SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-SB
GENERAL FORM FOR REGISTRATION OF SECURITIES OF SMALL BUSINESS ISSUERS UNDER
SECTION 12(b) OR 12(g) OF THE SECURITIES ACT OF 1934
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS & TECHNOLOGY CORP.
(Name of Small Business Issuer in Its Charter)
Delaware Applied For
(State or Other Jurisdiction of (IRS Employer
Incorporation or Organization) Identification No.)
Achillesstraat 95-97, 1076 PX Amsterdam, The Netherlands
(Address of Principal Executive Offices)
(31) 20 6759091
(Company's Telephone Number, Including Area Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of Each Class Name Of Each Exchange On Which
To Be So Registered Each Class Is To Be Registered
Securities to be registered pursuant to Section 12(g) of the Act:
Common stock, no par value
(Title of Class)
(Title of Class)
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TABLE OF CONTENTS
PART I
Item 1. Description of Business
Item 2. Management's Discussion and Analysis and Plan of Operation
Item 3. Description of Property
Item 4. Security Ownership of Certain Beneficial Owners and Management
Item 5. Directors, Executive Officers, Promoters and Control Persons
Item 6. Executive Compensation
Item 7. Certain Relationships and Related Transactions
Item 8. Description of Securities
PART II
Item 1. Market Price of and Dividends on the Company's Common Equity and
Other Shareholder Matters
Item 2. Legal Proceedings
Item 3. Changes in and Disagreements with Accountants
Item 4. Recent Sales of Unregistered Securities
Item 5. Indemnification of Directors and Officers
PART F/S
Index to Financial Statements
PART III
Index to Exhibits
SIGNATURES
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PART I
Item 1. Description of Business.
The Company was formed to develop a proprietary technology for drying and
treating animal manure and sludge.
The Company was originally incorporated in Colorado on December 10, 1997.
On December 11, 1997 the Company sold 5,000,000 shares of common stock for
$5,000 in cash. On December 26, 1997 the Company issued 175,456 shares of its
common stock in a share-for-share exchange with the Series "L" shareholders of
STB Corp. On January 9, the Company changed its corporate domicile to Delaware
and changed its name to Management of Environmental Solutions & Technology Corp.
On March 2, 1998 shareholders owning in excess of 50% of the Company's
common stock approved a 1,000-for-1 reverse split of the Company's common stock.
On March 10, 1998 the Company sold 5,094,900 shares of common stock for
$510.
On April 9, 1998 the Company issued 1,920,000 shares of its common stock in
consideration for all issued and outstanding shares of M.E.S.T., B.V., a
Netherlands corporation. M.E.S.T., B.V. was acquired because it had certain data
and technical information which the Company plans to use in its business. At the
time of this acquisition, M.E.S.T., B.V. was controlled by the Company's
President. See "Management - Transactions with Affiliates".
During 1998 the Company sold 299,980 shares of common stock for $3.00 per
share.
Between December 16, 1998 and September 30, 1999 the Company sold 354,410
shares of its Series A Preferred stock for an average price of $3.92 per share
(after currency translation adjustments).
Global population growth, economic expansion, scarcity of available water
resources, heightened public concern about water quality and growing regulatory
and legislative requirements have resulted in the continued growth in demand for
wastewater treatment. Government regulations require most companies and
municipalities to treat outgoing wastewater.
Government regulations regarding the disposal of industrial waste, as well
as rising wastewater discharge fees and public concern regarding water
pollution, have led to increased awareness on the part of businesses and public
utilities as to the need for waste treatment.
A six-year study by a group of Dutch Business school graduates and
associates involved in environmental issues related to agriculture production
and pollution in the Netherlands included an in-depth survey of the various
aspects of manure dumping in the Netherlands and the detrimental effects of this
practice on land and water reserves. The survey was performed in close
cooperation with the Dutch government and several scientific institutes. The
outcome of this survey led to a follow-up study on the global possibilities of
<PAGE>
exporting organic fertilizer from countries with excess manure to regions with a
shortage of fertilizer. This study was carried out in close cooperation with a
variety of international organizations such the U.N. Food and Agriculture
Organization (FAO) and revealed that many European countries and the United
States - on an even larger scale - were facing excessive environmental problems
from indiscriminate manure dumping by large livestock producers. At the same
time an agriculture review indicated that although farmers in many other
countries were seeking clean, environmentally friendly solutions to improve crop
production, they had little recourse but to use synthetic fertilizer, the
continued use of which often damages the soil composition and adversely affects
certain life forms, such as earthworms, which have a beneficial effect on soil
composition.
Although untreated animal manure has long been used as fertilizer, it is
unable to be economically shipped long distances due to the water content in the
manure. In addition, many farmers are reluctant to use animal manure as
fertilizer since untreated animal manure often contains weed seeds and
micro-organisms that can cause crop disease.
Research into the application of zeolites for drying specific substances
such as manure and sludge has been performed at The Netherlands Organization for
Applied Scientific Research ("TNO") for a number of years. Experiments have been
conducted under different conditions to investigate both the drying and further
treatment of the sludge by incineration during the regeneration stage of the
zeolite. The results of this research have been stated in various TNO reports
and publications.
Using proprietary technology developed by TNO, the Company and TNO formed
a corporation, known as Manure and Sludge Technology B.V. ("MST"), for the
purpose of developing a process for use on commercial basis which would
economically remove water from manure and sludge, refine the manure into pellets
which could be sold as organic fertilizer and other products. MST is a
Netherlands corporation. The Company and TNO each own 50% of the capital stock
of MST.
TNO is one of Europe's leading contract research organizations. TNO's
staff totals some 5,000 professionals whose experience is available to both the
public and the private sector. TNO's carries out research programs aimed at
investigating technological problems and using innovative technology to find
practical solutions for these problems. Most of TNO's research is undertaken in
collaboration with other research institutes, both public and private,
throughout the world.
TNO's process for the treatment of hog and/or poultry manure involves the
following steps:
1. Raw manure containing approximately 10% solid material is pretreated,
if required, to avoid release into the air of nitrogen compounds (in particular
ammonia) which may be present in the manure.
2. Part of the water present in the manure is removed by conventional
technology yielding a concentrated manure containing approximately 25% solid
material.
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3. The concentrated manure is mixed in a vessel with zeolites in such a way that
most of the water present in the manure is transferred to the zeolites. At the
same time small solid manure particles are formed.
4. The manure particles are separated from the zeolites using existing
technology.
5. The manure particles containing 85% solid material are reshaped into pellets
for packaging and shipment. The pelletizing process takes away another 5% of the
moisture, which leaves an organic fertilizer product with over 90% dry material.
6. The zeolites are regenerated to remove the absorbed water and are recycled
back to the drying vessel.
The Company is required to contribute $1,000,000 to the joint venture of which
$590,000 has been paid as of September 30, 1999, and $410,000 of which is to be
paid by January 2000. With the funds provided by the Company, TNO is performing
a study to determine the feasibility of using zeolites for the treatment and
processing of animal manure and/or sludge on a commercial basis. The joint
venture's feasibility study involves four phases:
Phase 1 - Determine the technical and economic feasibility of the zeolite
technology for manure/sludge treatment on a commercial scale. During this stage
a price range will be calculated which will be the basis for the decision
concerning the continuation of the project.
Phase 2 - Design the components of the system. The different functional
elements (manure/sludge pre-treatment, dryer, transport systems, zeolite, and
regeneration unit/furnace, etc.) will be assessed individually in an
experimental program. Product samples will be assessed as to their quality.
Phase 3 - Construct a large pilot-plant scale (200 kilograms per hour
capacity) to determine if the technology in its entirety (i) functions properly,
(ii) with adequate efficiency, and (iii) produces manure of good quality.
Phase 4 - Design, engineer and construct a fully operational plant (with a
five ton per hour capacity) to fully test the technology.
As of December 15, 1999 Phases 1, 2 and 3 have been completed. It is expected
that Phase 4 of the study will be completed by July 2000.
<PAGE>
If TNO's study suggests that TNO's process will be commercially feasible,
the Company will have the right to use TNO's technology to build manure/sludge
treatment facilities for third parties. The Company's right to use this
technology will expire fifteen years after the Company installs the first
treatment facility using the TNO technology. In return for these rights, the
Company is obligated to pay the joint venture royalty equal to:
(1) 15% of the manufacturing costs of the first ten treatment facilities
installed by the Company
(2) 12.5% of the manufacturing costs for the next 15 treatment facilities, and
(3) 10% of the manufacturing costs for all remaining treatment facilities
installed by the Company
Any net profits earned by the joint venture will be equally distributed
between the Company and TNO.
TNO has reserved the right to use its technology for any purpose other
than the treatment of manure and sludge.
Two international patents have been filed by TNO for the use of zeolites
for heating and drying foodstuffs and for treating sludge/manure with zeolites.
Although TNO has filed patent applications covering certain aspects of its
technology, there can be assurance that any patents will be issued. Furthermore,
there is no assurance as to the scope and degree of protection any issued
patents might afford TNO or the Company. Disputes may arise with third parties
as to the scope, validity and ownership rights of a patent. Any defense of a
patent could prove costly and time consuming and there can be no assurance that
TNO and/or the Company will be successful in defending any such patents.
There can be no assurance that joint venture between the Company and TNO
will be successful in developing the technology to a state where it is
commercially feasible. There can be no assurance that the Company will receive
any revenues from any technology developed by the joint venture.
Hog and Poultry Farms In the European Community an estimated 121,000,000
hogs are raised in hog farms each year generating million tons of hog manure
each year. Hog farms breed and raise hogs in indoor pens. The pens are enclosed
in barns which, in some cases, are as large as football fields. Metal grates are
used as the floors for the pens. Hog manure is pushed through slats between the
metal grates and flushed into pits or holding ponds known as lagoons. The manure
in the lagoons is then buried in landfills. However, many fields surrounding hog
farms are becoming so saturated that they cannot absorb all of the hog manure.
In addition, lagoons have at times leaked and overflowed. As a result, the hog
manure is beginning to contaminate ground water, drinking wells, lakes, streams
and rivers and is causing air pollution as a result of odors from the hog barns
and lagoons. Poultry farms dispose of their waste in a similar fashion resulting
in the same pollution problem. The Company believes the process being developed
by MST can provide a solution to the hog and poultry waste problem by processing
the manure into fertilizer on a continuous flow basis and thereby eliminating
the need for the lagoons.
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Sludge Disposal. Most wastewater treatment facilities treat wastewater
through the use of bacteria. Wastewater is collected in tanks where bacteria
consume the waste. The bacteria (i.e. "sludge") then settles to the bottom of
the tank. Prior to discharge into rivers or lakes the treated wastewater is
disinfected with chlorine or ultra-violet light. The sludge is buried in
landfills. The Company believes the same TNO technology applicable to hog and
poultry manure can be used to incinerate the sludge.
Sales and Marketing
The Company plans to market its proprietary process and fertilizer through
sales personnel, manufacturers' representatives, distributors and licensees.
It is expected that the joint ventures manufacturer's representatives,
distributors and licensees will be independent businesses which, in certain
cases, will have the exclusive right to sell or use the joint venture's
technology systems in a specified geographical area. The joint venture may be
required to provide both engineering and marketing support to its manufacturer's
representatives, distributors and licensees.
Competition
The waste treatment industry is fragmented, with numerous regional
participants in countries throughout the world which are limited in their
geographic scope. This fragmentation is primarily due to local differences in
water quality and supply, different levels of demand for water resulting from
varying concentrations of industry and population, and local governmental
regulation. Most participants in the waste treatment industry provide a limited
number of treatment technologies, a limited number of products or services, or
focus on a particular industry. The number of industry participants ranges from
several large companies to hundreds of small local companies.
A large number of companies compete in the chemical fertilizer industry,
most of which have greater financial and marketing resources than those of the
Company.
Government Regulation
Most governments, in one form or another, have laws concerning
environmental and water quality matters and the hauling or disposal of wastes.
Municipalities and businesses which discharge wastewater into rivers, streams,
lakes or other waters are often subject to various laws and regulations
concerning treatment standards, permits and enforcement procedures for the
discharge of pollutants from industrial and municipal waste sources.
<PAGE>
Many governments regulate and enforce wastewater treatment as well.
Continued promulgation and enforcement of similar regulations, or the failure to
adopt or enforce such regulations could have a significant impact on the demand
for any technology which may be developed by the Company's joint ventures with
TNO.
The Company's offices are located Jan Luijkenstraat 96, 1071 CV,
Amsterdam, the Netherlands. The Company's telephone number is (31) 206759091 and
its facsimile number is (31) 206707868.
As of September 30, 1999, the Company did not have any full-time
employees. Contingent upon the Company raising sufficient capital, the Company
plans to hire additional employees as may be required by the level of the
Company's operations. See "Use of Proceeds".
Item 2. Management's Discussion and Analysis or Plan of Operations
If TNO's study suggests that TNO's process will be commercially feasible,
the Company plans to use TNO's technology to build manure/sludge treatment
facilities for third parties. The Company anticipates that it will cost
approximately $850,000 and require from four to six months to construct a plant
capable of treating 11 tons per hour of manure.
During the twelve months ending September 30, 2000, the Company expects
that it will need approximately $2,610,000 in capital to fund the remaining
portion of its capital contribution to the joint venture ($410,000), for
operating and marketing expenses ($1,700,000) and to acquire the exclusive
rights to use the process being developed by MST for processing sludge
($500,000). The Company intends to raise this capital through the sale of its
capital stock.
There can be no assurance that the TNO's treatment process will be
commercially feasible, that the Company will be able to sell any treatment
plants or that the Company will be able to raise any additional capital.
Item 3. Description of Property.
The Company does not currently own any material amount of property or equipment.
Item 4. Security Ownership of Certain Beneficial Owners and Management.
The following table sets forth the number of and percentage of outstanding
shares of common stock beneficially owned by the Company's officers, directors
and those shareholders owning more than 5% of the Company's common stock as of
September 30, 1999.
<PAGE>
Shares of
Name and Address Common Stock (1) Percent of Class
- ---------------- ---------------- ----------------------
Marieke Oudejans 2,260,000 (2) 31%
#68 Willem Van Weldamme LAAN
P.C. 1082 KW
Amsterdam, The Netherlands
Maurice Schelvis 10,000 (2) Nil
Stadhouderskade 142
1074 BA Amsterdam
The Netherlands
Eugene M. Larabie -- --
507-595 Howe St.
Vancouver, British Columbia
Canada V6C 2T5
Robert E. Johnson -- --
L1901-1600 Beach Avenue
Vancouver, British Columbia
Canada V6G 7Y6
Environmental Renewal, Inc. 2,000,000 (2) 27.3%
1601 Blake Street
Suite 500
Denver, Colorado 80202
All Officers and Directors
as a Group (4 persons) 2,270,000 31%
(1) Does not include shares issuable upon the exercise of options held by the
certain officers. See "Management - Transactions with Affiliates".
(2) Maurice Schelvis owns 50% of the capital stock of Environmental Renewal,
Inc. Environmental Renewal has the option to purchase 1,500,000 shares of
the Company's common stock from Marieke Oudejans for $1,500,000.
Environmental Renewal also has the option to purchase the shares Maurice
Schelvis owns in Environmental Renewal for $1,500,000.
Item 5. Directors, Executive Officers, Promoters and Control Persons.
The following sets forth certain information concerning the present
management of the Company:
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Name Age Position with Company
Marieke Oudejans 30 President, Secretary, and a Director
Maurice Schelvis 59 Vice President
Eugene M. Larabie 61 Vice President
Robert E. Johnson 65 Chief Financial Officer and Vice
President of Operations
Marieke Oudejans has been an Officer and Director of the Company since
January 1998. Since June 1997 Ms. Oudejans has been the President of M.E.S.T.,
B.V., a corporation which was acquired by the Company in April 1998. From 1998
until June 1997 Ms. Oudejans was an assistant vice president for ATT-Unisource,
a Company engaged in telecommunications.
Maurice Schelvis has been an officer and director of the Company since
July 1998. For the past five years Mr. Schelvis has been an officer and director
of a real estate trading company.
Eugene M. Larabie has been an Officer of the Company since February 1998.
Since 1984 Mr. Larable has been the president of Laroth Engineering Ltd., a
corporation providing consulting services to the mining industry.
Robert E. Johnson has been an Officer of the Company since February 1998.
Mr. Johnson has been retired since 1993. From 1975 to 1993 Mr. Johnson was
manager of customer services for the British Columbia Hydro and Power Authority.
Technical Advisor Jan Pranger is a process engineering consultant with
extensive experience in manufacturing and design. Mr. Pranger obtained his
masters degree in Chemical Engineering (with distinction) from the Dutch
University of Delft. Before starting his studies he gained several years
research experience with the Company Tebodin Consultants and Engineers in the
Hague. After obtaining his degree in chemical engineering, Mr. Pranger became a
member of the Royal Institute of Engineers (Kivl).
Item 6. Executive Compensation.
The following table sets forth in summary form the compensation received
by (i) Marieke Oudejans, the Company's President, (ii) Maurice Schelvis, the
Company's Vice President and (iii) by each other executive officer of the
Company who received in excess of $100,000 during the fiscal years ended
December 31, 1997 and 1998.
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Other Annual Restricted Options
Name and Fiscal Salary Bonus Compensation Stock Awards Granted
Principal Position Year (1) (2) (3) (4) (5)
Marieke Oudejans, 1998 -- -- -- -- --
President 1997 -- -- -- -- --
Maurice Schelvis, 1998 -- -- -- -- 100,000
Vice President 1997 -- -- -- -- --
The dollar value of base salary (cash and non-cash) received.
(2) The dollar value of bonus (cash and non-cash) received.
(3) Any other annual compensation not properly categorized as salary or bonus,
including perquisites and other personal benefits, securities or property.
Amounts in the table represents automobile allowances.
(4) Amounts reflect the value of the shares of the Company's common stock issued
as compensation for services.
The table below shows the number of shares of the Company's Common Stock
owned by the officers listed above, and the value of such shares as of June 30,
1999.
