SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Date of Report (Date of earliest event reported) June 4, 1996
MEHL/BIOPHILE INTERNATIONAL COPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware 2-86149 22-2408186
(State or other jurisdiction of (Commission (IRS Employer
incorporation or organization) File Number) Identification Number)
4020 Newberry Road
Gainesville, Florida 32607
(Address of principal (Zip Code)
executive officer)
Registrant's telephone number, including area code (352) 373-2565
Selvac Corporation
221 Boston Post Road
Marlboro, Massachusetts 01752
(Former Name and Address)
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1. Change in Control of Registrant
On June 4, 1996, Classy Lady by Mehl of Puerto Rico, Inc., a privately-held
Puerto Rico company ("Classy Lady"), merged with and into a wholly-owned
subsidiary of the Registrant (the "Merger"). In consideration for the Merger,
the Registrant issued an aggregate of 25,000,000 shares of Common Stock, $.01
par value per share, to the shareholders of Classy Lady. As a result of the
Merger, the former Classy Lady shareholders own, in the aggregate
approximately 62% of the outstanding Common Stock of the Registrant, thereby
resulting in a change of control of the Registrant.
The following three principal shareholders of Classy Lady received an
aggregate of 22,669,000 shares of Common Stock upon completion of the Merger,
representing approximately 56.2% of the total outstanding number of shares of
the Registrant: Thomas L. Mehl, Sr., and Anne Marie Mehl (9,197,000 shares or
22.8%); Dr. Nardo Zaias (9,197,000 shares or 22.8%); and Pichit Suvanprakorn
(4,275,000 shares or 10.6%).
In exchange for the issuance of the shares of the Registrant issued
pursuant to the Merger, the Registrant obtained all of the stock of Classy
Lady, which owns the exclusive licensing rights granted to Classy Lady by
Thomas L. Mehl, Sr. for a multiple hair removal technology and by Dr. Nardo
Zaias for a laser hair removal technology.
The Merger was completed in accordance with the terms of the Second Amended
and Restated Agreement and Plan of Merger dated as of June 4, 1996 (the
"Merger Agreement"). Pursuant to the Merger Agreement, (i) the name of the
Registrant was changed to Mehl/Biophile International Corporation, (ii) Thomas
L. Mehl, Sr. ("Mehl"), a principal shareholder of Classy Lady, was elected as
Chairman of the Board of Directors, President and Chief Executive Officer of
the Registrant; and (iii) the Board of Directors of the Registrant was
expanded to seven members, five of whom were designated by Mehl.
Under the Merger Agreement, James J. Leonard, formerly President of the
Registrant, was to have continued as a director of the Registrant. On June 4,
1996 Mr. Leonard resigned as a director, and Paul W. Hartloff, formerly
Secretary of the Registrant was elected as his replacement on the Board.
The Merger as originally negotiated between the parties provided for the
issuance of 15 million shares of Common Stock of the Registrant at the Closing
of the Merger and up to an additional 10 million shares upon the completion of
certain designated milestones. Based on (i) the joint venture agreement
entered into by Classy Lady with Laser Industries Ltd., the formation of a
joint venture thereunder and the contribution thereto of a promissory note by
Laser Industries Ltd., (ii) the acquisition of SLS described in Item 2 below
and (iii) the completion of the $10,000,000 private placement described in
Item 5 below, the Board of Directors of the Registrant determined that all of
the designated milestones had been met as of the closing of the Merger and the
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Registrant issued all 25 million shares of stock to the Classy Lady
stockholders at the closing of the Merger.
Item 2. Acquisition or Disposition of Assets.
On June 4, 1996, Classy Lady by Mehl of Puerto Rico, Inc., a privately-held
Puerto Rico company ("Classy Lady"), merged with and into a wholly-owned
subsidiary of the Registrant (the "Merger"). Terms of the Classy Lady
merger are identified under item 1.
On June 4, 1996, the Registrant completed the purchase of capital stock
representing in the aggregate of 81% interest in SLS (Wales) Limited, a
privately held Welsh company ("SLS") engaged in developing, manufacturing and
selling lasers primarily in the field of hair removal. The consideration for
the acquisition of the SLS shares consisted of a cash payment approximately
$1.9 million and the assumption of certain liabilities and obligations of SLS
and the issuance of 25,044 shares of the Registrant's Common Stock. The
portion of the consideration comprised of cash funds paid by the Registrant
was derived from a private placement offering of $3,000,000 of 8% Convertible
Debentures completed in April 1996. The consideration paid was based upon
arms-length negotiations between the Registrant and the holders of the SLS
shares.
SLS holds patents pending, invented by Marc Clement, Ph.D., which are
compatible with the Zaias patent exclusively licensed to the Registrant in the
field of laser depilation. At its research and manufacturing facility in
Wales, SLS has been developing and clinically evaluating laser depilation
technology since 1993 and presently manufactures and markets its Chromos 694
ruby laser depilation system. SLS has received European Union (EU) regulatory
approval for the manufacture and sale of the Chromos 694 depilation laser in
Europe. SLS also provides a mobile laser depilation service in the United
Kingdom which allows the Chromos 694 system to be brought directly to hair
removal clinics and doctor's offices.
The Registrant intends to continue the use of the assets of SLS acquired
for the development, manufacture and sale of laser systems. Together with
SLS, the Registrant is currently negotiating additional joint ventures for the
Chromos 694 depilation laser system in New Zealand, Australia, South Africa,
Switzerland, Denmark, Germany, France, Spain, United Kingdom, Austria,
Bulgaria, Sweden, Holland, Italy, Israel, Egypt, the United Arab Emirates,
Thailand, Taiwan, Korea, Japan and Hong Kong. The Registrant also intends to
continue offering a range of laser based technologies already established by
SLS, including skin resurfacing, wrinkle removal and the treatment of vascular
lesions. The SLS Chromos 595 vascular lesion system, which has an installed
base in over 60 locations worldwide, also has EU regulatory approval for
manufacture and sale in Europe.
Prior to the acquisition, there was no material relationship between the
Registrant and SLS. Marc Clement, a shareholder and executive of SLS, was
elected as a director of the Registrant following closing of the acquisition.
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Item 5. Other Events.
On May 15, 1996, the Registrant completed a private placement offering
exempt under Regulation D promulgated under the Securities Act of 1933 of
10,000 shares of 5% Cumulative Convertible Series C Preferred Stock, par
value $10 per share (the "Series C Preferred Stock"), for an aggregate
purchase price of $10,000,000. Holders of the Series C Preferred Stock are
entitle to receive dividends payable at the annual rate of 5% per annum.
The Series C Preferred Stock is convertible into Common Stock of the
Registrant at the lesser of (i) 80% of the average market price on the five
trading days prior to conversion and (ii) $7.50, but in no event shall be
below $3.00. The Registrant agreed to file a registration statement covering
the public sale of the shares of Common Stock receivable upon conversion of
the Series C Preferred Stock on or before June 30, 1996. The Series C
Preferred Stock may not be converted until the earlier of (i) the 90th day
following issuance and (ii) the date on which the aforementioned registration
statement is declared effective by the Securities and Exchange Commission;
provided, however, that no holder is entitled to convert Series C Preferred
Stock into Common Stock, if after such conversion, the number of shares of
Common Stock beneficially owned by such holder would exceed 4.9% of the issued
and outstanding Common Stock of the Registrant.
The rate of conversion of the Series C Preferred Stock into Common Stock is
subject to adjustment if the registration statement described above is not
declared effective by the SEC within 90 days after issuance, or if a stop
order has been issued regarding such registration statement has been issued or
if the Registrant's Common Stock is not listed for quotation on the Nasdaq
Small Cap Market.
Item 7. Financial Statements and Pro Forma Financial Information and Exhibits.
a. Financial Statements of Business Acquired
b. Proforma Financial Information
It is impracticable for the Registrant to file the required financial
statements and proforma information relative to the acquired business at this
time. Such statements and information will be filed as an amendment to Form
8-K as soon as practicable, but no later than 60 days after the date of filing
of this report.
c. Exhibits.
Item 2.1. Second Amended and Restated Agreement and Plan of Merger dated as
of June 4, 1996 by and among Selvac Corporation, Classy Lady by Mehl of Puerto
Rico, Inc. and Selvac Acquisition Corp.
Item 2.2. Sale and Purchase Agreement dated June 4, 1996 by and among B. Mair
and others, and Selvac Corporation.
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Item 2.3. Sale and Purchase Agreement dated June 4, 1996 by and between
Robert Marc Clement and Selvac Corporation.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MEHL/BIOPHILE INTERNATIONAL CORPORATION
By: /s/ Thomas L. Mehl, Sr.
Title: President
Date: June 17, 1996
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Exhibit 2.1
SELVAC CORPORATION,
SELVAC ACQUISITION CORP.
and
CLASSY LADY BY MEHL OF PUERTO RICO, INC.
SECOND
AMENDED AND RESTATED
AGREEMENT AND PLAN
OF MERGER
Dated as of June 4, 1996
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AGREEMENT AND PLAN OF MERGER
SECOND AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER, effective and dated
as of June 4, 1996 (the "Agreement"), between and among Selvac Corporation, a
Delaware corporation ("Selvac"), and Selvac Acquisition Corp., a Delaware
corporation ("Acquisition"), and Classy Lady by Mehl of Puerto Rico, Inc., a
Puerto Rico corporation ("Classy Lady").
WHEREAS, the Boards of Directors of Selvac, Acquisition and Classy Lady have
approved the merger of Classy Lady with and into Acquisition (the "Merger")
pursuant to the terms and conditions set forth in an Agreement and Plan of
Merger dated as of January 1, 1996, as amended and restated on February 15,
1996 (the "Original Merger Agreement");
WHEREAS, the parties desire to amend certain terms and conditions of the
Original Merger Agreement;
NOW, THEREFORE, in consideration of the premises and the representations,
warranties, covenants and agreements contained herein, the parties hereto,
intending to be legally bound hereby, agree as follows:
1. The Merger: Effective Time; Surviving Corporation.
1. The Merger. Upon the terms and subject to the conditions of this
Agreement, at the Effective Time (as defined in Section 1.2 hereof) in
accordance with the General Corporate Law of 1995 of the Commonwealth of
Puerto Rico and the General Corporation Law of the State of Delaware (the
"Delaware GCL"), Classy Lady shall be merged with and into Acquisition in
accordance with this Agreement and the separate existence of Classy Lady shall
thereupon cease. Acquisition shall be the surviving corporation in the Merger
(hereinafter sometimes referred to as the "Surviving Corporation").
