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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. __)*
MICROTEK MEDICAL, INC.
- --------------------------------------------------------------------------------
(Name of Issuer)
Common Stock, par value $.01 per Share
- --------------------------------------------------------------------------------
(Title of Class of Securities)
0005949391
----------
(CUSIP Number)
Ian Hancock
Kleinwort Benson (Guernsey) Limited
P.O. Box 44, Westbourne, The Grange
St. Peter Port
Guernsey, Channel Islands GY1 3BG
with copies to:
John C. Hart, Esq. Jonathan Stearns
Latham & Watkins The KB Mezzanine Fund, L.P.
885 Third Avenue 200 Park Avenue, 25th Floor
New York, NY 10022 New York, New York 10166
--------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications)
April 30, 1996
------------------------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the
following box [ ] .
Check the following box if a fee is being paid with the statement [X] . (A
fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent
of the class of securities described in Item 1; and (2) has filed no
amendment subsequent thereto reporting beneficial ownership of five percent
or less of such class.) (See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be
filed with the Commission. See Rule 13d-1(a) for other parties to whom
copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of
that section of the Act but shall be subject to all other provisions of the
Act (however, see the Notes).
Page of pages
---- ----
<PAGE>
SCHEDULE 13D
CUSIP No. 0005949391
-----------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
The KB Mezzanine Fund, L.P.
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)
(b)
3 SEC USE ONLY
4 SOURCE OF FUNDS
00
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e)
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7 SOLE VOTING POWER
305,683
NUMBER OF
8 SHARED VOTING POWER
SHARES
BENEFICIALLY
None
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 305,683
WITH
10 SHARED DISPOSITIVE POWER
None
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
305,683
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES*
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.6%
14 TYPE OF REPORTING PERSON*
PN
*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
Item 1. Security and Issuer
This statement relates to the common stock, $.01 par value per
share ("Common Stock"), of Microtek Medical, Inc., a Delaware corporation
(the "Company"). The principal executive offices of the Company are
located at 512 Lehmberg Road, Columbus, Mississippi 39702.
Item 2. Identity and Background
(a)-(c) and (f). This statement is being filed by The KB
Mezzanine Fund, L.P., a Delaware limited partnership ("KB"). KB is engaged
primarily in investment activities and its principal executive offices are
located at P.O. Box 44, Westbourne, The Grange, St. Peter Port, Guernsey,
Channel Islands GY1 3BG.
The general partner of KB is Kleinwort Benson (Guernsey) Limited
("KBGL"), a corporation organized under the laws of the Channel Islands.
KBGL is engaged primarily in private banking, funds management and
administrative services and its principal executive offices are located at
P.O. Box 44, Westbourne, The Grange, St. Peter Port, Guernsey, Channel
Islands GY1 3BG.
All of the outstanding securities of KBGL are owned by Kleinwort
Benson Channel Islands Ltd ("KBL"). KBL, a holding company, is organized
under the laws of the Channel Islands and its principal executive offices
are located at P.O. Box 44, Westbourne, The Grange, St. Peter Port,
Guernsey, Channel Islands GY1 3BG. KBL is a wholly-owned subsidiary of
KBIM Overseas B.V. ("KBIM"), a holding company organized under the laws
of the Netherlands, whose principal executive offices are located at
Drentestreet 20, Amsterdam, Netherlands. KBIM is a wholly-owned
subsidiary of KBIM International Ltd ("KBIMI"), a holding company
organized under the laws of the United Kingdom, whose principal executive
offices are located at 20 Frenchurch Street, London, England EC3P 3DB.
KBIMI is a wholly-owned subsidiary of Kleinwort Benson Investment
Management Holdings Ltd ("KBIMH"), a holding company organized under
the laws of the United Kingdom, whose principal executive offices are
located at 10 Frenchurch Street, London, England EC3M 3LB.
All of the outstanding securities of KBIMH are owned by Kleinwort
Benson Group plc, a holding company organized under the laws of the United
Kingdom ("KBG"), whose principal executive offices are located at 20
Frenchurch Street, London, England EC3P 3DB. All of the outstanding
securities of KBG are owned by Dresdner Investments (UK) plc, a holding
company organized under the laws of the United Kingdom ("DI"), whose
principal executive offices are located at 125 Wood Street, London, England
EC2V 7AQ.