Name Shares Value
---- ------ -----
Marieke Oudejans 2,260,000 $2,260,000 *
Maurice Schelvis 10,000 $ 10,000 *
* The Company's common stock did not begin to trade until July 1999. For
purposes of this table, the value was deemed to be $1.00 per share, which is
the price at which Ms. Oudejans has agreed to sell 1,500,000 shares of her
common stock. See Item I, Part 4 of this Registration Statement.
(5) The shares of Common Stock to be received upon the exercise of all stock
options granted during the. year fiscal years shown in the table.
The following shows the amounts which the Company expects to pay to its
officers and technical advisor during the year ending December 31, 1999 and the
time which the Company's executive officers and technical advisor plan to devote
to the Company's business. The Company does not have employment agreements with
any of its officers or technical advisor.
<PAGE>
Proposed Time to be Devoted
Name Compensation To Company's Business
Marieke Oudejans (1) 100%
Maurice Schelvis (2) 100%
Eugene Larabie (3) 80%
Robert E. Johnson (3) 80%
Jan Pranger $25,000 50%
(1) The Company plans to issue 1,100,000 shares of its common stock to Ms.
Oudejans for services rendered.
(2) Subsequent to September 30, 1999 the Company issued 100,000 shares of its
common stock to Mr. Schelvis for services provided to the Company. The
Company also plans to compensate Mr. Schelvis with options for the purchase
of shares of the Company's common stock.
(3) The Company plans to issue shares of its common stock, as well as options,
to this person for services provided to the Company.
The Company's Board of Directors may increase the compensation paid to the
Company's officers depending upon the results of the Company's future
operations.
On August 1, 1998 the Company granted options for the purchase of the
Company's common stock to the following persons:
Shares Subject Option Expiration
Name To Option Exercise Price Date
Maurice Schelvis 100,000 $0.50 July 31, 2003
Eugene M. Larabie 15,000 $0.50 July 31, 2000
Robert E. Johnson 15,000 $0.50 July 31, 2000
Frank J. Janssen 50,000 $0.50 July 31, 2003
Item 7. Certain Relationships and Related Transactions.
The Company has issued shares of its common stock to the persons, in the
amounts, and for the consideration set forth below:
<PAGE>
Number
Name Date of Shares Consideration
Marieke Oudejans 3-10-98 1,920,000 All of the issued and out-
standing shares of M.E.S.T.,
B.V.
Marieke Oudejans 4-08-98 2,100,000 $25
Maurice Schelvis 3-10-98 250,000 $25
See Item 1 of this report for information concerning the acquisition of
M.E.S.T., B.V.
In March 1999 Marieke Oudejans transferred 1,760,000 of her shares of the
Company's common stock to Maurice Schelvis. In consideration for the transfer of
these shares, Mr. Schelvis forgave a $146,000 loan which he made to the Company.
Item 8. Description of Securities.
Common Stock
The Company is authorized to issue 30,000,000 shares of Common Stock (the
"Common Stock"). As of September 30, 1999 the Company had 7,320,055 shares of
Common Stock issued and outstanding. Holders of Common Stock are each entitled
to cast one vote for each share held of record on all matters presented to
shareholders. Cumulative voting is not allowed; hence, the holders of a majority
of the outstanding Common Stock can elect all directors.
Holders of Common Stock are entitled to receive such dividends as may be
declared by the Board of Directors out of funds legally available therefor and,
in the event of liquidation, to share pro rata in any distribution of the
Company's assets after payment of liabilities. The Board of Directors is not
obligated to declare a dividend and it is not anticipated that dividends will be
paid until the Company is in profit.
Holders of Common Stock do not have preemptive rights to subscribe to
additional shares if issued by the Company. There are no conversion, redemption,
sinking fund or similar provisions regarding the Common Stock. All of the
outstanding shares of Common Stock are fully paid and non-assessable and all of
the shares of Common stock offered hereby will be, upon issuance, fully paid and
non-assessable.
Preferred Stock
The Company is authorized to issue up to 5,000,000 shares of Preferred
Stock. The Company's Articles of Incorporation provide that the Board of
Directors has the authority to divide the Preferred Stock into series and,
within the limitations provided by Delaware statute, to fix by resolution the
voting power, designations, preferences, and relative participation, special
rights, and the qualifications, limitations or restrictions of the shares of any
series so established. As the Board of Directors has authority to establish the
terms of, and to issue, the Preferred Stock without shareholder approval, the
Preferred Stock could be issued to defend against any attempted takeover of the
Company.
<PAGE>
In January 1999, the Company's directors established the Company's Series
A Preferred Stock and authorized the issuance of up to 1,000,000 shares of
Series A Preferred Stock as part of this series. Each share of Series A
Preferred Stock is entitled to a dividend at the rate of $0.30 per share when,
as and if declared by the Board of Directors out of funds legally available for
the payment of dividends. Dividends not declared by the Board of Directors do
not cumulate. Upon any liquidation or dissolution of the Company, each
outstanding share of the Series A Preferred Stock is entitled to distribution of
$4.00 per share prior to any distribution to the holders of the Company's Common
Stock. The holders of the Series A Preferred Stock are not entitled to any
voting rights. Each share of the Series A Preferred Stock is convertible into
one share of the Company's Common Stock at any time after June 1, 1999.
Effective February 1, 2000 each Series A Preferred Share which is still
outstanding will automatically be converted into one share of the Company's
common stock.
Between December 16, 1998 and September 30, 1999 the Company sold 354,410
Series A Preferred Shares at an average price of $3.92 per share (after currency
translation adjustments).
PART II
Item 1. Market Price of and Dividends on the Company's Common Equity and
Other Shareholder Matters.
As of November 30, 1999, there were approximately 130 record owners of the
Company's common stock and 145 record owners of the Company's Series A preferred
stock. The Company's common stock is traded in the over-the-counter market. Set
forth below are the range of high and low bid quotations for the periods
indicated as reported by National Quotation Bureau. The market quotations
reflect interdealer prices, without retail mark-up, mark-down or commissions and
may not necessarily represent actual transactions. The Company's common stock
began trading in July 1999. There is no public market for the Company's Series A
Preferred Stock.
Quarter Ending High Low
September 30, 1999 $4.50 $4.50
Holders of Common Stock are entitled to receive such dividends as may be
declared by the Board of Directors out of funds legally available therefor and,
in the event of liquidation, to share pro rata in any distribution of the
Company's assets after payment of liabilities. The Board of Directors is not
obligated to declare a dividend. The Company has not paid any dividends on it's
Common Stock and the Company does not have any current plans to pay any Common
Stock dividends.
The provisions in the Company's Articles of Incorporation relating to the
Company's Preferred Stock would allow the Company's directors to issue Preferred
Stock with rights to multiple votes per share and dividends rights which would
have priority over any dividends paid with respect to the Company's Common
Stock. The issuance of Preferred Stock with such rights may make more difficult
the removal of management even if such removal would be considered beneficial to
shareholders generally, and will have the effect of limiting shareholder
participation in certain transactions such as mergers or tender offers if such
transactions are not favored by incumbent management.
<PAGE>
Item 2. Legal Proceedings.
None.
Item 3. Changes in and Disagreements with Accountants.
Not applicable.
Item 4. Recent Sales of Unregistered Securities.
Shares outstanding
Common Stock
On December 11, 1997 the Company sold 5,000,000 shares 5,000,000
of common stock for $5,000 in cash.
On December 26, 1997 the Company issued 175,456 shares 5,175,456
of its common stock in a share-for-share exchange
with the Series "L" shareholders of STB Corp.
On March 2, 1998 shareholders owning in excess of 50% 5,175
of the Company's common stock approved a 1,000-for-1
reverse split of the Company's common stock.
On March 10, 1998 the Company sold 5,094,900 shares of 5,100,075
common stock for $510.
On April 8, 1998 the Company issued 1,920,000 shares of 7,020,075
its common stock in consideration for all issued and out-
standing shares of M.E.S.T., B.V., a Netherlands corporation.
During 1998 the Company sold 299,980 shares of its common 7,320,055
stock for $3.00 per share.
The sale of all shares of the Company's common stock was exempt pursuant
to Rule 504 of the Securities and Exchange Commission.
Preferred Stock
Between December 16, 1998 and September 30, 1999 the Company sold 354,410
shares of its Series A preferred stock at an average price of $3.92 per
share (after currency translation adjustments).
<PAGE>
The sale of the Company's Series A preferred stock was exempt pursuant to
the provisions of Regulation S of the Securities and Exchange Commission. No
offering or sale of the Series A preferred stock was made to any U.S. person.
The Series A preferred stock and the shares issuable upon the conversion of
Series A preferred stock are restricted securities as that term is defined in
Rule 144 of the Securities and Exchange Commission. Neither the Series A
preferred shares or any shares issuable upon the conversion of the Series A
preferred shares can be sold or transferred to any U.S. person, unless
registered for public resale, prior to the end of the restricted period required
by Regulation S.
Item 5. Indemnification of Directors and Officers.
The Delaware General Corporation Law and the Company's Bylaws provide that
the Company may indemnify any and all of its officers, directors, employees or
agents or former officers, directors, employees or agents, against expenses
actually and necessarily incurred by them, in connection with the defense of any
legal proceeding or threatened legal proceeding, except as to matters in which
such persons shall be determined not to have acted in good faith and in the best
interest of the Company. Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors, officers, or
persons controlling the Company pursuant to the foregoing provisions, the
Company has been informed that in the opinion of the Securities and Exchange
Commission, such indemnification is against public policy as expressed in the
Securities Act of 1933 and is therefore unenforceable.
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
FINANCIAL STATEMENTS
DECEMBER 31, 1998
<PAGE>
AUDITOR'S REPORT
To the Board of Directors
Management of Environmental
Solutions & Technology Corp.
We have audited the accompanying consolidated balance sheets of Management of
Environmental Solutions & Technology Corp. (the "Company") at December 31, 1998
and the related consolidated statement of operations, changes in shareholders'
equity and cash flows for the year then ended. These financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.
We conducted our audit in accordance with the International Standards on
Auditing. Those standards require that we plan and perform the audit to obtain
reasonable assurance as to whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the fiscal 1998 financial statements referred to above present
fairly, in all material respects, the consolidated financial position of the
Company at December 31, 1998 and the consolidated results of operations and cash
flows for the year ended December 31, 1998.
Amsterdam, July 16, 1999
ARENTHALS EN PARTNERS
P. Prijs RA
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
CONSOLIDATED BALANCE SHEET
ASSETS
December 31, 1998
Current Assets
Cash $728,870
Accounts receivable 37,248
Other receivables 5,288
Prepaid expenses 3,703
-------
Total current assets 775,109
Property and equipment (net of
depreciation) 3,356
Goodwill 37,495
$815,960
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Loans $15,496
Payroll and other taxes payable 9,060
Accounts payable 66,762
Other liabilities 31,775
------
Total current liabilities 123,093
Common Stock, $0.0001 par value -
Authorized 30,000,000 shares; 7,320,055
shares issued and outstanding at September 30, 1999 732
Preferred Stock, $0.0001 par value - Authorized
5,000,000 shares, 23,900 Series A Preferred
Shares issued and outstanding 2
Additional paid-in capital 1,014,149
Retained Deficit (322,016)
-----------
Total Shareholders' Equity 692,867
----------
Total Liabilities and Shareholders' Equity $815,960
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
CONSOLIDATED STATEMENT OF OPERATIONS
Year Ended
December 31, 1999
Revenue $
Operating Expenses
Personnel expenses 33,774
General and administration 195,585
Office costs 57,066
Selling expenses 30,321
Housing expenses 10,042
Depreciation 9,719
---------
336,508
Other expenses
Interest income 793
Gain on currency translation 15,284
16,067
NET LOSS BEFORE TAXES (322,016)
Corporation tax --
NET LOSS $(322,016)
LOSS PER SHARE $ (0.04)
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
(A Company in the Development Stage)
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
PERIOD FROM INCEPTION (DECEMBER 10, 1997) TO DECEMBER 31, 1998
<TABLE>
Deficit
Accumulated
Common Stock Preferred Stock Additional During the
--------------------- --------------------- Paid-in Development
Shares Amount Shares Amount Capital Stage
<S> <C> <C> <C> <C> <C> <C>
Inception, December 10, 1997 - $ -- $ -- $ -- $ --
Issuance of common stock,
December 11, 1997 5,000,000 500 4,500 --
December 19, 1997 100 -- 10 --
December 26, 1997 175,456 18 157 --
------- ----- ----- ---- ------ -------
5,175,556 518 -- -- 4,667
Balances, December 31, 1997
Reverse stock split 1,000
for 1 March 2, 1998 (5,170,381) (517) 517
Issuance of common stock
March 10, 1998 5,094,900 509 1 --
Issuance of common stock to
acquire subsidiary,
April 9, 1998 1,920,000 192 19,808 --
Issuance of common stock
for cash 299,980 30 899,910
Issuance of preferred stock
for cash 23,900 2 89,246
Net loss (322,016)
------- ----- ------ -- ------- ---------
Balances, December 31,
1998 7,320,055 $732 23,900 $ 2 $1,014,149 $(322,016)
========== ==== ====== === ========== ==========
</TABLE>
See accompanying notes to financial statements
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
(A Company in the Development Stage)
STATEMENT OF CASH FLOWS
YEAR ENDED DECEMBER 31, 1998
CASH FLOWS USED IN OPERATING ACTIVITIES:
Net loss $(322,016) Adjustments to reconcile net loss to cash flows used in
operating activities: Depreciation and amortization 9,719 Increase in accounts
receivable (37,248) Increase in other receivables (5,288) Increase in prepaid
expenses (3,703) Increase in short term loans 15,496 Increase in payroll and
other taxes payable 9,060 Increase in accounts payable 66,762 Increase in other
liabilities 31,775
Net cash used in operating activities (235,443)
CASH FLOWS USED IN INVESTING ACTIVITIES:
Increase in property and equipment (3,701)
Increase in goodwill (46,869)
--------
Net cash used in investing activities (50,570)
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
Sale of common stock 900,450
Sale of preferred stock 89,248
Acquisition of subsidiary 20,000
-----------
Net cash provided by financing activities 1,009,698
NET INCREASE IN CASH 723,685
CASH AT THE BEGINNING OF PERIOD 5,185
-----------
CASH AT THE END OF PERIOD $728,870
========
See accompanying notes to financial statements
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
(A Company in the Development Stage)
YEAR ENDED DECEMBER 31, 1998
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION, BUSINESS, AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION AND BUSINESS
Management of Environmental Solutions & Technology Corp. (the "Company") was
originally incorporated in Colorado on December 10, 1997, and on December 18,
1997, reorganized as a Delaware corporation. The Delaware Corporation has the
authority to issue 30,000,000 shares of common stock $0.0001 par value and
5,000,000 shares of preferred stock $0.0001 par value. The Company was formed to
develop a proprietary technology for drying and treating animal manure and
sludge.
The accompanying consolidated financial statement include the historical
accounts of the Company and its wholly owned subsidiary (M.E.S.T., B.V.) for the
nine month period ending September 30, 1999. All intercompany accounts and
transactions have been eliminated in consolidation.
CASH FLOWS
For purposes of reporting cash flows, cash includes those investments which are
short-term in nature (three months or less to original maturity), are readily
convertible to cash, and represent insignificant risk of changes in value.
Basis of Presentation
All amounts in these financial statements are stated in U.S. Dollars.
Amounts denominated in foreign currencies have been translated into US dollars
at rates of exchange in force at year's end. Exchange differences are included
in the profit and loss account. Transactions in foreign currencies are
recalculated at the average exchange rate during the year.
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUT1ONS
& TECHNOLOGY CORP.
(A Company in the Devc1opment Stage)
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION, BUSINESS, AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
DEPRECIATION AMORTIZATION
Property and equipment are depreciated over useful lives of five years.
Goodwill is amortized over a period of five years.
ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amount of cash, receivables and accounts payable approximates fair
value.