2. Effective Time of the Merger. The merger shall become effective at such
time (the "Effective Time") as Acquisition shall have filed a copy of the duly
executed Certificate of Merger (the "Certificate of Merger") with, and the
same shall have been accepted for filing by, the Secretary of State of the
State of Delaware. The date on which the Effective Time occurs shall be the
"Effective Date." Acquisition and Classy Lady shall each take or cause to be
taken all such action and do or cause to be done all such things as are
necessary, proper or advisable under the laws of the State of Delaware and the
Commonwealth of Puerto Rico to make the Merger effective, subject to the terms
and conditions of this Agreement.
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3. Articles of Incorporation. The Articles of Incorporation of Acquisition
shall be the Articles of Incorporation of the Surviving Corporation after the
Effective Time.
4. By-Laws. The By-Laws of Acquisition shall be the By-Laws of the
Surviving Corporation after the Effective Time.
5. Directors and officers. The Board of Directors and officers of
Acquisition shall be the Board of Directors and officers of the Surviving
Corporation after the Effective Time to serve thereafter until their
successors are elected and qualified.
2. Conversion of Shares At Effective Time.
1. Conversion of Shares and Classy Lady Stock.
a. Each share of Classy Lady Common Stock issued and outstanding
immediately prior to the Effective Time shall, as of the Effective Time, by
virtue of the Merger and without any action on the part of the holder thereof,
be converted into 1,000 shares of Common Stock of Selvac, $.01 (the "Selvac
Common Stock").
b. No fraction of a share of Selvac Common Stock shall be issued. Each
record holder of shares of Classy Lady Common Stock issued and outstanding
immediately prior to the Effective Time (the "Classy Lady Stockholders") who
would otherwise be entitled to receive a fractional share of Selvac Common
Stock (after taking into account all shares of Classy Lady Common Stock then
held by such holder) shall receive one extra share of Selvac Common Stock.
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c. The Selvac Common Stock to be received upon the conversion of Classy
Lady Common Stock pursuant to the Merger shall be referred to herein as the
"Merger Consideration."
d. Each share of Acquisition's Common Stock, $.01 par value per share,
issued and outstanding immediately prior to the Effective Time, shall by
virtue of the Merger and without any action on the part of the holder thereof
be converted into one share of Common Stock of the Surviving Corporation.
2. Status of Securities After Effective Time.
a. From and after the Effective Time, and until surrendered and exchanged,
each outstanding certificate formerly representing shares of Classy Lady
Common Stock shall be deemed for all purposes (other than the payment of
dividends or other distributions, if any, to shareholders of Selvac) to
represent the right conferred upon such shares in accordance with Section 2.1
(a) and 2.1(b) above to receive the number of whole shares of Selvac Common
Stock. Upon surrender and exchange of each outstanding certificate
theretofore representing shares of Classy Lady Common Stock, there shall be
paid to the record holders of the certificate or certificates of Selvac Common
Stock issued in exchange therefor the amount, without interest thereon, of
dividends and other distributions declared and paid to shareholders of record
subsequent to the Effective Time with respect to the number of whole shares of
Selvac Common Stock represented thereby.
b. Immediately after the Effective Time, each former shareholder of record
of Classy Lady shall exchange their certificates formerly representing shares
of Classy Lady Common Stock for certificates representing Selvac Common Stock.
Classy Lady is aware that the shares of Selvac Common Stock to be issued to
the Classy Lady Stockholders at the Closing are not registered under the
Securities Act of 1933 (the "Securities Act"), or any securities law of any
state of the United States and may not be transferred without compliance with
(i) the registration provisions of the Securities Act or the availability of
an exemption therefrom and (ii) applicable securities laws of any state of the
United States. Classy Lady is aware that certificates representing such
shares will contain a legend written, printed or stamped on the face thereon
stating that the shares are not registered under the Securities Act or
applicable state securities laws.
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c. Subject to the provisions of the next sentence, no transfer taxes shall
be payable by such holder of former Classy Lady Common Stock in connection
with such exchange. If any certificate evidencing Selvac Common Stock is to
be registered in any name other than that in which the certificate surrendered
in exchange therefor is registered, it shall be a condition of such
registration that the certificate so surrendered shall be properly endorsed
and otherwise in proper form for transfer as determined by Selvac, that any
applicable securities laws are complied with, and that the person requesting
such exchange pay to Selvac any transfer or other taxes required by reason of
the issuance of a certificate for shares of Selvac Common Stock in any name
other than that of the registered holder of the certificate surrendered or
otherwise establish to the satisfaction of Selvac that such tax has been paid
or is not payable.
d. From and after the Effective Time, the stock transfer books of Classy
Lady shall be closed and no transfer of shares of Classy Lady Common Stock
shall be made.
3. Dividends. If Selvac shall, at any time after the date hereof but before
the Effective Time, (i) issue a dividend or make a distribution payable in
shares of Selvac Common Stock, (ii) combine the outstanding Selvac Common
Stock into a smaller number of shares, (iii) subdivide the outstanding Selvac
Common Stock, or (iv) reclassify the Selvac Common Stock, then, in any such
event, the Merger Consideration to be delivered to holders of Classy Lady
Common Stock who are entitled to receive Merger Consideration in exchange for
Classy Lady Common Stock shall be adjusted so that each shareholder shall be
entitled to receive such Merger Consideration as such shareholder would have
been entitled to receive if the Effective Time had occurred prior to the
happening of such event (or, if applicable, the record date in respect
thereof).
4. Closing. Subject to the satisfaction or waiver of the conditions set
forth herein, the Closing (the "Closing") of the transactions contemplated by
this Agreement shall take place at the offices of Marks & Murase L.L.P., 399
Park Avenue, New York, New York at 10:00 A.M., New York time promptly after
the last to occur of the satisfaction of all of the conditions set forth in
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Sections 7 and 8 and which have not been waived, or on such other date, time
and place as may be agreed upon in writing by the parties hereto. The date of
the Closing is herein referred to as the Closing Date. At the Closing, the
parties shall exchange the certificates, opinions, and other documents
contemplated by this Agreement in order to ascertain whether the conditions to
the parties' obligations to consummate the Merger have been satisfied or any
right or condition exists that would permit or require this Agreement to be
terminated. The parties shall on the Closing Date or as soon thereafter as
practicable cause an executed copy of the Certificate of Merger to be filed in
accordance with the laws of the State of Delaware and the Commonwealth of
Puerto Rico.
3. Representations and Warranties of Classy Lady. Classy Lady represents and
warrants to Selvac and Acquisition as follows:
1. Organization and Qualification. Classy Lady is a corporation duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Puerto Rico. Classy Lady has all requisite power and
authority to own, lease and operate its properties and carry on its business
as now being conducted. Classy Lady does not carry on activities which would
require it to be qualified and in good standing as a foreign corporation
authorized to do business in any jurisdiction.
2. Subsidiaries. Classy Lady does not own or control, directly or
indirectly, any shares of, or interest in, any corporation, association or
other business entity.
3. Capitalization. The authorized capital stock of Classy Lady consists of
25,000 shares of common stock, no par value per share (the "Classy Lady Common
Stock"), 25,000 of which shares of Classy Lady Common Stock will at the
Closing be issued and outstanding and are owned of record by the Classy Lady
Stockholders in such amounts as are set forth opposite such stockholder's name
on Schedule 3.3. To the best knowledge of Classy Lady, each Classy Lady
Stockholder owns beneficially the shares of Classy Lady Common Stock set forth
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opposite such person's name on Schedule 3.3 free and clear of any lien,
pledge, hypothecation, mortgage or other encumbrance thereon. All of the
issued and outstanding shares of Classy Lady Common Stock are duly authorized,
validly issued, fully paid, nonassessable and free of preemptive rights.
Except as listed on Schedule 3.3, there are no other equity securities or
securities convertible into equity securities of Classy Lady outstanding and
there are no options, warrants, calls, subscriptions, convertible securities,
or other rights or other agreements or commitments of any character whatsoever
obligating Classy Lady to issue or sell any shares of its capital stock or any
securities convertible into or exchangeable or exercisable for, or otherwise
evidencing a right to acquire, any shares of its capital stock or other
securities of any kind of Classy Lady. Except as disclosed on Schedule 3.3,
there are no voting trusts or other agreements or understandings to which
Classy Lady, or to the best knowledge of Classy Lady, any Classy Lady
Stockholder, is a party with respect to the voting of the capital stock of
Classy Lady.
4. Agreement. This Agreement, and all other agreements, documents,
instruments and certificates to be executed in connection herewith have been
duly authorized by the directors of Classy Lady and by the unanimous approval
of the Classy Lady Stockholders, and this Agreement has been duly executed and
delivered by Classy Lady and constitutes, and such other agreements,
documents, instruments and certificates when executed and delivered will
constitute, the legal and binding obligation of Classy Lady enforceable in
accordance with their terms. The execution and delivery by Classy Lady of
this Agreement, and all other agreements, documents, instruments, and
certificates contemplated hereby, the consummation of the transactions
contemplated hereby, and the performance by Classy Lady of its obligations
hereunder and thereunder will not conflict with or result in any violation or
termination of, or any default under (either immediately or with notice or
lapse of time), or any right to accelerate or the creation of any lien, charge
or encumbrance pursuant to, any provision of (a) the certificate of
incorporation or by-laws of Classy Lady, (b) any agreement, contract,
mortgage, lease, license, note, bond, mortgage, indenture, deed of trust or
other instrument to which Classy Lady is a party or by which any of the
properties or other assets of Classy Lady is bound, (c) any governmental
franchise, license, permit or authorization, or any judgment or order of any
tribunal or governmental body applicable to Classy Lady, or any of the
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properties or other assets of Classy Lady, or (d) any law, statute, decree,
rule or regulation of any jurisdiction applicable to Classy Lady. No
authorization, consent or approval of, or declaration of, filing with or
notice to any governmental body or authority by Classy Lady is required to be
obtained or made Classy Lady in connection with the execution of this
Agreement by Classy Lady, the consummation by Classy Lady of the transactions
contemplated hereby or the performance by Classy Lady of its obligations
hereunder, other than the filing of the Certificate of Merger with the
Secretary of State of the State of Delaware and the filing in the Department
of State for the Commonwealth of Puerto Rico of the Certificate of Merger
issued by the Secretary of State of Delaware.
