UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[X] Preliminary Proxy Statement
[_] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[_] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant toss.240.14a-12
ROCHEM ENVIRONMENTAL, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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Reg. ss. 240.14a-101. Notes:
<PAGE>
Rochem Environmental, Inc.
610 N. Milby Street
Houston, Texas 77003
Phone: (713) 224-7626
Fax: (713) 224-7627
August 21, 2000
Dear Shareholder:
You are cordially invited to attend the Fiscal 1999 Annual Meeting of
Shareholders of Rochem Environmental, Inc. to be held on Wednesday, September
20, 2000 at 10:00 a.m., Central Standard Time at 15001 Walden Road, Suite 203,
Montgomery, Texas. We look forward to this opportunity to update you on
developments at Rochem Environmental.
We hope you will attend the meeting in person. Whether you expect to be
present and regardless of the number of shares you own, please mark, sign and
mail the enclosed proxy in the envelope provided. Matters on which action will
be taken at the meeting are explained in detail in the notice and proxy
statement following this letter.
Sincerely,
Philip LeFevre
Chairman
<PAGE>
ROCHEM ENVIRONMENTAL, INC.
610 North Milby Street
Houston, Texas 77003
-------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held September 20, 2000
Notice is hereby given that the Annual Meeting of Stockholders of Rochem
Environmental, Inc. (the "Company") will be held at 15001 Walden Road, Suite
203, Montgomery, TX 77356 at 10:00 a.m., Central Standard Time, on Wednesday,
September 20, 2000 for the following purposes:
1. To elect three Directors;
2. To ratify the selection of Weinstein Spira & Company, P.C. as
independent auditors of the Company for the fiscal year ended
September 30, 2000;
3. To accept the offer made by Pall Corporation whereby the Company
and Pall Corporation agree to issue a promissory note for payment
of debts owed to Pall Corporation, for the principal sum of
$480,136.67, with principal accruing at a rate of 10% per annum,
with interest payable on September 30, 2000 and every three
months thereafter, and which entire principal shall be due on or
before December 31, 2002. In addition the Company and Pall
Corporation agree to render the Distribution Agreement dated
September 1, 1993 by and between Separation Technology Systems,
Inc. and Rochem Separation Systems, of which the Company and Pall
Corporation are successors in interest, respectively, terminated
and of no force and effect, in exchange for Pall Corporation
returning 8,589,714 shares of Company common stock to the
Company.
4. To transact such other business as may properly come before the
meeting.
Only common stockholders of record at the close of business on August 21,
2000 will be entitled to notice of and to vote at the meeting, or any
adjournment thereof.
Stockholders unable to attend the Annual Meeting in person are requested to
read the enclosed Proxy Statement and then complete and deposit the Proxy
together with the power of attorney or other authority, if any, under which it
was signed, or a notarized certified copy thereof with the Company's transfer
agent at least 48 hours (excluding Saturday, Sunday and statutory holidays)
before the time of the Annual Meeting prior to the commencement thereof.
Unregistered stockholders who received the Proxy through an intermediary must
deliver the Proxy in accordance with the instructions given by such
intermediary.
By Order of the Board of Directors,
Philip LeFevre
Chairman
August 21, 2000
THE PROXY STATEMENT WHICH ACCOMPANIES THIS NOTICE OF ANNUAL MEETING OF
STOCKHOLDERS CONTAINS MATERIAL INFORMATION CONCERNING THE MATTERS TO BE
CONSIDERED AT THE MEETING, AND SHOULD BE READ IN CONJUNCTION WITH THIS NOTICE.
<PAGE>
ROCHEM ENVIRONMENTAL, INC.
610 North Milby Street
Houston, TX 77003
------------------------
PROXY STATEMENT
Annual Meeting of Stockholders
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This Proxy Statement is being furnished to stockholders in connection with
the solicitation of proxies by the Board of Directors of Rochem Environmental,
Inc., a Utah corporation (the "Company"), for use at the Annual Meeting of
Stockholders of the Company to be held at 15001 Walden Road, Suite 203,
Montgomery, Texas at 10:00 a.m., on Wednesday, September 20, 2000, and at any
adjournments thereof, for the purpose of considering and voting upon the matters
set forth in the accompanying Notice of Annual Meeting of Stockholders. This
Proxy Statement and the accompanying form of proxy are first being mailed to
stockholders on or about August 30, 2000.