Note 1 - Loans from Affiliates
The Company has borrowed funds from two of its executive officers at an interest
rate of 6%. The loans are payable on demand and are due to:
Marieke Oudejans $9,114
Maurice Schelvis 6,382
-------
$15,496
=======
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
FINANCIAL STATEMENTS
SEPTEMBER 30, 1999
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
CONSOLIDATED BALANCE SHEET
(Unaudited)
ASSETS
September 30, 1999 December 31, 1998
Current Assets
Cash $ 959,070 $728,870
Accounts receivable 35,224 37,248
Other receivables -- 5,288
Prepaid expenses 1,478 3,703
-------- -------
Total current assets 995,772 775,109
Property and equipment (net of
depreciation) 12,022 3,356
Investment in joint venture 516,157 --
Goodwill 27,767 37,495
------ ------
$1,551,718 $815,960
========== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Loans $17,075 $15,496
Payroll and other taxes payable 16,650 9,060
Accounts payable 48,723 66,762
Other liabilities -- 31,775
------------ ------
Total current liabilities 82,448 123,093
Common Stock, $0.0001 par value -
Authorized 30,000,000 shares; 7,320,055
shares issued and outstanding at
September 30, 1999 732 732
Preferred Stock, $0.0001 par value -
Authorized 5,000,000 shares 354,410 Series
A Preferred Shares issued and outstanding
at September 30, 1999 35 2
Additional paid-in capital 2,348,505 1,014,149
Retained Deficit (880,002) (322,016)
----------- -----------
Total Shareholders' Equity 1,469,270 692,867
----------- ---------
Total Liabilities and Shareholders' Equity $1,551,718 $815,960
========== ========
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
Nine months ending
September 30, 1999
Revenue $
Operating Expenses
Personnel expenses 65,308
General and administration 251,300
Research and development costs 38,572
Office costs 38,667
Selling expenses 42,982
Housing expenses 13,803
Depreciation 7,934
---------
458,566
Other expenses
Interest expense 1,161
Loss on currency exchanges 23,205
24,366
Loss from operations of joint venture 75,054
---------
NET LOSS BEFORE TAXES (557,986)
Corporation tax --
NET LOSS $(557,986)
LOSS PER SHARE $(0.07)
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP. & SUBSIDIARY
(A Company in the Development Stage)
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
PERIOD FROM INCEPTION (DECEMBER 10, 1997) TO SEPTEMBER 30, 1999
(Unaudited)
<TABLE>
Deficit
Accumulated
Common Stock Preferred Stock Additional During the
--------------------- --------------------- Paid-in Development
Shares Amount Shares Amount Capital Stage
<S> <C> <C> <C> <C> <C> <C>
Inception, December 10, 1997 -- $ -- $ -- $ -- $ --
Issuance of common stock,
December 11, 1997 5,000,000 500 4,500 --
December 19, 1997 100 -- 10 --
December 26, 1997 175,456 18 157 --
------- ------ ----- ------- ------- ------
5,175,556 518 -- -- 4,667
Balances, December 31, 1997
Reverse stock split 1,000
for 1 March 2, 1998 (5,170,381) (517) 517
Issuance of common stock
March 10, 1998 5,094,900 509 1 --
Issuance of common stock to
acquire subsidiary,
April 9, 1998 1,920,000 192 19,808 --
Issuance of common stock
for cash 299,980 30 899,910
Issuance of preferred stock
for cash 23,900 2 89,246
Net loss (322,016)
-------- --- ------ --- ------- ---------
Balances, December 31, 1998 7,320,055 $732 23,900 $ 2 $1,014,149 $(322,016)
========= ==== ====== ==== ========== =========
Issuance of preferred stock
for cash 330,510 33 1,334,356
Net loss (557,986)
--------- ---- ------- --- --------- ---------
Balances,
September 30, 1999 7,320,055 $732 354,410 $35 $2,348,505 $(880,002)
========= ==== ======= === ========= ==========
</TABLE>
See accompanying notes to financial statements
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP. & SUBSIDIARY
(A Company in the Development Stage)
STATEMENT OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 1999
(Unaudited)
CASH FLOWS USED IN OPERATING ACTIVITIES:
Net loss $(557,986) Adjustments to reconcile net loss to cash flows used in
operating activities: Depreciation and amortization 7,934 Loss in joint venture
75,054 Decrease in accounts receivable 2,024 Decrease in other receivables 5,288
Decrease in prepaid expenses 2,225 Increase in short term loans 1,579 Increase
in payroll and other taxes payable 7,590 Decrease in accounts payable (18,039)
Decrease in other liabilities (31,775)
Net cash used in operating activities (506,106)
CASH FLOWS USED IN INVESTING ACTIVITIES:
Increase in property and equipment (10,192)
Advances to joint venture (591,211)
-
Currency translation adjustment - Goodwill 3,320
----------
Net cash used in investing activities (598,083)
CASH FLOWS PROVIDED BY FINANCING ACTIVITIES:
Sale of preferred stock 1,334,389
Net cash provided by financing activities 1,334,389
NET INCREASE IN CASH 230,200
CASH AT THE BEGINNING OF PERIOD 728,870
-------
CASH AT THE END OF PERIOD 959,070
=======
See accompanying notes to financial statements
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP. & SUBSIDIARY
(A Company in the Development Stage)
NINE MONTHS ENDED SEPTEMBER 30, 1999
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - ORGANIZATION, BUSINESS, AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION AND BUSINESS
Management of Environmental Solutions & Technology Corp. (the "Company") was
originally incorporated in Colorado on December 10, 1997, and on December 18,
1997, reorganized as a Delaware corporation. The Delaware Corporation has the
authority to issue 30,000,000 shares of common stock $0.0001 par value and
5,000,000 shares of preferred stock $0.0001 par value. The Company was formed to
develop a proprietary technology for drying and treating animal manure and
sludge.
The accompanying consolidated financial statement include the historical
accounts of the Company and its wholly owned subsidiary (M.E.S.T., B.V.) for the
nine month period ending September 30, 1999. All intercompany accounts and
transactions have been eliminated in consolidation.
CASH FLOWS
For purposes of reporting cash flows, cash includes those investments which are
short-term in nature (three months or less to original maturity), are readily
convertible to cash, and represent insignificant risk of changes in value.
Basis of Presentation
The accompanying financial statements have been prepared in accordance with
rules established for the preparation of interim financial statements. The
reader is referred to the Company's financial statements for the year ended
December 31, 1998. In the opinion of management, all accruals and adjustments
(each of which is of a normal recurring nature) necessary for a fair
presentation of Company's the financial position as of September 30, 1999 and
the results of operations for the nine-month period then ended have been made.
Significant accounting policies have been consistently applied in the interim
financial statements and the financial statements for the year ended December
31, 1998.
All amounts in these financial statements are stated in U.S. Dollars.
Amounts denominated in foreign currencies have been translated into US dollars
at rates of exchange in force at September 30,1999. Exchange differences are
included in the profit and loss account. Transactions in foreign currencies are
recalculated at the average exchange rate during the year.
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUT1ONS
& TECHNOLOGY CORP. & SUBSIDIARY
(A Company in the Devc1opment Stage)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - ORGANIZATION, BUSINESS, AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(continued)
DEPRECIATION AMORTIZATION
Property and equipment are depreciated over useful lives of five years.
Goodwill is amortized over a period of five years.
ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
FAIR VALUE OF FINANCIAL INSTRUMENTS
The carrying amount of cash, receivables and accounts payable approximates fair
value.
Note 1 - Loans from Affiliates
As of September 30, 1999 the Company had borrowed $17,075 from a General Manager
and one of its executive officers at an interest rate of 6%. The loans are
payable on demand.
NOTE 2 - JOINT VENTURE
In July 1999, the Company and The Netherlands Organization for Applied
Scientific Research ("TNO") formed a corporation, known as Manure and Sludge
Technology B.V. ("MST"). MST was formed for the purpose of developing a process
for use on commercial basis which would economically remove water from manure
and sludge and refine the manure into pellets and other products. The pellets
could then be sold as organic fertilizer. MST is Netherlands corporation. The
Company and TNO each own 50% of the capital stock of MST.
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUT1ONS
& TECHNOLOGY CORP. & SUBSIDIARY
(A Company in the Devc1opment Stage)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
NOTE 2 - JOINT VENTURE (continued)
TNO contributed the technology for the processing of manure and sludge to
MST. The Company is required to contribute $1,000,000 to MST of which $590,000
has been paid as of September 30, 1999, and $410,000 of which is to be paid by
January 2000.
From July 1999 through September 30, 1999 MST lost $130,776. As of
September 30, 1999 the Company had advanced $581,545 to MST. The Company's
advances to MST have been reduced by the Company's share (50%) of the losses
incurred by MST through September 30, 1999.
<PAGE>
PART III
Index to Exhibits
Page
Exhibit 2 Plan of Acquisition, Reorganization, Arrangement,
Liquidation, etc. ____
Exhibit 3 Articles of Incorporation, as amended, and Bylaws ____
Exhibit 4 Instruments Defining the Rights of Security Holders ____
Exhibit 5 Subscription Agreement None
Exhibit 9 Voting Trust Agreement None
Exhibit 10 Material Contracts ____
Exhibit 2 Financial Data Schedules ____
<PAGE>
SIGNATURES
In accordance with Section 12 of the Securities Exchange Act of 1934, the
Company caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY, CORP.
Date: December 17, 1999 By: /s/ Marieke Oudejans
-------------------------------------
Marieke Oudejans, President
<PAGE>
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS
& TECHNOLOGY CORP.
FORM 10-SB
EXHIBITS
PLAN OF MERGER
(a)CONSTITUENT
CORPORATIONS: Management of Environmental Solutions & Technologies Corp.
(A Delaware Corporation)
Solutions Tek, Inc.
(A Colorado Corporation)
Management of Environmental Solutions & Technologies Corp
("MST") has only one class of stock outstanding, that being
common stock. MST has 100 shares of common stock
outstanding, with each share entitled to one vote.
Solutions Tek, Inc. ("STI") has only one class of stock out
standing, that being common stock. STI has 5,175,456
shares of common stock issued and outstanding, with each
share entitled to one vote.
(b)SURVIVING
CORPORATION: Management of Environmental Solutions & Technologies Corp.
(A Delaware Corporation)
(c) Effective as of the date of the merger, (i) all shares of STI shall be
cancelled, (ii) all assets of STI shall become assets of MST, (iii) all
liabilities of STI shall be assumed by MST, (iv) each shareholder of STI
shall receive one share of MST for each share of STI held by such
shareholder, and (v) STI shall cease to exist.
(d) MST agrees that it may be served with process in Colorado, by registered or
certified mail (return receipt requested) in any proceeding for enforcement
of any obligation of Solutions Tek, Inc. in Colorado, as well as for the
enforcement of any obligation of Solutions Tek, Inc. arising from the
merger, including any suit or other proceeding to enforce the rights of any
stockholders as determined in appraisal proceedings pursuant to Sec- tions
7-113-101 through 7-113-302 of the Colorado Business Corporation Act.
CERTIFICATE OF INCORPORATION
OF
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS & TECHNOLOGY CORP.
The undersigned natural, adult person, acting as incorporator of a
corporation (hereinafter usually referred to as the "Corporation") pursuant to
the provisions of the Delaware Corporation Law, hereby adopts the following
Certificate of Incorporation for said Corporation:
ARTICLE I
Name
The name of the Corporation shall be Management of Environmental Solutions
& Technology Corp.
ARTICLE II
Duration
The period of duration of the Corporation shall be perpetual.
ARTICLE III
Purpose
The purpose for which the Corporation is organized is to transact any or
all lawful business for which corporations may be incorporated pursuant to the
Delaware Corporation Law.
ARTICLE IV
Capital Stock
The authorized capital stock of the Corporation shall consist of
30,000,000 shares of common stock, $0.0001 par value, and 5,000,000 shares of
preferred stock, $0.0001 par value.
ARTICLE V
Preferences, Limitations,
and Relative Rights of
Capital Stock
No share of the common stock shall have any preference over or limitation
in respect to any other share of such common stock. All shares of common stock
shall have equal rights and privileges, including the following:
1. All shares of common stock shall share equally in dividends. Subject to
the applicable provisions of the laws of this State, the Board of Directors of
the Corporation may, from time to time, declare and the Corporation may pay
dividends in cash, property, or its own shares, except when the Corporation is
<PAGE>
insolvent or when the payment thereof would render the Corporation insolvent or
when the declaration or payment thereof would be contrary to any restrictions
contained in this Certificate of Incorporation. When any dividend is paid or any
other distribution is made, in whole or in part, from sources other than
unreserved and unrestricted earned surplus, such dividend or distribution shall
be identified as such, and the source and amount per share paid from each source
shall be disclosed to the stockholder receiving the same concurrently with the
distribution thereof and to all other stockholders not later than six months
after the end of the Corporation's fiscal year during which such distribution
was made.
2. All shares of common stock shall share equally in distributions in
partial liquidation. Subject to the applicable provisions of the laws of this
State, the Board of Directors of the Corporation may distribute, from time to
time, to its stockholders in partial liquidation, out of stated capital or
capital surplus of the Corporation, a portion of its assets in cash or property,
except when the Corporation is insolvent or when such distribution would render
the Corporation insolvent. Each such distribution, when made, shall be
identified as a distribution in partial liquidation, out of stated capital or
capital surplus, and the source and amount per share paid from each source shall
be disclosed to all stockholders of the Corporation concurrently with the
distribution thereof. Any such distribution may be made by the Board of
Directors from stated capital without the affirmative vote of any stockholders
of the Corporation.
3. Each outstanding share of common stock shall be entitled to one vote at
stockholders' meetings, either in person or by proxy.
(b) The designations, powers, rights, preferences, qualifications,
restrictions and limitations of the preferred stock shall be established from
time to time by the Corporation's Board of Directors, in accordance with the
Delaware Corporation Law.
(c) 1. Cumulative voting shall not be allowed in elections of
directors or for any purpose.
2. No holders of shares of capital stock of the Corporation
shall be entitled, as such, to any preemptive or preferential right to subscribe
to any unissued stock or any other securities which the Corporation may now or
hereafter be authorized to issue. The Board of Directors of the Corporation,
however, in its discretion by resolution, may determine that any unissued
securities of the Corporation shall be offered for subscription solely to the
holders of common stock of the Corporation, or solely to the holders of any
class or classes of such stock, which the Corporation may now or hereafter be
authorized to issue, in such proportions based on stock ownership as said board
in its discretion may determine.
3. The Board of Directors may restrict the transfer of any of
the Corporation's stock issued by giving the Corporation or any stockholder
"first right of refusal to purchase" the stock, by making the stock redeemable,
or by restricting the transfer of the stock under such terms and in such manner
as the directors may deem necessary and as are not inconsistent with the laws of
this State. Any stock so restricted must carry a conspicuous legend noting the
restriction and the place where such restriction may be found in the records of
the Corporation.
<PAGE>
4. The judgment of the Board of Directors as to the adequacy
of any consideration received or to be received for any shares, options, or any
other securities which the Corporation at any time may be authorized to issue or
sell or otherwise dispose of shall be conclusive in the absence of fraud,
subject to the provisions of these Articles of Incorporation and any applicable
law.
ARTICLE VI
Registered Agent
The name and address of the Corporation's initial registered agent shall
be:
The Company Corporation
1313 North Market Street
New Castle County
Wilmington, Delaware 19801-1151
The Board of Directors, however, from time to time may establish such
other offices, branches, subsidiaries, or divisions which it may consider to be
advisable.
ARTICLE VII
Directors
The affairs of the Corporation shall be governed by a board of not less
than one (1) director, who shall be elected in accordance with the Bylaws of the
Corporation. Subject to such limitation, the number of directors shall be fixed
by or in the manner provided in the Bylaws of the Corporation, as may be amended
from time to time. The organization and conduct of the board shall be in
accordance with the following:
l. The name and address of the initial Director, who shall hold office
until the first annual meeting of the stockholders of the Corporation or until
his successor shall have been elected and qualified, is:
Name Address
Marieke Oudejans Achillesstraat 97
1076 PX Amsterdam, Netherlands
2. The directors of the Corporation need not be residents of Delaware and
shall not be required to hold shares of the Corporation's capital stock.
3. Meetings of the Board of Directors, regular or special, may be held
within or without Delaware upon such notice as may be prescribed by the Bylaws
of the Corporation. Attendance of a director at a meeting shall constitute a
waiver by him of notice of such meeting unless he attends only for the express
purpose of objecting to the transaction of any business thereat on the ground
that the meeting is not lawfully called or convened.
<PAGE>
4. A majority of the number of directors at any time constituting the
Board of Directors shall constitute a quorum for the transaction of business.
5. By resolution adopted by a majority of the Directors at any time
constituting the Board of Directors, the Board of Directors may designate two or
more directors to constitute an Executive Committee or one or more other
committees each of which shall have and may exercise, to the extent permitted by
law or in such resolution, all the authority of the Board of Directors in the
management of the Corporation; but the designation of any such committee and the
delegation of authority thereto shall not operate to relieve the Board of
Directors, or any member thereof, of any responsibility imposed on it or him by
law.
6. Any vacancy in the Board of Directors, however caused or created, may
be filled by the affirmative vote of a majority of the remaining directors,
though less than a quorum of the Board of Directors. A director elected to fill
a vacancy shall be elected for the unexpired term of his predecessor in office
and until his successor is duly elected and qualified.
ARTICLE VIII
Officers
The officers of the Corporation shall be prescribed by the Bylaws of this
Corporation.
ARTICLE IX
Meetings of Stockholders
Meetings of the stockholders of the Corporation shall be held at such
place within or without Delaware and at such times as may be prescribed in the
Bylaws of the Corporation. Special meetings of the stockholders of the
Corporation may be called by the President of the Corporation, the Board of
Directors, or by the record holder or holders of at least ten percent (l0%) of
all shares entitled to vote at the meeting. At any meeting of the stockholders,
except to the extent otherwise provided by law, a quorum shall consist of a
majority of the shares entitled to vote at the meeting; and, if a quorum is
present, the affirmative vote of the majority of shares represented at the
meeting and entitled to vote thereat shall be the act of the stockholders unless
the vote of a greater number is required by law.
ARTICLE X
Voting
When, with respect to any action to be taken by stockholders of this
Corporation, the laws of Delaware requires the affirmative vote of the holders
of more than a majority of the outstanding shares entitled to vote thereon, or
of any class or series, such action may be taken by the affirmative vote of the
holders of a majority of the outstanding shares entitled to vote on such action.
<PAGE>
ARTICLE XI
Bylaws
The initial Bylaws of the Corporation shall be adopted by its Board of
Directors. Subject to repeal or change by action of the stockholders, the power
to alter, amend, or repeal the Bylaws or to adopt new Bylaws shall be vested in
the Board of Directors.
ARTICLE XII
Transactions with Directors and
Other Interested Parties
No contract or other transaction between the Corporation and any other
corporation, whether or not a majority of the shares of the capital stock of
such other corporation is owned by the Corporation, and no act of the
Corporation shall in any way be affected or invalidated by the fact that any of
the directors of the Corporation are pecuniarily or otherwise interested in, or
are directors or officers of, such other corporation. Any director of the
corporation, individually, or any firm with which such director is affiliated
may be a party to or may be pecuniarily or otherwise interested in any contract
or transaction of the Corporation; provided, however, that the fact that he or
such firm is so interested shall be disclosed or shall have been known to the
Board of Directors of the Corporation, or a majority thereof, at or before the
entering into such contract or transaction; and any director of the Corporation
who is also a director or officer of such other corporation, or who is so
interested, may be counted in determining the existence of a quorum at any
meeting of the Board of Directors of the Corporation which shall authorize such
contract or transaction, with like force and effect as if he were not such
director or officer of such other corporation or not so interested.
ARTICLE XIII
Limitation of Director Liability
and Indemnification
No director of the Corporation shall have liability to the Corporation or
to its stockholders or to other security holders for monetary damages for breach
of fiduciary duty as a director; provided, however, that such provisions shall
not eliminate or limit the liability of a director to the Corporation or to its
shareholders or other security holders for monetary damages for: (i) any breach
of the director's duty of loyalty to the Corporation or to its shareholders or
other security holders; (ii) acts or omissions of the director not in good faith
or which involve intentional misconduct or a knowing violation of the law by
such director; (iii) acts by such director as specified by the Delaware
Corporation Law; or (iv) any transaction from which such director derived an
improper personal benefit.