5. Title to Property, Absence of Encumbrances, etc. Set forth in Schedule
3.5 is a complete and accurate list of (a) all real property leased by Classy
Lady, and (b) all machinery, equipment, tools, furniture and fixtures owned or
leased by Classy Lady, and of all mortgages, liens and material encumbrances
to which such real property, machinery, equipment, tools, furniture and
fixtures are subject. Except for leased property and as specified in such
Schedule 3.5, Classy Lady has good, valid and marketable title to all assets,
real or personal, tangible or intangible, owned or used by it, respectively,
free and clear of all mortgages, pledges, liens, security interests or
encumbrances of any nature (other than liens for taxes, assessments or other
governmental charges not yet due and payable, or presently payable without
penalty or interest), except for such leases and such mortgages, liens and
encumbrances, or as otherwise disclosed in Schedule 3.5 or other Schedules to
this Agreement.
6. Patents, Trademarks, etc. Schedule 3.6 contains a complete and correct
list including the number and date thereof, of all patents, trademarks
registered or claimed by Classy Lady, trade names and registered copyrights
owned or used by, or registered in the name of, Classy Lady, and of all
applications for patents or for registration of trademarks, trade names or
copyrights made by Classy Lady, or by any of its employees for the benefit of
Classy Lady. Except as otherwise indicated on Schedule 3.6, Classy Lady is
the registered and beneficial owner of all such patents, trademarks, trade
names and registered copyrights, free and clear of any license, royalty, lien,
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encumbrance or other interest of any third party. Other than as set forth on
Schedule 3.6, there is no existing, pending threatened claim by Classy Lady
against any third party for infringement, misuse or misappropriation of any
patent, trademark, trade name, copyright or other intellectual property
(including without limitation any trade secrets or know-how) owned by Classy
Lady or in which Classy Lady has an interest. There is no existing, pending
or, to the knowledge of Classy Lady, threatened, action, suit, or proceeding
against Classy Lady for infringement, misuse or appropriation by Classy Lady
of any patent, trademark, trade name, copyright or other intellectual property
(including without limitation any trade secret or know-how) owned by any third
party or, to the knowledge of Classy Lady, any basis therefor.
7. Employee Remuneration, etc.
a. Schedule 3.7 lists the current salaries, bonuses, or any other form of
compensation paid (together with pending or anticipated increases therein) to
each director, officer, or employee, of Classy Lady, including any bonuses
which Classy Lady has promised or currently anticipates paying to any such
person. No officer or other key employee of Classy Lady has indicated an
intention to Classy Lady to terminate his or her employment with Classy Lady.
b. Schedule 3.7 also lists each officer or employee of Classy Lady who has
entered into an employment contract, consulting contract or other special
arrangement with Classy Lady, and true and complete copies of all such
contracts and descriptions of all such arrangements have been previously
delivered to Selvac.
c. Except as set forth on Schedule 3.7, Classy Lady has not entered into
any agreement or arrangement with any employees of Classy Lady to pay such
employee any amount beyond such individual's regular salary as an inducement
to remain as an employee until, or contingent upon, the execution of this
Agreement or the consummation of the transactions contemplated hereby.
8. Officers, Directors, and Bank Accounts. Schedule lists as of the date
hereof (a) the names of all directors and officers of Classy Lady and (b) the
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name and location of each bank or other institution in which Classy Lady has
any account or safe deposit box, the number or other identification thereof
and the names of all persons authorized to draw thereon or have access
thereto.
9. Environmental Matters.
a. As of the date of this Agreement, there is not with respect to any
Environmental Matter (as such term is defined below), related to or which
affects or might affect Classy Lady or any of the transactions contemplated by
this Agreement: (i) any judicial or administrative action, suit, order,
proceeding or governmental investigation concerning or against Classy Lady
pending or to the knowledge of Classy Lady threatened before any court or
tribunal or governmental instrumentality, (ii) any citation, summons,
directive, order or notice of violation of any law, decree, rule, regulation
or order against Classy Lady or to which Classy Lady is a party, (iii) any
lien on Classy Lady property arising from or related to Environmental Matters,
or to the knowledge of Classy Lady any governmental action resulting or which
is likely to result in the imposition of any such lien on any of the
properties owned or leased by Classy Lady or (iv) to the best knowledge of
Classy Lady, any basis for any of the foregoing.
b. Schedule 3.9 lists, together with the date of expiration thereof, all
currently effective registrations, permits, licenses, authorizations and
approvals issued to Classy Lady by or on behalf of any federal, state or local
governmental body or agency with respect to Environmental Matters. True and
complete copies of all such registrations, permits, licenses, authorizations
and approvals have been previously delivered to Selvac. Such registrations,
permits, licenses, authorizations and approvals constitute all those necessary
for the lawful conduct of Classy Lady's business as presently conducted with
respect to Environmental Matters and there is no administrative action or
other proceeding pending or, to the best of Classy Lady's knowledge,
threatened to revoke or suspend any such registration, permit, license,
authorization or approval.
c. No Hazardous Substances (as such term is defined below) arising out of
the operations of Classy Lady have been generated, treated, released, stored,
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discharged, disposed of or deposited on any of the premises now or previously
utilized by Classy Lady (whether directly or indirectly through a third party)
or at any other location, except as permitted by current applicable laws and
regulations. All storage facilities, whether above or below ground, and
associated piping and equipment located on the premises of Classy Lady are in
sound condition and free of leaks which may result or have resulted in any
release of Hazardous Substances.
d. As used herein, the term "Environmental Matters" refers to all matters
relating to ground, air and water pollution or discharge, solid or hazardous
wastes, toxic, hazardous or polluting substances, transportation, occupational
health, product liability, the transport, storage, recycling or disposal of
waste (including, without limitation, garbage, refuse, sludge and other
discarded materials, whether solid, liquid, semisolid or gaseous and whether
on-site or off-site), ground water and soil monitoring, and discharge or
emission of pollutants, contaminants or by-products (including, without
limitation, dredged soil, solid wastes, incinerator residue, sewage, garbage,
sewage sludge, chemical wastes, biological materials, radioactive materials,
heat, wrecked or discarded equipment, industrial waste, chemicals, metals or
other substances), whether such pollution or discharge was caused by (i)
Classy Lady, (ii) any third party arising from transport, storage, disposal or
treatment, whether on-site or offsite, on behalf of Classy Lady, (iii) any
lessee or sublessee of any real property owned or leased by Classy Lady, or
(iv) any partnership, joint venture or other similar business arrangement to
which Classy Lady is a party.
e. As used herein, the term "Hazardous Substances" shall have the meaning
assigned to such term in Section 101(14) of the comprehensive Environmental
Response, Compensation, and Liability Act of 1980, 42 U.S.C. Section 9601 et
seq., but shall also include petroleum hydrocarbons and any substance defined
as hazardous or toxic by any state, local or territorial regulatory agency
having jurisdiction.
10. Litigation. Other than in regard to any Environmental Matter or as set
forth on Schedule 3.10, there is no judicial or administrative action, suit,
proceeding or governmental investigation pending or, to the knowledge of
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Classy Lady, threatened before any court or tribunal or governmental
instrumentality, or any citation, order or notice of violation of any law,
decree, rule or regulation, by or against Classy Lady, or any of Classy Lady's
properties, which relates in any way to Classy Lady or to Classy Lady's
business, properties, assets or operations, or which has or is likely to
result in an imposition of a lien on any of the properties or assets owned or
leased by Classy Lady, or which question the validity of this Agreement or any
action to be taken in connection herewith, nor is there any such action, suit,
proceeding or investigation, pending or to the knowledge of Classy Lady,
threatened, which involves any director, officer, employee, consultant or
independent contractor of Classy Lady in its or his or her capacity as such.
Except as set forth in Schedule 3.10, neither Classy Lady nor any property or
assets of Classy Lady is subject to any judicial or administrative order,
judgment, injunction or decree nor has Classy Lady been a party to any
litigation, including without limitation any product or professional liability
litigation, within the last two years.
11. Compliance with Other Instruments and Laws. As of the date hereof,
Classy Lady is not in violation of any provision of (a) its charter or by-
laws, or (b) any agreement, contract, mortgage, lease, license or other
instrument, governmental franchise, license, permit or authorization, judgment
or order of any tribunal or governmental body, or law, statute, decree, rule
or regulation applicable to it or any of its properties or to which it is a
party or by which it is bound which violation in any case would reasonably be
expected to impair Classy Lady's ability to operate its business in a manner
consistent with past practice.
12. Contracts, etc. Schedule 3.12 contains a complete and correct list, of
each
a. contract for the employment of any person by Classy Lady (including any
management or consulting agreement) not listed on Schedule 3.7,
b. profit sharing, bonus, deferred compensation, stock option, severance
pay, pension, retirement or similar plan, agreement or arrangement of Classy
Lady,
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c. mortgage, debenture, note or installment obligation, or other
instrument or contract for the borrowing or lending of money by Classy Lady,
including without limitation any agreement or arrangement relating to the
maintenance of compensating balances or the availability of a line of credit,
d. license agreement (including without limitationary patent license
agreement), sales agency agreement or distribution agreement to which Classy
Lady is a party,
e. guaranty of any obligation by Classy Lady,
f. agreement for the sale of any properties or assets by Classy Lady,
g. contract, purchase order or other agreement for the purchase of
machinery, equipment, tools, raw materials furniture or fixtures with an
aggregate consideration of more than $5,000,
h. secrecy or invention agreement under which Classy Lady, or, to Classy
Lady's knowledge, any of the present officers or employees of Classy Lady has
any obligation and relating to the business of Classy Lady,
i. agreement of Classy Lady with, or loan or advance by Classy Lady to or
from, or other obligation of Classy Lady to or from any officer or director of
Classy Lady,
j. lease of real or personal property with Classy Lady as lessor or
lessee, involving rents of more than $5,000 per year,
k. agreement or arrangement limiting the freedom of Classy Lady or, to the
knowledge of Classy Lady, any of the present officers or employees of Classy
Lady to compete in any line of business similar to Classy Lady's business,
with any person or other entity or in any geographical area,
l. joint venture agreement or partnership, profit sharing or other
agreements to which Classy Lady is a party,
<PAGE>
m. contract commitment or agreement not referred to above in this Section
3.12 or in any other Schedule to this Agreement and any one of which involves
aggregate payments by or to Classy Lady of $5,000 or more.
