As filed with the Securities and Exchange Commission on May 17, 1995.
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
RESEARCH INDUSTRIES CORPORATION
(Exact name of registrant as specified in its charter)
UTAH 3845 87-0277827
(State or other juris- (Primary Standard (I.R.S. Employer
diction of Industrial Identification No.)
incorporation Classification Code
or organization) Number)
6864 SOUTH 300 WEST
MIDVALE, UTAH 84047
(801) 562-0200
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
MARK W. WINN
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
RESEARCH INDUSTRIES CORPORATION
6864 SOUTH 300 WEST
MIDVALE, UTAH 84047
(801) 562-0200
(Name, address, including zip code, and
telephone number, including area code, of agent for service)
Copies To:
A. ROBERT THORUP
RAY, QUINNEY & NEBENKER
SUITE 700
79 SOUTH MAIN STREET
SALT LAKE CITY, UTAH 84111
(801) 532-1500
Approximate date of commencement of proposed sale of the securities to the
public: upon the Effective Time of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following
box. x
CALCULATION OF REGISTRATION FEE
{PRIVATE AMOUNT TO PROPOSED PROPOSED AMOUNT OF
}TITLE OF BE MAXIMUM MAXIMUM REGISTRATION
EACH CLASS REGISTERED
OF OFFERING AGGREGATE FEE
SECURITIES PRICE PER OFFERING
TO BE SHARE PRICE
REGISTERED
COMMON $17.00(1) $453,900 $157.00
STOCK 26,700
($0.50 PAR shares
VALUE)
(1) Estimated pursuant to Rule 457(c) solely for the purpose of calculating
the registration fee, as determined May 15, 1995.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE TIME UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
<PAGE>
CROSS-REFERENCE SHEET
RESEARCH INDUSTRIES CORPORATION
Item No. Item Location in Prospectus
- -------- ---- ----------------------
1 Forepart of Registration Facing page, cross-reference
Statement and Outside Front sheet; cover page of
Cover Page of Prospectus Prospectus
2 Inside Front and Outside Back Available Information;
Cover Pages of Prospectus Incorporation of Certain
Documents by Reference
3 Summary Information, Risk Cover Page of Prospectus
Factors and Ration of Earnings
to Fixed Charges
4 Use of Proceeds Not Applicable
5 Determination of Offering Not Applicable
Price
6 Dilution Not Applicable
7 Selling Security Holders Selling Shareholders
8 Plan of Distribution Not Applicable
9 Description of Securities to Incorporation of Certain
be Registered Documents by Reference
10 Interests of Named Experts and Not Applicable
Counsel
11 Material Changes Not Applicable
12 Incorporation of Certain Incorporation of Certain
Information by Reference Documents by Reference
13 Disclosure of Commission Disclosure of Commission
Position on Indemnification Position on Indemnification
for Securities Act Liabilities for Securities Act Liabilities
Exhibit Index
<PAGE>
PROSPECTUS
RESEARCH INDUSTRIES CORPORATION
26,700 Shares of Common Stock
$0.50 Par Value
This Prospectus relates to up to 26,700 shares of common stock (the `Shares'')
of Research Industries Corporation (the `Company'') which may be offered from
time to time by the selling shareholders named herein (the `Selling
Shareholders'). The Company will not receive any of the proceeds from the sale
of the Shares. The Company will bear the costs relating to the registration of
the Shares, estimated to be approximately $ .
The Shares may be offered for sale by the Selling Shareholders named herein, or
by their pledgees, donees, transferees or other successors in interest, to or
through underwriters or directly to other purchasers or through agents in one or
more transactions through the National Market System of the National Association
of Securities Dealers Automated Quotation System (the `NASDAQ/NMS''), in the
over-the-counter market, in one or more private transactions, or in a
combination of such methods of sale, at prices and on terms then prevailing, at
prices related to such prices, or at negotiated prices. The Selling
Shareholders may pledge all or a portion of the Shares owned by them as
collateral in loan transactions. Upon default by the Selling Shareholders, the
pledgee in such loan transaction would have the same rights of sale as the
Selling Shareholders under this Prospectus. The Selling Shareholders may also
transfer Shares owned by them by gift and upon any such transfer the donee would
have the same rights of sale as such Selling Shareholders under this Prospectus.
The Selling Shareholders and any brokers and dealers through whom sales of the
Shares are made may be deemed to be `underwriters'' within the meaning of the
Securities Act of 1933, as amended, and the commissions or discounts and other
compensation paid to such persons may be regarded as underwriters' compensation.
(See "Plan of Distribution.")
The Shares are traded on the NASDAQ / National Market System.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS MAY , 1995
All of the securities offered hereby are to be offered for the account of
existing security holders.
AVAILABLE INFORMATION
The Company is subject to the informational reporting requirements of the
Securities Exchange Act of 1934, as amended ("Exchange Act"), and in accordance
therewith file periodic reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Copies of such reports,
proxy statements and other information can be obtained, upon payment of
prescribed fees, at the Public Reference Room of the Commission at 450 Fifth
Street, N.W., Washington, D.C. 20549. Such reports, proxy statements and other
information can also be inspected at the Commission's facilities referred to
above and at the Commission's Regional Offices at Suite 1400, 500 West Madison
Street, Chicago, Illinois 60621-2511, and Room 1228, 75 Park Place, New York,
New York 10007. In addition, the Company's Common Stock is included for
quotation on the National Association of Securities Dealers Automated
Quotation/National Market System ("NASDAQ/NMS"), and such reports, proxy
statements and other information concerning FSC should be available for
inspection and copying at the offices of the National Association of Securities
Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006.
The Company has filed with the Commission a Registration Statement on Form S-3
(together with any amendments thereto, the "Registration Statement") under the
Securities Act of 1933, as amended ("Securities Act"), with respect to the
Company's Common Stock offered hereby. This Prospectus does not contain all the
information set forth in the Registration Statement and the exhibits thereto,
certain portions of which have been omitted as permitted by the rules and
regulations of the Commission. For further information, reference is made to
the Registration Statement, including the exhibits thereto.
Statements contained in this Prospectus or in any documents incorporated in this
Prospectus by reference as to the contents of any contract or other document
referred to herein or therein are not necessarily complete, and in each instance
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement or such other document, each such
statement being qualified in all respects by such reference. The Registration
Statement may be inspected by anyone without charge at the principal office of
the Commission in Washington, D.C., and copies of all or any part of it may be
obtained from the Commission upon payment of the prescribed fees.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are incorporated herein by reference the following documents filed with
the Commission by the Company (File No. 0-6944):
(1) Registrant's Annual Report to Shareholders for its fiscal year ended June
30, 1994;
(2) Registrant's Annual Report on Form 10-K for its fiscal year ended June
30, 1994.
(3) Registrant's Quarterly Report on Form 10-Q fro the quarters ended
September 30, 1994, December 31, 1994 and March 31, 1995; and
(4) Registrant's Proxy Statement dated October 3, 1994.
All documents filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus are incorporated herein by reference, and such documents shall be
deemed to be a part hereof from the date of filing of such documents. Any
statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. COPIES OF ANY SUCH DOCUMENTS, OTHER THAN EXHIBITS
TO SUCH DOCUMENTS, ARE AVAILABLE WITHOUT CHARGE TO ANY PERSON TO WHOM THIS
PROSPECTUS IS DELIVERED UPON WRITTEN OR ORAL REQUEST DIRECTED TO FIRST SECURITY
CORPORATION, ATTENTION: MARK W. WINN, VICE PRESIDENT AND CHIEF FINANCIAL
OFFICER, 6864 SOUTH 300 WEST, SALT LAKE CITY, UTAH 84047; TELEPHONE NUMBER
(801) 562-0200.
No agent or officer of the Company, nor any other person, has been authorized to
give any information or to make any representations other than as contained
herein; and, if given or made, such information or representations should not be
relied upon as having been authorized by the Company. Neither the delivery of
this Prospectus nor any sale or exchange made hereunder shall, under any
circumstances, create any implication that there has been no change in the
affairs or operations of the Company since the date of this Prospectus, or that
the information herein is correct as of any time subsequent to such date.
THE COMPANY
The Company is a Utah corporation headquartered in Salt Lake City, Utah. At
March 31, 1995, the Company and its subsidiaries had total consolidated assets,
liabilities, and shareholders' equity of $43.3 million, $2.9 million and $40.4
million, respectively.