No officer or director shall be personally liable for any injury to person
or property arising out of a tort committed by an employee of the Corporation
unless such officer or director was personally involved in the situation giving
rise to the injury or unless such officer or director committed a criminal
offense. The protection afforded in the preceding sentence shall not restrict
other common law protections and rights that an officer or director may have.
<PAGE>
The word "director" shall include at least the following, unless limited
by Delaware law: an individual who is or was a director of the Corporation and
an individual who, while a director of a Corporation is or was serving at the
Corporation's request as a director, officer, partner, trustee, employee or
agent of any other foreign or domestic corporation or of any partnership, joint
venture, trust, other enterprise or employee benefit plan. A director shall be
considered to be serving an employee benefit plan at the Corporation's request
if his duties to the Corporation also impose duties on or otherwise involve
services by him to the plan or to participants in or beneficiaries of the plan.
To the extent allowed by Delaware law, the word "director" shall also include
the heirs and personal representatives of all directors.
This Corporation shall be empowered to indemnify its officers and
directors to the fullest extent provided by law, including but not limited to
the provisions set forth in the Delaware Corporation Law, or any successor
provision.
ARTICLE XIV
Incorporator
The name and address of the incorporator of the Corporation is as
follows:
Name Address
William T. Hart 1624 Washington Street
Denver, CO 80203
IN WITNESS WHEREOF, the undersigned incorporator has hereunto affixed his
signature on the _____ day of _____________, 1999.
/s/ William T. Hart
William T. Hart
BYLAWS
OF
MANAGEMENT OF ENVIRONMENTAL
SOLUTIONS & TECHNOLOGY CORP.
ARTICLE I
OFFICES
Section l. Offices:
The principal office of the Corporation shall be determined by the Board
of Directors, and the Corporation shall have other offices at such places as the
Board of Directors may from time to time determine.
ARTICLE II
STOCKHOLDER'S MEETINGS
Section l. Place:
The place of stockholders' meetings shall be the principal office of the
Corporation unless some other place shall be determined and designated from time
to time by the Board of Directors.
Section 2. Annual Meeting:
The annual meeting of the stockholders of the Corporation for the election
of directors to succeed those whose terms expire, and for the transaction of
such other business as may properly come before the meeting, shall be held each
year on a date to be determined by the Board of Directors.
Section 3. Special Meetings:
Special meetings of the stockholders for any purpose or purposes may be
called by the President, the Board of Directors, or the holders of ten percent
(l0%) or more of all the shares entitled to vote at such meeting, by the giving
of notice in writing as hereinafter described.
Section 4. Voting:
At all meetings of stockholders, voting may be viva voce; but any
qualified voter may demand a stock vote, whereupon such vote shall be taken by
ballot and the Secretary shall record the name of the stockholder voting, the
number of shares voted, and, if such vote shall be by proxy, the name of the
<PAGE>
proxy holder. Voting may be in person or by proxy appointed in writing, manually
signed by the stockholder or his duly authorized attorney infact. No proxy shall
be valid after eleven months from the date of its execution, unless otherwise
provided therein.
Each stockholder shall have such rights to vote as the Articles of
Incorporation provide for each share of stock registered in his name on the
books of the Corporation, except where the transfer books of the Corporation
shall have been closed or a date shall have been fixed as a record date, not to
exceed, in any case, fifty (50) days preceding the meeting, for the
determination of stockholders entitled to vote. The Secretary of the Corporation
shall make, at least ten (l0) days before each meeting of stockholders, a
complete list of the stockholders entitled to vote at such meeting or any
adjournment thereof, arranged in alphabetical order, with the address of and the
number of shares held by each, which list, for a period of ten (l0) days prior
to such meeting, shall be kept on file at the principal office of the
Corporation and shall be subject to inspection by any stockholder at any time
during usual business hours. Such list shall also be produced and kept open at
the time and place of the meeting and shall be subject to the inspection of any
stockholder during the whole time of the meeting.
Section 5. Order of Business:
The order of business at any meeting of stockholders shall be as follows:
l. Calling the meeting to order.
2. Calling of roll.
3 Proof of notice of meeting.
4. Report of the Secretary of the stock represented at the meeting and the
existence or lack of a quorum.
5. Reading of minutes of last previous meeting and disposal of any
unapproved minutes.
6. Reports of officers.
7. Reports of committees.
8. Election of directors, if appropriate.
9. Unfinished business.
10. New business.
11. Adjournment.
12. To the extent that these Bylaws do not apply, Roberts' Rules of Order
shall prevail.
<PAGE>
ARTICLE III
BOARD OF DIRECTORS
Section l. Organization and Powers:
The Board of Directors shall constitute the policy making or legislative
authority of the Corporation. Management of the affairs, property, and business
of the Corporation shall be vested in the Board of Directors, which shall
consist of not less than one nor more than ten members, who shall be elected at
the annual meeting of stockholders by a plurality vote for a term of one (l)
year, and shall hold office until their successors are elected and qualify.
Directors need not be stockholders. Directors shall have all powers with respect
to the management, control, and determination of policies of the Corporation
that are not limited by these Bylaws, the Articles of Incorporation, or by
statute, and the enumeration of any power shall not be considered a limitation
thereof.
Section 2. Vacancies:
Any vacancy in the Board of Directors, however caused or created, shall be
filled by the affirmative vote of a majority of the remaining directors, though
less than a quorum of the Board, or at a special meeting of the stockholders
called for that purpose. The directors elected to fill vacancies shall hold
office for the unexpired term and until their successors are elected and
qualify.
Section 3. Regular Meetings:
A regular meeting of the Board of Directors shall be held, without other
notice than this Bylaw, immediately after and at the same place as the annual
meeting of stockholders or any special meeting of stockholders at which a
director or directors shall have been elected. The Board of Directors may
provide by resolution the time and place, either within or without the State of
Colorado, for the holding of additional regular meetings without other notice
than such resolution.
Section 4. Special Meetings:
Special meetings of the Board of Directors may be held at the principal
office of the Corporation, or such other place as may be fixed by resolution of
the Board of Directors for such purpose, at any time on call of the President or
of any member of the Board, or may be held at any time and place without notice,
by unanimous written consent of all the members, or with the presence and
participation of all members at such meeting. A resolution in writing signed by
all the directors shall be as valid and effectual as if it had been passed at a
meeting of the directors duly called, constituted, and held.
<PAGE>
Section 5. Notices:
Notices of both regular and special meetings, save when held by unanimous
consent or participation, shall be mailed by the Secretary to each member of the
Board not less than three days before Any such meeting and notices of special
meetings may state the purposes thereof. No failure or irregularity of notice of
any regular meeting shall invalidate such meeting or any proceeding thereat.
Section 6. Quorum and Manner of Acting:
A quorum for any meeting of the Board of Directors shall be a majority of
the Board of Directors as then constituted. Any act of the majority of the
directors present at a meeting at which a quorum is present shall be the act of
the Board of Directors. Any action of such majority, although not at a regularly
called meeting, and the record thereof, if assented to in writing by all of the
other members of the Board, shall always be as valid and effective in all
respects as if otherwise duly taken by the Board of Directors.
Section 7. Executive Committee:
The Board of Directors may by resolution of a majority of the Board
designate two (2) or more directors to constitute an executive committee, which
committee, to the extent provided in such resolution, shall have and may
exercise all of the authority of the Board of Directors in the management of the
Corporation; but the designation of such committee and the delegation of
authority thereto shall not operate to relieve the Board of Directors, or any
member thereof, of any responsibility imposed on it or him by law.
Section 8. Order of Business:
The order of business at any regular or special meeting of the Board of
Directors, unless otherwise prescribed for any meeting by the Board, shall be as
follows:
l. Reading and disposal of any unapproved minutes.
2. Reports of officers and committees.
3. Unfinished business.
4. New business.
5. Adjournment.
6. To the extent that these Bylaws do not apply, Roberts' Rules of Order
shall prevail.
<PAGE>
Section 9. Remuneration:
No stated salary shall be paid to directors for their services as such,
but, by resolution of the Board of Directors, a fixed sum and expenses of
attendance, if any, may be allowed for attendance at each regular or special
meeting of the Board. Members of special or standing committees may be allowed
like compensation for attending meetings. Nothing herein contained shall be
construed to preclude any director from receiving compensation for serving the
Corporation in any other capacity, subject to such resolutions of the Board of
Directors as may then govern receipt of such compensation.
ARTICLE IV
OFFICERS
Section l. Titles:
The officers of the Corporation shall consist of a President, one or more
Vice Presidents, a Secretary, and a Treasurer, who shall be elected by the
directors at their first meeting following the annual meeting of stockholders.
Such officers shall hold office until removed by the Board of Directors or until
their successors are elected and qualify. The Board of Directors may appoint
from time to time such other officers as it deems desirable who shall serve
during such terms as may be fixed by the Board at a duly held meeting. The
Board, by resolution, shall specify the titles, duties and responsibilities of
such officers.
Section 2. President:
The President shall preside at all meetings of stockholders and, in the
absence of a, or the, Chairman of the Board of Directors, at all meetings of the
directors. He shall be generally vested with the power of the chief executive
officer of the Corporation and shall countersign all certificates, contracts,
and other instruments of the Corporation as authorized by the Board of Directors
or required by law. He shall make reports to the Board of Directors and
stockholders and shall perform such other duties and services as may be required
of him from time to time by the Board of Directors.
Section 3. Vice President:
The Vice President shall perform all the duties of the President if the
President is absent or for any other reason is unable to perform his duties and
shall have such other duties as the Board of Directors shall authorize or
direct.
<PAGE>
Section 4. Secretary: The Secretary shall issue notices of all meetings of
stockholders and directors, shall keep minutes of all such meetings, and shall
record all proceedings. He shall have custody and control of the corporate
records and books, excluding the books of account, together with the corporate
seal. He shall make such reports and perform such other duties as may be
consistent with his office or as may be required of him from time to time by the
Board of Directors.
Section 5. Treasurer:
The Treasurer shall have custody of all moneys and securities of the
Corporation and shall have supervision over the regular books of account. He
shall deposit all moneys, securities, and other valuable effects of the
Corporation in such banks and depositories as the Board of Directors may
designate and shall disburse the funds of the Corporation in payment of just
debts and demands against the Corporation, or as they may be ordered by the
Board of Directors, shall render such account of his transactions as may be
required of him by the President or the Board of Directors from time to time and
shall otherwise perform such duties as may be required of him by the Board of
Directors.
The Board of Directors may require the Treasurer to give a bond
indemnifying the Corporation against larceny, theft, embezzlement, forgery,
misappropriation, or any other act of fraud or dishonesty resulting from his
duties as Treasurer of the Corporation, which bond shall be in such amount as
appropriate resolution or resolutions of the Board of Directors may require.
Section 6. Vacancies or Absences:
If a vacancy in any office arises in any manner, the directors then in
office may choose, by a majority vote, a successor to hold office for the
unexpired term of the officer. If any officer shall be absent or unable for any
reason to perform his duties, the Board of Directors, to the extent not
otherwise inconsistent with these Bylaws, may direct that the duties of such
officer during such absence or inability shall be performed by such other
officer or subordinate officer as seems advisable to the Board.
Section 7. Compensation:
No officer shall receive any salary or compensation for his services
unless and until the Board of Directors authorizes and fixes the amount and
terms of such salary or compensation.
<PAGE>
ARTICLE V
STOCK
Section 1. Regulations:
The Board of Directors shall have power and authority to
take all such rules and regulations as they deem expedient concerning the issue,
transfer, and registration of certificates for shares of the capital stock of
the Corporation. The Board of Directors may appoint a Transfer Agent and/or a
Registrar and may require all stock certificates to bear the signature of such
Transfer Agent and/or Registrar.
Section 2. Restrictions on Stock:
The Board of Directors may restrict any stock issued by giving the
Corporation or any stockholder "first right of refusal to purchase" the stock,
by making the stock redeemable or by restricting the transfer of the stock,
under such terms and in such manner as the directors may deem necessary and as
are not inconsistent with the Articles of Incorporation or by statute. Any stock
so restricted must carry a stamped legend setting out the restriction or
conspicuously noting the restriction and stating where it may be found in the
records of the Corporation.
ARTICLE VI
DIVIDENDS AND FINANCES
Section l. Dividends:
Dividends may be declared by the directors and paid out of any funds
legally available therefor under the laws of Colorado, as may be deemed
advisable from time to time by the Board of Directors of the Corporation. Before
declaring any dividends, the Board of Directors may set aside out of net profits
or earned or other surplus such sums as the Board may think proper as a reserve
fund to meet contingencies or for other purposes deemed proper and to the best
interests of the Corporation.
Section 2. Monies:
The monies, securities, and other valuable effects of the Corporation
shall be deposited in the name of the Corporation in such banks or trust
companies as the Board of Directors shall designate and shall be drawn out or
removed only as may be authorized by the Board of Directors from time to time.
<PAGE>
Section 3. Fiscal Year:
Unless and until the Board of Directors by resolution shall determine the
fiscal year of the Corporation.
ARTICLE VII
AMENDMENTS
These Bylaws may be altered, amended, or repealed by the Board of
Directors by resolution of a majority of the Board.
ARTICLE VIII
INDEMNIFICATION
The Corporation shall indemnify any and all of its directors or officers,
or former directors or officers, or any person who may have served at its
request as a director or officer of another corporation in which this
Corporation owns shares of capital stock or of which it is a creditor and the
personal representatives of all such persons, against expenses actually and
necessarily incurred in connection with the defense of any action, suit, or
proceeding in which they, or any of them, were made parties, or a party, by
reason of being or having been directors or officers or a director or officer of
the Corporation, or of such other corporation, except in relation to matters as
to which any such director or officer or person shall have been adjudged in such
action, suit, or proceeding to be liable for negligence or misconduct in the
performance of any duty owed to the Corporation. Such indemnification shall not
be deemed exclusive of any other rights to which those indemnified may be
entitled, independently of this Article, by law, under any Bylaw agreement, vote
of stockholders, or otherwise.
ARTICLE IX
CONFLICTS OF INTEREST
No contract or other transaction of the Corporation with any other
persons, firms or corporations, or in which the Corporation is interested, shall
be affected or invalidated by the fact that any one or more of the directors or
officers of the Corporation is interested in or is a director or officer of such
other firm or corporation; or by the fact that any director or officer of the
Corporation, individually or jointly with others, may be a party to or may be
interested in any such contract or transaction.
<PAGE>
MANAGEMENT OF ENVIRONMENTAL
SOLUTIONS & TECHNOLOGY CORP.
AMENDMENT TO THE CERTIFICATE
OF INCORPORATION
Pursuant to the provisions of the Delaware Corporation Law, Management of
Environmental Solutions & Technology Corp adopts the following Amendment to its
Certificate of Incorporation.
The following amendment was adopted on March 2, l998, pursuant to Section
242 of the Delaware Corporation Law. Such amendment was adopted by the consent
of shareholders owning a majority of the Corporation's issued and outstanding
shares of common stock. Notice of this amendment has been sent to all
shareholders of record pursuant to Section 228 of the Delaware Corporation Law.
Amendment
Article IV was amended with the addition of the following paragraph:
Effective March 2, 1998 each issued and outstanding share of this
Corporation's common stock will be automatically converted into 0.001 share of
common stock. No fractional shares will be issued as a result of this reverse
stock split and each holder of a fractional share, upon written application to
this Corporation, shall be paid $0.01 for each fractional share held by such
person.
-----------------------------
Marieke Oudejans
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF THE SERIES A PREFERRED STOCK
OF
MANAGEMENT OF ENVIRONMENTAL SOLUTIONS & TECHNOLOGY CORP.
I, Marieke Oudejans, the President of Management of Environmental
Solutions & Technology Corp., a Delaware corporation, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of Directors by
the Articles of Incorporation of the Corporation, the Board of Directors on
January 4, 1999, adopted the following resolution creating a series of Preferred
Shares, $0.0001 par value per share, designated as the Series A Preferred
Shares.
The relative rights and preferences of the Series A Preferred Stock are as
follows:
1. Designation and Amount. The shares of such series shall be designed as
the Series A Preferred Shares (the "Series A Preferred Shares"), and the number
of shares constituting such series shall be 1,000,000. The number of shares
constituting such series may, unless prohibited by the Articles of
Incorporation, be decreased by resolution of the Board of Directors; provided
that no decrease shall reduce the number of Series A Preferred Shares to a
number less than the number of shares then outstanding plus the number of shares
issuable upon the exercise of outstanding options, rights or warrants or upon
the conversion of any outstanding securities issued by the Corporation
convertible into Series A Preferred Shares.
2. Dividends and Distributions
(i) The holders of Series A Preferred Shares, in preference to the
holders of Common Shares, shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally available
for the purpose, annual dividends payable in cash on the 31st day of
December in each year (each such date being referred to herein as a
"Dividend Payment Dates:), commencing on December 31, 1999 (a) at
the rate of $0.30 per share per year.
(ii)Dividends which are not declared will not accrue. Dividends not
declared will not cumulate. Accrued but unpaid dividends shall not
bear interest. Dividends paid on the Series A Preferred Shares in an
amount less than the total amount of such dividends at the time such
dividends are declared and become payable shall be allocated pro
rata on a share-by-share basis among all such shares outstanding at
that time. The Board of Directors may fix a record date for the
determination of holders of the Series A Preferred Shares entitled
to receive payment of a dividends or distribution declared thereon,
which record date shall be not more than thirty (30) days prior to
the date fixed for the payment thereof.
3. Voting Rights. Except as otherwise provided by law, the holders of
Series A Preferred Shares shall have no voting rights and their consent shall
not be required (except to the extent required by law) for taking any corporate
action.
<PAGE>
4. Certain Restrictions.
(i) Whenever dividends declared or other distributions payable on the
Series A Preferred Shares as provided in Section 2 hereof are in
arrears, thereafter and until all unpaid dividends and distributions
on the Series A Preferred Shares outstanding shall have been paid in
full, the Corporation shall not:
(a)declare or pay dividends, or make any other distributions, on
any shares of stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A
Preferred Shares;
(b)declare or pay dividends, or make any other distributions, on
any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with
the Series A Preferred Shares, except dividends paid ratably
on the Series A Preferred Shares and all such parity stock on
which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then
entitled:
(c)redeem or purchase or otherwise acquire for consideration any
Series A Preferred Shares, or any shares of stock ranking on a
parity with the Series A Preferred Shares, except in
accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of
Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of
the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the
respective series of classes.