All such contracts and agreements are, with respect to Classy Lady,
valid, binding and in full force and effect; Classy Lady is not in any default
thereunder which can reasonably be expected to cause termination of such
contract or any additional liability to Classy Lady under such contract; to
the best knowledge of Classy Lady, no event has occurred which, whether with
notice, lapse or time or otherwise, would constitute such a default by Classy
Lady thereunder; and Classy Lady has not received any notice of cancellation
or termination thereunder.
Except as disclosed in Schedule 3.12 hereto, no consent of any party or
the payment of any penalty or incurrence of any additional obligation or
change of any terms is necessary so that all rights of Classy Lady under
contracts extending beyond the Closing Date shall continue unimpaired on and
after the Closing.
13. Taxes. Except as set forth on Schedule 3.13:
a. Classy Lady has timely filed (giving due regard to permitted
extensions) all Tax (as defined below) returns and reports required to be
filed by it, which returns and reports are consistent with the books and
records of Classy Lady. All Taxes due and payable as shown on such returns
have been paid in full. There is no tax lien upon any property or assets of
Classy Lady except liens for current Taxes not yet due. There are no pending
audits or outstanding proposed adjustments with respect to such returns.
b. No deficiency for any other Tax has been asserted or assessed against
Classy Lady, and there are no unresolved claims concerning, or proceedings or
actions pending, which relate to either the Tax liability of Classy Lady or
the collection or assessment of Tax for any period for which returns covering
Classy Lady have been filed or were due.
c. Classy Lady has duly and timely withheld from all salaries, wages and
other compensation of its respective employees and has duly and timely paid
over to the appropriate governmental authorities all amounts required to be so
withheld and paid over for all periods under all applicable laws.
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d. "Tax" shall mean any federal, state and local income, franchise, sales
and use, property, excise, stamp, transfer, withholding, social security,
unemployment insurance, employment or other tax or governmental charge of
Classy Lady, imposed by the United States or any state, territory or locality
therein, including any penalty, addition to tax or interest with respect to
such tax.
14. Permits. Classy Lady has obtained and holds all licenses, permits,
authorizations, consents and orders or approvals of all federal, state,
territorial or local governmental or regulatory bodies that are necessary for
the lawful conduct of its business (the "Permits"), including without
limitation permits to operate machinery, or to store, handle, utilize or
dispose of raw materials (including without limitation hazardous materials)
and waste. All of the Permits are listed on Schedule 3.14 and are validly
issued and in full force and effect and Classy Lady is in compliance
therewith. No proceeding is pending or, to the best knowledge of Classy Lady,
threatened which seeks or may result in canceling, suspending, restricting or
modifying any Permit.
15. Employee Benefit Plans and Arrangements and Compliance with ERISA.
a. Schedule 3.15 hereto sets forth all employee benefit plans (within the
meaning of Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended ("ERISA")) and all bonus, incentive, deferred compensation,
retiree medical or life insurance, supplemental retirement, severance or other
benefit plans, programs or arrangements, which are or have been maintained,
contributed to or sponsored by Classy Lady for the benefit of any current or
former employee, officer or director of Classy Lady or under which any current
or former employee, officer or director of Classy Lady claims any benefits or
rights (collectively, the "Plans"). Each Plan is in writing and Classy Lady
has furnished Selvac with a true and complete copy of each Plan and a true and
complete copy of each material document prepared in connection with each such
Plan.
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16. Insurance. Schedule 3.16 lists all insurance policies to which Classy
Lady is a party or which relate to the employees of Classy Lady (the
"Insurance Policies") and sets forth for each such Insurance Policy the name
of the insurer, the coverage limit, the amount and frequency of payment of the
premium, and the term of the policy and, on attachments if necessary, a claims
history for each Insurance Policy since January 1, 1993. The Insurance
Policies are in full force and effect, all premiums with respect thereto
covering all periods up to and including the date of the Closing have been
paid or will be paid when due, and no notice of cancellation or termination
has been received with respect to any Insurance Policy. The Insurance
Policies provide coverage that is in compliance with all material requirements
of law and of all material agreements to which Classy Lady is a party, are
valid, outstanding and enforceable policies, and provide adequate insurance
coverage for Classy Lady and the operations of its business.
17. Other Liabilities. Classy Lady does not have any liabilities or
obligations (direct or indirect, contingent or absolute, matured or unmatured)
of whatever nature, whether arising out of contract, tort, statute or
otherwise, except liabilities and obligations (a) disclosed in the Schedules
to this Agreement, or (b) incurred in the ordinary course of business which do
not singly or in the aggregate with respect to similar liabilities involve an
amount greater than $5,000.
18. Brokers. No finder, broker, agent or other intermediary has acted on
behalf of Classy Lady in connection with this Agreement or the transactions
contemplated hereby for whose fees Classy Lady is liable.
19. Absence of Certain Payments. Neither Classy Lady nor to the best of
Classy Lady's knowledge, any officers, directors, employees, agents,
representatives, or independent contractors of Classy Lady has made, or
arranged for the making of, any unlawful payment to any official, officer or
employee of any Federal, state, county, municipal or other governmental or
regulatory body or authority or any self-regulatory body or authority, or made
any payment to any customer or supplier of Classy Lady or any officer,
director, partner, employee or agent of any customer or supplier, for the
unlawful sharing of fees or to any such customer or supplier or any such
officer, director, partner, employee or agent for the unlawful rebating of
<PAGE>
charges, or engaged in any other unlawful reciprocal practice, or made any
other unlawful payment or given any other unlawful consideration to any such
customer or supplier or any such officer, director, partner, employee or
agent, in respect of Classy Lady.
20. Disclosure. This Agreement, the Schedules hereto, and any other
information furnished or to be furnished by Classy Lady to Selvac in
connection with this Agreement and the transactions contemplated hereby do not
contain any untrue statement of a material fact or omit to state any material
fact necessary to make the statements contained therein not false or
misleading.
4. Representations and Warranties of the Selvac. Selvac represents and
warrants to Classy Lady as follows:
1. Organization and Qualification. Each of Selvac and Acquisition is a
corporation duly organized, validly existing and in good standing under the
laws of the state of Delaware and has all requisite power and authority to
own, lease and operate its properties and business as it is now being
conducted. Selvac is duly qualified and in good standing as a foreign
corporation authorized to do business in each jurisdiction where the failure
to be so qualified would have a material adverse effect on the business or
assets of Selvac. Acquisition conducts no business activities and is not
required to be qualified to do business as a foreign corporation in any
Jurisdiction.
2. Agreement. The execution, delivery and performance of this Agreement,
and all other agreements, documents, instruments and certificates contemplated
hereby are within the corporate power and corporate authority of Selvac and
Acquisition and have been authorized by all necessary corporate action by
Selvac and Acquisition, and this Agreement has been duly executed and
delivered by Selvac and Acquisition and constitutes, and such other
agreements, documents, instruments certificates when executed and delivered
will constitute the legal and binding obligation of Selvac and Acquisition
enforceable in accordance with its terms. The execution and delivery by
Selvac and Acquisition of this Agreement, and all other agreements, documents,
instruments and certificates contemplated hereby, the consummation of the
transactions contemplated hereby, and the performance by Selvac and
<PAGE>
Acquisition of their respective obligations hereunder and thereunder will not
conflict with or result in any violation or termination of (either immediately
or with notice or lapse of time), or any right to accelerate or the creation
of any lien, change or encumbrance pursuant to, any provision of (a) the
certificate of incorporation or by-laws of Selvac or Acquisition, as
applicable, (b) any governmental franchise, license, permit or authorization,
or any judgment or order of any tribunal or governmental applicable to Selvac
or Acquisition, or any of Selvac's or Acquisition's properties or other
assets, (c) any law, statute, decree, rule or regulation of any jurisdiction
or (d) any agreement, contract, mortgage, lease, license, note, bond,
indenture, deed of trust or other instrument to which Selvac or Acquisition is
a party or by which any of the properties or other assets of Selvac or
Acquisition is bound. The issuance of the Selvac Common Stock pursuant to
this Agreement has been duly and validly authorized and the Selvac Common
Stock, when issued pursuant hereto, will be validly issued, fully paid and
non-assessable. Other than filings or notices which may be necessary to
comply with federal and state securities law, no authorization, consent or
approval of, or declaration of, filing or registration with or notice to any
governmental body or authority by Selvac or Acquisition is required to be
obtained or made by Selvac or Acquisition in connection with the execution of
this Agreement by Selvac and Acquisition, the consummation by Selvac and
Acquisition of the transactions contemplated hereby, the valid offer, issue,
sale or delivery of the Merger Consideration or the performance by Selvac or
Acquisition of their obligations hereunder.
3. Capitalization. (a) The authorized capital stock of Selvac consists of
20,000,000 shares of Common Stock, $.01 par value (the "Selvac Common Stock"),
of which 15,199,098 shares are issued and outstanding as of May 29, 1996, and
200,000 Shares of Serial Preferred Stock, of which 4,000 shares of 12% Series
A Preferred Stock, 2500 shares of 12% 1985 Series Preferred Stock and 10,000
shares of Series C, 5% Cumulative Convertible Preferred Stock are issued and
outstanding. All of the issued and outstanding shares of Selvac Common Stock,
12% Series A Preferred Stock, 12% 1985 Series Preferred Stock and Series C 5%
Preferred Stock are duly authorized, validly issued, fully paid, nonassessable
and free of preemptive rights. Except for outstanding common stock purchase
warrants to purchase 375,646 shares of Selvac Common Stock as of May 29, 1996
<PAGE>
and shares of Common Stock receivable upon the conversion of an aggregate of
$3,000,000 principal amount of 8% Convertible Debentures and the interest
accrued thereon, there are no other equity securities or securities
convertible into equity securities of Selvac outstanding and there are no
options, warrants, calls, subscriptions, or other rights or other agreements
or commitments of any character whatsoever obligating Selvac to issue or sell
any shares of its capital stock or any securities convertible into or
exchangeable or exercisable for, or otherwise evidencing a right to acquire,
any shares of its capital stock or other securities of any kind of Selvac. To
the best knowledge of Selvac, there are no voting trusts or other agreements
or understandings to which Selvac or any of its shareholders is a party with
respect to the voting of the capital stock of Selvac.
a. The authorized capital stock of Acquisition consists of 1,000 shares
of Common Stock, $.01 par value, (the "Acquisition Common Stock"), of which
100 shares are issued and outstanding and owned by Selvac. All of the issued
and outstanding shares of Acquisition Common Stock are duly authorized,
validly issued, fully paid, nonassessable and free of preemptive rights.