The Company maintains its executive offices at 6864 South 300 West, Salt Lake
City, Utah 84047; Telephone number (801) 562-0200.
The Company is engaged in the development and marketing of a variety of medical
devices and products, with an emphasis on the production and marketing of
devices used in the cardio-vascular surgical marketplace.
SELLING SHAREHOLDERS
The 26,700 Shares of the Company's Common Stock described in this Prospectus are
owned by the persons listed below. All of the shares offered hereby were
acquired by the listed persons in connection with the acquisition of Imodex,
Inc. ("Imodex") by the Company in March 1995, and the Shares are being
registered by the Company for resale by the Selling Shareholders pursuant to the
Agreement of Merger for that acquisition.
The Selling Shareholders participated directly in the negotiation of the
acquisition arrangements between Imodex and the Company.
At the request of the Selling Shareholders, the Company has filed with the
Securities and Exchange Commission a Registration Statement on Form S-3 under
the Securities Act of 1933 (the `Securities Act''), of which this Prospectus
forms a part, with respect to the resale of the Shares. The Shares may be
resold in transactions on the NASDAQ/NMS, on which the Shares are included and
traded, in other public securities markets or in private transactions or other
transactions exempt from registration under the Securities Act. (See "Plan of
Distribution.")
<PAGE>
SHARES OWNED SHARES SHARES OWNED
PRIOR TO OFFERED AFTER
THIS OFFERING HEREBY OFFERING
------------- ------ --------
SELLING SHAREHOLDERS
- --------------------
Sheldon H. Davis, as 13,350 13,350 0
Trustee or Successor
Trustee under that
certain Amended and
Restated Revocable Living
Trust Agreement dated
September 20, 1993, by
and between Sheldon H.
Davis, as grantor and
Trustee
16035 Homestead Circle
Northville, Michigan
48167
Tax ID Number: 198-28-
4837
Michael C. Wierzbinski 13,850 13,350 500
4936 Bugle Court
Plymouth, Michigan 48170
Tax ID Number 334-46-
3858
TOTAL SHARES 27,200 26,700 500
None of the Selling Shareholders had any position, office or other material
relationship within the past three years with the Company or any of its
affiliates.
The information set forth above excludes shares of the Company's Common Stock
held by affiliates of the Selling Shareholders in their own right or by the
Selling Shareholders or their affiliates in trust accounts, custody accounts or
in other similar capacities. All of the shares listed in the preceding table
are offered hereby.
The Shares of Common Stock registered hereby were acquired by the Selling
Shareholders pursuant to the Agreement of Merger, a copy of which is an exhibit
to the Securities Act Registration Statement of which this prospectus forms a
part.
PLAN OF DISTRIBUTION
Any distribution of the Shares by the Selling Shareholders, or by pledgees,
donees, transferees or other successors in interest, may be effected in one or
more of the following transactions: (a) to underwriters who will acquire the
<PAGE>
Shares for their own account and resell them in one or more transactions,
including negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of sale (any public offering price and any
discount or concessions allowed or reallowed or paid to dealers may be changed
from time to time); (b) through brokers, acting as principal or agent, in
transactions (which may involve block transactions) on the NASDAQ/NMS, in
special offerings, or otherwise, at market prices prevailing at the time of
sale, at prices related to such prevailing market prices, at negotiated prices
or at fixed prices; or (c) directly or through brokers or agents in private
sales at negotiated prices, or by any other legally available means.
The Selling Shareholders and any such underwriters, brokers, dealers or agents,
upon effecting the sale of the Shares, may be deemed "underwriters" as that term
is defined by the Securities Act.
Underwriters participating in any offering made pursuant to this Prospectus (as
amended or supplemented from time to time) may receive underwriting discounts
and commissions, and discounts or concessions may be allowed or reallowed or
paid to dealers, and brokers or agents participating in such transactions may
receive brokerage or agent's commissions or fees.
In order to comply with the securities laws of certain states, if applicable,
the Shares will be sold in such jurisdictions only through registered or
licensed brokers or dealers. In addition, in certain states the Shares may not
be sold unless the Shares have been registered or qualified for sale in such
state or an exemption from registration or qualification is available and
complied with.
All costs, expenses and fees in connection with the registration of the Shares
will be borne by the Company. Commissions and discounts, if any, attributable
to the sale of the Shares will be borne by the Selling Shareholders. The
Selling Shareholders may agree to indemnify any agent, dealer or broker-dealer
that participates in transactions involving sales of the Shares against certain
liabilities, including liabilities arising under the Securities Act. The
Company and the Selling Shareholders have agreed to indemnify each other and
certain other persons against certain liabilities in connection with the
offering of the Shares, including liabilities arising under the Securities Act.
The Company has agreed to maintain the effectiveness and material currency of
this Prospectus for a period of 120 days from the date hereof. Thereafter any
of the Shares not previously sold will be deregistered and may not be offered or
sold by means of this Prospectus.
EXPERTS
The financial statements OF Research Industries Corporation as of June 30, 1994
and for the year then ended have been incorporated in this Prospectus by
reference from the Company's Annual Report on Form 10-K in reliance on the
report of KPMG Peat Marwick LLP, independent certified public accountants, which
is incorporated by reference, and upon the authority of said firm as experts in
accounting and auditing.
The consolidated financial statements of Research Industries Corporation at June
30, 1993, and for each of the two years then ended incorporated by reference in
Research Industries Corporation's Annual Report (Form 10-K) for the year ended
June 30, 1994, have been audited by Ernst & Young LLP, independent auditors, as
set forth in their report thereon dated August 3, 1993 included therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
LEGAL MATTERS
The legality of the Company's Common Stock offered hereby and certain other
matters with respect to this offering have been passed upon for the Company by
Ray, Quinney & Nebeker P.C. As of March 31, 1995, attorneys at Ray, Quinney &
Nebeker, as a group, were beneficial owners of less than 1% of the total
outstanding Common Stock of the Company.
TABLE OF CONTENTS
-----------------
26,700 Shares
Available Information......
Incorporation of Certain
Documents by Reference...
RESEARCH INDUSTRIES
The Company................ CORPORATION
Selling Shareholders.......
Experts.................... Common Stock
Legal Matters..............
==========================
-------------------
PROSPECTUS
May 16, 1995
==========================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
- -----------------------------------------------------
The expenses relating to the registration of the Shares will be borne by the
registrant. Such expenses are estimated to be as follows:
Registration fee - Securities and Exchange Commission $
Accountant's fees $
Legal fees $
Miscellaneous $
Total $
Item 15. Indemnification of Directors and Officers
- ---------------------------------------------------
The Utah Revised Business Corporation Act authorizes a corporation to indemnify
its directors and officers as well as other employees and individuals in terms
sufficiently broad to permit such indemnification under certain circumstances
for liabilities (including reimbursement for expenses incurred) arising under
the Securities Act. The Company's Articles and By-Laws require indemnification
to the full extent permitted under Utah law and provides certain rights to
indemnification for directors, officers and employees of the Company.
The Company also maintains an insurance policy insuring its Directors and
Officers against liability for certain acts or omissions while acting in their
official capacities.
INSOFAR AS INDEMNIFICATION FOR LIABILITIES ARISING UNDER THE SECURITIES ACT MAY
BE PERMITTED TO DIRECTORS, OFFICERS OR PERSONS CONTROLLING THE COMPANY PURSUANT
TO THE FOREGOING PROVISIONS, THE COMPANY HAS BEEN INFORMED THAT IN THE OPINION
OF THE SECURITIES AND EXCHANGE COMMISSION SUCH INDEMNIFICATION IS AGAINST PUBLIC
POLICY AS EXPRESSED IN THE SECURITIES ACT AND IS THEREFORE UNENFORCEABLE. IN
THE EVENT THAT A CLAIM FOR INDEMNIFICATION AGAINST SUCH LIABILITIES (OTHER THAN
THE PAYMENT BY THE COMPANY OF EXPENSES INCURRED OR PAID BY A DIRECTOR, OFFICER
OR CONTROLLING PERSON OF THE COMPANY IN THE SUCCESSFUL DEFENSE OF ANY ACTION,
SUIT OR PROCEEDING) IS ASSERTED BY SUCH DIRECTOR, OFFICER OR CONTROLLING PERSON
IN CONNECTION WITH THE SECURITIES BEING REGISTERED, THE COMPANY WILL, UNLESS IN
THE OPINION OF ITS COUNSEL THE MATTER HAS BEEN SETTLED BY CONTROLLING PRECEDENT,
SUBMIT TO A COURT OF APPROPRIATE JURISDICTION THE QUESTION WHETHER SUCH
INDEMNIFICATION BY IT IS AGAINST PUBLIC POLICY AS EXPRESSED IN THE SECURITIES
ACT AND WILL BE GOVERNED BY THE FINAL ADJUDICATION OF SUCH ISSUE.