(ii)The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under
subparagraph (i) of this Section 4, purchase or otherwise acquire
such shares at such time and in such manner.
5. Reacquired Shares. Any Series A Preferred Shares purchased or
otherwise acquired by the Corporation in any manner whatsoever shall constitute
authorized but unissued Preferred Shares and may be reissued as part of a new
series of Preferred Shares by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance set forth
herein, in the Articles of Incorporation, or in any other Certificate of
Designation creating a series of Preferred Shares or as otherwise required by
law.
6. Liquidation, Dissolution or Winding Up. Upon any liquidation,
dissolution or winding up of the Corporation, no distribution shall be made to
the holders of shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred Shares unless,
prior thereto, the holders of Series A Preferred Shares shall have received
$4.00 per share.
<PAGE>
7. Consolidation, Merger, Exchange, etc.. In case the Corporation shall
enter into any consolidation, merger, combination, statutory share exchange or
other transaction in which the Common Shares are exchanged for or changed into
other stock or securities, money and/or any other property, then in any such
case the Series A Preferred Shares shall at the same time be similarly exchanged
or changed into preferred shares of the surviving entity providing the holders
of such Preferred Shares with (to the extent possible) the same relative rights
and preferences as the Series A Preferred Shares.
8. Conversion.
(a) At the option of the holder of the Series A Preferred Shares, on
and after June 1, 1999, each share of the Series A Preferred Stock may be
converted into one share of the Corporation's common stock. Effective February
1, 2000 each Series A preferred share will automatically convert into one share
of this Corporation's common stock.
IN WITNESS WHEREOF, I have executed this Certificate of Designation,
Preferences and Rights this 4th day of January, 1999.
Marieke Oudejans, President
SHAREHOLDERS AGREEMENT
THE UNDERSIGNED:
1. M.E.S.T. BV, based in Amsterdam, Achillesstraat 97, hereafter called:
"MEST"; and
2. TNO MANAGEMENT BV, based in Delfi, Schoemakerstraat 97, hereafter called:
TMB"; Taking into consideration that:
- - TMB is 100% owned by the Netherlands Organization for Applied Technological
Research TNO (hereafter called "TNO") and on behalf of TNO acts as the
holding company with commercial activities;
- - TNO, especially the department of Processes and Applications of TNO
Environment, Energy and Process innovation, (hereafter called TNO-MEP), has
investigated and has acquired knowledge for the application of zeolites with
drying processes;
- - TNO-MEP conducted research, on the basis of this technology for the
treatment of sludge and manure;
- - TNO has applied for international patents for the zeolite technology used
in drying processes with regard to the treatment of sludge and manure;
- - MEST is 100% owned by M.E.S.T. Corp.;
- - MEST provides advice regarding agricultural and environmental problems and
MEST will exploit the above mentioned technology after further development
for the construction of manure conversion plants and installations;
- - Parties agree to collaborate for the development of the earlier mentioned
technology for the treatment of sludge and manure;
- - Parties have agreed to pursue their collaboration in a new to be
established Limited Company;
HAVE AGREED AS FOLLOWS:
1. Definitions
Company: The Company to be established by the Parties, named "Manure
and Sludge Technology BV" trading under the name "MST".
Shareholders: The shareholders are MEST and TMB together;
CSM: Common Shareholders Meeting;
<PAGE>
Know-how: The knowledge and experience with regard to the treatment of
sludge and manure on the basis of zeolite technology which is
available with TNO;
Patent application: The application that is filed by TNO in the
Netherlands, for the invention "sludge treatment" for the
treatment of sludge and manure based on the zeolite technology
number 1009619, dated July 10, 1998, titled: "Cost effective
method for treatment and/or total disposal of water containing
(waste) streams (like sludges, sewage, dung, etc.) based on
the application of zeolites";
Agreement: This agreement plus the attached enclosures;
Parties: Both TMB and MEST;
BOD: Board of Directors of the Company;
2. The Company
2.1 Parties will establish a company with limited liabilities, conforming to
the establishment act attached as enclosure 1, as soon as possible, after
the undersigning of this Agreement.
2.2 The Company will carry the name "Manure and Sludge Technology BV",
abbreviated: "MST BV". If it appears from the Chambre of Commerce that
this name or abbreviation is not permitted, Parties will establish a
different name for the Company.
2.3 The objective of the Company will be: the development of a technology with
regard to the treatment of manure and sludge, the commercialization of this
technology with regard to the treatment and incineration of sludge and the
guardianship and exploitation of the patents with regard to this technology. The
Company will have its base in Apeldoorn.
2.4 With the establishment of the Company, 40,000 (forty thousand) shares will
be issued with a par value of NLG 1.00 (one Dutch guilder) per share. The
shareholders will pay for the shares in cash at the moment of the issuance. The
authorized capital will be NLG 200,000 (two hundred thousand Dutch guilders).
2.5 With the establishment of the Company the issued shares will be placed
with the shareholders as follows:
TMB: 20,000 shares;
MEST: 20,000 shares;
Every party will have the same number of shares.
<PAGE>
3. Objective and financing
3.1 The Company's objective is the development of technology with regard to the
treatment and incineration of manure and sludge, the commercializing of this
technology with regard to the treatment and incineration of sludge and the
guardianship and the exploitation of the related patents. For the purpose of
this, Parties bring in the following:
a. MEST will supply with banks and TNO a subordinated loan of NLG
2,000,000 (two million Dutch guilders) conforming to the Loan
Agreement (see enclosure 2). The loan will be provided against 5%
interest.
b. TNO brings to the Company the Patent application and the Know-how against
payment for licensing fees conforming to the Licensing Agreement, see
enclosure 3. The licensing fee has a value of NLG 2,000,000 (two million
Dutch guilders) irrespective of the relative share in the application of
the technology. In the agreement a payment schedule is made in which
payment will be made in yearly terms of 50% of the positive Company results
and against payment of 5% interest over the unpaid balance of the licensing
compensation. All costs (including maintenance and broadening) with regard
to the application of the patents will be paid by the Company from the
moment of the start of the licensing agreement. After payment of the total
licensing compensation and as soon as the application results in patents,
TNO will give in ownership the patents and know-how to the Company for an
extra amount of NLG 1,000,000 (one million Dutch guilders). The conditions
related to this are stipulated in enclosure 3 'licensing agreement".
c. The Company will place an order with TNO-MEP for NLG 2,000,000 (two
million Dutch guilders) for the development of the technology based on
the know-how to make it commercially viable to turn raw manure into a
dry, granulated organic fertilizer product. In the research order a
payment schedule is stipulated that payment will be made in terms
before different phases will be concluded.
d. The Company gives in sub-license the patent applications and know-how
against payment of royalties as stipulated in enclosure 4:
Sub-licensing Agreement. MEST will use these rights to build or to
have built manure conversion plants and installations.
e. MEST will look for parties for the development and commercialization
of the zeolite technology for the treatment of different sorts of
sludges. In accordance with the shareholders it will be established
against which price and if yes or no, these parties can acquire shares
in the Company.
3.2 Taking into account what is established under 3.1 b the susceptible profit
will be paid to the shareholders yearly provided the liquidity position
allows it.
<PAGE>
3.3 When the Company and TNO come to the conclusion that the further development
of the technology does not lead to the foreseen results and through which
continuation of collaboration is no longer wished, Parties shall, in accordance
with each other, take measures for termination with regard to the Company,
patents, licenses and the research project.
4. Directors
4.1 At present the direction of the Company consists of two persons. The
shareholders appoint Ms. M. A. Oudejans (on behalf of MEST) and Mr. Eng. C.
Roos (on behalf of TNO) as first statutory directors of the Company. The
tasks and competence of the directors will be established in accordance
with the CSM.
4.2 The directors of the Company are obliged to implement, with regard to the
financial, social and economic guidance, the policies established by the
CSM and the BOD.
4.3 The directors shall report to the BOD on a monthly basis with regard to
the enterprise of the Company and its financial situation. Yearly, before
November 1, the directors shall present to the BOD the budget for the
following financial year for approval.
4.4 The Company will make sure that the Directors will be insured adequately
against managers liability.
5. Board of Directors
5.1 Shareholders who have a minimum of 20% of the shares in the placed capital
of the Company are legally allowed to appoint a commissioner to the CSM.
When more than three shareholders have 20% or more of the shares in the
placed capital of the Company this article can be changed accordingly.
5.2 The shareholders are obliged to agree with the appointment of a
commissioner by one of the shareholders.
5.3 Each shareholder has the right to submit to this shareholder appointed
commissioner for resignation with the CSM. The other shareholders are obliged to
agree with the resignation proposal.
5.3 A commissioner will be removed from the post at the CSM on the moment that
the shareholder on who's behalf he is appointed no longer has 20% or more
of the shares.
5.4 Mr. M. Schelvis (on behalf of MEST) and Mr. L. Bouwer (on behalf of TMB)
are appointed as commissioners with the establishment of the Company.
5.5 The members of the BOD will appoint a chairman from their members. This
appointment takes place for a period of two years, ternating once by MEST
and by TMB and so forth.
<PAGE>
5.6 The Company will make sure that the members of the BOD will be adequately
insured against commissioners responsibilities.
6. Meetings
6.1 Once quarterly, or how many times the commissioners wish, the BOD will
have a meeting. The directors will attend these meetings, but have no
voting rights.
6.2 The common meeting of the shareholders of the Company will take place as
stipulated in the statutes.
7. The length and termination of the Agreement
7.1 The agreement starts on the date of the complete signing of the contracts
and will hold for an undetermined length of time, as long as there is more
than one shareholder in the Company. Parties can cancel the agreement in
accordance with each other as determined in article 3.3. A shareholder's
agreement can also be cancelled in conformity with article 7.2.
7.2 This agreement will end for a shareholder by cancellation by registered
mail on behalf of the other shareholders, starting immediately, when this
shareholder:
a. no longer has shares in the company;
b. fails in compliance with what is established in the statutes of the
Company, and fails or lacks in reestablishing the situation as was
mentioned in the registered letter within 30 days;
c. is in state of suspension of payment or bankruptcy;
d. loses a corporate personality or will be disincorporated or liquidated;
e. for whatever reason loses free management or free disposition
over his/her capital.
7.3 In case of termination of this Agreement on grounds determined in article
7.2 b, the departing shareholder is obliged to offer and deliver all
his/her shares in the Company immediately to the other shareholders for a
price not higher than the visibly intrinsic value. When other shareholders
do not wish to buy the shares, the departing shareholder is allowed to
offer and deliver the shares to third parties for a price not lower than
the price offered to the other shareholders.
7.4 The commissioner, who was appointed on behalf of the departing shareholder
in the BOD, will be dismissed by the CSM on the day on which the
determination has taken place.
7.5 When the Agreement is terminated for a shareholder, all his/her rights
under this agreement expire. The departing shareholder is obliged to hand
over all documentation with regards to the collaboration of which the
Company is the owner.
<PAGE>
7.6 The departing shareholder will have no right on restitution or absolution of
outstanding amounts or debts which date from before the day of determination but
will only be freed from future financial obligations. A determination as
stipulated under 7.2 b leaves the rights to penalties and claims unimpeded.
8. Estrangement/ breach of shares
8.1 The shareholders will not offer their shares for sale in the first three
years after the establishment of the Company. Despite what is laid out in the
statutes with regard to estrangement, this three year non-sale period for shares
remains in full force. The shareholder who sells his shares to third parties is
obliged to make sure that this third party accepts the agreement and all
liabilities this concerns. Also in other cases, a third party can only receive
shares in the Company if he is a third party in the Agreement and accepts all
liabilities and obligations concerned.
8.2 A shareholder is, at any moment, allowed to transfer ownership of the shares
in the Company to a subsidiary that 100% belongs to this shareholder, provided
that this subsidiary will become a party in this Agreement and accepts all
responsibilities of the shareholder who transfers the shares in ownership. The
shareholder who transfers the shares in ownership will be , next to the
subsidiary, responsible for all obligations till the moment of estrangement
which is determined in the Agreement or in the statutes of the Company.
8.3 When after estrangement as meant in 8.2, the subsidiary to whom the shares
are transferred will no longer be a subsidiary of the shareholder who
transferred the shares in ownership, the transferring shareholder will be
obliged to transfer the ownership of the shares back to him and will become
again a party of the Agreement and will accept all responsibilities of the
subsidiary as his own responsibilities.
9. Non-disclosure
9.1 As legally or differently required, Parties will not publicize nor make
public to third parties, directly or indirectly, confidential information
regarding the Company, the Agreement or each other, no matter if this
information is confidential or secret, or pertains to lists of clients,
deliverers or manufacturers or organizations who do business or have done
business or will do business with the Company.
10. Complete Agreement
10.1 The contents of the Agreement include enclosures I through 4 which are an
integral parts of this Agreement. The Agreement can only be changed or
supplemented with documents signed by both parties.
10.2 The agreement contains all agreements between Parties with regard to the
Company and replaces all earlier made oral and written agreements.
<PAGE>
11. Rights and Disagreements
11.1 Dutch law is applicable to this Agreement.
11.2 All disagreements which arise with regard to this Agreement, will be
brought to court with the competent lawyer in The Hague, unless Parties decide
differently.
As agreed upon and thrice signed:
MEST TMB
Name: M. A. Oudejans Name: L. Bouwer
Title: Director Title: Director
Date/Place: January 22, 1999 Amsterdam Date/Place: January 25, 1999 Delft
TNO TNO
Name: M.Sc. J.A. Dekker Name: Dr. Eng. P. Folstar
Title: Chairman Board of Directors Title: Member Board of Directors TNO
Date/Place: February 1, 1999, Delft Date/Place: February 1, 1999, Delft
<PAGE>
In this translation an attempt has been made to be as literal as possible
without jeopardizing the overall continuity. Inevitably, differences may occur
in translation, and if so, the Dutch text will by law govern.
12 July 1999
INCORPORATION OF A PRIVATE COMPANY
This twelfth day of July nineteen hundred and ninety-nine there appeared before
me, Onno Berend Okkinga, Civil law notary, officiating in Rotterdam:
1. Mrs. Nicole Corine van Smaalen, candidate-notary, residing at 2985 AR
Ridderkerk, Kerkweg 217, born at Rotterdam on the eleventh day of May
nineteen hundred and sixty-two, not married and not a registered partner,
holder of driving permit number: 3030605188 (issued at Rotterdam on the
tenth day of March nineteen hundred and ninety-four), acting in her
capacity of mandatory in writing of M.E.S.T. Management of
Environmental Solutions & Technology B.V., a private company with limited
liability, having its registered office at Amsterdam and its address at
Achillesstraat 97, 1076 PX Amsterdam;
2. Mrs. Sandra Gerarda Broekmans-Romberg, secretary, residing at 3069 DB
Rotterdam, Hopklaver 49, born at Delft on the sixteenth day of April
nineteen hundred and sixty-one, married and holder of driving permit with
number; 3152633365 (issued at Rotterdam on the twenty seventh day of April
nineteen ninety-nine), acting in her capacity of mandatory in writing of
TNO Management B V., a private company with limited liability, having its
registered office at Delft, and its address at Schoemakerstraat 97, 2628 VK
Delft.
Powers of attorney
The mandates appear from two written powers of attorney, which shall be attached
to this deed. The existence of the mandates is sufficiently known to me, civil
law notary.
The appearing person in their said capacity have declared hereby to incorporate
a private company with limited liability ("besloten vennootschap met beperkte
aansprakelijkheid") with the following articles of association:
Name and seat.
Article 1.
1. The name of the company is: Manure and Sludge Technology (MST) B.V.
2. The corporate seat of the company is in Apeldoorn.
<PAGE>
Objects.
Article 2.
The objects of the company are:
- - the research and development as well as the application of technologies
relating to the treatment and processing of manure and sludge.
- - to participate in, to administer, to finance, to conduct the management of
and to render advice and services to other companies and enterprises;
- - to operate and to trade in copyrights, patents, models, secret processes,
trademarks and other intellectual and industrial property rights;
- - to lend and to borrow moneys, to issue bonds, debentures and other
securities, as well as entering into agreements pertaining thereto;
- - to provide guarantees for debts and other liabilities of the company and of
third parties;
- - all other activities that are connected with or that may be conductive to
the above, all this in the broadest sense.
DURATION
Article 3.
The Company shall continue in existence for an indefinite period.
CAPITAL AND SHARES
Article 4.
The authorized capital of the Company is two hundred thousand Guilders
(NLG200.000,--) divided into two hundred thousand shares (200.000) of one
Guilder (NLG 1,--) each.
Article 5.
1. The "Algemene Vergadering van Aandeelhouders" (General Meeting of
Shareholders) shall resolve upon the issue of unsubscribed shares and shall
determine the price and the further terms of issue.
2. The General Meeting of Shareholders is entitled to assign its authorities
to adopt resolutions, referred to in para. I of this Article, to another
corporate body and is entitled to revoke such an assignment.
3. Upon any issuance of shares the nominal amount must be paid on each share.
<PAGE>
4. A shareholder shall not have a preferential right in case of an issuance of
shares and in case of a granting of subscription rights on shares.
5. In view of subscription for or acquisition of shares in the Company's
capital or of depositary receipts therefor, the Company may only make loans
to the extent of its distributable reserves.
Article 6.
1. The "Directie" (managing Board) may - without prejudice to the other
provisions, laid down in Articles 2O7 and 207d of Book 2 of the (Dutch)
Civil Code - cause the Company to acquire fully-paid shares in its capital
otherwise than gratuitously and for valuable consideration only, if:
a. the Company's own assets and property, decreased by the acquisition
price, is not less than the paid-up and called-up part of the capital,
increased by the reserves that are required to be kept under and in
pursuance of the statutory provisions (or the provisions of the
Articles of Association);
b. the nominal amount of the shares to be acquired and the shares already
held jointly by the Company and its subsidiary companies in its capital
is not in excess of one half of the issued capital; and
c. the authorization for such acquisition has been granted by the General
Meeting or by another organ or body of the Company that has been
designated for that purpose by the General Meeting. The concept
"shares" in this Article shall mean to include depositary receipts for
shares in the Company.