All of the outstanding securities of DI are owned by Zenon
Beteiligungs GmbH ("Zenon"), which is a wholly-owned subsidiary of Dresdner
Bank, AG, a bank organized under the laws of the Federal Republic of
Germany ("Dresdner"). Dresdner's principal executive offices are located
at Jurgen-Ponto-Platz 1, 60301 Frankfurt am Main, Germany.
For information with respect to the executive officers and
directors of KBGL, see Schedule I attached hereto, which is incorporated
herein by reference.
(d) and (e). During the last five years, KB has not and, to the
best knowledge of KB, no person named in this Item 2 or on Schedule I
hereto (each, a "Related Person") has (i) been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors), or (ii)
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
On April 30, 1996, Micro Partners, L.P., a Missouri limited
partnership ("Micro Partners"), made a liquidating distribution of all of
the Common Stock held by Micro Partners to its limited partners and its
general partner in proportion to their respective partnership interests and
in accordance with its partnership agreement. Pursuant to such
distribution, KB, as a limited partner of Micro Partners, received 305,683
shares of Common Stock. The shares distributed to it were not issued in
exchange for any "funds or other consideration."
Page of pages
---- ----
<PAGE>
Item 4. Purpose of Transaction
KB acquired its shares of the Common Stock pursuant to the April
30, 1996 liquidating distribution of Micro Partners, in which KB held a
limited partnership interest for investment, as described in Item 3.
Except as set forth below, neither KB nor, to the best knowledge of KB, any
Related Person, has any present plans or proposals which would relate to or
result in: (i) the acquisition by any person of additional securities of
the Company, or the disposition of securities of the Company; (ii) an
extraordinary corporate transaction, such as a merger, reorganization or
liquidation, involving the Company or any of its subsidiaries; (iii) a sale
or transfer of a material amount of assets of the Company or any of its
subsidiaries; (iv) any change in the present board of directors or
management of the Company, including any plans or proposals to change the
number or term of directors or to fill any existing vacancies on the Board;
(v) any material change in the present capitalization or dividend policy of
the Company; (vi) any other material change in the Company's business or
corporate structure; (vii) changes in the Company's certificate of
incorporation or by-laws or other actions which may impede the acquisition
of control of the Company by any persons; (viii) causing a class of
securities of the Company to be delisted from a national securities
exchange or to cease to be authorized to be quoted in an inter-dealer
quotation system of a registered national securities association; (ix) a
class of equity securities of the Company becoming eligible for termination
of registration pursuant to Section 12(g)(4) of the Securities Exchange Act
of 1934, as amended; or (x) any action similar to those enumerated above.
The Company and Isolyser Company, Inc., a Georgia corporation
("ICI"), have entered into an Agreement and Plan of Merger, dated March 15,
1996 (the "Merger Agreement"), pursuant to which a subsidiary of ICI has
agreed, subject to certain terms and conditions, to merge into the Company
(the "Merger"). In the Merger, the Company's stockholders will receive
shares of ICI common stock in exchange for their Common Stock, in
accordance with the exchange ratio set forth in the Merger Agreement.
Consummation of the Merger is subject to, among other things, approval by
the Company's stockholders. In connection with the parties' execution of
the Merger Agreement, Micro Partners delivered an agreement to ICI, a form
of which is attached hereto as Exhibit A and incorporated herein by
reference, pursuant to which Micro Partners appointed ICI its proxy to vote
all of its shares of Common Stock at the Stockholders meeting held to
approve the Merger and covenanted not seek to assert any appraisal or
dissenters' right in respect of the Merger. KB has been requested and
currently intends to deliver an agreement to ICI, a form of which is
attached hereto as Exhibit B and incorporated herein by reference,
containing the same proxy and covenant.
Item 5. Interest in Securities of the Issuer
(a) KB beneficially owns an aggregate of 305,683 shares of
Common Stock, which represents approximately 6.6% of the outstanding Common
Stock (based on 4,596,886 shares outstanding at March 20, 1996, as reported
in the Company's Report on Form 10-Q for the fiscal quarter ended February
29, 1996). All of such shares are held of record by KB.
(b) Except as described herein, KB has the sole power to vote
or to direct the vote with respect to, and the sole power to dispose of,
or to direct the disposition of, the shares of Common Stock owned by it.