The close of business on August 21, 2000 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
Annual Meeting and any adjournment thereof. As of the record date, there were
19,184,751 shares of Company common stock, par value $.001 per share ("Common
Stock"), issued and outstanding. The presence, in person or by proxy, of a
majority of the outstanding shares of Common Stock on the record date is
necessary to constitute a quorum at the Annual Meeting. Each share of Common
Stock is entitled to one vote on all questions requiring a stockholder vote at
the Annual Meeting. A majority of the votes of the shares of Common Stock
present in person or represented by proxy and entitled to vote at the Annual
Meeting is required for the election of directors nominated in Item 1 as set
forth in the accompanying Notice. The affirmative vote of a majority of the
shares of Common Stock present or represented by proxy and entitled to vote at
the Annual Meeting is required for the approval of Item 2 as set forth in the
accompanying Notice. The affirmative vote of a majority of the shares of Common
Stock present or represented by proxy and entitled to vote at the Annual Meeting
is required for the approval of Item 3 as set forth in the accompanying Notice.
Stockholders may not cumulate their votes in the election of directors.
All shares represented by properly executed proxies, unless such proxies
previously have been revoked, will be voted at the Annual Meeting in accordance
with the directions on the proxies. If no direction is indicated, the shares
will be voted (i) TO ELECT THREE DIRECTORS, (ii) TO RATIFY THE SELECTION OF
WEINSTEIN SPIRA & COMPANY, P.C. AS INDEPENDENT AUDITORS OF THE COMPANY FOR THE
FISCAL YEAR ENDING SEPTEMBER 30, 2000; AND (iii) TO ACCEPT THE TERMINATION OF
THE DISTRIUTOR AGREEMENT WITH PALL CORPORATION (iv) TO TRANSACT SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE MEETING. The enclosed proxy, even
though executed and returned, may be revoked at any time prior to the voting of
the proxy (a) by the execution and submission of a revised proxy, (b) by written
notice to the Secretary of the Company or (c) by voting in person at the Annual
Meeting.
<PAGE>
ANNUAL REPORT
The Annual Report to Stockholders, covering the Company's fiscal year ended
September 30, 1999, including audited financial statements, is enclosed
herewith. The Annual Report to Stockholders does not form any part of the
material for solicitation of proxies.
The Company will provide, without charge, a copy of its Annual Report and
Form 10-KSB upon written request to Ann K. Tanabe, Investor Relations Manager,
at 610 N. Milby Street, Houston, TX 77003. The Company will provide exhibits to
its Annual Report and Form 10-KSB, upon payment of the reasonable expenses
incurred by the Company in furnishing such exhibits. The SEC maintains an
Internet site that contains reports, proxy and information statements and other
information for companies that file electronically. The address of the site is
http://www.sec.gov.
ITEM 1
TO ELECT THREE DIRECTORS
The Bylaws of the Company provide that the number of directors will be
determined by the Board of Directors, but shall consist of not less than three
or more than nine directors. The directors are elected annually by the
stockholders of the Company at each annual meeting of the stockholders of the
Company. Any director elected to fill a vacancy or newly created directorship
resulting from an increase in the authorized number of directors shall hold
office until his successor is elected and duly qualified. Any vacancy on the
Board, howsoever resulting, may be filled by a majority of the directors then in
office, even if less than a quorum, or by a sole remaining director. Any
director elected to fill a vacancy shall hold office until his successor is
elected and duly qualified. The stockholders will elect three directors for the
coming year, with two of the nominees presently serving as directors of the
Company.
Unless otherwise instructed or unless authority to vote is withheld, the
enclosed proxy will be voted for the election of the nominees listed herein.
Although the Board of Directors of the Company does not contemplate that any of
the nominees will be unable to serve, if such a situation arises prior to the
Annual Meeting, the persons named in the enclosed proxy will vote for the
election of such other person(s) as may be nominated by the Board of Directors.
William E. Bracken, (age 63). Mr. Bracken has served as director and vice
president of the Company since December 1992. Mr. Bracken served as operations
manager of EnClean's Environmental Group from January 1989 to December 1992. Mr.