2. In respect of alienation by the Company of shares acquired by it in its own
capital Article 5 hereof shall apply correspondingly, with the proviso that
such alienation may also be effected at a price below par.
3. The Company cannot base any preferential right of subscription on any
account whatsoever on shares, nor on depositary receipts for shares, in its
capital held by it or by a subsidiary company.
4. No votes can be cast at the General Meeting of Shareholders in respect of a
share owned by the Company or a subsidiary company thereof; nor in respect
of a share for which the depositary receipts are held by one of them.
However, usufructuaries and pledgees of shares owned by the Company and its
subsidiary companies shall not be excluded from their right of voting, if
the usufruct or the right of pledge had been created before the share was
owned by the Company or by a subsidiary company thereof. No votes can be
cast by the Company or a subsidiary company thereof in respect of a share
in which it has a right of usufruct or on which it has a right of pledge.
<PAGE>
5. When determining to which extent the shareholders cast votes, are present
or represented, or to which extent the share capital is provided or
represented, the shares, in respect of which the law provides that no votes
can be cast in respect thereof, shall not be taken into account.
6 From shares held by the Company in its capital no right of any distribution
shall ensue for the benefit of the Company. In the computation of the
distribution of profit shares from which no rights of any distribution
ensue for the benefit of the Company shall not count.
Article 7
1. The shares shall be registered shares and shall be numbered from 1 (one)
onwards.
2. No share certificates will be issued.
3. The Managing Board shall keep a share register, in which shall be recorded
the names and addresses of all the shareholders, at the same time stating
the number of shares held by them, the amount paid up on each share and all
other data, that by virtue of the law are required to be recorded therein,
including the names and addresses of those persons who have a right of
usufruct or a right of pledge on those shares at the same time stating
which rights attaching to the shares may be exercised by them in conformity
with paras. 9, 10 and 11 of this Article.
4. In the register shall furthermore be recorded the names and addresses of
the holders of registered depositary receipts issued with the cooperation
of the Company.
5. Each shareholder, usufructuary and pledgee of shares and each holder of
registered depositary receipts issued with the cooperation of the Company
shall take due care to see that his address is known to the Company.
Such address shall as against the Company continue to apply, as long as
another address has not been notified to the Managing Board by registered
letterpost.
6. The register must be kept up-to-date by the Managing Board.
7. On being so requested, the Managing Board shall furnish a shareholder, a
usufructuary and a pledgee with an extract from the register in respect of
his right to a share, free of charge. If a right of usufruct or a right of
pledge has been established on the share, the extract shall state which
persons may exercise the rights mentioned in paras. 9, 10 and 11 of this
Article.
8. The Managing Board shall make the register available at the Company's
office for inspection and perusal by the shareholders, as also by the
usufructuaries and pledgees who are entitled to exercise the rights
mentioned in paras. 9 10 and 11 of this Article.
9. A usufruct may be established on shares. If at the establishment of such
usufruct it has been provided that the usufructuary shall be entitled to
the voting right, he only shall be entitled to the voting right if both
that provision and - in case of transfer of the usufruct - the passing of
the voting right to another person have been approved by the General
Meeting of Shareholders.
<PAGE>
10. The shareholder who has no voting right and the usufructuary who has the
voting right shall have the rights conferred by Statute upon the holders of
depositary receipts issued with the cooperation of the Company.
ii. Shares and rights attaching to shares shall not, without the consent of
the General Meeting of Shareholders which may attach conditions to the
granting of such consent, be capable of being pledged.
When establishing a right of pledge the provisions of the second sentence of
para. 9 and para. 10 of this Article shall apply correspondingly.
12. In these Articles of Association the term 'holders of depositary receipts
shall mean the holders of depositary receipts issued with the cooperation
of the Company, as also the persons who as a result of a usufruct or pledge
established on a share have the rights mentioned in paras. 10 and 11 of
this Article.
Article 8.
If shares form part of any community, the joint co-owners may only have
themselves be represented as against the Company by a person designated by them
for that purpose in writing.
MODE OF TRANSFER OF SHARES
Article 9.
Any transfer of a share or of a right of usufruct in a share or the creation of
a right of usufruct in or of a right of pledge on a share shall be effected with
due observance of the provisions of Article 196 of Book 2 of the (Dutch) Civil
Code.
PROVISIONS RESTRICTING THE FREE TRANSFERABILITY OF SHARES
Article 10.
1. If a shareholder (hereinafter also called "the offeror") wishes to transfer
the ownership of one or more of his shares - gratuitously or for a valuable
consideration - he shall first offer the same to the other shareholders and
to the persons within the meaning of para. 5 of this Article.
2. For that purpose the shareholder shall notify his intention to the Managing
Board by registered letterpost, stating the number of shares he is desirous
of transferring and naming the person(s), to whom he wishes to transfer the
same.
3. Within one week of receipt of the communication mentioned in the
immediately preceding paragraph of this Article the Managing Board shall
bring the same by registered letter Post to the knowledge of all the
shareholders recorded in the share register. Each shareholder who wishes to
exercise his preferential right shall within four weeks of dispatch of the
notification mentioned in the immediately preceding sentence inform the
Managing Board by registered letter post how many of the shares offered he
is desirous of taking over, failing which his preferential right to take
over the shares so offered shall lapse, excepting a renewed offer as
hereinafter described.
<PAGE>
4. If the shareholders claim in the aggregate more shares than have been
offered, then and in such case allocation shall, as far as possible, be pro
rata to the number of shares held by each of them and otherwise by lot, the
drawing of lots to be arranged and carried into effect by the Managing
Board, with the proviso that no shareholder may be allotted more shares
than the number of shares he has declared himself willing to take over and
with the proviso that so long as upon such drawing of lots or upon a
drawing of lots as herein before mentioned which took place at an earlier
date after any previous offer each of the shareholders therefor qualifying
has not been allocated at least one share, the shareholders who upon any
such drawing of lots have been allocated a share shall not any further take
part in such drawing of lots.
5. However the Managing Board shall, if and in so far as the shareholders in
the aggregate did claim less shares than have been offered, have authority
after having obtained the approval of the General Meeting of Shareholders -
to designate one or more third persons, by whom the shares - or one or more
thereof are taken over. The Company can be designated as a claimant only
with the consent of the offeror.
Simultaneously with the notification of the communications received from
the other shareholders respecting the number of shares they wish to take
over, the Managing Board shall within four weeks after expiry of the period
mentioned in para. 3 of this Article and prescribed for the claiming of the
shares by the other shareholders, bring such fact to the knowledge of the
offeror and of those who wish to take over the shares by registered letter
post.
6. The parties shall mutually determine the price, at which the shares shall
be transferred.
If they shall not reach agreement within four weeks after dispatch by the
Managing Board of the notification mentioned in para. 5 of this Article,
the value shall be fixed by one independent expert (or, if one of the
parties shall so wish, by three independent experts), to be mutually
appointed by the offeror and the claimants, or, if the parties cannot reach
agreement on such appointment either, by the Chairman of the Chamber of
Commerce and Industry within whose district the Company's Registered Office
is situate, upon the application of whichever of the parties first makes
the same.
The Managing Board shall furnish such expert(s) with all such information
as he (they) shall demand
The Managing Board shall forthwith notify the price fixed by the expert(s)
by registered letter to the offeror and to each claimant
The decision of this (these) expert(s) shall be binding upon the parties. A
claimant shall have the right to abandon the purchase within one month
after the price has been notified to him. If shares become available as a
result thereof, the shares which have thus become available shall yet be
offered to the other claimants at the price fixed by the expert(s), subject
to the provisions embodied in paras. 3 to 5 inclusive of this Article.
The offeror shall continue to be entitled to withdraw his offer, provided
always this takes place within one month after it is known to him to which
claimants he can sell all the shares to which the offer relates and at
which price, in which event he shall retain these shares, and in that event
he may not transfer the same to any third person.
<PAGE>
The expert(s) fee and expenses shall be borne by the Company.
7. If all the shares have been taken, the offeror shall within ten days after
the payment hereinafter to be mentioned has been made, transfer the shares.
The claimants shall within ten days after an application to that effect by
the Managing Board be under the obligation to deposit the price of the
shares, unless otherwise agreed upon, with the civil law notary before whom
the deed of transfer will be executed. If the parties fail to agree upon
the appointment of the said civil law notary, the Managing Board shall
appoint the notary.
If one or more claimants shall fail to deposit the said price, the Managing
Board shall within two weeks after expiry of the aforementioned period
notify to the claimants who have fulfilled their obligation, to deposit the
price the number of shares, in respect whereof the price has not been
deposited; such shares shall be deemed to have been offered to the persons,
to whom the notification was addressed.
The claimants who are desirous of taking over one or more of the shares
which have thus become available at the price fixed in respect thereof
shall so inform the Managing Board within fourteen days after dispatch of
the aforementioned notification. The Managing Board shall within fourteen
days after expiry of the period prescribed in the immediately preceding
sentence inform the offeror and the persons who have claimed shares which
have become available, how many shares are allocated and to whom.
The provision laid down in the penultimate sentence of the preceding
paragraph shall apply correspondingly.
The claimants to whom additional shares have been allocated shall within
fourteen days after dispatch of the aforesaid notice of allocation deposit
the price payable by them in respect thereof in the manner as herein before
described in this paragraph.
8. The offeror shall be at liberty to transfer all the shares offered to the
proposed acquirer, if all the shares offered are not taken over against
payment in cash, provided such transfer takes place within three months
after such has become an established fact.
9. In the event of the offeror failing to transfer the shares as prescribed in
para. 7 of this Article, the Company shall irrevocably be authorized to
effect such transfer.
l0. If and as soon as a shareholder be declared bankrupt, be granted a
moratorium in respect of his debts or in the event of shares passing to
others, - which shall not include the joining of an estate as a result of a
marriage - either in whole or in respect of an undivided part otherwise
than by transfer, as also in the event of transfer of shares on the ground
of appropriation of a community to a person other than the shareholder
himself out of a community, into which he had brought the shares, the
shareholder or his legal representative or - as the case may be - the
acquirer(s) shall be under the obligation to offer these shares to the
other shareholders.
<PAGE>
So long as the shares have not been transferred, the shareholder or his
legal representative or the acquirer(s) shall continue to be vested with
all the rights attaching to the shares.
The provisions herein before shall apply correspondingly, with the proviso
that it shall not be competent for the offeror to withdraw and with the
further proviso that in cases where it would by virtue of the present
Article be competent for the offeror to transfer the shares offered to
(the) person(s) named by him, the offeror mentioned in this paragraph shall
only have the right to retain such shares.
If no offer as referred to in the first sentence of this paragraph is made,
then and the Company shall, after a summons, irrevocably be authorized to
make such offer in the name and behalf of the offeror.
11. The provisions of this Article shall also apply, if a person wishes, in any
capacity or by virtue of any title whatsoever, to alienate one or more
shares belonging to someone else.
12. The provisions of this Article shall apply in like manner to subscription
rights and other rights attaching to shares, except for rights to cash
payments.
13. The provisions of the preceding paragraphs of this Article shall not apply,
if all the remaining shareholders have notified either the person, whose
shares have been offered or are deemed to have been offered, or the
Managing Board, in writing that with respect to the case concerned they
waive and renounce their rights under this Article, provided the transfer
takes place within three months after all the shareholders have made such
declaration.
14. If among the persons entitled to an estate is the person in whose name the
shares were registered in the share register, the obligation to offer shall
for a period of six months be deferred and shall terminate if the shares
have been allocated to that person within the said period.
The provisions laid down in this Article shall neither apply, if by virtue
of the law the shareholder is obliged to transfer his share to a former
holder.
15. The preceding paragraphs of this Article shall not apply in the case of
transfer or passing of one or more shares to the Company or in the case of
alienation by the Company of shares acquired by it in its capital.
<PAGE>
MANAGEMENT AND SUPERVISION
Article 11
1. The Company shall be managed by a "Directie" (Managing Board), consisting
of one or more "Directeuren'f (Managing Directors).
The general meeting of shareholders may resolve to establish a Supervisory
Board, consisting of one or more Supervisory Directors. The Supervisory
Board will be established as of the date of registration of the resolution
referred to in the preceding sentence, as well as the registration of a
resolution adopted by the General Meeting of Shareholders to that effect
with the commercial register at the place of registration of the corporate
seat of the Company.
If the Company does have a Supervisory Board pursuant to the preceding two
sentences, this article as well as the articles 16 and 17 shall apply to
the Supervisory Board and is members, notwithstanding the provisions of the
law and these Articles in respect of the Supervisory Bard and its member.
The number of Managing Directors and, if a Supervisory Board has been
established, the number of Supervisory Directors shall be fixed by the
General meeting of Shareholders.
A juristic person shall also be eligible for appointment as Managing
Director.
2. The Managing Directors and the Supervisory Directors shall be appointed by
the General Meeting of Shareholders and may at any time be suspended and
removed by it from office.
3. If the General Meeting of Shareholders or the Supervisory Board has
suspended a Managing Director from office, and also if the General Meeting
of Shareholders has suspended a Supervisory Director from office, the
General Meeting of Shareholders shall within three months after
commencement of such suspension from office resolve either upon termination
or upon extension of the suspension, failing which the suspension from
office shall cease. A suspension from office may be extended only once and
for a period not exceeding three months, commencing on the day, on which
the General Meeting of Shareholders resolves upon such extension. If the
General Meeting has not resolved upon removal or upon termination of the
suspension within the period prescribed for such extension, the suspension
from office shall terminate.
4. A Managing Director or a Supervisory Director so suspended from office
shall be enabled to account for his actions at the General Meeting of
Shareholders and may for that purpose procure the assistance of an adviser.
5. If the office(s) of one or more Managing Directors be vacated or if one or
more Managing Directors be otherwise unavailable, the remaining managing
Directors or the remaining Managing Director shall temporarily be vested
with the entire management.
If the offices of all the Managing Directors or the office of the sole
Managing Director be vacated or if all the Managing Directors or the sole
managing Director be otherwise unavailable, the management shall
provisionally vest in the Supervisory Board; it shall in that event be
competent for the Supervisory Board to designate from its body or otherwise
- one or more persons, who shall be in charge of such management.
If the offices of all the Managing Directors or the office of the sole
Managing Director be vacated, the Supervisory Board shall, as soon as
possible, call a General Meeting of Shareholders for the purpose of having
definite provision made.
<PAGE>
MANAGING BOARD
Article 12.
1. The Managing Board shall be vested with the management of the Company's
affairs. The Managing Directors shall in the conduct of their management
duly observe and comply with directives that may have been drawn up by the
Supervisory Board,in respect of the general lines of the financial, social,
economic and staff policy to be adopted and pursued in the business of the
Company.
If there is more than one Managing Director in office, the General Meeting
of Shareholders may grant to one or more Managing Directors the title of
Algemeen Directeur (General Managing Director)
2. The Managing Board may, with due observance of these Articles of
Association, draw up rules, regulating matters concerning the Board
internally. Furthermore, the Managing Directors may, by means of a code of
rules or otherwise, determine the duties to be discharged by each of them.
3. The Managing Board shall meet whenever a Managing Director shall so demand.
It shall pass resolutions by absolute majority of votes which majority is
to include the vote of the General Managing Director. If the votes are
equal the General Meeting of shareholders shall decide if so requested by a
Managing Director.
4. The General Meeting of shareholders shall be competent to subject in a
resolution of the Board to that effect clearly described resolutions of the
Managing Board to its approval or authorization.
Without prejudice to the provision laid down in the preceding sentence, the
Managing Board shall require the authorization or approval of the General
Meeting of shareholders for resolutions of the Managing Board, the subject
matter of which is:
a. acquisition, encumbrance, alienation, hiring or letting notice to leave or
acquiescence in notice to leave of registered goods;
b. encumbrance of other goods than registered goods;
c. the borrowing of money and/or obtainment of advances on current account
on behalf of the Company, as also the placing on deposit of moneys of
the Company otherwise than from or with the institutions approved by
the General Meeting of Shareholders;
d. the lending of money;
e. granting, alteration or withdrawal of powers of procuration or the
according to or withdrawal from a "procuratiehouderff (officer of the
Company holding powers of procuration) of a title as referred to in
Article 14 hereof;
f. the granting to an employee of a fixed annual salary exceeding the an
amount fixed by the General Meeting of Shareholders and notified to the
Managing Board, and the dismissal of an employee earning a fixed annual
salary as herein before described;
<PAGE>
g. arranging of group pension schemes or the granting of pension rights
otherwise than in pursuance of a group pension scheme;
h. binding the Company for debts of others, as surety or otherwise;
i. entry into agreements - to the extent that the same do not form part of
standard contracts - in pursuance whereof disputes, if any, are to be
referred to the determination of arbitrators or are to be determined by
binding opinion, or the subject matter whereof is the compromising of
matters;
j. the taking or defending of legal proceedings in the ordinary courts of
law, the taking or defending of arbitration proceedings or the taking
of measures for the purpose of obtaining a binding opinion, except for
taking legal action which no delay or are of a purely precautionary
nature and, further, except for taking measures for the collection of
receivables;
k. the exercise of voting rights in respect of unlisted shares and other
securities, to which voting rights attach, which shall include
determination of the way of voting;
l. establishment or winding up of offices and branches;
m. extension of the business by a new branch or discontinuance which shall
include transfer of ownership - of the Company's business or any part
thereof;
n. participation in or undertaking or relinquishment of the administration
of other enterprises or termination of such participations;
o. the undertaking of commitments or the doing of acts, to the extent that
any such commitment or act does not fall under any of the preceding
letters, exceeding in amount or value such sum as shall each time be
fixed by the General Meeting of Shareholders, or undertaken or binding
for a period in excess of twelve months.
Article 13.