There are no options, warrants, calls, subscriptions, or other rights or other
agreements or commitments of any character whatsoever obligating Acquisition
to issue or sell any shares of its capital stock or any securities convertible
into or exchangeable or exercisable for, or otherwise evidencing a right to
acquire, any shares of its capital stock or other securities of any kind of
Acquisition. There are no voting trusts or other agreements or understandings
to which Selvac or Acquisition is a party with respect to the voting of the
capital stock of Acquisition.
4. Financial Statements. Selvac has previously delivered to Classy Lady
true and complete copies of the audited balance sheets of Selvac as of May 31,
1995 and the related statements of income, retained earnings and cash flows
for such years then ended. Such statements, including the notes to such
statements, are referred to herein collectively as the "Selvac Financial
Statements". The Selvac Financial Statements and all other financial
statements of Selvac included in the Filings (as defined below) complied as to
form with applicable accounting requirements and the rules of regulations of
the Securities and Exchange Commission with respect thereto, have been
<PAGE>
prepared in accordance with generally accepted accounting principles applied
on a consistent basis throughout the periods specified, and present fairly the
financial position of Selvac as of the respective dates specified and the
results of operations and changes in financial position of Selvac for the
respective periods specified.
5. No Adverse Change. Since May 31, 1995 there has not been any material
adverse change in the financial condition, operations, business or prospects
of Selvac.
6. Compliance with Other Instruments and Laws. Neither Selvac nor
Acquisition is in violation of any provision of (a) its charter or by-laws, or
(b) any agreement, contract, mortgage, lease, license or other instrument,
governmental franchise, license, permit or authorization, judgment or order of
any tribunal or governmental body, or law, statute, decree, rule or regulation
applicable to it or any of its properties or to which it is a party or by
which it is bound, which violation in any case would reasonably be expected to
impair the ability of Selvac to operate its business in a manner consistent
with past practice.
7. Filings. Selvac has filed all documents required to be filed with the
Securities and Exchange Commission (the "Commission") pursuant to the
requirements of the Securities Act, the Securities Exchange Act of 1934, and
the Rules and Regulations promulgated thereunder, true and complete copies of
which for Selvac's 1994 and 1995 fiscal years have been delivered to Classy
Lady (the "Filings"). The Filings complied in all material respects with the
requirements of the Securities Act or the Securities Exchange Act, as
applicable and did not contain on the respective dates of filing thereof any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
8. Brokers. No finder, broker, agent or other intermediary has acted on
behalf of Selvac or the Acquisition in connection with this Agreement or the
transactions contemplated hereby for whose fees Classy Lady are liable.
<PAGE>
9. Absence of Certain Payments. Neither Selvac nor to the best of Selvac's
knowledge, any officers, directors, employees, agents, representatives, or
independent contractors of Selvac has made, or arranged for the making of, any
unlawful payment to any official, officer or employee of any Federal, state,
county, municipal or other governmental or regulatory body or authority or any
self-regulatory body or authority, or made any payment to any customer or
supplier of Selvac or any officer, director, partner, employee or agent of any
customer or supplied, for the unlawful sharing of fees or to any such customer
or supplier or any such officer, director, partner, employee or agent for the
unlawful rebating of charges, or engaged in any other unlawful reciprocal
practice, or made any other unlawful payment or given any other unlawful
consideration to any such customer or supplier or any such officer, director,
partner, or agent, in respect of Selvac.
10. Litigation. Other than as set forth in the Filings, there is no
judicial or administrative action, suit, proceeding or governmental
investigation pending or, to the knowledge of Selvac or Acquisition,
threatened before any court or tribunal or governmental instrumentality, or
any citation, order or notice of violation of any law, decree, rule or
regulation, by or against Selvac or Acquisition or any of their respective
properties, or which relates in any way to Selvac's or to Acquisition's
business, properties, assets or operations, or which has or is likely to
result in an imposition of a lien on any of the properties or assets owned or
leased by Selvac or Acquisition, or which question the validity of this
Agreement or any action to suit, proceeding or investigation, pending or to
the knowledge of Selvac or Acquisition, threatened, which involves any
director, officer, employee, consultant or independent contractor of Selvac or
Acquisition in its or his or her capacity as such.
11. Disclosure. This Agreement, the Filings, the Selvac Financial
Statements and any other information furnished or to be furnished to Classy
Lady in connection with this Agreement and the transactions contemplated
hereby does not contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements contained therein not
false or misleading.
<PAGE>
5. Covenants of Classy Lady. Classy Lady covenants as follows:
1. Action to Closing. From the date of this Agreement until the Effective
Time, Classy Lady will:
a. conduct its business only in the ordinary course, in substantially the
manner as heretofore conducted and in accordance with all laws, rules,
regulations, orders, approvals, authorizations, exemptions and registrations,
b. maintain all right, title and interest in all of its assets, including
all patents, patent assignments and licenses,
c. perform in all material respects all of the respective obligations
under all contracts listed in Schedule 3.12,
d. use its best efforts to keep available the services of Classy Lady's
present officers and employees,
e. not, without the prior written consent of Selvac, take any action or
engage in any transaction not expressly permitted by this Section 5.1 or
otherwise contemplated by this Agreement which would cause any of the
representations and warranties made by Classy Lady herein to be untrue as of
the Effective Time or a breach of the terms and conditions of this Agreement;
provided, however, that it is agreed and understood by the parties hereto that
Classy Lady's continuation of the ongoing business negotiations which it has
been conducting with Laser Industries, Ltd. and L.L. Knickerbocker, Inc. in
connection with joint ventures for the Classy Lady laser hair removal
technology shall not constitute a violation of this Section 5.1.
2. Access and Information. Classy Lady will afford Selvac and Selvac's
employees, accountants, counsel and other authorized representatives
reasonable access during business hours to Classy Lady's properties, books and
records as Selvac may from time to time reasonably request.
<PAGE>
3. Publicity; Confidentiality.
a. Except as may be required to comply with applicable federal or state
securities laws, prior to the Effective Time Classy Lady will not, without the
consent of Selvac, issue or cause the publication of any press release or
other public announcement with respect to this Agreement after the date
hereof.
b. Classy Lady agrees, and shall cause each stockholder, director, officer
and key employee of Classy Lady to agree, that such person shall keep secret
and retain in strictest confidence, and shall not use for the benefit of
himself or others, all confidential matters including, without limitation,
"know-how", trade secrets, customer lists, pricing policies, operational
methods, marketing plans or strategies, product development techniques or
plans, business acquisition plans, new personnel acquisition plans, methods of
manufacture, technical processes, designs and design projects, inventions and
research projects and other business affairs ("Confidential Information") of
Selvac and its affiliates learned by such person, heretofore or hereafter and
which have not been publicly disclosed, and shall not disclose them to anyone
outside of Classy Lady or Selvac and their affiliates, without Selvac's
express written consent.
4. Best Efforts. Classy Lady agrees to use its best efforts to satisfy the
conditions to the obligations of Selvac hereunder set forth in Section 8.
5 Negotiation with Other Parties. Neither Classy Lady, nor any director,
officer or stockholder of Classy Lady will participate in any negotiations
with any third party for the acquisition of all or any part of Classy Lady or
its assets prior to the Effective Time or the prior termination of this
Agreement pursuant to Section 10.3. Classy Lady will report to Selvac any
contacts or indications of interest from any third party with respect to such
acquisition.
6. Covenants of Selvac. Selvac covenants as follows:
1. Action to Closing. From the date of this Agreement until the Effective
Time, Selvac will:
<PAGE>
a. operate its business in the ordinary course consistent with past
practice;
b. not amend the terms of any Selvac capital stock or any other securities
of Selvac;
c. not amend the Certificate of Incorporation or Bylaws of Selvac, except
as may be necessary to permit an increase in the number of shares of
authorized capital stock and to change the name of Selvac as provided in
Section 6.9;
d. promptly advise Classy Lady in writing of any change or event having,
or which, insofar as can reasonably be foreseen, would have, a material
adverse effect on Selvac without regard to whether such change or event would
be permitted hereunder. Selvac shall promptly provide Classy Lady with copies
of all filings made by Selvac with the Commission or any other governmental
entity in connection with this Agreement and the transactions contemplated
hereby; and
e. not, without the prior written consent of Classy Lady, take any action
or engage in any transaction not expressly permitted by this Section 6.1 or
otherwise contemplated by this Agreement which would cause any of the
representations and warranties made by Selvac and Acquisition herein to be
untrue as of the Effective Time or a breach of the terms and conditions of
this Agreement.
2. Negotiation with Other Parties and Sale of Stock. Prior to the Effective
Time or the prior termination of this Agreement pursuant to Section 10.3,
neither Selvac nor any director or officer of Selvac will participate in any
negotiations with any third party for the acquisition of all or substantially
all of the assets of Selvac or relating to any transaction upon the
consummation of which Selvac would not be the surviving entity. Selvac will
report to Classy Lady any contacts or indications of interest from any third
party with respect to such acquisition.
3. Reorganization. Prior to the Effective Time, acquisition will engage in
no business, and will not assume any substantial assets or liabilities.
<PAGE>
4. Directors and Officers. Effective as of the Closing, (a) the Board of
Directors shall consist of seven members: Allan Borkowski, James Leonard,
Thomas L. Mehl, Sr. ("Mehl") and four individuals designated prior to the
Effective Time by Mehl, and (b) Mehl shall be appointed as Chairman of the
Board of Directors and Chief Executive Officer of Selvac.