Bracken served as a sales engineer with HydroKem from September 1985 to January
1989.
Philip LeFevre, (age 50). Mr. LeFevre has served as director of the Company
since March 1995. Mr. LeFevre is currently serving as president of Lefco
Environmental Technology, and has held this position since January 1991.
James Ward, (age 48). Mr. Ward is currently serving as owner and president
of Excalibur Constructors, Inc., and has held this position since May 1983. Mr.
Ward also owns numerous other companies including Dina Industries, Inc., J.H.
Ward Enterprises, Inc., BMM, Inc., Remax-Conroe, Spring Creek Oaks Development
Company and Lakewood Development Company to name a few. Mr. Ward is currently an
executive board member of the Houston Contractors Association and a member of
American General Contractors, American Society of Military Engineers, Greater
Houston Builders Association and the Greater Houston Partnership.
Board of Directors, Committees, and Meetings
The Board of Directors held six meetings during fiscal 1999. During fiscal
1999, each director attended at least 75% of the total number of Board meetings.
The Company does not maintain an audit, nomination, compensation or any other
committee.
<PAGE>
Directors' Fees
The directors are not compensated for their services on the Board of
Directors, however all directors are reimbursed for their reasonable expenses
incurred for each Board meeting attended.
Compliance with Section 16(A) of the Exchange Act
Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than 10 percent of the Company's
Common Stock, to file reports of ownership and changes of ownership with the
Securities and Exchange Commission. Copies of all filed reports are required to
be furnished to the Company pursuant to Section 16(a). Based solely on the
reports received by the Company, the Company believes that the directors,
executive officers, and greater than ten percent beneficial owners complied with
all applicable filing requirements during the fiscal year ended September 30,
1999. Filing requirements were made timely.
THE BOARD HAS RECOMMENDED A VOTE FOR THE ELECTION OF MESSRS. BRACKEN,
LEFEVRE AND WARD. THE ELECTION OF THE DIRECTORS REQUIRES THE AFFIRMATIVE VOTE OF
THE MAJORITY OF THE HOLDERS OF OUTSTANDING SHARES OF COMMON STOCK PRESENT OR
REPRESENTED BY PROXY AT THE ANNUAL MEETING.
<PAGE>
ITEM 2
RATIFY THE SELECTION OF WEINSTEIN SPIRA & COMPANY, P.C. AS
INDEPENDENT AUDITORS OF THE COMPANY FOR THE FISCAL YEAR
ENDING SEPTEMBER 30, 2000
The Board of Directors has approved the engagement of Weinstein Spira &
Company, P.C. as its independent auditors of the consolidated financial
statements for the fiscal year ending September 30, 2000. The Board of Directors
wishes to obtain from the stockholders a ratification of the Board's action in
appointing Weinstein Spira & Company, P.C. as independent auditors of the
Company for the fiscal year ending September 30, 2000. The engagement of
Weinstein Spira & Company, P.C. for audit services has been approved by the
Board of Directors.
There have been no disagreements with the independent auditors on any
matter of accounting principles or practices, financial statement disclosure, or
auditing scope procedure. The independent auditor's report contained a modified
opinion for a going concern uncertainty.
In the event the appointment of Weinstein Spira & Company, P.C. as
independent auditors for fiscal 2000 is not ratified by the stockholders, the
adverse vote will be considered as a direction to the Board of Directors to
select other auditors for the following year. However, because of the difficulty
in making any substitution of auditors so long after the beginning of the
current fiscal year, it is contemplated that the appointment for fiscal 2000
will be permitted to stand unless the Board finds other good reason for making a
change.
Representatives of Weinstein Spira & Company, P.C. are expected to be
present at the meeting, with the opportunity to make a statement if desired to
do so. Such representatives are also expected to be available to respond to
appropriate questions.
THE BOARD HAS RECOMMENDED THE RATIFICATION OF WEINSTEIN SPIRA & COMPANY,
P.C. AS INDEPENDENT AUDITORS. SUCH RATIFICATION REQUIRES THE AFFIRMATIVE VOTE OF
THE MAJORITY OF THE HOLDERS OF OUTSTANDING SHARES OF COMMON STOCK PRESENT OR
REPRESENTED BY PROXY AT THE ANNUAL MEETING.