The General Meeting of Shareholders shall fix the salary, the "tantieme",
if any, and the further terms of employment of the Managing Directors.
OFFICERS OF THE COMPANY HOLDING POWERS OF PROCURATION
Article 14.
The Managing Board may, with due observance of Article l2, paragraph 4,
hereof, confer powers of procuration upon one or more persons whether or
not in the employ of the Company, and accord to one or more
"procuratiehouders" such title as it shall choose.
<PAGE>
REPRESENTATION
Article 15.
1. The Company is represented by the Managing Board, insofar as the law does
not otherwise provide. If two or more Managing Directors have been
appointed, the authority to represent the Company shall also vest in two
Managing Directors acting together.
If only one Managing Director is officiating, such Managing Director
represents the Company alone. The Managing Board may authorize one or
more Managing Directors to represent the Company within the limitations
set by such authorization.
2. If a Managing Director privately enters into an agreement with the Company
or conducts legal proceedings against the Company, the Company shall be
represented by a Supervisory Director to be designated for that purpose by
the Supervisory Board. The General Meeting of shareholders is always
competent to designate one or more other persons for that purpose.
In all other matters of conflicting interests between a Managing Director
and the Company, the Company shall be represented in conformity with the
first paragraph of this Article.
SUPERVISORY BOARD
Article 16
1. The management by the Managing Board and the general course of affairs of
the Company and of the enterprise connected with it shall be supervised by
a "Raad van Commissarissen" (Supervisory Board).
The "Commissarissen" (Supervisory Directors) shall give advice to the
Managing Board. In the exercise of their duties, the Supervisory Directors
shall let themselves be guided by the interests of the Company and of the
enterprise connected with it. The Managing Board shall in good time supply
to the Supervisory Board the data and further particulars required for a
proper performance of its duties.
2. Upon a person being recommended for appointment as Supervisory Director the
data and particulars concerning the candidate required in pursuance of
Article 252, para. (3) of Book 2 of the Civil Code shall be furnished. The
reasons for such recommendation shall be stated.
3. If there is more than one Supervisory Director, the Supervisory Board may
appoint one of them to the chairman; the latter's title shall be "President
Commissaris". The Supervisory Board shall appoint a secretary, from its
body or otherwise.
<PAGE>
Furthermore, the Supervisory Board may appoint from its body one or more
"gedelegeerde Comrnissarissen" (delegated Supervisory Directors), whose
task shall be to keep more frequent contact with the Managing Board. He
(they) shall report to the Supervisory Board. The offices of
"President~Commissaris and "gedelegeerde Commissaris" may be held by one
and the same person.
4 The General Meeting of Shareholders may allocate to the Supervisory
Directors or to one or more of them a fixed remuneration or a remuneration
depending in whole or in part upon the Company's results. Expenses shall be
refunded to them.
5. A Supervisory Director shall retire from office at the Close of the
ordinary annual General Meeting of Shareholders held in the financial year
in the course whereof he attains the age of seventy-two years.
6. The Supervisory Board may suspend a Managing Director from office.
Article 17.
1. The Supervisory Board may provide that one or more of its members shall
have access to all business premises in use of by the Company and that he
(they) shall have authority to inspect all the books, correspondence and
other records and to take cognizance of all acts and things that have been
transacted or done, or that he may exercise part of the said powers.
2. The Supervisory Board shall meet whenever one of its members shall so
request. It shall pass resolutions by absolute majority of votes.
If the votes are equal no resolution shall come into being, unless there
are more than two Supervisory Directors and one of them has been appointed
as "President-Commissaris", in such event the "President-Commissaris" shall
have a deciding vote.
3. Subject to the provisions of para. (4) of this Article, the Supervisory
Board may not take resolutions, if the majority of the members is not
present.
4. The Supervisory Board may also pass resolutions without a meeting being
held, provided in writing, by telegram, by teleprinter or by telefax and
provided all Supervisory Directors declare in favor of the proposal
concerned. A resolution which has been taken in this manner shall be noted
in the book, wherein the proceedings at meetings of the Supervisory Board
are recorded, which book will be kept by the Secretary of the Supervisory
Board; the records, evidencing any such resolution, shall be attached to
the minute book.
5. If so invited, the Managing Directors shall attend the meetings of the
Supervisory Board and shall furnish all such information required by the
Supervisory Board.
6. The Supervisory Board may at the Company's cost and expense ask the opinion
of experts on such matters as the Supervisory Board shall deem desirable
for a proper performance of its duties.
<PAGE>
7. If there is only one Supervisory Director, such Supervisory Director shall
be vested with all such powers and obligations as are conferred and imposed
by Statute and by these Articles of Association upon the Supervisory Board,
the "Pesident-Commissaris" and the "gedelegeerde Commissaris".
8. The Supervisory Board may, with due observance of the provisions of these
Articles of Association, draw upr ules, regulating matters concerning the
Supervisory Board internally.
GENERAL MEETING OF SHAREHOLDERS
Article 18.
1. The ordinary general meeting of shareholders shall annually be held not
later than within six months after the end of the financial year.
2. At these meetings:
a. the annual written report to be delivered by the Managing Board.upon
the state of the Company's affairs and the management thereof shall be
dealt with;
b. the annual account and the appropriation of the profit shall be dealt
with;
c. all such further business shall, with due observance of Article 224 of
the second Book of the Civil Code, be dealt with as has been placed on
the agenda of the meeting;
d. vacancies shall be filled.
3. Extraordinary general meetings of shareholders shall be held whenever the
Managing Board or the Supervisory Board shall call the same.
4. Such meetings shall be called by the Managing Board and the Supervisory
Board if shareholders and/or holders of depositary receipts for shares,
representing at least ten per cent. of the entire issued capital shall so
request the Managing Board and the Supervisory Board in writing, specifying
at the same time the nature of the business to be dealt with.
If no member of the Managing Board or the Supervisory Board shall in such
event call a General meeting of Shareholders thus that it is held within
four weeks of the day of receipt of such request, each requisitionist shall
have power to call such meeting himself, with due observance of and subject
to the relative provisions of the law and these Articles of Association.
Article 19.
1. General meetings of Shareholders shall be held at the place where the
Company's Registered Office is situated.
In a general meeting held elsewhere, valid resolutions shall may only be
capable of being taken provided the entire issued capital is represented
and all holders of depositary receipts are present or represented.
<PAGE>
2. Subject to the provisions of Article 18, para 4, hereof notice of any
meeting shall be given by a managing Director or a Supervisory Director by
means of registered letters sent to the addresses of shareholders and
holders of depositary receipts for shares, as stated in the register
mentioned in Article 7 hereof. The term of such notice shall be at least
fourteen days, not counting the day, on which notice is given and the day
appointed for the meeting.
The convening notice shall specify the nature of the business to be dealt
with.
3. If the regulations set by Statute or by these Articles of Association in
respect of the holding of meetings and announcement of the business to be
transacted have not been complied with, valid resolutions shall, without
prejudice to para.l, second sentence, nevertheless be taken, provided the
entire issued capital is represented at the meeting concerned and provided
any such resolution is carried unanimously.
Article 20.
1. The General Meeting shall be presided over by a person designated by the
Supervisory Board from among its body or otherwise. Failing such
designation the General Meeting itself shall choose its chairman. The
chairman shall designate the secretary of the meeting.
2. The secretary shall keep minutes of the business transacted at any meeting,
unless a notarial record thereof is drawn up. Each Managing Director and
each Supervisory Director, as well as chairman of the meeting, shall at all
times have authority to order such notarial record to be drawn up, at the
Company's cost and expense.
The minutes shall be confirmed by the meeting concerned or by a subsequent
meeting and shall in witness thereof be signed by the persons who act as
chairman and secretary at the meeting, at which such confirmation takes
place.
Article 21.
1. At the General Meeting of Shareholders one vote may be cast in respect of
each share.
2. Blank votes and invalid votes shall be regarded as not having been cast.
3. Shareholders and holders of depositary receipts may have themselves be
represented at any meeting by a proxy duly authorized in writing.
4. All resolutions shall be adopted by an absolute majority of votes, unless
these Articles of Association prescribe a larger majority.
5. The Chairman shall determine the way of voting, privided that upon the
request of a person entitled to vote, voting persons shall so demand,
voting concerning the appointment of persons, the suspension and removal of
persons from office shall be by folded, unsigned ballot-papers.
<PAGE>
6. If, the votes are equal, a second meeting shall be held not earlier than
three weeks and not later than seven weeks after the first meeting, at
which a fresh vote shall be taken. If at this second meeting the votes are
also equal, then the General Meeting of Shareholders shall appoint one or
more (provided always consisting of an uneven number) expert(s) for the
purpose of taking a decision on the proposal concerned. If the General
meeting of Shareholders shall fail to reach agreement on the appointment of
the expert(s), this expert/these experts shall be appointed by the Chairman
of the Chamber of Commerce and Industry, in whose district and jurisdiction
the Company's Registered office is located, upon the application of which
ever of the persons entitled to vote first makes the same.
Article 22.
1. Unless there are holders of depositary receipts the shareholders also may
adopt all resolutions which they are empowered to take when in meeting
without a meeting being held.
If no meeting is held, a resolution may only be taken if the holders of all
the shares not held by the Company have been declared in favor of the
resolution concerned in writing, by telegram, by telex or by telefax.
2. A statement signed by the holders of all the issued shares not held by the
Company shall be considered to constitute a resolution of the General
Meeting of Shareholders.
The provision laid down in this paragraph shall not apply, if there are
holders of depositary receipts.
3. A Managing Director and a Supervisory Director shall enter resolutions
which have been adopted in the manner as mentioned in the preceding
paragraphs of this Article in the book, wherein the proceedings at General
Meetings of Shareholders are recorded, which entry shall be signed by them
and which shall be read out at the next General Meeting.
In addition, the records evidencing the taking of such a resolution shall
be attached to the minute-book of the General Meetings.
FINANCIAL YEAR - ANNUAL ACCOUNTS
Article 23.
1. The financial year shall be the calendar year.
2. Every year the Managing Board shall within five months after the end of
each financial year subject to extension of this period by the General
Meeting of Shareholders with term of not longer than six months on account
of extraordinary circumstances draw up the annual account, which shall be
submitted to the General Meeting for confirmation.
The annual accounts shall be accompanied by the annual report and the
further data, referred to article 392, para 1, second Book, Civil Code, all
this as far as applicable to the Company.
<PAGE>
The annual account shall be signed by all the Managing Directors and all
the Supervisory Directors; if the signature of one or more of them fails,
the reason therefor shall be stated on the document concerned.
3. Confirmation of the annual accounts by the General Meeting shall - unless
the said Meeting makes a reservation - constitute a discharge to the
Managing Board in respect of its management during the past financial year,
and a discharge to the Supervisory Board in respect of its supervision
thereof, subject to the provisions of Articles 248 and 259 of the second
Book of the Civil Code.
4. From the day, on which notice is given of the General Meeting, called for
the purpose of considering the annual account, the documents mentioned in
para. 2 of this Article shall until the close of that meeting be available
at the Company's office for inspection and perusal by the shareholders and
the holders of depositary receipts.
Each of them may obtain full copies thereof, free of charge.
If the accounts are confirmed after alteration, the immediately preceding
sentence shall apply correspondingly to he accounts as adopted and
confirmed.
PROFIT AND LOSS
Article 24.
The profit shall be at the disposal of the General Meeting of Shareholders.
Article 25.
1. Distribution to shareholders may only be made to the extent the Company's
own capital exceeds the aggregate of the paid up and called for part of the
capital, increased by the reserves that are to be maintained by virtue of
the law.
2. Distribution of profit shall only be made after the confirmation of the
annual account from which the distribution appears to be allowed.
3. If the General Meeting of Shareholders shall so provide, an interim
dividend shall be paid out, but only in case the requirement of paragraph 1
is met.
4. The General Meeting of Shareholders may provide for dividends partially or
wholly to be paid in an other manner than in cash.
5. A deficit may only be set off against reserves that are to be maintained by
virtue of the law in so far as such set off is permitted by the law.
6. Dividends shall be made payable not later than one month of their being
declared unless another due date is fixed by the General Meeting of
Shareholders.
<PAGE>
7. Dividend claims shall become barred by lapse of five years after
commencement of the day after the date on which they have become due for
payment.
WINDING-UP
Article 26.
1. If the Company is dissolved in pursuance of a resolution of the General
Meeting, its affairs shall be liquidated by the Managing Board under the
supervision of the Supervisory Board, if and to the extent that the General
Meeting shall not otherwise resolve.
2. The General Meeting shall fix the remuneration of the liquidators and of
the persons if any charged with the supervision of the liquidation.
3. The liquidation shall be effected in accordance with the relative statutory
provisions. During the liquidation the provisions of these Articles of
Association shall as far as possible continue in force.
4. The amount of the Company's business-assets remaining after satisfaction of
all debts shall be distributed among the shareholders pro rata to the
nominal amount of the shares held by them.
5. The Company's books, records and other data carriers shall for the period
prescribed by the law remain in the custody of the person designated for
that purpose by the General Meeting.
Transitional Provision
The first financial year of the company shall end on the thirty first day
of December nineteen hundred and ninety-nine.
Final statement
Finally, the appearing persons have declared:
a. At the incorporation, the issued share capital amounts to forty
thousand guilders (NEG 40.000,--). The following are participating in
the issued capital:
The incorporator M.E.S.T. Management of Environmental Solutions and
Technology for 20.000 shares and the incorporator TNO Management B.V.
for 20.000 shares.
<PAGE>
The issuance takes place at par value. The issued share capital has been
paid up in cash. Payment in foreign currency is permitted. The documents
which must be attached by virtue of Article 2:203a Civil Code have been
attached to this instrument. The company accepts the payments on the shares
issued at the incorporation.
b. The first members of the management board are:
Mrs. Marieke Adriane Oudejans, residing at Achillesstraat 97, 1076
PX Amsterdam, born at Koedijk on 6 April 1968
and
Mr Cornelis Roos, residing at Sluisoordlaan 341, 7323 EN Apeldoorn,
born at The Hague on 27 October 1949.
c. The ministerial declaration of no objections was granted on the third
day of May nineteen hundred and ninety-nine, under number B. V.
1073369, as stated in the certificate, which has been attached to this
instrument.
The appearing persons are known to me, civil law notary.
- --------------------------------------------------------------------------------
THIS DEED, drawn up to be kept in the civil law notary's custody was executed in
Rotterdam, on the date first above written.
Before reading out, a concise summery of the contents of this instrument was
given to the appearing persons.
They then declared that they had noted the contents and did not want a full
reading thereof. Thereupon, after limited reading, this instrument was signed by
the appearing persons and by me, civil law notary.
<PAGE>
Enclosure 2
AGREEMENT WITH REGARD TO THE SUBORDINATED LOAN
1. M.E.S.T. B.V., located in Amsterdam, hereafter referred to as MEST
and
2. Manure and Sludge Technology B.V., located in Apeldoorn, hereafter referred
to as MST
CONSIDERING THAT:
- - MEST has established collaboration with TNO Management BV, A subsidiary of
the Dutch Organization of Applied Scientific Research (hereafter referred
to as TNO) for the treatment of sludge and manure.
- - MEST and TNO Management BV have established MST and have agreed upon in the
Shareholders Agreement that MEST provides a subordinated loan to MST.
- - Parties wish to have their agreement for a loan in writing.
THE PARTIES HAVE AGREED UPON THE FOLLOWING:
1. MEST places NLG 2,000,000 at the disposal of MST as a loan by transferring
the funds to the account of MST at the RABO Bank in four phases;
Phase 1: NLG 300,000 (three hundred thousand guilders) due on February 1,
1999; Phase 2: NLG 500,000 (Five hundred thousand guilders) due on
February 1, 1999; Phase 3: NLG 1,000,000 (one million guilders) due on May
1, 1999; Phase 4: NLG 200,000 (two hundred thousand guilders) due on the
date the project ends, estimated on December 31, 1999. With regard to
written statements made by TNO regarding the development of the research
for this project, Parties can decide deviation from the earlier mentioned
dates by mutual agreement.
2. MST will pay off the loan starting on December 31, 1999, in yearly terms of
50% of the positive operating profit of MST over the fiscal year. Operating
profit means: the operating profit from normal management after payment of
taxes and before unusual profit and charges.
3. MST owes MEST a yearly interest of 5% (five percent) on the unpaid part of
the total amount. The interest will be paid yearly at the end of the year
starting on December 31, l999.This comes into force on the date this
agreement is signed.
4. Within a month after the end of the fiscal year, MST will pay due payments,
interest and, if necessary, due sales tax by bank transfer to an account
number given by MEST mentioning "loan MST.
<PAGE>
5. MST has the right to add due interest to the due total amount when this is
beneficiary to the management of MST.
6. In case MST is in liquidation or stops its activities, MEST will acquit the
rest of the payments to MST.
7. All payments will be made to an account given by MEST, no reduction or
compensation will be permitted.
8. Payments by MST to MEST will, in the first place, be with regard to
interest payments and secondly, with regard to payment of due repayments.
SUBORDINATION
9. MEST declares, for the benefit of the RABO bank in Apeldoorn and for the
benefit of TNO that in case of termination of MST, an agreement for the
suspension of payment or bankruptcy of MST, repayment and eventual interest
of the loan will be paid after all other, at that moment, outstanding debts
of MST, except the loans equal to both parties.
10. MST declares to take into account the subordination as described above.
GENERAL TERMS
11. This agreement comes into force on the date that the main amount of the
loan is paid to the bank account of MST and ends when MST has paid all
interests and repayments to MEST.
12. Dutch law is applicable to this agreement,
13. All disagreements that arise with regard to this agreement will be brought
to court with the competent lawyer in The Hague, unless Parties decide
differently.