5. Best Efforts. Selvac will use its best efforts to satisfy the conditions
to the obligations of Classy Lady hereunder set forth in Section 7.
6. Tax-Free Reorganization. Selvac shall not take any action which causes
the transactions contemplated hereby not to be treated as a tax-free
reorganization under the Code.
7. Publicity; Confidentiality.
a. Prior to the Effective Time, Selvac shall allow Classy Lady to review
and give comments on any press release or other public announcement regarding
Selvac prior to the public release of such information.
b. Prior to the Effective Time, Selvac agrees to maintain the
confidentiality of any non-public Confidential Information furnished by Classy
Lady to it in connection with the transactions contemplated by this Agreement.
If this Agreement is terminated, Selvac shall return to Classy Lady all
written Confidential Information provided by Classy Lady and agrees not to use
such information in conducting its business unless such information ceases
being non-public information. Notwithstanding the foregoing, Selvac may
disclose such information if required to do so by law or governmental order.
8. Access to Classy Lady. Prior to the Effective Time, Selvac shall give
Classy Lady and its employees, accountants, counsel and other representatives
full access to the properties, book and records of Selvac as may reasonably be
requested by Classy Lady from time to time.
9. Amendments to Certificate. Selvac shall take all actions as are
necessary to amend its Certificate of Incorporation to (a) increase its
<PAGE>
authorized capital stock to permit the issuance of the Selvac Common Stock
required to be issued pursuant to Section 2.1 and (b) to change its name, as
of the Effective Time, to "Mehl/Biophile International Corporation."
7. Conditions to the Obligations of Classy Lady. The obligations of Classy
Lady to effect the transactions contemplated hereby are subject to the
fulfillment to its satisfaction, prior to the Effective Time of the following
conditions:
1. Representations and Warranties. The representations and warranties of
Selvac and Acquisition contained herein shall have been true and correct when
made and shall be true and correct at and as of the Effective Time as though
such representations and warranties were made at and as of the
2. Performance. Selvac and Acquisition shall have performed and complied
with each covenant or condition required by this Agreement to be performed or
complied with by it before or at the Effective Time.
3. Closing Certificate. Selvac and Acquisition shall have delivered to
Classy Lady a certificate, dated the Effective Date and executed by a
principal executive or financial officer of each of Selvac and Acquisition,
certifying that the conditions specified in Sections 7.1 and 7.2 have been
fulfilled.
4. Opinion of Counsel. Classy Lady shall have received from counsel for
Selvac an opinion, dated the Effective Date, addressed to Classy Lady and in a
form reasonably acceptable to counsel of Classy Lady as to the matters set
forth in Sections 4.1, 4.2 and 4.3 hereof and as to the effect of the
consummation of the Merger.
5. No Order. No governmental entity or court of competent jurisdiction
shall have enacted, issued, promulgated, enforced or entered any law, rule,
regulation, order, decree or injunction which has the effect of preventing the
Merger or making the transactions contemplated hereby illegal.
8. Conditions to the Obligations of Selvac. The obligations of Selvac and
Acquisition to effect the transactions contemplated hereby are subject to the
fulfillment to its satisfaction, before or at the Effective Time, of the
following conditions:
<PAGE>
1. Representations and Warranties. The representations and warranties of
Classy Lady contained in this Agreement (including the Schedules hereto) shall
have been true and correct when made and shall be true and correct in all
material respects at and as of the Effective Time as though such
representations and warranties were made at and as of the Effective Time.
2. Performance. Classy Lady shall have performed and complied with each
covenant and condition required by this Agreement to be performed or complied
with by them before or at the Effective Time.
3. Closing Certificate. Classy Lady shall have delivered to Selvac a
certificate, dated the Effective Date and executed by Classy Lady, certifying
that the conditions specified in Sections 8.1 and 8.2 have been fulfilled.
4. Opinion of Counsel. Selvac shall have received from counsel for Classy
Lady an opinion, dated the Effective Date, addressed to Selvac and in a form
reasonably acceptable to counsel for Selvac as to the matters set forth in
Sections 3.1, 3.3 and 3.4 hereof and as to the effect of the consummation of
the Merger.
5. No Dissenting Shares. No Classy Lady Stockholder shall have perfected
their dissenters, rights of appraisal as provided by the Delaware GCL or the
General Corporate Law of 1995 of the Commonwealth of Puerto Rico.
6. Fairness Opinion. Selvac shall have received an opinion from a reputable
investment banking firm that the proposed transaction with Classy Lady is fair
to the shareholders of Selvac from a financial point of view.
9. Survival of Representations and Warranties. The representations and
warranties contained in Sections 3 and 4 of this Agreement shall survive any
investigation by either party but shall expire and be extinguished on the
Closing Date.
10. Additional Covenants
<PAGE>
1. (a) Issuance of Additional Shares. In the event that the Surviving
Corporation or Selvac sells its ownership interest in either the Joint Venture
with Laser Industries Ltd. or all or substantially all of its ownership
interest in a second joint venture or business combination which is entered
into to commercialize laser hair removal technology (collectively, the "Joint
Ventures") for the sum of up to $50,000,000, the Designated Recipients shall
receive no additional compensation other than the aforementioned additional
shares of Selvac Common Stock.
a. In the event that the Surviving Corporation or Selvac sells its
ownership interest in either of the Joint Ventures for between the sum of up
to $50,000,001 to $100,000,000, the Designated Recipients shall also receive
25% of the proceeds from such sale between $50,000,000 and $100,000,000.
b. In the event that the Surviving Corporation or Selvac sells its
ownership interest in either of the Joint Ventures for any sum over
$100,000,000.00, the Designated Recipients shall also receive 50% of the
proceeds from such sale over $100,000,000.00.
2. Settlement of Litigation. Effective as of the Closing, Selvac and Thomas
L. Mehl, Sr. agree to enter into a settlement agreement and release whereby
Civil Action No. 91-10868Z filed in the Federal District Court of
Massachusetts, will be dismissed with prejudice to the parties thereto and
both parties shall release each other in full in connection with any claims
arising out of the subject matter of such litigation.
11. General Provisions.
1. Modification; Waiver. This Agreement may be modified only by a written
instrument executed by the parties herein. Any of the terms and conditions of
this Agreement may be waived in writing at any time on or before the Closing
Date by the party entitled to the benefits thereof.
2. Entire Agreement, etc. This Agreement, together with the schedules and
exhibits hereto, constitutes the entire agreement among the parties pertaining
to the subject matter hereof and supersedes all prior agreements and
understandings of the parties in connection therewith.
<PAGE>
3. Termination. This Agreement may be terminated:
a. at any time before the Effective Time by mutual consent of Selvac and
Classy Lady; or
b. by either Selvac or Classy Lady in writing, if the Closing shall not
have occurred on or before the earlier of (i) August 1, 1996 or (ii) all of
the conditions set forth in Sections 7 and 8 have been satisfied that the non-
occurrence of the Closing is not attributable to a breach of the terms hereof
by the party seeking termination.
4. Expenses. Whether or not the transactions contemplated herein shall be
consummated, each party shall pay its own expenses incident to the preparation
and performance of this Agreement.
5. Further Actions. Each party shall execute and deliver such certificates,
agreements and other documents and take such other actions as may reasonably
be requested by the other party in order to consummate or implement the
transactions contemplated hereby.
6. Notice. All notices, requests, demands, and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered, telecopied or mailed, registered mail, first-class postage paid,
return receipt requested, or any other delivery service with proof of
delivery:
If to Classy Lady:
Classy Lady by Mehl of Puerto Rico, Inc.
c/o M.C.M. Group, Inc.
4020 Newberry Road, Suite 400
Gainesville, Florida 32607
Attention: Thomas L. Mehl, Sr.
<PAGE>
with a copy to:
Kevin Leary, Esq.
4020 Newberry Road, Suite 400A
Gainesville, Florida 32607
If to Selvac:
Selvac Corporation
1 Horizon Road
Fort Lee, New Jersey 07024
Attention: Allan Borkowski
with a copy to:
Marks & Murase L.L.P.
399 Park Avenue
New York, New York 10022
Attention: Alan J. Bernstein, Esq.
or to such other address or to such other person as either party hereto shall
have last designated by notice to the other party.
7. Assignment. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns, but shall not be assignable, by operation of law or otherwise, by
either party hereto without the prior written consent of the other party.
8. Counterparts. This Agreement may be executed in several counterparts,
each of which is an original but all of which shall constitute one instrument.
9. Headings. The section and other headings in this Agreement are for
convenience of reference only and shall not be deemed to alter or affect the
meaning or interpretation of any provision hereof.
10 Governing Law. The validity, performance and enforcement of this
Agreement shall be governed by the laws of the State of Delaware, without
giving effect to the principles of conflicts of law thereof.
<PAGE>
11. Separability. Any term or provision of this Agreement which is invalid
or unenforceable shall be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining
terms and provisions of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
SELVAC CORPORATION
By: Allan Borkowski
Name:
Title:
SELVAC ACQUISITION CORP.
By: Allan Borkowski
Name:
Title:
CLASSY LADY BY MEHL
OF PUERTO RICO, INC.
By: Thomas L. Mehl, Sr.
Name:
Title:
<PAGE>
Exhibit 2.2
I N D E X
1. Interpretation 1
2. Sale of Shares 3
3. Consideration 3
4. Completion 3
5. Warranties 6
6. Non-Competition Covenant 6
7. Contingent Patent Payments 8
8. General Provisions 9
9. Costs 10
10. Notices 10
11. Press Announcements 10
12. Governing Law 11
The following schedules have not been included with this filing. The
Registrant agrees to furnish supplementally a copy of any omitted schedule
to the commission upon request.