<PAGE>
ITEM 3
TO ACCEPT THE OFFER FROM PALL CORPORATION
The Board of Directors of the Company believe it is in the best interest of
the Company to enter into an agreement with Pall Corporation wherein the Company
and Pall Corporation agree to render the Distribution Agreement dated September
1, 1993 by and between Separation Technology Systems, Inc. and Rochem Separation
Systems, of which the Company and Pall Corporation are successors in interest,
respectively, terminated and of no force and effect, in exchange for Pall
Corporation returning 8,589,714 shares of Company common stock to the Company.
Nothing contained in the agreement shall prohibit the Company from competing
with Pall Corporation using alternative technologies in any market.
In December 1999, the Company received notice from Pall Corporation that it
intended to pursue the termination of the Distributor Agreement if the Company
did not pay its outstanding accounts payable owed to Pall Corporation in the
amount of $480,136.67. Accordingly, the Board of Directors believes it is in the
best interest of the Company to issue a promissory note for payment of debts
owed to Pall Corporation, for the principal sum of $480,136.67, with principal
accruing at a rate of 10% per annum, with interest payable on September 30, 2000
and every three months thereafter, and which entire principal shall be due on or
before December 31, 2002. The Company currently does not have the cash on hand
to make these payments. The Company intends to collect receivables or pursue
financing to meet these obligations. There are no assurances that this
obligation can be met. If the Company cannot meet this obligation, it will be in
default of the promissory note.
This transaction will not have a negative effect on future earnings as the
Company realized an asset impairment of $3,488,058 related to the write down of
the remaining value of the Distributor Agreement from Pall Rochem in the fourth
quarter of Fiscal 1999. In addition, future selling, general and administrative
(SG&A) costs will no longer reflect an annual Distributor Agreement amortization
deduction of approximately $377,136. In early July 1999, the Company was
notified that it was not selected as the final contractor to provide
hydrodrilling and waste water treatment services at the Chevron refinery in
Pascagoula, Mississippi. The loss of the Chevron contract affected the Company
severely as it was the Company's only long-term contract and was the only
contract the Company had utilizing the Disc Tube technology. Since the loss of
the Chevron contract in July 1999, the Company has not been able to secure any
other service contract utilizing the Disc Tube technology. Additionally, the
Company has not successfully sold a Disc Tube system during Fiscal 2000. Over
the last year, the Company's efforts have primarily been directed to selling
grey water systems in the US cruise ship market using Rochem Group's FM module
which the company believes is a superior design to the Disc Tube technology. The
Company is pursuing additional sales of grey water equipment and FM module
systems in other applications.
THE BOARD HAS RECOMMENDED THE ACCEPTANCE OF PALL CORPORATION'S OFFER. SUCH
RATIFICATION REQUIRES THE AFFIRMATIVE VOTE OF THE MAJORITY OF THE HOLDERS OF
OUTSTANDING SHARES OF COMMON STOCK PRESENT OR REPRESENTED BY PROXY AT THE ANNUAL
MEETING.
<PAGE>
STOCK OWNERSHIP
The table below sets forth information with respect to the total number of
shares of the Company's Common Stock beneficially owned by each person known to
the Company to beneficially own more than 5% of its Common Stock, each named
executive officer, director and the total number of shares of the Company's
Common Stock beneficially owned by each director and officer, as a group, as
reported by each such person, as of August 18, 2000.
Common Stock
Name and Address of Beneficially Outstanding
Beneficial Owner (1) Number Percentage
-------------------- ------ ----------
Pall Corporation 8,589,714 43.6%
2200 Northern Boulevard
East Hills, New York 11548
William Palmer (2) 8,589,714 43.6%
2200 Northern Boulevard
East Hills, New York 11548
William E. Bracken 950,000 4.8%
610 N. Milby Street
Houston, TX 77003
Lefco Environmental Technology, Inc. 2,565,558 (3) 13.0%
15001 Walden Rd, #203
Montgomery, TX 77356
Philip LeFevre(4) 2,565,558 13.0%
15001 Walden Rd, #203
Montgomery, TX 77356
Erick J. Neuman (5) 751,400 3.8%
610 N. Milby Street
Houston, TX 77003
James Ward 1,893,167 9.6%
PO Box 783
Spring, TX 77383
All officers and directors
as a group (4 persons)
---------------------------
(1) Unless otherwise noted, each person has sole voting and investment power
over the shares listed opposite his name, subject to community property
laws where applicable.