Item 16. List of Exhibits
- --------------------------
The Exhibits filed together with this registration statement are listed in the
Index to Exhibits.
Item 17. Undertakings
- ----------------------
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii)To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most post-
effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement;
(iii)To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
Provided, however, that paragraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
(4) For purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(5) That, for purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and,
where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange Act of 1934)
that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offering therein, and the offering of such securities at that time shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Midvale, State of Utah, on the th day of May,
1995.
RESEARCH INDUSTRIES CORPORATION
/s/ Gary L. Crocker
- --------------------------------------------
By: Gary L. Crocker, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities indicated
on the th day of May, 1995.
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints A.
Robert Thorup, Esq. his true and lawful attorney-in-fact and agent, with full
powers of substitution, for him and in his name, place and stead, in any and all
capacities, to sign this Registration Statement and any and all amendments
(including post-effective amendments) to this Registration Statement, with the
Securities and Exchange Commission, granting to said attorney-in-fact full power
and authority to perform any other act on behalf of the undersigned required to
be done in connection therewith.
Signature Title Date
- --------- ----- ----
President and Chief
/s/ Gary L. Crocker Executive May 16, 1995
- -------------------- Officer, Director
Gary L. Crocker
Vice President and Chief
Financial Officer (Principal
/s/ Mark W. Winn Financial and Accounting May 16, 1995
- ---------------------- Officer)
Mark W. Winn
/s/ Louis M. Haynie Director May 16, 1995
- -------------------
Louis M. Haynie
/s/Edward M. Blair, Jr.Director May 16, 1995
- ----------------------
Edward M. Blair, Jr.
/s/ William A. Gay,Jr. Director May 16, 1995
- ---------------------
William A. Gay, Jr.
/s/Sterling D. Sessions Director May 16, 1995
- -----------------------
Sterling D. Sessions
/s/ Charles J.Aschauer,Jr. Director May 16, 1995
- --------------------------
Charles J. Aschauer, Jr.
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
- ------ --------------------------------------------
10.12 Agreement of Merger, dated as of
January 1, 1995, by and among Research
Industries Corporation and Imodex, Inc.
5. Opinion of Ray Quinney & Nebeker, Professional
Corporation.
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Ernst & Young LLP
23.3 Consent of Ray Quinney & Nebeker (included in Exhibit 5)
EXHIBIT 10.12
AGREEMENT OF MERGER
This Agreement of Merger, dated as of the 1st day of January, 1995
("Agreement"), is made and entered into by and among Research Industries
Corporation, a Utah corporation ("REIC"), Imodex Acquisition Corporation, a Utah
Corporation ("IAC"), and IMODEX MEDICAL DEVICES INCORPORATED, a Michigan
corporation ("Imodex").
R E C I T A L S:
A. REIC is a corporation duly organized under the laws of the State of
Utah with its principal place of business located at 6864 South 300 West,
Midvale, Utah 84047. REIC is authorized by its Articles of Incorporation to
issue up to 20,000,000 shares of Common Stock, $0.50 par value ("REIC Common
Stock"), of which as of the date of this Agreement, there were 9,196,775 shares
issued and outstanding.
B. IAC is a Utah corporation, having authorized capital stock of 1,000,000
shares of Common Stock, par value $0.01 ("IAC Common Stock"), of which 100,000
shares are issued and outstanding. REIC owns 100% of the issued and outstanding
stock of IAC.
C. Imodex is a corporation organized under the laws of the State of
Michigan, with its principal place of business located at 21199 Hilltop Street,
Southfield, Michigan 48034. Imodex is authorized by its Articles of
Incorporation to issue 50,000 shares of capital stock, $1.00 par value ("Imodex
Common Stock"), of which as of the date of this Agreement, there were 20,000
shares issued and outstanding.
D. IAC and Imodex desire to merge Imodex with and into IAC upon the terms
and subject to the conditions set forth herein (the "Merger").
E. The Boards of Directors of Imodex, IAC and REIC, each by resolutions
duly adopted pursuant to the authority given by and in accordance with the laws
governing them, have approved this Agreement and authorized the execution
hereof.
A G R E E M E N T:
NOW, THEREFORE, in consideration of the premises, and the mutual covenants
and conditions herein the parties hereto covenant and agree to effect the merger
in accordance with the terms and conditions set forth as follows:
ARTICLE 1. THE MERGER
1. Merger. Pursuant to the laws of the States of Utah and Michigan
------
and subject to and in accordance with the terms and conditions of this Agreement
of Merger, Imodex shall be merged with and into IAC, to form a single
corporation, and IAC shall be the surviving entity to be governed by the laws of
the State of Utah. IAC and Imodex shall execute any "Certificate" or "Articles"
of Merger for filing, as may be required by applicable law. The Merger of
Imodex with and into IAC shall become effective on such date as the laws and
regulations of the State of Utah deem the Merger effective. The time when the
Merger shall become effective is herein called the "Effective Time."
2. Effect of Merger. At the Effective Time, Imodex shall be merged
----------------
with and into IAC in the manner and with the effect provided by the laws of Utah
and Michigan, and the separate legal existence of Imodex shall cease and
thereupon IAC and Imodex (hereinafter sometimes referred to as the "Merging
Companies") shall be a single corporation (the "Surviving Company") subject to
the Articles of Incorporation of IAC. The Surviving Company shall possess all
the rights, privileges, powers and franchises of a public as well as of a
private nature, and shall be subject to all restrictions, disabilities and
duties of the Merging Companies; and all the rights, privileges, powers and
franchises of the Merging Companies and all property, real, personal and mixed
and all debts due to the Merging Companies on whatever account, as well as for
stock subscriptions and all other things in action or belonging to the Merging
Companies shall be vested in the Surviving Company; and all property, rights,
privileges, powers and franchises, and all and every other interest shall
hereafter effectively be the property of the Surviving Company as they were of
Imodex and all rights of creditors and all liens upon any property of Imodex
shall be preserved unimpaired, and all debts, liabilities and duties of Imodex
shall thereafter attach to the Surviving Company, and may be enforced against it
to the same extent as if such debts, liabilities and duties had been incurred or
contracted by it.
The outstanding shares of Imodex Common Stock shall be converted on the
basis, terms, and conditions described in Section 4.
3. Articles of Incorporation; By-laws; Directors. The Articles of
---------------------------------------------
Incorporation and By-laws of IAC in effect immediately prior to the Merger shall
govern the Surviving Company after the Merger without amendment. The directors
and officers of the Surviving Company shall be the directors and officers of IAC
holding such positions immediately prior to the Merger.
4. Conversion of Shares. The manner and basis of converting the
--------------------
shares of the Merging Companies shall be as follows:
(a) Imodex Common Stock. Each share of Imodex Common Stock
-------------------
which is outstanding immediately prior to the Effective Time, other than shares
as to which dissenters' rights are perfected, and all rights in respect thereof,
shall be converted, ipso facto, and without any action on the part of the holder
----------
thereof, into the right to receive 26,700 shares of REIC Common Stock
(hereinafter the "Conversion Ratio"). The Conversion Ratio was determined and
agreed based on a total valuation of Imodex for the purpose of this transaction
at $387,500; and using the average of the last sale prices of REIC Common Stock
over the ten business days immediately preceding the Closing Date.
(b) IAC Common Stock. The issued and outstanding stock of
----------------
IAC shall be unchanged by the Merger, except that IAC shall issue additional
shares of its common stock to REIC equal to the value of the REIC Common Stock
issued pursuant to the Merger to compensate REIC for REIC shares used to effect
the Merger.