(c) Except as described herein, KB has not, and to the best
knowledge of KB no Related Person has, effected any transaction in the
Common Stock during the past 60 days.
(d) No person other than KB is known to have the right to
receive, or the power to direct the receipt of, dividends from, or the
proceeds from the sale of, the shares of Common Stock owned by KB.
(e) Not applicable.
Page of pages
---- ----
<PAGE>
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
Except as described in Item 4 and incorporated herein by
reference, KB is not aware of any contracts, arrangements, understandings
or relationships between KB or any Related Person or between such persons
and any other person with respect to any securities of the Company.
Item 7. Material to be Filed as Exhibits
Exhibit A -- Form of Agreement dated as of March 15, 1996, between
Isolyser Company, Inc. and Micro Partners, L.P.
Exhibit B -- Form of Agreement dated as of May 1, 1996, between
Isolyser Company, Inc., Micro Partners, L.P. and The KB
Mezzanine Fund, L.P.
Page of pages
---- ----
<PAGE>
SCHEDULE I
CERTAIN INFORMATION WITH RESPECT TO THE DIRECTORS
AND EXECUTIVE OFFICERS OF KLEINWORT BENSON (GUERNSEY) LIMITED
The following table sets forth the name, business address and present
principal occupation or employment of each director and executive officer of
Kleinwort Benson (Guernsey) Limited. Except as otherwise noted, the business
address of each person is Kleinwort Benson (Guernsey) Limited, P.O. Box 44,
Westbourne, The Grange, St. Peter Port, Guernsey, Channel Islands GY1 3BG, and
each such person is an citizen of the Channel Islands.
Name Present Principal Occupation or Employment Position
- ---- ---------------------------------------------------
D. Hinshaw Chief Executive and Director
B. Brehaut Managing Director and Director
D.W. Blanciiard Secretary
G.F.O. Alford(1) Chairman of the Board of Directors
P.J. Creed Director
J.J. Gilligan Director
R.C. Hendry Director
P.D. Hyde Director
G.N. Le Tissier Director
N.C. Robins Director
R.F. Robins Director
B. T. Vickers Director
_________________________
(1) Mr. Alford is a citizen of the United Kingdom.
<PAGE>
Signatures
----------
After reasonable inquiry and to the best of its knowledge and belief,
the undersigned certifies that the information set forth in this statement
is true, complete and correct.
THE KB MEZZANINE FUND, L.P.
By: KLEINWORT BENSON (GUERNSEY) LIMITED
Its General Partner
/s/ Kevin M. Lynch
----------------------------------------
Name: Kevin M. Lynch
Title: Attorney-in-Fact
Dated: 5/10/96
--------------------
Page of pages
---- ----
<PAGE>
EXHIBIT INDEX
Exhibit A -- Form of Agreement dated as of March 15, 1996, between
Isolyser Company, Inc. and Micro Partners, L.P.
Exhibit B -- Form of Agreement dated as of May 1, 1996, between
Isolyser Company, Inc., Micro Partners, L.P. and The KB
Mezzanine Fund, L.P.
Page of pages
---- ----
EXHIBIT A
AGREEMENT
THIS AGREEMENT, dated as of March 15, 1996, is made by and between Isolyser
Company, Inc., a Georgia corporation ("ICI"), and MICRO PARTNERS, L.P. (the
"Stockholder").
Simultaneously herewith, ICI and Microtek Medical, Inc. ("MMI") are parties
to an Agreement and Plan of Merger, dated as of the date hereof (the "Merger
Agreement"), pursuant to which a subsidiary of ICI has agreed, subject to
certain terms and conditions, to merge into MMI (the "Merger"). The Stockholder
is a member of, or has a representative on, the board of directors and/or an
executive officer of MMI and has voting power with respect to the number of
shares of Common Stock, $.01 par value ("Common Stock"), of MMI set forth by the
Stockholder's signature hereto. Capitalized terms not otherwise defined herein
shall have the meaning set forth in the Merger Agreement.
At the request of and for the benefit of MMI and the other holders of
shares of MMI's Common Stock and in order to induce ICI to enter into the Merger
Agreement and to provide reasonable assurances that the transactions
contemplated by the Merger Agreement will be consummated, the Stockholder is
required to make certain agreements regarding the Shares, upon the terms and
subject to the conditions set forth below.