(2) Mr. Palmer is an affiliate of Pall Corporation.
(3) Includes 14,000 shares of Company Common Stock owned by Lefco Corporation,
an affiliate of Lefco Environmental Technology, Inc. and 561,550 solely
owned by Mr. LeFevre.
(4) Mr. LeFevre is an affiliate of Lefco Environmental Technology, Inc. and
Lefco Corporation.
(5) Mr. Neuman owns 251,400 shares and warrants to purchase 750,000 shares of
Common Stock, 500,000 of which are currently exercisable.
<PAGE>
EXECUTIVE OFFICERS
The following table lists the present officers of the Company as of the
date hereof and the capacities in which they serve.
Name of Individual Capacity
------------------ --------
Erick Neuman President
William E. Bracken Vice President
Mr. Erick J. Neuman, (age 39). Since January 1996, Mr. Neuman has served as
president and chief executive officer of the Company. Mr. Neuman was elected to
the Board in March 1996 and resigned in August 2000. Mr. Neuman served as
director, Technology and Technical of Waste Management Italy, a subsidiary of
WMX Technologies, Inc., from September 1992 to December 1995. Mr. Neuman
received a Bachelor of Science degree in Chemical Engineering from Illinois
Institute of Technology in 1983.
Biographical information with respect to Mr. Bracken was previously
described under Item 1. There is no family relationship between any present
executive officers and directors.
COMPENSATION
The following table sets forth the compensation with respect to the
chief executive officer. No other executive officer of the Company received
total annual salary and bonus for the fiscal year ended September 30, 1999 in
excess of $100,000.
Summary Compensation Table
Long-Term
Annual Compensation Compensation
Awards
Securities
Name and Principal Fiscal Underlying Warrants
Position Year Salary (1) (#)
-------- ---- ---------- -------------------
Erick J. Neuman 1999 $115,000 (1)
Chief Executive Officer 1998 $115,000 (1) 312,500(2)
1997 $115,000 (1) 437,500(2)
------------------------------
(1) Mr. Neuman received certain perquisites and other benefits in the above
referenced fiscal year; however, the Company has concluded that the
aggregate amount of such personal benefits and other compensation is less
than 10% of the total of Mr. Neuman's annual salary. No bonus was paid to
Mr. Neuman during the 1999 fiscal year.
(2) Consists of a warrant to purchase a total of 250,000 shares at $0.001 per
share, a warrant to purchase 250,000 shares at $0.10 per share, and a
warrant to purchase 250,000 shares at $0.25 per share. These warrants are
effective January 1, 1996, and expire on December 31, 2000.
The Company did not grant any options or warrants to any executive officers
in Fiscal 1999.
<PAGE>
The following table provides information regarding option and warrant
exercises in fiscal 1999 by the named executive officer and the value of such
officer's unexercised warrant at September 30, 1999:
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-The-Money Options/
Shares Options/Warrants at Warrants at
Acquired on Value Fiscal Year-End Fiscal Year-End
Name Exercise (1) Realized Exercisable Unexercisable Exercisable Unexercisable
---- ------------ -------- --------------------------- ---------------------------
<S> <C> <C> <C> <C> <C> <C>
Erick Neuman - $0 500,000 250,000 $174,750 $37,500
</TABLE>
---------------
(1) As outlined in Mr. Neuman's employment agreement.
Employment Agreements
In November 1999, the Company entered into a thirteen-month employment
agreement with Mr. Bracken, which automatically extends for additional one-year
terms unless terminated six months prior to the end of such term. Mr. Bracken's
current salary is $90,000. The current term of Mr. Bracken's employment
agreement expires on December 31, 2001. This agreement will automatically extend
for an additional year if not terminated by June 30, 2002.