(c) Surrender of Certificates. After the Effective Time, each
-------------------------
holder of shares of Imodex Common Stock outstanding immediately prior to the
Effective Time (other than shares as to which dissenters' rights have been
perfected) shall, upon surrender for cancellation of a certificate or
certificates representing such shares to REIC or its agent designated for such
purpose, be entitled to forthwith receive a certificate or certificates
representing the number of shares of REIC Common Stock into which such shares of
Imodex Common Stock shall have been converted pursuant to the provisions of this
Article. Until so surrendered, the certificates which prior to the Merger
represented shares of Imodex Common Stock shall be deemed for all corporate
purposes to evidence ownership of the shares of REIC Common Stock into which
such shares of Imodex Common Stock shall have been converted.
No fractional shares of REIC Common Stock shall be issued in the
Merger but, in lieu of any such fractional shares, each holder of shares of
Imodex Common Stock who would otherwise have been entitled to a fraction of a
share of REIC Common Stock upon surrender of Imodex stock certificates will upon
such surrender be paid an amount of cash (without interest) determined by
multiplying (a) the last sale price for REIC Common Stock as quoted on the
NASDAQ, National Market System, at closing on the day preceding the Effective
Time by (b) the fractional share interest in REIC Common Stock to which the
holder would otherwise be entitled.
5. Subsequent Actions. If, at any time after the Effective Time, the
------------------
Surviving Company shall consider or be advised that any deeds, bills of sale,
assignments, assurances, or any other actions or things are necessary or
desirable to vest, perfect, or confirm of record or otherwise in the Surviving
Company its right, title, or interest in, to, or under any of the rights,
properties, or assets of Imodex acquired or to be acquired by the Surviving
Company as a result of or in connection with, the Merger or otherwise to carry
out this Agreement, the officers and directors of the Surviving Company shall be
authorized to execute and deliver, in the name and on behalf of Imodex or
otherwise, all such deeds, bills of sale, assignments, and assurances, and to
make and do, in the name and on behalf of Imodex or otherwise, all such other
actions and things as may be necessary or desirable to vest, perfect, or confirm
any right, title, and interest in, to, and under such rights, properties, or
assets in the Surviving Company or otherwise to carry out this Agreement.
ARTICLE 2. FURTHER AGREEMENTS
1. Registration of REIC Shares.
---------------------------
(a) For a period of time ending at 5:00 PM Mountain Time on the
date which is exactly Six Hundred Thirty (630) days after the Closing Date (the
"Demand Period"), upon the joint written request of the Sellers specifying the
number of REIC Shares to be registered and the intended method of disposition
thereof, REIC will thereupon use all reasonable efforts to effect the
registration under the Securities Act of the REIC Shares which REIC has been so
requested to register by the Sellers, all to the extent requisite to permit the
legal and open disposition (in accordance with the intended methods thereof) of
the REIC Shares so to be registered.
(b) Notwithstanding anything to the contrary otherwise stated or
implied in this Agreement, (i) REIC shall not be required to honor more than two
(2) Registration Demands, as just described, during the Demand Period; provided,
--------
however, that in the event of any discontinuance or suspension of sales under,
- -------
or the deferral of the filing of, any Registration Statement at the request of
REIC, the Sellers may revoke their pending Demand at anytime (x) after such
discontinuance, suspension or deferral and (y) prior to the filing of such
registration statement or amendment thereto, in connection with such
underwritten offering, without prejudice to the rights of the Sellers to make
another Registration Demand within the Demand Period and (ii) the number of REIC
Shares requested by the Sellers to be so registered shall be no less than 10,000
(the "Minimum Amount") shares of REIC Common Stock; provided, however, that if
-------------- -------- -------
at any time the number of REIC Shares outstanding shall be less than 10,000, the
Minimum Amount shall be 5,000 shares.
2. Registration Procedures. If and whenever REIC is required to
-----------------------
maintain effective on a current basis a registration statement under the
Securities Act pertaining to any REIC Shares as provided in paragraph 1 of this
Article 2, REIC will use all reasonable efforts to effect the registration of
such REIC Shares in accordance with the intended methods of disposition thereof
specified by the Sellers. Without limiting the foregoing, REIC in each such
case will, as expeditiously as possible:
(a) prepare and file with the Commission the requisite registration
statement to effect such registration and use all reasonable efforts to cause
such registration statement to become effective, provided that as far in advance
--------
as reasonably practical before filing such registration statement or any
supplement or amendment thereto, REIC will furnish to the Sellers copies of
reasonably complete drafts of all such documents proposed to be filed (including
exhibits), and any Seller shall have the opportunity to object to any
information pertaining to such Seller and its plan of distribution that is
contained therein and REIC will make the corrections reasonably requested by
such Seller with respect to such information prior to filing any such
registration statement or amendment;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and any prospectus used in connection
therewith as may be necessary to maintain the effectiveness of such registration
statement and to comply with the provisions of the Securities Act with respect
to the disposition of all REIC Shares covered by such registration statement, in
accordance with the intended methods of disposition thereof, as specified by the
Sellers in the notice delivered to REIC in connection with such sale, provided
--------
that REIC shall in no event be required to maintain the effectiveness of a
registration statement filed for the benefit of the Sellers for more than 120
days after such registration statement first becomes effective;
(c) promptly notify each Seller:
(1) when such registration statement or any prospectus used
in connection therewith, or any amendment or supplement thereto, has been filed
and, with respect to such registration statement or any post-effective amendment
thereto, when the same has become effective;
(2) of any written comments from the Commission with
respect to any filing referred to in this paragraph and of any written request
by the Commission for amendments or supplements to such registration statement
or prospectus;
(3) of the notification to REIC by the Commission of its
initiation of any proceeding with respect to the issuance by the Commission of,
or of the issuance by the Commission of, any stop order suspending the
effectiveness of such registration statement; and
(4) of the receipt by REIC of any notification with respect
to the suspension of the qualification of any REIC Shares for sale under the
applicable securities or blue sky laws of any jurisdiction;
(d) furnish to each Seller such reasonable number of conformed copies
of such registration statement and of each amendment and supplement thereto (in
each case including all exhibits and documents incorporated by reference), such
reasonable number of copies of the prospectus contained in such registration
statement (including each preliminary prospectus and any summary prospectus) and
any other prospectus filed under Rule 424 promulgated under the Securities Act
relating to such Seller's REIC Shares, and such other documents, as such seller
may reasonably request to facilitate the disposition of his REIC Shares;
(e) use all reasonable efforts to register or qualify all REIC Shares
covered by such registration statement under such other securities or blue sky
laws of such jurisdictions as each Seller shall reasonably request and to keep
such registration or qualification in effect for so long as such registration
statement remains in effect, and take any other action which may be reasonably
necessary to enable such holder to consummate the disposition in such
jurisdictions of the REIC Shares being sold by the Sellers, except that REIC
shall not for any such purpose be required (i) to qualify generally to do
business as a foreign corporation in any jurisdiction wherein it would not but
for the requirements of this paragraph be obligated to be so qualified, (ii) to
subject itself to taxation in any such jurisdiction or (iii) to consent to
general service of process in any jurisdiction;
(f) use all reasonable efforts to cause all REIC Shares covered by
such registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable each Seller
to consummate the disposition of such REIC Shares;
(g) pay all registration fees to the Commission incurred in
connection with the Demand Registration.
It shall be a condition precedent to the obligations of REIC to take any
action pursuant to this paragraph that the Sellers shall furnish to REIC such
information regarding themselves, the REIC Shares held by them, and the intended
method of disposition of such securities as shall be reasonably requested by
REIC or required by law to effect the registration of the REIC Shares.
Notwithstanding anything to the contrary herein, each holder of REIC Shares
also agrees by acquisition of such REIC Shares that upon receipt of any notice
from REIC that in the reasonable good faith judgment of REIC the making of
offers and sales pursuant to the Demand Registration would require REIC to make
public disclosure of information, the disclosure of which would not otherwise be
required at that time and which REIC has a bona fide business purpose for
preserving as confidential, REIC shall have the right to defer such filing or to
suspend sales under the Demand Registration, provided, however, that promptly
-------- -------
following public disclosure of such information REIC will make such filing or
take such steps as are necessary to permit such sales, as the case may be. In
the event of any such suspensions during the Demand Period, the Demand Period
shall be extended for a period equal to the number of days of such suspension.