Accordingly, the parties hereto agree as follows:
1. Voting of Shares. The Stockholder hereby appoints ICI his/its proxy,
----------------
with full power of substitution and revocation, for and in the name, place and
stead of the Stockholder, to vote upon and act with respect to all of the Shares
standing in the name of the Stockholder or with respect to which the Stockholder
is entitled to vote and act at the MMI stockholders' meeting referenced in
Section 5.8 of the Merger Agreement, or at any adjournment thereof, and the
Stockholder directs that his/its proxy be voted in favor of the Merger as
contemplated by Section 5.11(c) of the Merger Agreement. The Stockholder hereby
revokes any proxy or proxies heretofore given to vote upon or act with respect
to the Shares and hereby ratifies and confirms all that said proxy, its
substitutes, or any of them, may lawfully do by virtue hereof. The Stockholder
further covenants not to seek to assert any appraisal or dissenters' right (to
the extent applicable) in respect of the Merger. This proxy shall be
irrevocable and shall survive the death, disability or bankruptcy, or with
respect to non-natural persons: the bankruptcy, merger, dissolution or
liquidation, of the Stockholder. Notwithstanding the foregoing, this proxy
shall be subject to revocation and of no further force or effect in the event
that (i) the Merger Agreement is terminated as a result of the provisions of
Section 9.1(a) thereof or (ii) both (A) the Merger Agreement is terminated as a
result of the provisions of Section 9.1(f) or 9.1(g) thereof and (B) MMI has
paid ICI the fee set forth in Section 9.2(b) of the Merger Agreement.
<PAGE>
2. Representation and Warranties of the Stockholder. The Stockholder
------------------------------------------------
hereby represents and warrants to, and covenants with ICI that:
(a) The Stockholder is the sole record and beneficial owner of the number
of Shares listed opposite such Stockholder's signature hereto; no person has a
right to acquire or direct the disposition, or holds a proxy or other right to
vote or direct the vote, of such Shares. Other than this Agreement and the
Merger Agreement, there is no option, warrant, right, call, proxy, agreement,
commitment or understanding of any nature whatsoever, fixed or contingent, that
directly or indirectly (i) calls for the sale, pledge or other transfer or
disposition of any of such Stockholder's Shares, any interest therein or any
rights with respect thereto, or relates to the voting, disposition or control of
such Shares (except under pledge agreements with commercial lenders, copies of
which have been furnished to ICI, or (ii) obligates such Stockholder to grant,
offer or enter into any of the foregoing.
(b) The Stockholder has the full right, power, authority and legal
capacity to enter into this Agreement, and this Agreement has been duly and
validly executed and delivered by such Stockholder and constitutes a valid and
binding obligation of such Stockholder, enforceable against such Stockholder in
accordance with its terms.
(c) Securities Act Representations. The Stockholder hereby agrees and
------------------------------
represents to ICI that such Stockholder has been advised that the offering, sale
and delivery of ICI Common Stock pursuant to the Merger shall be registered
under the Securities Act on a registration statement on Form S-4. Such
Stockholder has also been advised, however, that to the extent such Stockholder
is considered an "affiliate" of MMI at the time the Agreement is submitted for a
vote of stockholders of MMI, any public offering or sale by such Stockholder of
any ICI Common Stock received by such Stockholder in the Merger will, under
current law, require compliance with Rule 145 promulgated by the SEC under the
Securities Act or the availability of another exemption from registration under
the Securities Act. Such Stockholder is familiar with and agrees to comply with
such requirements. Such Stockholder understands that ICI shall place a legend
on the certificate of such Stockholder's ICI Common Stock to ensure compliance
with the Securities Act and rules thereunder.
(d) Pooling Act Representations. The Stockholder will not offer to sell,
---------------------------
transfer or otherwise dispose of any of the shares of MMI Common Stock or ICI
Common Stock issued to such Stockholder beginning thirty (30) days prior to the
Closing Date and continuing until such time as financial results covering a
period of at least thirty (30) days of combined operations of ICI and MMI have
been published in accordance with Section 5.10 of the Agreement.
3. Representations and Warranties of ICI. ICI represents and warrants
-------------------------------------
that:
(a) It has the corporate power to execute, deliver and perform this
Agreement and to consummate the transactions contemplated hereby.