In January 1996, Mr. Neuman entered into a five-year employment agreement
with the Company that provides for an annual base salary of $115,000. In
addition, Mr. Neuman was granted the following five year warrants: (i) one
warrant to purchase a total of 250,000 shares at $0.001 per share provided that
Mr. Neuman is employed with the Company on December 31, 1996, which Mr. Neuman
exercised in January 1997; (ii) a warrant to purchase a total of 250,000 shares
at $0.001 per share which warrant vests 25% per calendar quarter of 1997
provided that Mr. Neuman is employed by the Company on these dates; (iii) a
warrant to purchase 250,000 shares at $0.10 per share which warrant vests based
upon the Company attaining certain financial goals; and (iv) a warrant to
purchase 250,000 shares at $0.25 per share which warrant vests based upon the
Company attaining certain financial goals.
Warrants
Mr. Neuman is the sole officer and director that beneficially owns warrants
to purchase shares of Common Stock. Mr. Neuman owns warrants to purchase 750,000
shares as described in "Employment Agreements."
The Company has not established, nor does it provide for, long-term
incentive plans, defined benefit, or actuarial plans. The Company does not grant
any stock appreciation rights.
Certain Transactions
In January 1998, Pall Corporation purchased 8,589,714 shares of Company
Common Stock from Argentaurum SA. This transaction was part of an asset purchase
whereby Pall Corporation acquired certain assets of Argentaurum SA including the
reverse osmosis and nanofiltration technologies and operations of the Rochem
Group.
In December 1999, the Company received notice from Pall Corporation that it
intended to pursue the termination of the Distributor Agreement if the Company
did not pay its outstanding accounts payable owed to Pall Corporation. In July
2000, the Company executed a promissory note with Pall Corporation
<PAGE>
for the principal sum of $480,136.67, together with interest thereon at a rate
of 10% per annum on the unpaid balance. Upon execution of the note, interest was
paid on the unpaid balance of the principal from December 31, 1999. Interest
will be paid on a quarterly basis, beginning September 30, 2000. The entire
principal is due and payable on or before December 31, 2002. In addition, the
Company executed a Letter of Intent with Pall Corporation whereby Pall
Corporation will return 8,589,714 shares of the Company common stock and give up
their seat on the board. In return, the Company agrees to terminate its
Distributor Agreement with Pall dated September 1, 1993.
In September 1998, the Company obtained a $500,000 loan from Rochem Group
SA, an affiliate of Fluid Separation Systems S.A. As part of the loan agreement,
the Company agreed to issue a stock purchase warrant entitling Rochem Group SA
to purchase an aggregate of 1,250,000 shares of the Company's common stock at an
exercise price for $0.25 per share. The proceeds of this transaction were used
to repay loans to Fluid Separation Systems totaling $150,000 in principal. The
loan, which bears an interest rate of 10.5% per annum, with interest payable
upon maturity had an original maturity date of December 31, 1999 and was
subsequently extended to May 31, 2000. The Company entered into a separate
letter of intent, subject to a future definitive agreement, with Rochem Group
that states the following:
A. Rochem Group will give an exclusive agency agreement to the Company
for "the products" for the marine shipping market, including naval
applications. The agreement language will have safeguards to protect
Rochem Group from nonperformance or insolvency.
B. Rochem Group will extend its loan of $500,000 which was due on 31
December 1999 until 31 July 2001 at a reduced interest rate of
10%/annum. Past interest to be paid at the execution of the final
agreement(s). Ongoing interest will be paid on a quarterly basis. The
Company currently does not have the cash on hand to make these
payments. Accordingly, the Company intends to collect receivables or
pursue financing to meet these obligations. There are no assurances
that this obligation can be met. If the Company cannot meet its
obligations of the letter of intent, it may void the entire agreement.
C. Rochem Group will reimburse the Company for the expenses it incurred
in shipping materials for the installation of the Rochem Group systems
aboard the Mercury (approx. $74.5k) and Galaxy (approx. $67.3k) within
14 days of signing this agreement. Rochem Group has already reimbursed
$50k of these costs. Rochem Group and the Company further agree to
settle the labor expenses on pro rata share based on the amount
recovered from the client for labor expenses.
D. The Company will execute an agreement with Pall Corporation that will
convert the existing accounts payable into a promissory note. The
principal on the note will be due no earlier than 31 December 2002.
E. The Company will return existing license to Pall Corporation in return
for not less than 90% of their shares. The returned shares will go to
the Company's Treasury.
F. Erick Neuman will continue to be employed by the Company until the
deliveries to the Celebrity vessels have been accepted and paid.