2. Indemnification by the Sellers. Each Seller shall, to the full extent
------------------------------
permitted by law, indemnify and hold harmless REIC, its directors and officers,
and each other person, if any, who controls REIC within the meaning of the
Securities Act, against any losses to which REIC or any such director or officer
or controlling person may become subject under the Securities Act or otherwise,
insofar as such losses (or actions or proceedings, whether commenced or
threatened, in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any such
registration statement, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of a
prospectus, in the light of the circumstances under which they were made) not
misleading, if such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to REIC by such Seller for use in the preparation of such
registration statement, preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement pursuant to demand registration; provided,
--------
however, that the obligation to provide indemnification shall be several, and
- -------
not joint and several, among the Sellers. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of REIC or
any such director, officer or controlling person and shall survive the transfer
of such securities by such Seller.
3. Notices from REIC; Effect. Upon receipt of any such notice
-------------------------
pursuant to either of the prior two paragraphs, each holder of REIC Shares will
forthwith discontinue such holder's disposition of such REIC Shares pursuant to
the registration statement relating to such REIC Shares until REIC shall have
provided notice that such holder may resume such disposition.
4. Additional Covenants. The parties hereto further covenant as
--------------------
follows:
(a) Officers and Directors of Surviving Company. The directors
-------------------------------------------
and officers listed on Schedule B shall be the directors and officers of the
Surviving Company following the Closing, each to hold office in accordance with
the Articles of Incorporation and By-laws of IAC.
(b) REIC Common Stock to be Reserved for Merger. REIC agrees to
-------------------------------------------
reserve and make available sufficient shares of REIC Common Stock to permit the
issuances of shares to the holders of Imodex Common Stock contemplated by this
Agreement.
(c) Name of Surviving Company. Contemporaneous with the
-------------------------
Effective Time, the name of the Surviving Company will be changed to Research
Vascular, Inc. pursuant to the requirements of Utah law.
ARTICLE 3. REPRESENTATIONS AND WARRANTIES
1. Representations and Warranties of Imodex. The Shareholders of
----------------------------------------
Imodex who will also execute and deliver this Agreement ("Sellers") hereby
represent and warrant to REIC, jointly and severally, that at the date hereof
and as of the Closing:
(a) Imodex is a corporation duly organized, validly existing and in
good standing under the laws of the State of Michigan, has corporate power and
all necessary authorizations to own all of its properties and assets, and to
carry on its business as it is now being conducted, and is duly qualified to do
business and is in good standing in the State of Michigan.
(b) The authorized capital stock of Imodex consists of
shares of common stock, all of which, as of the date of this Agreement are
issued and outstanding. Imodex has no commitment to issue or sell any shares of
common stock or any securities or obligations convertible or exchangeable for,
or giving any person any right to acquire from Imodex, any shares of its common
stock. All of the issued and outstanding shares of Imodex Common Stock are
validly issued, fully paid and non-assessable.
(c) Imodex has taken all action required by law, its Articles of
Incorporation, its By-laws or otherwise, to authorize Imodex's execution and
delivery of all contracts now in place and force governing Imodex or granting to
Imodex any right or privilege associated with its current business.
(d) This Agreement is a valid and binding agreement of both
Imodex and the Sellers, enforceable in accordance with its terms, subject as to
enforcement to bankruptcy, insolvency, and other laws of general applicability
relating to or affecting creditors' rights and to general equity principles.
(e) Imodex is not in default under or in violation of any provisions
of its Articles of Incorporation or By-laws. Neither the execution and delivery
of this Agreement nor the consummation of the transactions contemplated hereby
will, to the knowledge of Sellers, conflict with or result in a breach of or
constitute a default under Imodex's Articles of Incorporation or By-laws or any
material agreement or instrument to which Imodex or any of the Sellers is a
party or by which Imodex or any of the Sellers is bound or to which any of the
properties of Imodex or any of the Sellers is subject or, to the knowledge of
Imodex or the Sellers, any statute, order, rule or regulation of any court or
governmental agency or body having jurisdiction over Imodex or any of its
properties.
(f) Sellers have heretofore delivered to REIC the (i) income
statement of Imodex for the period January 1, 1994 through December 31, 1994,
(ii) the balance sheet for Imodex as of December 31, 1994, and (iii) such other
business and financial information concerning Imodex as has been requested by
REIC (collectively, the "Imodex Information"). The Imodex Information does not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they were made, not misleading.
(g) Except as provided below, (i) Imodex has duly filed all federal,
state, county and local income, excise, sales, customs, property, withholding,
social security and other tax and information returns and reports required to
have been filed by it from the date of its inception to the date hereof (unless
an appropriate extension is available), and has paid all taxes, amounts, duties,
interest and penalties shown on such returns or reports to be due or claimed to
be due prior to the date hereof to any federal, state, county, local or other
governmental authority; (ii) each of such returns and reports filed by Imodex is
complete and correct in all material respects; (iii) Imodex has paid or made
adequate provision in Imodex's balance sheet as of December 31, 1994 (the
"Imodex Balance Sheet") for all taxes, duties, and related interest and
penalties payable by Imodex on or prior to and with respect to all periods
ending at or prior to December 31, 1994, except where such taxes, duties and
related interest and penalties are being contested in good faith in the manner
permitted by applicable law and in any such case adequate provision has been
made therefor in the Imodex Balance Sheet; (iv) Imodex has no liability, other
than for immaterial amounts, for any taxes, duties, and related interest or
penalties of any nature whatsoever other than as shown on the Imodex Balance
Sheet, and there is no basis for any additional material claims or assessments
other than with respect to liabilities for taxes that may have accrued since
December 31, 1994, in the ordinary course of business; and (v) none of Imodex's
income tax returns have been audited by the tax authorities, and no proposed
additional taxes, interest and penalties have been asserted by the tax
authorities against Imodex that have not been paid and totally resolved.
(h) Imodex is not in material default under any material contract or
commitment of any kind or nature whatsoever, written or oral, including, without
limitation, any loan agreement, indenture, mortgage, debt instrument,
distribution, franchise or license agreement, lease, employment, consultant or
commission agreement, pension, profit-sharing, bonus, or stock purchase
agreement, and no claim of default by any party has been made or is now pending,
and as to Imodex there does not exist any event that with notice or the passing
of time or both would constitute a material default or would excuse performance
by any party thereto.
(i) There are no actions, proceedings or investigations pending or,
to the knowledge of Imodex or any of the Sellers, threatened or contemplated
against or affecting Imodex or any of its properties, except such as have been
disclosed to REIC.
(j) Imodex owns all of its properties and assets free and clear of
liens, mortgages, encumbrances or security interests, and Imodex has good title
thereto.
(k) Imodex has not dealt with any person acting as a broker or finder
in connection with this Agreement or the transactions contemplated hereby.
(l) All contracts for the production of Imodex products or material
portions thereof are in full force and effect, in writing, and enforceable
according to their terms by REIC to the same extent as Sellers could have
enforced the same prior to Closing. Copies of all such contracts shall have
been delivered to REIC prior to Closing.
2. Representations and Warranties of REIC. REIC hereby represents and
---------------------------------------
warrants to Imodex and the Sellers that at the date hereof:
(a) REIC is a corporation duly organized, validly existing and in
good standing under the laws of the State of Utah, has corporate power and all
necessary authorizations to own all of its properties and assets, and to carry
on its business as it is now being conducted, and is duly qualified to do
business and is in good standing in the State of Utah.
(b) The authorized capital stock of REIC consists of 20,000,000
shares of common stock, of which, as of the date of this Agreement, 9,196,775
shares are issued and outstanding. REIC has no commitment to issue or sell any
shares of common stock or any securities or obligations convertible or
exchangeable for, or giving any person any right to acquire from it, any shares
of its common stock except as provided in the stock options reported in the REIC
Proxy Statement from time to time, and except as provided in certain stock
options granted to selling agents. All of the issued and outstanding shares of
REIC Common Stock are validly issued, fully paid and non-assessable.
(c) REIC has taken all action required by law, its Articles of
Incorporation, its By-laws or otherwise, to authorize its execution and delivery
of this Agreement and the performance of its obligations hereunder. This
Agreement is a valid and binding agreement of REIC enforceable in accordance
with its terms, subject as to enforcement to bankruptcy, insolvency, and other
laws of general applicability relating to or affecting creditors' rights and to
general equity principles.