<PAGE>
(b) It has taken all corporate action necessary to authorize its
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby; and that this Agreement has been duly and
validly executed and delivered by ICI and constitutes a valid and binding
obligation of ICI.
4. Binding Effect; Assignment. This Agreement shall inure to the benefit
--------------------------
of and be binding upon the parties and their respective heirs, personal
representatives, successors and permitted assigns.
5. Injunctive Relief; Remedies Cumulative. Each party hereto acknowledges
--------------------------------------
that the other parties will be irreparably harmed and that there will be no
adequate remedy at law for a violation of any of the covenants or agreements of
such party that are contained in this Agreement. It is accordingly agreed that,
in addition to any other remedies that may be available to the non-breaching
party or parties upon the breach by any other party of such covenants and
agreements, the non-breaching party or parties shall have the right to obtain
injunctive relief to restrain any breach or threatened breach of such covenants
or agreements or otherwise to obtain specific performance of any of such
covenants or agreements. No remedy conferred upon or reserved to any party
herein is intended to be exclusive of any other remedy, and every remedy shall
be cumulative and in addition to every other remedy herein or now or hereafter
existing at law, in equity or by statute.
6. Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Delaware, without regard to the law of
conflicts of laws thereof.
7. Counterparts. This Agreement may be executed in one or more
------------
counterparts, all of which together shall constitute a single agreement.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be signed as of the date first above written.
ISOLYSER COMPANY, INC.
By: ______________________________
MICRO PARTNERS, L.P.
__________________________________
(Name of Stockholder: to be signed exactly as name
appears on certificates)
No. of Shares: ___________________
EXHIBIT B
AGREEMENT
THIS AGREEMENT, dated as of May 1, 1996, is made by and between Isolyser
Company, Inc., a Georgia corporation ("ICI"), Micro Partners, L.P. ("Micro
Partners") and The KB Mezzanine Fund, L.P. (the "Stockholder").
The Stockholder has voting power with respect to the number of shares of
Common Stock, $.01 par value ("Common Stock" or "Shares"), of Microtek Medical,
Inc. ("MMI") set forth by the Stockholder's signature hereto. On April 30,
1996, Micro Partners transferred those shares of Common Stock to the
Stockholder.
On March 15, 1996, Micro Partners entered into an Agreement with ICI which
Agreement included terms substantially similar to those set forth herein. The
Stockholder has entered into this Agreement in consideration of the distribution
by Micro Partners to its limited and general partners of the Common Stock owned
by Micro Partners.
Accordingly, the parties hereto agree as follows:
1. Voting of Shares. The Stockholder hereby appoints ICI his/its proxy,
----------------
with full power of substitution and revocation, for and in the name, place and
stead of the Stockholder, to vote upon and act with respect to all of the Shares
standing in the name of the Stockholder or with respect to which the Stockholder
is entitled to vote and act at the MMI stockholders' meeting referenced in
Section 5.8 of the Agreement and Plan of Merger, dated March 15, 1996 (the
"Merger Agreement"), pursuant to which a subsidiary of ICI has agreed, subject
to certain terms and conditions, to merge into MMI (the "Merger"), or at any
adjournment thereof, and the Stockholder directs that his/its proxy be voted in
favor of the Merger as contemplated by Section 5.11(c) of the Merger Agreement.
The Stockholder hereby revokes any proxy or proxies heretofore given to vote
upon or act with respect to the Shares and hereby ratifies and confirms all that
said proxy, its substitutes, or any of them, may lawfully do by virtue hereof.
The Stockholder further covenants not to seek to assert any appraisal or
dissenters' right (to the extent applicable) in respect of the Merger. This
proxy shall be irrevocable and shall survive the death, disability or
bankruptcy, or with respect to non-natural persons: the bankruptcy, merger,
dissolution or liquidation, of the Stockholder. Notwithstanding the foregoing,
this proxy shall be subject to revocation and of no further force or effect in
the event that (i) the Merger Agreement is terminated as a result of the
provisions of Section 9.1(a) thereof or (ii) both (A) the Merger Agreement is
terminated as a result of the provisions of Section 9.1(f) or 9.1(g) thereof and
(B) MMI has paid ICI the fee set forth in Section 9.2(b) of the Merger
Agreement.