As agreed upon and twice signed:
MST MST
By: M.A. Oudejans By: Eng. C. Roos
Title: Director Title: Director
Date/Place: January 22, 1999, Amsterdam Date/Place:January 22, 1999, Amsterdam
MEST
By: M.A. Oudejans
Title: Director
Date/Place: January 22, 1999, Amsterdam
<PAGE>
Enclosure 3
LICENSING AGREEMENT
THE UNDERSIGNED:
1 The Dutch Organization for Applied Scientific Research, TNO, based in
2628VK Deift, Schoemakerstraat 97, hereafter referred to as "TNO";
and
2 Manure and Sludge Technology B.V., based in Apeldoorn, hereafter referred
to as "MST" or "LICENSEE";
TAKING INTO CONSIDERATION THAT:
- - TNO, especially the department Processes and Applications of TNO
Environment, Energy and Process innovation, (hereafter called TNO-MEP), has
investigated and has acquired knowledge for the application of zeolites
with drying processes;
- - TNO-MEP conducted research, on the basis of this technology for the
treatment of sludge and manure, (hereafter referred to as "Application");
- - TNO has applied for international patents for the zeolite technology used
in drying processes with regard to the treatment of sludge and manure. The
patent number is PCTINL96/002 15 with the title: "Method and device for
heating and cooling food products" (from the original application
NL/1000482, dated June 1, 1995) (hereafter referred to as Patent
Application I);
- - TNO has applied for international patents for the zeolite technology used
in drying processes with regard to the treatment of sludge and manure. The
patent number is 1009619, dated July 10, 1998, with the title: "Cost
effective method for treatment and/or disposal of water containing (waste)
streams (like sludges, sewage, dung, etc. based on the application of
zeolites", as defined in the patent application (hereafter referred to as
Patent Application 2);
- - TNO wishes to further develop and commercialize the Application and
therefore has agreed to collaborate with MEST, based in Amsterdam, through
its 100% subsidiary TNO Management. TNO and MEST have established MST and
TNO has agreed to bring the Patent applications into MST as well as the
Know-how.
- - TNO and MST wish to conclude their agreement in writing, taking into
account the following terms;
<PAGE>
PARTIES HAVE AGREED AS FOLLOWS:
1. License
1.1 TNO give the LICENSEE exclusive, non-transferable license for Patent
application 2 for the further development and commercialization of the
Application, with the right of sub-licensing conforming to 1.4. This
license agreement will be registered with the Patent Office if necessary.
All costs will be for the licensee.
1.2 The LICENSEE has the rights to use, on a non-exclusive basis, all technical
knowledge and experience with regard to the Application as stipulated in
reports and publications, hereafter referred to as know-how.
1.3 If no patent is given for patent application 2, this agreement stays in
force for the Know-how and the Know-how regarding Patent applications.
1.4 For the manufacturing and sales of manure' conversion installations by MEST
BV, The LICENSEE will give a non-transferable exclusive sub-license on
Patent 2 and the Know-how, against payment of royalties by MEST BV.
1.5 When Patent 2 cannot be exploited independently from Patent 1, or when it
appears that Patent request 2 will not be honored, TNO will give license to
the LICENSEE on Patent I to protect MEST BV's commercial options for the
purpose of this agreement.
1.6 TNO will, at the start of this Agreement, expand Patent I, on the costs of
the LICENSEE in countries to be mentioned by the LICENSEE, without changing
the rights as mentioned in 1.5 and 3.1.
2. Financial agreements bookkeeping and verification
2.1 The due license compensation to be paid by the LICENSEE, without right on
compensation or reduction, totals NLG 2,000,000 (two million Dutch
guilders) excluding VAT.
2.2 The amount as stipulated in 2.1 will be paid, in yearly terms of 50% of the
positive operating profit of MST over the fiscal year, starting on December
31, 1999. Operating profit means: the operating profit from normal
management after payment of taxes and before unusual profit and charges.
2.3 The LICENSEE owes TNO, from the date of this agreement, a yearly interest
of 5% (five percent) over the unpaid balance of the license fees as
mentioned in 2.1. The interest will be paid at the end of each year,
starting on December 31, 1999.
2.4 Within one month after the end of the fiscal year, the LICENSEE will make
due payments, interest and eventually due turnover taxes, by bank transfer
to account number ABN-AMRO 511530102 to the attention of TNO, with notice:
License 98-13: sludge treatment.
<PAGE>
2.5 The LICENSEE is obliged to secure records of all facts and figures
necessary for the calculation of the due payments of license fees and
interest to TNO. Within three weeks after the end of the fiscal year, the
LICENSEE will supply TNO with a declaration of an external registered
accountant regarding the due license fees and interest over the past year.
2.6 TNO is allowed the right to further examination through an accountant
indicated by TNO. In this case the LICENSEE is obliged to give full
collaboration and present its book-keeping or administration. The costs of
this investigation will be paid by TNO, unless it appears that the LICENSEE
paid an incorrect amount of license fees and interest, in this case the
LICENSEE will repay all costs involved to TNO.
3. Patent protection and -infringement
3.1 During the period of this contract, TNO will maintain and continue Patent
1, with expansions, conforming to 1.6, and will maintain and continue
Patent 2 at the end of each year, at costs of the LICENSEE. TNO will inform
the LICENSEE by forwarding the complete correspondence.
3.2 When one of the Parties notices infringement on Patent 2, this Party will
inform the other Party as soon as possible to consult on necessary actions.
The Parties will establish accordingly, in which way they will act against
the person(s) who infringed.
3.3 The Parties have the right to protect their rights and interests, to take
necessaiy measures, independently and for own costs, at any time.
3.4 All costs (including costs for application, maintenance, and external
advice) with regard to Patent application 2 and later Patents, will be paid
by the LICENSEE. These costs will be paid within thirty days after the end
of each month on the basis of specified declarations delivered by TNO, on
bank account number ABN-AMRO 511530102 in the name of TNO with notice:
Patent costs 98-13: sludge treatment.
3.5 TNO will consult with the LICENSEE regarding the countries in which Patent
2 is applied for. Costs regarding countries in which MST wishes to have
patent applications, will be paid by MST conforming to 3.4. When MST does
not wish to further maintain the Patents in different countries, TNO is
allowed to maintain Patents for its own costs at any time. These patent
applications are not included in this agreement.
4. Patent grant
4.1 From the moment patent 2 is honored in a country and after full payment of
license fees, as mentioned in 2.1 and fees mentioned in 4.2, TNO will
transfer the ownership of Patent 2 and Know-how to the LICENSEE. This
transfer of ownership will be accepted by the LICENSEE. All costs involved
will be for the account of the LICENSEE.
4.2 For compensation of the transfer in ownership of the Patents and Know-how,
the LICENSEE will pay TNO a one time payment of NLG 1,000,000 (one million
Dutch guilders), which has to be paid for subscription in the registers of
the Patent Office by bank transfer to account number: ABN-AMRO 511530102 in
the name of TNO with notice:
Transfer of ownership 98-13: sludge treatment.
<PAGE>
5. Non-Disclosure
5.1 The LICENSEE is obliged to keep information strictly secret regarding
Patent I, Patent 2 and the Know-how, marked as "confidential", unless it is
necessary to give information to third parties with regard to the further
development and commercialization of the Application. The LICENSEE will
ensure strict confidentiality is observed by these third parties regarding
the information given by the LICENSEE.
5.2 The non-disclosure does not count for:
a. information that is commonly known;
b. information of which the LICENSEE can prove was already in the
possession of the LICENSEE at the moment TNO mentioned this information
was confidential, and this information was not provided by TNO;
c. information of which the LICENSEE can prove was provided by third
parties who had the right to give this information.
6. Title and Responsibility
6.1 TNO is not responsible for damage that occurs as a result of the fact that
Patent 2 and other Patents based on Patent 2 with regard to the Application
are not granted, neither will the LICENSEE have the right to reduction on
the license agreement.
6.2 TNO is not responsible for damage forthcoming from the use by the LICENSEE
of the license rights or from the LICENSEE's use of the transferred Patent
2 and Know-how as stipulated in 4.1, unless this damage is due to the
mistakes of TNO, or committed on purpose by TNO. The LICENSEE will
indemnify TNO from all claims of third parties.
6.3 TNO is not responsible for faults, whichever, in Patent 2 and the Know-how,
unless this damage is due to gross mistakes of TNO, or committed on purpose
by TNO.
6.4 The responsibility of TNO is, at all times, limited to the amount of
payments by the LiCENSEE to TNO with regard to Patent 2 and the Know-how,
over the year in which the damage occurred.
7 The Coming into Force and Termination
7.1 This agreement comes into force on the date the shareholders agreement
between TNO Management BV and M.E.S.T. BV came into force. Termination of
the agreement is possible conforming to what is stipulated in 7.2 with no
reduction of TNO's right on license fees as stipulated in 2.1.
7.2 TNO is allowed to terminate this agreement immediately by registered mail in
case:
a. The LICENSEE does not meet its commitments, fully or in time or when
this is not corrected within thirty days after this was mentioned in a
letter from TNO, sent by registered mail.
<PAGE>
b. When the collaboration between TNO Management BV and M.E.S.T. BV is
terminated for whatever reason.
c. In case of suspension of payment or bankruptcy of the LICENSEE, or
requests thereof and from distrained and executorial seizures against
the LICENSEE.
7.3 When this agreement terminates, all rights of the LICENSEE, as mentioned in
this agreement, terminate. All documentation regarding Patent 2 and the
Know-how will then be made immediately available by the LICENSEE to TNO.
7.4 In case of termination, as mentioned in 7.2, the LICENSEE will have no
right to restitution or payment discharge of payments already made or due
payments. A termination as mentioned in 7.2 a and c maintain the rights on
claims of TNO.
8. Rights and disagreements
8.3 Dutch law is applicable to this agreement.
8.4 All disagreements which arise with regard to this Agreement, will be
brought to court with the competent lawyer in The Hague, unless Parties
decide differently.
As agreed and twice signed
TNO TNO
Name: Ir. J.A. Dekker Name: Dr. Ir. P. Folstar
Title: Chairman of the Board Title: Member of the Board
Date / Place: February 1, 1999, Delft Date / Place:
February 1, 1999, DeIft
LICENSEE LICENSEE
Name: M.A. Oudejans Name: Ing. C. Roos
Title: Director Title: Director
Date/Place: January 22, 1999, Amsterdam Date/Place: January 22, 1999
<PAGE>
Enclosure 4
SUB-LICENSE AGREEMENT
THE UNDERSIGNED:
1. Manure and Sludge Technology B.V., located in Apeldoorn, hereafter referred
to as:
"MST';
and
2. M.E.S.T. B.V., located in 1076 PX Amsterdam, Achillesstraat 97, hereafter
referred to as "MEST" or "Sub-Licensee
Taking into consideration:
- - The Dutch Organization for Applied Technological Research TNO (hereafter
referred to as "TNO") and MST have a licensing agreement as stipulated in
enclosure 1, by which TNO gives license to MST regarding the Patent Application
and Know-how.
- - MEST provides advice regarding agricultural and environmental problems and
MEST will exploit the above-mentioned technology after further development for
the construction of manure conversion plants and installations.
- - MST wishes to give a sub-license to MEST regarding the Patents and Know-how,
for the manufacturing and sales of manure conversion installations.
- - MST and MEST wish to put this agreement with regard to the sub-license in
writing, under the conditions mentioned hereafter.
Have agreed as follows:
1. License
1.1 MST gives the SUB-LICENSEE the exclusive, non-transferable sub-license
regarding the patents, without the right to sub-licensing, for the
manufacturing and worldwide sales of manure conversation installations. The
SUB-LICENSEE will accept this sub-license. The Sub-License will, if
necessary, be registered with the Patent Office. All costs involved will be
for the account of the SUB-LICENSEE.
1.2 In respect to the extent of the use of its rights, as stipulated in 1.1 and
the manufacturing of manure conversion installations, the SUB-LICENSEE will
be allowed to use the knowledge and experience from MST regarding the
patent as stipulated in enclosure 2 (hereafter referred to as "Know-how").
<PAGE>
1.3 When the Patent Application(s) is (are) not honored, this agreement stays
in force concerning the Know-how and the know-how regarding the Patent
Application(s).
1.4 MST is permitted at all times, to use the Patent Application(s) and
Know-how itself and for third parties.
1.5 MST will make all improvements in the Know-how available to the
SUB-LICENSEE. The SUB-LICENSEE will apply these improvements in the manure
conversion installations, unless this is not reliable. When SUB-LICENSEE
itself discovers and applies improvements in the Know-how, he/she is
obliged to inform MST about these improvements. The rights with regard to
such improvements will be fully, and for free be transferred to MST.
1.6 When the SUB-LICENSEE in the opinion of MST, does not sell enough manure
conversion installation to its potential clients, MST is permitted to
terminate this agreement, or the exclusivity of rights, after consulting
the SUB-LICENSEE.
2. Financial regulations, book keeping and verification
2.1 During 15 years from the date on which the SUB-LICENSEE installs and brings
into use the first manure conversion installation, the SUB-LICENSEE owes
MST payment contributions on the gross manufacturing costs of the manure
conversion installation, as follows;
- - 15% of the gross manufacturing costs of manure conversion installations
numbers 1 to 10;
- - 12.5% of the gross manufacturing costs of manure conversion installations
numbers 1 to 25;
- - 10% of the gross manufacturing costs of manure conversion installation
numbers 26 and further. Gross manufacturing costs means: the complete cost
price that the SUB-LICENSEE has to pay with a subcontractor for the
manufacturing of the manure conversion installations.
2.2 The SUB-LICENSEE will pay due contributions every quarter of the year.
Within 30 days after the end of the quarter of the year, the SUB-LICENSEE
will pay the due amount by bank transfer to an account to be given by MST.
2.3 The due payment contributions are net amounts. All taxes, increases and
other costs are for the account of the SUB-LICENSEE and will be paid by the
SUB-LICENSEE when these costs are submitted to MST.
2.4 The SUB-LICENSEE is obliged to keep secure book-keeping of all facts
regarding the calculation of contributions to be paid to MST. Within three
months after the last fiscal year, the SUB-LICENSEE will give a declaration
of an external registered accountant specified to calculate the due
contributions of the foregoing year.
2.5 MST is entitled the right to further financial examination through an
accountant indicated by MST. In this case the SUB-LICENSEE is obliged to
fully co-operate and present its records and administration. The costs
involved in this examination, will be paid by MST, unless it appears that
the SUB-LICENSEE has given, or paid incorrect amounts on contributions, in
which case the SUB-LICENSEE will refund all the costs involved.
<PAGE>
3. Patent protection, Breach of Patent and Patent Infringement
3.1 During the duration of this agreement, MST will inform the SUB-LICENSEE, at
the end of each year, regarding the status of honoring the Patents.
3.2 When one of the Parties notices breach of the Patents or the Patent
Applications, this party will contact the other party as soon as possible
to discuss eventual sanctions.
3.3 Parties are at all times, entitled to protect their rights and interests
without foregoing consultation and take necessary measures on their own
account.
4. Non-Disclosure
4.1 The SUB-LICENSEE is obliged to keep information strictly secret regarding
Patent 1, Patent 2 and the Know-how, marked as "confidential", unless it is
necessary to provide such information to third parties with regard to the
further development and commercialization of the Application. The
SUB-LICENSEE will ensure strict confidentiality agreements with these third
parties regarding the information provided by the Licensee.
4.2 The non-disclosure does not count for:
a. information that is commonly known;
b. information of which the SUB-LICENSEE can prove that this information
was in possession of the SUB-LICENSEE at the moment MST mentioned this
information was confidential, and this information was not provided by
MST;
c. information of which the SUB-LICENSEE can prove, was provided by third
parties that had the right to give this information.
5. Title and responsibility
5.1 MST is not responsible for damage that occurs as a result of Patent 2 and
other Patents based on Patent 2 with regard to the Application, not being
fully honored.
5.2 MST is not responsible for damage forthcoming from the use, by the
SUB-LICENSEE of the license rights or from the SUB-LICENSEE's use of the
license rights, unless this damage is due to mistakes of MST, or committed
on purpose by MST. The SUB-LICENSEE will indemnify MST from all claims of
third parties.
5.3 MST is not responsible for faults, whichever, in the manure conversion
installations, unless this damage is due to gross mistakes of MST, or
committed on purpose by MST.
5.4 The responsibility of MST is, at all times, limited to the amount of
contributions3 over the year in which the damage occurred.
<PAGE>
6. The coming into force and Termination
6.1 This agreement comes into force on the date the license agreement between
TNO and M.E.S.T. came into force for a period of 15 years or as long as the
longest Patent validity period. Meanwhile, termination of the agreement is
possible conforming to what is stipulated in 1.6 and 6.2.
6.2 MST is entitled to terminate this agreemen immediately by registered mail
in case:
a. The SUB-LICENSEE does not meet its commitments, fully or in time or when
this is not corrected within thirty days after this was mentioned in a
letter from MST, sent by registered mail.
b. When the collaboration between TNO and MST is terminated for whatever
reason, without the patent being transferred in ownership to MST.
c. In case of suspension of payment or bankruptcy of the SUB-LICENSEE, or
requests thereof, and from distrained and executorial seizures against the
SUB-LICENSEE.
6.3 When this agreement terminates, all rights of the SUB-LICENSEE, as
mentioned in this agreement, terminate. All documentation regarding the
Patent in the possession of the SUB-LICENSEE relating to Applications and
Know-how will immediately be made available to MST. During a period after
termination, to be determined by the Parties, the SUB-LICENSEE is allowed
to sell manure conversion installations which are still in stock with the
SUB-LICENSEE against payment of contributions to MST conforming to the
conditions as specified in this agreement.
6.4 In case of termination as mentioned in 6.2, the SUB-LICENSEE will have no
right to restitution or payment discharge of amounts already made or due
payments and will only be discharged from financial obligations in the
future. A termination as stipulated in 6.2 a and c maintain the rights on
claims of MST.
7. Rights and Disagreements
7.1 Dutch law is applicable to this agreement.
7.2 All disagreements which arise with regard to this Agreement, will be
brought to court with the competent lawyer in The Hague, unless Parties
decide differently.
As agreed upon and twice-signed
MST MST
Name: M.A. Oudejans Name: Ing. C. Roos
Title: Director Title:Director
Date/Place: January 22, 1999, Amsterdam Date/Place:January 22, 1999, Amsterdam
SUB-LICENSEE
Name: M.A. Oudejans, on behalf of MEST BV
Title: Director
Date/Place: January 22, 1999, Amsterdam
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