(d) REIC is not in default under or in violation of any provisions of
its Articles of Incorporation or By-laws. Neither the execution and delivery of
this Agreement nor the consummation of the transactions contemplated hereby
will, to the knowledge of REIC, conflict with or result in a breach of or
constitute a default under REIC's Articles of Incorporation or By-laws or any
material agreement or instrument to which REIC is a party or by which it is
bound or to which any of its properties is subject or, to the knowledge of REIC,
any statute, order, rule or regulation of any court or governmental agency or
body having jurisdiction over REIC or any of its properties.
(e) REIC has heretofore delivered to Imodex (i) Annual Reports of
REIC on Form 10-K for the years ended June 30, 1994, as filed with the SEC; (ii)
all Quarterly Reports of REIC on Form 10-Q, as filed with the SEC; and (iii)
such other business and financial information concerning REIC as has been
requested in writing by Imodex (collectively, the "REIC Information"). REIC
Information does not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they were
made, not misleading.
(f) The audited financial statements and unaudited interim financial
statements included in REIC Information have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis (except
as may be indicated in the notes thereto) and fairly present the financial
position of REIC as at the dates thereof and the results of operations and
changes in financial position of REIC for the periods then ended, subject, in
the case of the unaudited interim financial statements, to normal year-end
adjustments and any other adjustments described therein.
(g) (i) REIC has duly filed all federal, state, county and local
income, excise, sales, customs, property, withholding, social security and other
tax and information returns and reports required to have been filed by it from
the date of its inception to the date hereof (unless an appropriate extension is
available), and has paid all taxes, amounts, duties, interest and penalties
shown on such returns or reports to be due or claimed to be due prior to the
date hereof to any federal, state, county, local or other governmental
authority; (ii) each of such returns and reports filed by REIC is complete and
correct in all material respects; (iii) REIC has paid or made adequate provision
in REIC's audited balance sheet as of June 30, 1994 (the "REIC Balance Sheet")
for all taxes, duties, and related interest and penalties payable by REIC on or
prior to and with respect to all periods ending prior to December 31, 1994,
except where such taxes, duties and related interest and penalties are being
contested in good faith in the manner permitted by applicable law and in any
such case adequate provision has been made therefor in REIC Balance Sheet; and
(iv) REIC has no liability, other than for immaterial amounts, for any taxes,
duties, and related interest or penalties of any nature whatsoever other than as
shown on REIC Balance Sheet, and there is no basis for any additional
<PAGE>material claims or assessments other than with respect to liabilities for
taxes that may have accrued since December 31, 1994, in the ordinary course of
business.
(h) REIC is not in material default under any material contract or
commitment of any kind or nature whatsoever, written or oral, including, without
limitation, any loan agreement, indenture, mortgage, debt instrument,
distribution, franchise or license agreement, lease, employment, consultant or
commission agreement, pension, profit-sharing, bonus, or stock purchase
agreement, and no claim of default by any party has been made or is now pending,
and there does not exist any event that with notice or the passing of time or
both would constitute a material default or would excuse performance by any
party thereto.
(i) There are no actions, proceedings or investigations pending or,
to the knowledge of REIC or its officers or directors, threatened or
contemplated against or affecting REIC or any of its properties.
(j) REIC has not dealt with any person acting as a broker or finder
in connection with this Agreement or the transactions contemplated hereby.
(k) REIC has filed all reports, schedules and documents that it is
required to pursuant to the Securities Exchange Act of 1934 (the "1934 Act") in
order that it presently be "current," as that term is understood under the 1934
Act, and will continue to make such filings as are required pursuant to the 1934
Act.
ARTICLE 4. ADDITIONAL COVENANTS
1. Conduct of Business in Regular Course.
--------------------------------------
(a) During the period from the date of this Agreement to the Closing
Date, each of the Sellers, Imodex and REIC will use its best efforts to comply
promptly with all filing requirements which federal or state law may impose on
it with respect to the transactions contemplated by this Agreement, and each
will use its best efforts to cooperate with and furnish information promptly to
the other in connection with any such filing requirements (including, without
limitation, pursuant to state securities or "Blue Sky" laws) imposed upon the
other in connection with the transactions contemplated by this Agreement.
(b) Imodex will not, following the date hereof and through the
Closing Date, except with the prior written consent of REIC or as provided in
this Agreement:
(i) Declare, set aside or pay any dividend or make any
distribution to its shareholders, or redeem, purchase or otherwise acquire
any shares of its outstanding capital stock, or enter into any agreement in
respect of the foregoing provided that Imodex may distribute to the Sellers
up to 50% of Imodex' 1994 "S Corporation" earnings prior to Closing.
(ii) Issue or sell any shares of its capital stock or issue,
sell or grant any rights or options to purchase or otherwise acquire any
shares of its capital stock other than with respect to transactions
contemplated by this Agreement;
(iii) Create any obligations for money borrowed, or mortgage,
pledge or otherwise subject to any lien or encumber any of its assets, or
acquire any real property, other than in the ordinary course of business;
(iv) Make any commitments in excess of 60 days other than in the
ordinary course of business;
(v) Merge or consolidate with or into any entity or sell, lease,
abandon or otherwise dispose of all or substantially all of its assets or
acquire the stock or assets of any entity; or
(vi) Amend its Articles of Incorporation or By-laws, or make any
change in its authorized capital stock.
2. Access
------
(a) Each of the Sellers, Imodex and REIC shall afford the other and
its officers, employees, counsel, accountants and other authorized
representatives access, during normal business hours throughout the period prior
to the Closing Date, to all of the properties, books, contracts, commitments and
records of the other and, during such period, each shall furnish promptly to the
other (i) a copy of each report, schedule and other document filed or received
by it pursuant to the requirements of federal or state securities laws and (ii)
all other information concerning its business, properties and personnel as the
other may reasonably request. No party to the Agreement (or its successors or
assigns) shall be entitled to rely upon any representation or warranty made by
another party hereto (or bring any claim for breach of the representation or
warranty or for failure of a related condition) to the extent that the party who
would otherwise have relied upon the representation or warranty has become aware
of facts prior to Closing from which it could reasonably determine that the
representation or warranty was materially false or misleading.
3. Filings; Further Action. Subject to the terms and conditions herein
------------------------
provided, the parties hereto shall (a) take all reasonable steps to cooperate
with one another in (i) determining which filings, if any, are required to be
made prior to the Closing Date and which consents, approval, permits or
authorizations are required to be obtained prior to the Closing Date from
governmental or regulatory authorities of the United States and the several
states in connection with the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby and (ii) timely making all
such filings and timely seeking all such consents, approvals, permits or
authorizations; (b) use all reasonable efforts to take, or cause to be taken,
all other action and do, or cause to be done, all other things necessary, proper
or appropriate to consummate and make effective the transactions contemplated by
this Agreement; and (c) use all reasonable efforts to defend against and respond
to any suit, action, proceeding or investigation relating to this Agreement or
to the transactions contemplated hereby commenced by any third party. In case
at any time after the Closing Date any further action is necessary or desirable
to carry out the purpose of this Agreement, the proper officers and/or directors
of the parties hereto shall take all such necessary action.
ARTICLE 5. CONDITIONS
1. Conditions to Obligations of the Sellers. The obligations of the
-----------------------------------------
Sellers to consummate the transactions contemplated hereby are subject to the
fulfillment at the Closing Date, of each of the following conditions, any or all
of which may be waived in whole or in part by the Sellers to the extent
permitted by applicable law:
(a) Corporate Approval. This Agreement and the transactions
------------------
contemplated hereby shall have been duly approved by all necessary corporate
action on the part of REIC and IAC, in accordance with applicable law and the
Articles of Incorporation and By-laws of REIC and IAC.
(b) Certified Copies of Resolutions. At the Closing, REIC and IAC
-------------------------------
shall have furnished the Sellers with copies of resolutions duly adopted by
REIC's and IAC's Boards of Directors approving the execution and delivery of
this Agreement and all other necessary or proper corporate action to enable REIC
and IAC to comply with the terms of this Agreement, certified by the Secretaries
of REIC and IAC.
(c) Omitted
(d) Representations; Warranties; Agreements; Covenants. The
--------------------------------------------------
representations and warranties of REIC contained in this Agreement shall be true
and correct in all material respects at and as of the date of this Agreement and
as of the Closing Date as if made at and as of such time, and REIC shall have
performed or complied in all material respects with its agreements and covenants
required by this Agreement to be performed by it at or prior to the Closing
Date.
