EXHIBIT 99.1
MARGO CARIBE, INC.
P.O. BOX 706
DORADO, PR 00646
NEWS RELEASE
NASDAQ SYMBOL: MRGO
FOR IMMEDIATE RELEASE
CONTACTS: Michael Spector Alfonso Ortega
(787) 883-2570, Ext. 24 (787) 883-2570, Ext. 33
MARGO CARIBE, INC.
ANNOUNCES EXTENSION OF MERGER AGREEMENT
WITH iTRACT, LLC
Vega Alta, Puerto Rico, October 20, 2000 - Margo Caribe, Inc. ("Margo")
(NASDAQ Symbol: MRGO) announced today that it signed an amendment to its merger
agreement with itract, LLC ("itract"), dated April 11, 2000. The amendment
modifies the termination provisions to extend from October 14, 2000 to December
31, 2000 the date on which the merger agreement may be terminated by either
party if the merger has not occurred (subject to a 60-day extension if the
registration statement relating to the merger has not been declared effective by
the SEC and the parties are using their best efforts to cause such
effectiveness).
The amendment also provides that any amounts required to be paid by
Margo to dissenting shareholders exercising appraisal rights in connection with
the merger will not be considered in determining whether Margo has complied with
the requirement that it have at least $5 million in cash and cash equivalents
and not be subject to liabilities exceeding $10,000 in the aggregate at the time
of the merger. The amendment also provides that if more than ten percent of
Margo's shareholders exercise their dissenters' rights, itract shall not be
obligated to consummate the merger and may terminate the merger agreement
without any liability.
The amendment also provides that if the merger is consummated, itract
will pay the legal and accounting fees of Margo incurred after July 1, 2000 in
connection with the merger up to $250,000, which shall not constitute
liabilities of Margo under the merger agreement. In addition, the amendment
provides that if Margo pays any such expenses, the requirement that Margo have
at least $5 million in cash and cash equivalents at the effective time of the
merger will be reduced by the amount of any such payments.
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Concurrently with the execution of this amendment, Margo and Empresas
Margo, Inc. ("Empresas Margo") have entered into an amendment to their agreement
for the sale of Margo's subsidiaries to Empresas Margo extending the date on
which either party may terminate the agreement from October 15, 2000 to December
31, 2000 (subject to a 60-day extension it the itract merger agreement has not
been consummated and Margo is using its best efforts to consummate the merger).
The merger with itract and the sale of Margo's subsidiaries to Empresas
Margo are expected to close during the fourth quarter of 2000. No assurance can
be given that the parties will be able to satisfy the conditions to the
consummation of the merger and the sale of the subsidiaries.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the Safe Harbor Provisions of the Private Securities Litigation
Reform Act of 1995. Such statements are based on the current expectations and
beliefs of the management of Margo and are subject to a number of factors and
uncertainties that could cause actual results to differ materially from those
described in the forward-looking statements.
For a detailed discussion of these and other cautionary statements,
please refer to the Registration Statement filed by iTract, Inc. with the
Securities and Exchange Commission and the proxy statement/prospectus to be
filed by Margo as described below, as well as Margo's filings with the
Securities and Exchange Commission.
Where You Can Find Additional Information
Margo expects to mail a proxy statement/prospectus to its stockholders
containing information about the sale of Margo's subsidiaries to Empresas Margo
and the merger with itract. iTract, Inc. has filed a Registration Statement on
SEC Form S-4 on July 3, 2000 in connection therewith but the Registration
Statement has not yet become effective. The securities covered by the
Registration Statement may not be sold nor offers to buy be accepted prior to
the time the Registration Statement becomes effective. This news release shall
not constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of these securities in any state in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of any such state.
Investors and security holders are advised to read the Registration
Statement and the proxy statement/prospectus when it becomes available, because
they will contain important information about itract, Margo, the proposed
transactions and related matters. Investors and security holders may obtain a
free copy of the Registration Statement and the proxy statement/prospectus (when
available) and other documents filed by Margo and iTract, Inc. at the Securities
and Exchange Commission's web site at http://www.sec.gov. Free copies of the
proxy statement/prospectus and
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such other documents may also be obtained from Margo by directing such requests
to Margo Caribe, Inc., Investor Relations Dept., P.O. Box 706, Dorado, P.R.
00646.
Margo, its directors, executive officers and certain other members of
management and employees may be soliciting proxies from Margo stockholders in
favor of the adoption of the proposed transactions. A description of any
interest that Margo's directors and executive officers have in these
transactions will be available in the proxy statement/prospectus.
Filed by Margo Caribe, Inc. pursuant to Rule 425 under the Securities
Act of 1933 and deemed filed pursuant to Rule 14a-12 of the Securities Exchange
Act of 1934.
Subject Company: Margo Caribe, Inc. Commission File No. 0-15336
