party hereto shall hereafter
bring any action to interpret this contract or enforce any
rights owing hereunder, then the prevailing party in such
litigation shall additionally be entitled to recover
reasonable attorney fees and court costs.
12.6 (Parties Covered). This First Amendment covers all of the
aforesaid parties, together with their respective successors,
assigns and for individual signatories, their personal
representatives, heirs and beneficiaries.
12.7 (Controlling Law and Forum Selection). This contract is
entered into in Tulsa County, and shall be construed under the
laws of
Oklahoma. Any litigation as to this contract must be
had either in the Federal or State courts in Tulsa County,
Oklahoma.
12.8 (Authority of Signatories). By signing this Agreement, each
signatory represents that he or she has all of the requisite
authority to sign this agreement and to bind the corporate
entity for which he or she is signing. Each corporation which
is a signatory herein represents that there are no judgments,
pending suits or known impending litigation which would either
prohibit or interfere with that corporate entity's full
performance of all undertakings herein. In this connection,
Fibr-Plast is making a public offering of stock and any
related restrictions that are not covered by the foregoing
representation.
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12.9 (Effective Date). Notwithstanding the date or dates of
execution hereof, the effective date of this First Amendment
shall be as of 12th day of December, 2001.
/s/ XXXXXX XXXXXXX
--------------------------------
XXXXXX XXXXXXX
INLAND ISLAND, INC.
By: /s/ XXXXXX XXXXXXX
--------------------------------
Xxxxxx Xxxxxxx, President
FIBR-PLAST CORPORATION
( By: /s/ XXXXXX XXXXXX, PRESIDENT
( --------------------------------
( Xxxxxx Xxxxxx, President
(
(
( By: /s/ XXXXXX XXXXXXXXX, EXEC. V.P.
( --------------------------------
( Xxxxxx Xxxxxxxxx, Executive Vice
( President
(
(
( By: /s/ XXXX X. XXXXXXXX, XX. V.P.
( --------------------------------
( Xxxx X. Xxxxxxxx, Senior Vice
( President
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