(e) Litigation. On the Closing Date, there shall be in effect no
----------
preliminary or permanent injunction of a court or governmental or regulatory
agency of the United States or the several states of competent jurisdiction
directing that the transactions contemplated herein, or any of them, not be
consummated, and there shall not be any action or proceeding pending or
threatened by any governmental agency or authority that challenges the
consummation of any of such transactions.
(f) Consents; Approvals. All permits, approvals and consents of any
-------------------
governmental body or agency necessary or appropriate for the consummation of the
transactions contemplated hereby shall have been obtained, and each of such
approvals or permits shall be in full force and effect and not subject to any
condition which requires the taking or refraining from taking of any action
which would have a material adverse effect on Imodex. All non-governmental
permits, approvals and consents necessary or appropriate for the consummation of
the transactions contemplated hereby shall have been obtained, other than those
which, if not obtained, would not, in the aggregate have a material adverse
effect on Imodex.
2. Conditions to Obligations of REIC. The obligations of REIC to
----------------------------------
consummate the transactions contemplated hereby are subject to the fulfillment
at the Closing Date, of each of the following conditions, any or all of which
may be waived in whole or in part by REIC to the extent permitted by applicable
law:
(a) Corporate Approval. This Agreement and the transactions
------------------
contemplated hereby shall have been duly approved by all necessary corporate
action on the part of Imodex, in accordance with applicable law and the Articles
of Incorporation and By-laws of Imodex, including that the merger shall have
been affirmatively voted in favor by at least 90% of the issued and outstanding
shares of Imodex Common Stock.
(b) Certified Copies of Resolutions. At the Closing, any corporate
-------------------------------
or other entity Seller shall have furnished REIC with copies of resolutions duly
adopted by its governing persons approving the execution and delivery of this
Agreement and all other necessary or proper corporate action to enable Imodex to
comply with the terms of this Agreement, certified by the Secretary or similar
officer.
(c) Litigation. On the Closing Date, there shall be in effect no
----------
preliminary or permanent injunction of a court or governmental or regulatory
agency of the United States or the several states of competent jurisdiction
directing that the transactions contemplated herein, or any of them, not be
consummated, and there shall not be any action or proceeding pending or
threatened by any governmental agency or authority that challenges the
consummation of any of such transactions, or that seeks damages from or
challenges the business and operations of Imodex.
(d) Consents; Approvals. All permits, approvals and consents of any
-------------------
governmental body or agency necessary or appropriate for the consummation of the
transactions contemplated hereby shall have been obtained, and each of such
approvals or permits shall be in full force and effect and not subject to any
condition which requires the taking or refraining from taking of any action
which would have a material adverse effect on REIC. All non-governmental
permits, approvals and consents necessary or appropriate for the consummation of
the transactions contemplated hereby shall have been obtained, other than those
which, if not obtained, would not, in the aggregate have a material adverse
effect on REIC.
ARTICLE 6. RESTRICTIONS ON TRANSFERABILITY
1. Restrictions. REIC Share to be exchanged for the Imodex Shares
-------------
hereunder have not been registered under the Securities Act of 1933 (the
"Securities Act") or any state securities laws and is issued in reliance upon
certain exemptions contained in federal and state securities laws. There are
substantial restrictions on transferability of REIC Shares under applicable
securities laws. Except as otherwise provided for herein, REIC Shares are being
acquired solely for the account of the Sellers for investment and not with a
view to or for the resale, distribution, sub-division or fractionalization
thereof, and the Sellers have no plans to enter into, and have not entered into,
any contract, undertaking, agreement or arrangement to such end.
2. Legend. To insure compliance with the provisions of the Securities
-------
Act, each certificate representing (i) REIC Common Stock to be delivered
pursuant to this Agreement and (ii) any other securities issued in respect of
the shares of such REIC Common Stock upon any stock split, stock dividend,
recapitalization, merger, consolidation or similar event, shall (unless
otherwise permitted or unless the securities evidenced by such certificate shall
have been registered under the Securities Act) be stamped or otherwise imprinted
with a legend in substantially the following form (in addition to any legend
required under applicable state securities laws):
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR
OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
AS TO THE SECURITIES UNDER SAID ACT AND ANY APPLICABLE STATE
SECURITIES LAW OR AN OPINION OF COUNSEL SATISFACTORY TO REIC THAT SUCH
REGISTRATION IS NOT REQUIRED.
ARTICLE 7. SHAREHOLDER ACTIONS
1. Imodex Meeting. This Agreement shall be submitted to the
--------------
shareholders of Imodex for approval in accordance with the applicable provisions
of Michigan law as promptly as practicable after the execution of this
Agreement.
2. IAC Meeting. This Agreement shall be submitted to the shareholder of
-----------
IAC for approval, ratification and confirmation in accordance with the
applicable provisions of Utah law as promptly as practicable after the execution
of this Agreement.
ARTICLE 8. CLOSING OF THE MERGER
1. Closing. Unless this Agreement is earlier terminated in accordance
--------
with ARTICLE NINE, Imodex shall be merged with and into IAC, with IAC being the
surviving entity, as contemplated by this Agreement, at a closing (the
"Closing") to be held at the offices of REIC, at 2:00 P.M., local time, on a
date (the "Closing Date") mutually agreed upon by the parties as soon as
practicable after satisfaction of the conditions precedent set forth in this
Agreement.
2. Effective Time of Merger. The Merger shall take effect on the
------------------------
later of the date when all required filings and approvals have been made and/or
obtained in Utah, and the date when all required filings and approvals have been
made and/or obtained in Michigan. The time when the Merger shall become
effective is herein called the "Effective Time."
ARTICLE 9. TERMINATION
1. Termination by Mutual Consent. This Agreement may be terminated and
-----------------------------
the transactions contemplated hereby may be abandoned at any time prior to the
Closing Date, by the mutual consent in writing of REIC and the Sellers.
2. Termination by any Party. This Agreement may be terminated and the
------------------------
transactions contemplated hereby may be abandoned by action of REIC or Imodex at
any time prior to the Closing Date, effective upon written notice by the
terminating party to the other parties if: (a) the Closing shall not have
occurred by March 31, 1995; (b) a final and nonappealable order shall be in
effect enjoining the transactions contemplated hereby; or (c) any statute, rule
or regulation shall have been enacted or promulgated by any government or
governmental agency which makes consummation of the transactions contemplated
hereby illegal; provided that a terminating party may not assert the grounds
described in clause (a) above if at the time of such assertion the terminating
party is in material breach of any of its representations, warranties or
covenants under this Agreement and such breach has given rise or substantially
contributed to the events or conditions forming the basis of such termination.
3. Termination by Imodex. Upon written notice to REIC and to IAC,
---------------------
Imodex may terminate this Agreement at any time if any representation or
warranty of REIC or IAC contained in this Agreement was materially incorrect
when made or becomes materially incorrect on or prior to the Closing Date, or if
REIC or IAC, as applicable, fails to comply with any of its covenants contained
in this Agreement, and the same is not cured within thirty (30) days after
notice of such inaccuracy or noncompliance.
4. Termination by REIC and IAC. Upon written notice to Imodex,
---------------------------
REIC and IAC may terminate this Agreement at any time if any representation or
warranty of Imodex contained in this Agreement was materially incorrect when
made or becomes materially incorrect on or prior to the Closing Date, or if
Imodex fails to comply with any of its covenants contained in this Agreement,
and the same is not cured within thirty (30) days after notice of such
inaccuracy or noncompliance.
5. Effect of Termination and Abandonment. In the event of
-------------------------------------
termination of this Agreement and abandonment of the transactions contemplated
hereby pursuant to this Article, no party hereto (or any of its directors,
officers or agents) shall have any liability or further obligation to any other
party to this Agreement. Nothing herein will relieve any party from liability
for any breach of this Agreement.
ARTICLE 10. MISCELLANEOUS AND GENERAL
1. Amendments. Prior to the Effective Time, any provision of this
----------
Agreement may be amended or modified at any time, either before or after its
approval by the shareholders of either party to this Agreement, by an agreement
in writing between the parties hereto approved by its Boards of Directors and
executed in the same manner as this Agreement.
2. Assignment. This Agreement may not be assigned by any party
----------
hereto except with the prior written consent of the other parties.
3. Counterparts. Any number of counterparts of this Agreement may
-------------
be signed and delivered and each shall be considered an original and together
they shall constitute one agreement.