SCHEDULE 1 12
Vendors
SCHEDULE 2 13
Information concerning the Company
SCHEDULE 3 15
The Property
SCHEDULE 4 16
Loans to be Repaid
SCHEDULE 5 17
Warranties
SCHEDULE 6 21
Disclosure Bundle Documents
<PAGE>
THIS AGREEMENT is made the 4th day of June One Thousand Nine Hundred and
Ninety Six
B E T W E E N:-
(1) The persons whose names and addresses are set out in Schedule 1 ("the
Vendors")
(2) SELVAC CORPORATION a company incorporated under the laws of the State of
Delaware, USA whose principal office is at 221 Boston Post Road, Marlboro,
Massachusetts 01752, USA ("the Purchaser")
W H E R E B Y IT IS AGREED as follows:-
1. INTERPRETATION
In this Agreement and in the Schedules hereto where the context so admits:-
1.1. "agreed form"
means a document in a form approved by and for the purposes of
identification signed by or on behalf of the parties;
"the Company"
means SLS (Wales) Limited incorporated in England and Wales on 13 May 1992
as a private company with limited liability and with registered number 2714095
and having an authorized share capital of 403,982.70 British Pounds divided as
detailed in Schedule 2 and of which 403,010 British Pounds has been issued and
is held as detailed in Schedule 2;
"Completion"
means completion of the sale and purchase of the Sale Shares;
"Disclosure Bundle"
means the documents listed in Schedule 6, copies of which have been
provided to the Purchaser or the Purchaser's Solicitors;
<PAGE>
"Property"
means the leasehold property brief details of which are set out in Schedule
3;
"Purchaser's Solicitors"
means Lane & Partners of 46/47 Bloomsbury Square, London WC1A 2RU;
"Sale Shares"
means the shares in the capital of the Company to be bought and sold
pursuant to clause 2;
"the Warranties"
means the warranties set out in Schedule 5;
"3i"
means 3i Group plc being the second named Vendor;
"WDA"
means the Welsh Development Agency being the third named Vendor;
1.2. Words and phrases the definition of which is contained or referred to in
sections 735 to 744 inclusive of the Companies Act 1985 (as amended) shall be
construed as having the meaning thereby attributed to them.
1.3. References to statutory provisions shall be construed as references to
those provisions as respectively amended or re-enacted or as their application
is modified by other provisions (whether before or after the date hereof) from
time to time and shall include references to any provisions of which they are
re-enactments (whether with or without modification) and to all regulations
orders and statutory instruments issued thereunder.
1.4. References to Clauses and Schedules are references to Clauses hereof and
Schedules hereto, references to sub-clauses or paragraphs are, unless
otherwise stated, references to sub-clauses or paragraphs of the Clause or
Schedule in which the reference appears, and references to this Agreement
include the Schedules.
1.5. The headings and sub-headings are inserted for convenience only and shall
not affect the construction of this Agreement.
<PAGE>
2. SALE OF SHARES
2.1. Sale and Purchase
Subject to the terms of this Agreement each of the Vendors shall sell the
Sale Shares as detailed opposite the relevant Vendor's name in Schedule 1 in
each case with full title guarantee and the Purchaser shall purchase all the
Sale Shares with effect from Completion with the benefit of full title
guarantee and free from all liens charges equities and encumbrances and
together with all rights now or hereafter attaching thereto.
2.2. Simultaneous Completion
The Purchaser shall not be obliged to complete the purchase of any of the
Sale Shares unless the purchase of all the Sale Shares is completed
simultaneously.
3. CONSIDERATION
The total consideration for the Sale Shares shall be 1,255,000 British
Pounds to be allocated between the Vendors as set out in Schedule 1 and
satisfied by the Purchaser in cash on Completion in accordance with Clause
4.3(a).
4. COMPLETION
4.1. Completion Date
Completion of the sale and purchase of the Sale Shares shall take place
immediately following the execution of this Agreement at the offices of the
Purchaser's Solicitors or as otherwise agreed by the parties hereto in
writing.
4.2. Vendors' Obligations
4.2.1 On Completion each of the Vendors shall deliver or procure the
delivery to the Purchaser of a transfer or transfers of the relevant Sale
Shares as detailed opposite the relevant Vendor's name in Schedule 1 duly
executed by or on behalf of such Vendor in favour of the Purchaser or its
nominees together with the relative share certificate(s).
4.2.2 On Completion the first named Vendor shall deliver or procure the
delivery to the Purchaser of:
<PAGE>
a. waivers in the agreed form signed by each of Dr. Robert Marc Clement and
Mr. Meirion Thomas in respect of any rights of pre-emption they may have over
all or any of the Sale Shares;
b. powers of attorney in agreed form executed by the first, fourth and
fifth named Vendors to allow the Purchaser to exercise full rights in respect
of the Sale Shares pending stamping of the relevant transfers;
c. resignation under seal in the agreed form of the first named Vendor from
his office and employment as Managing Director of the Company;
d. resignations under seal in the agreed form of the first named Vendor as
an employee and director of S L Sensors Limited and as an employee and
director of The Charing Cross Hospital Skin Laser Centre Limited (as from 19
June 1996), such resignations confirming that the first named Vendor has no
claim for compensation against such companies;
e. a Deed of Cancellation in the agreed form duly executed by or on behalf
of the first named Vendor and 3i and WDA in respect of the Share Option
Agreement dated 11 August 1994 between the first named Vendor 3i, WDA and the
Company;
f. certificates from the bankers of the Company as to the amounts of all
balances (whether in debit or in credit) on the accounts of the Company at the
close of business on the last practicable business day before the date of
Completion;
g. all the statutory and other corporate books (duly written up to date)
and common seals of the Company and its incorporation certificate and change
of name certificates;
h. all deeds and documents relating to the Property (subject to the
Purchaser having complied in full with its obligations under Clause 4.3(b));
<PAGE>
4.2.3 On Completion:
a. WDA shall deliver to the Purchaser a waiver in the agreed form signed on
behalf of WDA in respect of any rights of pre-emption they may have over the
Sale Shares and a power of attorney in agreed form to allow the Purchaser to
exercise full rights in respect of the relevant Sale Shares pending stamping
of the relevant transfers and
b. 3i shall deliver a waiver in the agreed form signed on behalf of 3i in
respect of any rights of pre-emption they may have over the Sale Shares.
4.2.4 The Vendors (other than 3i and WDA) shall procure that a board meeting
of the Company is held at which:-
a. Mr Tom Mehl and/or such other persons as the Purchaser shall nominate
shall be appointed directors of the Company;
b. the registration of the share transfers to be delivered to the Purchaser
by the Vendors pursuant to 4.2.1 above shall be approved (subject only to the
same being duly stamped);
c. the revocation of all authorities to the bankers of the Company relating
to bank accounts giving authority to such persons as the Purchaser shall
nominate to operate the same shall be effected;
d. the Deed of Cancellation referred to in Clause 4.2.2(f) shall be
approved;
4.2.5 An Extraordinary General Meeting of the Company shall be held at
Completion at which the Vendors shall vote in favour of the proposed payment
of 30,000 British Pounds to the first named Vendor following his resignation as
Managing Director of the Company.
4.3. Purchaser's Obligations
On Completion:-
a. The Purchaser shall by telegraphic transfer pay to each Vendor the
amount set out opposite his name in Schedule 1.
<PAGE>
b. The Purchaser shall repay on behalf of the Company or shall put the
Company in funds so that the Company shall repay the loans and other
indebtedness of the Company as detailed in Schedule 4.
5. WARRANTIES
5.1. The Vendors hereby acknowledge that the Purchaser is entering into this
Agreement in reliance upon the Warranties to the intent that such warranties
are true and accurate at the date hereof.
5.2 None of the Vendors shall be liable under the Warranties insofar as the
amount accepted or adjudicated as being recoverable from him thereunder
exceeds the amount of the consideration received by him pursuant to clause
4.3(a) for the Sale Shares sold by him.
5.3 The Warranties are given and shall take effect subject to the matters
which are fairly and in all material particulars accurately disclosed in the
Disclosure Bundle and none of the Vendors shall be liable in respect of any
claim under the Warranties to the extent that the matter or matters giving
rise to such claim are so fairly and accurately disclosed.
5.4 No claims by the Purchaser under the Warranties shall be enforceable
unless written notice thereof (including all details thereof or relating
thereto then available to the Purchaser) has been given to the Vendors by not
later than the first anniversary of the date of this Agreement.
6. NON-COMPETITION COVENANT
6.1 The first named Vendor hereby covenants with the Purchaser that subject to
Clause 6.3 he will not for a period of three years after Completion either
alone or jointly with or as manager adviser consultant or agent for any person
directly or indirectly:-
a. seek in competition with the Company to procure orders from or do
business with or procure directly or indirectly any other person to procure
orders from or do business with any person who has been a customer of the
<PAGE>
Company at any time during the period of twelve months prior to the date of
this Agreement;
b. engage or employ or solicit or contact with a view to the engagement or
employment by any person any employee or any person who has been a senior
employee officer or manager of the Company in the 12 months prior to the date
of this Agreement;
c. be engaged or concerned or interested in any business in the United
Kingdom that is in competition with any business carried out at today's date
by the Company;
with the intent that each of the foregoing shall constitute an entirely
separate and independent restriction on the first named Vendor.
6.2 It is agreed between the Purchaser and the first named Vendor that whilst
the restrictions set out in sub-clause 6.1 above are considered fair and
reasonable, if it should be found that any of the restrictions be void as
going beyond what is fair and reasonable in all the circumstances and if by
deleting part of the wording or substituting a shorter period of time or
different geographical limit or a more restricted range of activities than set
out in sub-clause 6.1 it would not be void, then there shall be substituted
such next less extensive period and/or limit and/or activity, or such
deletions shall be made as shall render this clause 6 valid and enforceable.
6.3 The provisions of sub-clauses 6.1(a) and 6.1(b) shall not operate in any
way so as to prohibit or restrict the first named Vendor from:-
a. retaining a shareholding in S L Sensors Ltd not exceeding 50% in nominal
value of the issued share capital of that company or from participating in the
business of it notwithstanding the manufacture and/or distribution and/or sale
of or other interest whatsoever of such company in RIFD tag products; or
<PAGE>
b. retaining a shareholding in Telesensors Limited not exceeding 50% in
nominal value of the issued share capital of that company or from being a
director of it and/or participating in the business of it notwithstanding that
the business of such company involves the use or application of base
material(s) similar to that or those used dealt in applied or otherwise by the
Company but provided that the use or application by such company of such
material(s) is in or for the non-medical industry sector.