<PAGE>
OTHER MATTERS
Management is not aware of any other matters to be presented for action at
the meeting. However, if any other matter is properly presented, it is the
intention of the persons named in the enclosed form of proxy to vote in
accordance with their best judgment on such matter.
COST OF SOLICITATION
The Company will bear the costs of the solicitation of proxies from its
stockholders. In addition to the use of mail, proxies may be solicited by
directors, officers and regular employees of the Company in person or by
telephone or other means of communication. The directors, officers and employees
of the Company will not be compensated additionally for the solicitation but may
be reimbursed for out-of-pocket expenses in connection with the solicitation.
Arrangements are also being made with brokerage houses and any other custodians,
nominees and fiduciaries of the forwarding of solicitation material to the
beneficial owners of the Company, and the Company will reimburse the brokers,
custodians, nominees and fiduciaries for their reasonable out-of-pocket
expenses.
STOCKHOLDER PROPOSALS
Proposals by stockholders intended to be presented at the 2001 Annual
Meeting of Stockholders must be received by the Company for inclusion in the
Company's proxy statement and form of proxy relating to that meeting no later
than October 23, 2000.
BY ORDER OF THE BOARD OF DIRECTORS
Houston, Texas Philip LeFevre
August 21, 2000 Chairman
<PAGE>
PROXY
ROCHEM ENVIRONMENTAL, INC.
ANNUAL MEETING OF STOCKHOLDERS
September 20, 2000
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF ROCHEM
ENVIRONMENTAL, INC. THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED IN
ACCORDANCE WITH THE CHOICES SPECIFIED BELOW.
The undersigned stockholder of ROCHEM ENVIRONMENTAL, INC. (the "Company") hereby
appoints Philip LeFevre and William Bracken, the true and lawful attorneys,
agents and proxies of the undersigned with full power of substitution for and in
the name of the undersigned, to vote all the shares of Common Stock of the
Company which the undersigned may be entitled to vote at the Annual Meeting of
Stockholders of the Company to be held at 15001 Walden Road, Suite 203,
Montgomery, Texas on Wednesday, September 20, 2000 at 10:00 a.m., Central
Standard Time and any and all adjournments thereof, with all of the powers which
the undersigned would possess if personally present, for the following purposes:
1. To elect three directors. FOR AGAINST WITHHOLD
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William E. Bracken [ ] [ ] [ ]
Philip LeFevre [ ] [ ] [ ]
James Ward [ ] [ ] [ ]
2. To ratify the selection of Weinstein Spira & Company, P.C. as independent
auditors of the Company for the fiscal year ending September 30, 2000.
FOR AGAINST WITHHOLD
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[ ] [ ] [ ]
3. To accept the offer made by Pall Corporation whereby the Company and Pall
Corporation agree to issue a promissory note for payment of debts owed to
Pall Corporation, for the principal sum of $480,136.67, with principal
accruing at a rate of 10% per annum, with interest payable on September 30,
2000 and every three months thereafter, and which entire principal shall be
due on or before December 31, 2002. In addition the Company and Pall
Corporation agree to render the Distribution Agreement dated September 1,
1993 by and between Separation Technology Systems, Inc. and Rochem
Separation Systems, of which the Company and Pall Corporation are
successors in interest, respectively, terminated and of no force and
effect, in exchange for Pall Corporation returning 8,589,714 shares of
Company common stock to the Company.
FOR AGAINST WITHHOLD
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[ ] [ ] [ ]
4. The proxies are authorized to vote as they determine in their discretion
upon such other matters as may properly come before this meeting.
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THIS PROXY WILL BE VOTED FOR THE CHOICES SPECIFIED. IF NO CHOICE IS SPECIFIED
FOR ITEMS 1, 2 AND 3, THIS PROXY WILL BE VOTED FOR THESE ITEMS.
The undersigned hereby acknowledges receipt of the Notice of Annual Meeting and
Proxy Statement Dated August 21, 2000.
PLEASE MARK, SIGN AND DATE THIS PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE.
DATED: ________________________________
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[Signature]
_______________________________________
[Signature if jointly held]
_______________________________________
Printed Name]
Please sign exactly as name appears on stock certificate(s). Joint owners should
each sign. Trustees and others acting in a representative capacity should
indicate the capacity in which they sign.