4. Exclusive Merger Agreement. Imodex and the Sellers of Imodex
---------------------------
executing this Agreement below, covenant and agree that, between the date hereof
and the date of the action of the shareholders of Imodex described herein, they
will not, either directly or indirectly, solicit or attempt to procure offers
relating to the Merger or acquisition of Imodex with or by any entity not a
party to this Agreement, or negotiate or enter into any agreements relating to
the Merger or acquisition of Imodex with or by any such third party, and such
persons further agree to use his or her best efforts to bring about the Closing
of this Agreement.
5. Binding Agreement. This Agreement shall be binding upon and shall
------------------
inure to the benefit of the parties hereto and their respective heirs,
representatives, successors and permitted assigns, provided that no party hereto
may assign its rights hereunder or delegate its duties hereunder without the
prior written consent of the other parties hereto.
6. Payment of Expenses. Except as otherwise provided in this Agreement,
-------------------
all costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such
expenses, provided that Research shall pay all costs of the above deferred
demand registrations.
7. Arbitration. Any controversy or claim arising out of or relating to
-----------
this Agreement or the breach hereof shall be settled by arbitration in Salt Lake
City, Utah in accordance with the rules of the American Arbitration Association,
and judgment upon the award rendered by the arbitrators may be entered in any
court having jurisdiction thereof. There shall be one arbitrator if the parties
can agree on a single arbitrator, and if the parties are unable to agree on a
single arbitrator within ten (10) days, then each side (i.e., REIC and Sellers
or Imodex, as the case may be) shall select an arbitrator within an additional
five (5) day period, and these two arbitrators shall select a third arbitrator
(provided that if a third arbitrator is not selected within five (5) days after
appointment of the initial two arbitrators, a third arbitrator shall be selected
by the American Arbitration Association). All arbitrators shall be selected
from a list of potential candidates to be provided by the American Arbitration
Association.
8. Governing Law. This Agreement shall be governed by and construed and
-------------
enforced in accordance with the laws of the State of Utah.
9. Severability. Wherever possible, each provision of this Agreement
------------
shall be interpreted in such a manner as to be effective and valid under the
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.
10. Entire Agreement; Amendments. This Agreement sets forth the entire
----------------------------
agreement of the parties and is intended to supersede all prior negotiations,
understandings and agreements. No provisions of this Agreement may be waived or
changed except by a writing signed by the party against whom such waiver or
change is sought to be enforced.
11. Notices. All notices, requests, demands or other communications under
-------
this Agreement shall be in writing and deemed duly given upon personal delivery,
three days after being deposited in First Class U.S. Mail, postage prepaid, or
one business day after being sent by generally recognized overnight courier,
postage prepaid, to the parties hereto at their respective addresses set forth
below (provided that any party hereto may change its notice address by giving
notice to the other parties hereto in accordance with this section).
If to REIC:
ATTENTION: GARY CROCKER
6864 South 30 West
Midvale, Utah 84047 Fax Number: (801)
With a copy to:
A. R. Thorup, of
Ray, Quinney & Nebeker
400 Deseret Building
79 South Main Street
Salt Lake City, Utah 84111 Fax Number: (801) 532-7543
If to Imodex or Sellers:
Michael C. Wierzbinski
-----------------------
21119 Hilltop St
----------------
Southfield, MI 48034
---------------------
and
Sheldon H. Davis
----------------
21199 Hilltop St.
-----------------
Southfield, MI 48034
---------------------
With a copy to:
Marco, Watkins and Owsiany
--------------------------
20180 Mack Ave
--------------
Grouse Pointe, MI 48236
-----------------------
Attn: Robert Watkins
--------------------------------
Each party hereto shall notify promptly the other in writing of the
occurrence of any event which will or may result in the failure to satisfy the
conditions of this Agreement. Between the date of this Agreement and the
Effective Time, each party hereto will advise the other of the satisfaction of
such conditions as they occur.
12. No Waiver. The waiver by any party of a breach by the other of any of
---------
the terms of this Agreement shall not operate or be construed as a waiver of any
other terms hereof or of any other subsequent breach by such other party.
13. Section Headings. The section and paragraph headings are inserted
----------------
only as a matter of convenience and reference and in no way define, limit, or
describe the scope or intent of any provision of this Agreement.
IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date first above written.
RESEARCH INDUSTRIES CORPORATION,
a Utah corporation
By: /s/ Gary L. Crocker
-------------------
IMODEX MEDICAL DEVICES, INCORPORATED,
a Michigan corporation
By: /s/ Michael C. Wierzbinski
--------------------------
It's President
/s/ Sheldon H. Davis
--------------------
SHELDON H. DAVIS, individually
Michael C. Wierzbinski
----------------------
MICHAEL C. WIERZBINSKI, individually
AGREEMENT OF MERGER
EFFECTIVE JANUARY 1, 1995
By and Among
IMODEX ACQUISITION CORPORATION
RESEARCH INDUSTRIES CORPORATION
and
IMODEX MEDICAL DEVICES INCORPORATED
SCHEDULE B
OFFICERS: GARY L. CROCKER, PRESIDENT AND CHIEF EXECUTIVE OFFICER
MARK W. WINN, VICE PRESIDENT
V. KELLY RANDALL, SECRETARY AND TREASURER
DIRECTORS: GARY L. CROCKER
MARK W. WINN
V. KELLY RANDALL
CLYDE H. BAKER
EXHIBIT 5
May 17, 1995
Research Industries Corporation
Attn: Mark W. Winn,
Vice President and Chief Financial Officer
6864 South 300 West
Salt Lake City, Utah 84047
Re: REGISTRATION OF 26,700 SHARES OF RESEARCH INDUSTRIES
CORPORATION COMMON STOCK FOR SHAREHOLDERS OF IMODEX, INC.
Dear Mr. Winn:
This Firm has acted as counsel to Research Industries Corporation, a Utah
corporation ("the Company), in connection with its registration of 26,700 shares
of its common stock, par value $0.50 ("the Shares") at the request of the former
shareholders of Imodex, Inc. In this connection we have prepared the Company's
Registration Statement on Form S-3 as filed with the Securities and Exchange
Commission on May , 1995.
In connection with this representation, we have examined the originals, or
copies identified to our satisfaction, of such minutes, agreements, corporate
records and filings and other documents necessary to our opinion contained in
this letter. We have also relied as to certain matters of fact upon
representations made to us by officers and agents of the Company.
Based upon and in reliance on the foregoing, it is our opinion that:
1. The Company has been duly incorporated and is validly existing and
in good standing as a corporation under the laws of the State of Utah;
and has full corporate power and authority to own its properties and
conduct its business as described in the Prospectus/Proxy Statement
referred to above.
2. The Shares are duly and validly issued and are fully paid and
nonassessable.
3. The shareholders of the Company have no pre-emptive rights to acquire
additional shares of Research Industries Corporation Common Stock in
respect of the Shares.
We hereby consent to the use of our name in the Prospectus/Proxy Statement
and therein being disclosed as counsel to the Company in this matter.
Very truly yours,
RAY, QUINNEY & NEBEKER
/s/ A. Robert Thorup
Exhibit 23.1
Independent Auditors' Consent
-----------------------------
We consent to incorporation by reference in the Registration Statement No. 33-
on Forms S-3 of Research Industries Corporation and subsidiaries of our
- --------
report dated August 8, 1994, relating to the consolidated balance sheet of
Research Industries Corporation and subsidiaries as of June 30, 1994, and the
related consolidated statements of income, stockholders' equity, and cash flows
fro the year then ended, which report appears in the June 30, 1994 annual report
on Form 10-K of Research Industries Corporation and subsidiaries.
KPMG Peat Marwick LLP
Salt Lake City, Utah
May 16,1995
Exhibit 23.2
Consent of Independent Auditors
We consent to the reference of our firm under the caption `Experts'' in the
Registration Statement (Form S-3) and the related Prospectus of Research
Industries Corporation for the registration of 26,700 shares of its common stock
and to the incorporation by reference therein of our report dated August 3,
1993, with respect to the consolidated financial statements and schedules of
Research Industries Corporation included in its Annual Report (Form 10-K) for
the year ended June 30, 1994, filed with the Securities and Exchange Commission.
Ernst & Young, LLP
Salt Lake City, Utah
May 12, 1995