7. CONTINGENT PATENT PAYMENTS
The Purchaser agrees to procure the payment by the Company to 3i to its
account no 20014158 with Royal Bank of Scotland, 5-10 Great Tower Street,
London or to such other account and/or bank as 3i shall request and the first
named Vendor respectively of the sums detailed below without delay in the
event of the patent applications detailed below being duly registered and
issued in the name of the Company or in the name of Dr. Marc Clement in the
United States and/or the European Patent Office in respect of ruby red laser
hair removal and the Purchaser agrees to procure that the Company takes all
steps and actions necessary or appropriate to progress and facilitate such
registration as soon as practicable and in any event in a timely fashion
subject to costs of such steps and action not rendering the same excessively
uneconomic to the Company:
3i Group plc Dr. B Mair
USA:- national phase of 100,000 50,000
the PCT Patent, ref: (British Pounds) (British Pounds)
GB94/02682 (filed 7.12.94)
including any continuation,
continuation in part, or
divisional application based
thereon
<PAGE>
European Patent Office:- 50,000 50,000
Application reference number (British Pounds) (British Pounds)
95902863.0 (excluding "by
country" registration application)
8. GENERAL PROVISIONS
8.1 Assignment
This Agreement shall be binding upon and enure for the benefit of the
successors of the parties but shall not be assignable.
8.2 Whole Agreement
This Agreement (together with any documents referred to herein) constitutes
the whole agreement between the parties hereto and it is expressly declared
that no variations hereof shall be effective unless made in writing and signed
by or on behalf of the parties hereto.
8.3 Agreement Survives Completion
The provisions of this Agreement in so far as the same shall not have been
performed at Completion shall remain in full force and effect notwithstanding
Completion.
8.4 Right of Rescission
Any right of rescission conferred or implied upon any party hereby shall be
in addition to and without prejudice to all other rights and remedies
available to that party and no exercise or failure to exercise such a right
shall constitute a waiver by any party of any such right or remedy.
8.5 Further Assurance
At any time after the date hereof each Vendor shall (so far as he is able),
at the request and cost of the Purchaser, execute or procure the execution of
such documents and do or procure to have done such acts and things as the
Purchaser may reasonably require for the purpose of vesting the Sale Shares
set opposite such Vendor's name in Schedule 1 in the Purchaser or its nominees
and giving to the Purchaser the full benefit of all of the provisions of this
Agreement.
<PAGE>
8.6 Payment to the Vendors
Any payment falling to be made to a Vendor under any provision of this
Agreement may be made to such Vendor's duly appointed Solicitors or other
representatives whose receipt therefor shall be an absolute discharge save
that all and any payments to be made to 3i shall be made directly to 3i.
8.7 Counterparts
This Agreement may be executed in any number of counterparts, which shall
together constitute one agreement.
9. COSTS
Each party to this Agreement shall pay its own costs of and incidental to
this Agreement and the sale and purchase hereby agreed to be made.
10. NOTICES
10.1 Any notices required to be given hereunder shall be in writing and shall
be sent to the party concerned at its address given herein or such other
addresses as they may from time to time notify to each other.
10.2 Any notice may be given by letter or by facsimile. Any notice sent by
post shall be deemed to have been delivered 2 business days after posting.
Any notice sent by facsimile shall be deemed to have been delivered on
transmission if during normal working hours and otherwise on the next business
day. Any notice sent by facsimile shall be confirmed by letter.
11. PRESS ANNOUNCEMENTS
No press or other releases or announcements shall be made in relation to
the terms of this Agreement or the transaction effected pursuant to it without
the consent in writing of all the parties hereto (such approval not to be
unreasonably withheld or delayed) or as required by United States Federal or
<PAGE>
State Securities Law or as otherwise required by law or judicial order.
12. Governing Law
This Agreement shall be governed by and construed in accordance with the
laws of England and Wales and the parties submit to the jurisdiction of the
Courts in England and Wales.
AS WITNESS the hands of the parties hereto or their duly authorized
representatives the day and year first above written
<PAGE>
Exhibit 2.3
THIS AGREEMENT is made the 4th day of June One Thousand Nine Hundred and
Ninety Six
B E T W E E N:-
(1) DR ROBERT MARC CLEMENT of 11 Plas Road, Pontardawe, Swansea SA8 3HD ("the
Vendor")
(2) SELVAC CORPORATION a company incorporated under the laws of the State of
Delaware, USA whose principal office is at 221 Boston Post Road, Marlboro,
Massachusetts 01752, USA ("the Purchaser")
W H E R E B Y IT IS AGREED as follows:-
1. INTERPRETATION
In this Agreement and in the schedules hereto where the context so admits:-
1.1 "agreed form"
means a document in a form approved by and for the purposes of
identification signed by or on behalf of the parties;
"the Company"
means SLS (Wales) Limited incorporated in England and Wales on 13 May 1992
as a private company with limited liability and with registered number 2714095
and having an authorized share capital of 403,982.70 British Pounds divided as
detailed in Schedule 1 and of which 403,010 British Pounds has been issued and
is held as detailed in Schedule 1;
"Completion"
means completion of the sale and purchase of the Sale Shares;
"Intellectual Property"
means letters patent, trade marks and service marks, registered designs,
utility models, applications for any of the foregoing, copyright, design
rights, brand and trade names and any similar or equivalent rights arising or
subsisting anywhere in the world;
"Purchaser's Solicitors"
<PAGE>
means Lane & Partners of 46/47 Bloomsbury Square, London WC1A 2RU;
"Sale Shares"
1,000 ordinary shares of 10p each in the capital of the Company to be
bought and sold pursuant to clause 2;
1.2 References to Clauses and Schedules are references to Clauses hereof and
Schedules hereto, references to sub-clauses or paragraphs are, unless
otherwise stated, references to sub-clauses or paragraphs of the Clause or
Schedule in which the reference appears, and references to this Agreement
include the Schedules.
1.3 The headings and sub-headings are inserted for convenience only and shall
not affect the construction of this Agreement.
2. SALE OF SHARES
Subject to the terms of this Agreement the Vendor shall sell the Sale
Shares with full title guarantee and the Purchaser shall purchase all the Sale
Shares with effect from Completion with the benefit of full title guarantee
and free from all liens charges equities and encumbrances and together with
all rights now or hereafter attaching thereto.
3. CONSIDERATION
The total consideration for the Sale Shares shall be 131,629 British Pounds
to be satisfied by the Purchaser procuring the issue or transfer to the Vendor
of shares of common stock in the Purchaser in accordance with Clause 4.3.
4. COMPLETION
4.1 Completion Date
Completion of the sale and purchase of the Sale Shares shall take place on
the execution of this Agreement at the offices of the Purchaser's Solicitors
or as otherwise agreed.
<PAGE>
4.2 Vendor's Obligations
4.2.1 On Completion the Vendor shall deliver to the Purchaser:-
a. transfer of the Sale Shares duly executed by the Vendor in favour of
the Purchaser or its nominees together with the relative share certificate(s);
b. such waivers or consents as the Purchaser may require to enable the
Purchaser or its nominees to be registered as holders of the Sale Shares;
c. a power of attorney in agreed form to allow the Purchaser to exercise
full rights in respect of the Sale Shares pending stamping of the relevant
transfer(s).
4.2.2 The Vendor shall procure that a board meeting of the Company is held at
which the registration of the share transfer(s) to be delivered to the
Purchaser by the Vendor pursuant to Clause 4.2.1(a) above shall be approved
(subject only to the same being duly stamped).
4.2.3 The Vendor will enter into an Employment Agreement with the Company in
a form to be agreed as soon as practicable after Completion.
4.3 Purchaser's Obligations
The Purchaser shall procure the issue or transfer to the Vendor of 25,044
shares of common stock in the Purchaser based on a value of $7.96 per share
representing the average bid price for such stock at close of business (USA)
for the five days 20 May 1996 to 24 May 1996 inclusive. All such shares of
common stock in the Purchaser shall be credited as fully paid, free from all
liens charges and encumbrances, with all rights attaching thereto and ranking
pari passu in all respects with the existing common stock of the Purchaser.
5.
WARRANTIES
The Vendor warrants to the Purchaser in the terms of Schedule 2 to the
intent that such warranties are true and accurate at the date hereof and the
<PAGE>
Vendor hereby acknowledges that the Purchaser is entering into this Agreement
in reliance upon such warranties.
6. GENERAL PROVISIONS
6.1 Assignment
This Agreement shall be binding upon and enure for the benefit of the
successors of the parties but shall not be assignable.
6.2 Whole Agreement
This Agreement (together with any documents referred to herein) constitutes
the whole agreement between the parties hereto and it is expressly declared
that no variations hereof shall be effective unless made in writing and signed
by or on behalf of the parties hereto.
6.3 Agreement Survives Completion
The provisions of this Agreement in so far as the same shall not have been
performed at Completion shall remain in full force and effect notwithstanding
Completion.
6.4 Right of Rescission
Any right of rescission conferred or implied upon any party hereby shall be
in addition to and without prejudice to all other rights and remedies
available to that party and no exercise or failure to exercise such a right
shall constitute a waiver by any party of any such right or remedy.
6.5 Further Assurance
At any time after the date hereof the Vendor shall, at the request and cost
of the Purchaser, execute or procure the execution of such documents and do or
procure to have done such acts and things as the Purchaser may reasonably
require for the purpose of vesting the Sale Shares in the Purchaser or its
nominees and giving to the Purchaser the full benefit of all of the provisions
of this Agreement.
<PAGE>
6.6 Counterparts
This Agreement may be executed in any number of counterparts, which shall
together constitute one agreement.
7. COSTS
Each party to this Agreement shall pay its own costs of and incidental to
this Agreement and the sale and purchase hereby agreed to be made.
8. NOTICES
8.1 Any notices required to be given hereunder shall be in writing and shall
be sent to the party concerned at its address given herein or such other
addresses as they may from time to time notify to each other.
8.2 Any notice may be given by letter or by facsimile. Any notice sent by
post shall be deemed to have been delivered 2 business days after posting.
Any notice sent by facsimile shall be deemed to have been delivered on
transmission if during normal working hours and otherwise on the next business
day. Any notice sent by facsimile shall be confirmed by letter.
9. PRESS ANNOUNCEMENTS
No press or other releases or announcements shall be made in connection
with the transaction unless so required or approved in advance by the
Purchaser or unless required by United States Federal or State Securities Law
or as otherwise required by law or judicial order.
AS WITNESS the hands of the parties hereto or their duly authorized
representatives the day and year first above written