2. Representation and Warranties of the Stockholder. The Stockholder
------------------------------------------------
hereby represents and warrants to, and covenants with ICI that:
<PAGE>
(a) The Stockholder is the sole record and beneficial owner of the number
of Shares listed opposite such Stockholder's signature hereto; no person has a
right to acquire or direct the disposition, or holds a proxy or other right to
vote or direct the vote, of such Shares. Other than this Agreement and the
Merger Agreement, there is no option, warrant, right, call, proxy, agreement,
commitment or understanding of any nature whatsoever, fixed or contingent, that
directly or indirectly (i) calls for the sale, pledge or other transfer or
disposition of any of such Stockholder's Shares, any interest therein or any
rights with respect thereto, or relates to the voting, disposition or control of
such Shares (except under pledge agreements with commercial lenders, copies of
which have been furnished to ICI), or (ii) obligates such Stockholder to grant,
offer or enter into any of the foregoing.
(b) The Stockholder has the full right, power, authority and legal
capacity to enter into this Agreement, and this Agreement has been duly and
validly executed and delivered by such Stockholder and constitutes a valid and
binding obligation of such Stockholder, enforceable against such Stockholder in
accordance with its terms.
(c) Securities Act Representations. The Stockholder hereby agrees and
------------------------------
represents to ICI that such Stockholder has been advised that the offering, sale
and delivery of ICI Common Stock pursuant to the Merger shall be registered
under the Securities Act on a registration statement on Form S-4. Such
Stockholder has also been advised, however, that to the extent such stockholder
is considered an "affiliate" of MMI at the time the Agreement is submitted for a
vote of stockholders of MMI, any public offering or sale by such Stockholder of
any ICI Common Stock received by such Stockholder in the Merger will, under
current law, require compliance with Rule 145 promulgated by the SEC under the
Securities Act or the availability of another exemption from registration under
the Securities Act. Such Stockholder is familiar with and agrees to comply with
such requirements. Such Stockholder understands that ICI shall place a legend
on the certificate of such Stockholder's ICI Common Stock to ensure compliance
with the Securities Act and rules thereunder.
(d) Pooling Act Representations. The Stockholder will not offer to sell,
---------------------------
transfer or otherwise dispose of any of the shares of MMI Common Stock or ICI
Common Stock issued to such Stockholder beginning thirty (30) days prior to the
Closing Date and, to the extent the Stockholder is considered an "affiliate" of
MMI, continuing until such time as financial results covering a period of at
least thirty (30) days of combined operations of ICI and MMI have been published
in accordance with Section 5.10 of the Agreement.
3. Representations and Warranties of ICI. ICI represents and warrants
-------------------------------------
that:
<PAGE>
(a) It has the corporate power to execute, deliver and perform this
Agreement and to consummate the transactions contemplated hereby.
(b) It has taken all corporate action necessary to authorize its
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated hereby; and that this Agreement has been duly and
validly executed and delivered by ICI and constitutes a valid and binding
obligation of ICI.
4. Binding Effect; Assignment. This Agreement shall inure to the benefit
--------------------------
of and be binding upon the parties and their respective heirs, personal
representatives, successors and permitted assigns.
5. Injunctive Relief; Remedies Cumulative. Each party hereto acknowledges
--------------------------------------
that the other parties will be irreparably harmed and that there will be no
adequate remedy at law for a violation of any of the covenants or agreements of
such party that are contained in this Agreement. It is accordingly agreed that,
in addition to any other remedies that may be available to the non-breaching
party or parties upon the breach by any other party of such covenants and
agreements, the non-breaching party or parties shall have the right to obtain
injunctive relief to restrain any breach or threatened breach of such covenants
or agreements or otherwise to obtain specific performance of any of such
covenants or agreements. No remedy conferred upon or reserved to any party
herein is intended to be exclusive of any other remedy, and every remedy shall
be cumulative and in addition to every other remedy herein or now or hereafter
existing at law, in equity or by statute.
6. Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Delaware, without regard to the law of
conflicts of laws thereof.
7. Counterparts. This Agreement may be executed in one or more
------------
counterparts, all of which together shall constitute a single agreement.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be signed as of the date first above written.
ISOLYSER COMPANY, INC.
By: ______________________________
Name:
Title:
MICRO PARTNERS, L.P.
By: Micro General, Inc.
By: ________________________
Name:
Title:
KB MEZZANINE FUND, L.P.
By: ________________________
Name:
Title:
No. of Shares: ___________________
