SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 1, 1999
HITOX CORPORATION OF AMERICA
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of corporation)
0-17321
(Commission File Number)
74-2081929
(I.R.S. Employer Identification No.)
722 Burleson
Corpus Christi, Texas
(Address of principal executive offices)
78402
(Zip Code)
Registrant's telephone number, including area code: (361) 882-5175
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(Former name or former address, if changed since last report)
<PAGE> 1
Item 5. Other Events
On July 1, 1999, Hitox Corporation of America (the
"Company") executed an agreement (the "Agreement") to acquire and
cancel outstanding warrants to purchase 1,111,111 shares of the
Company's common stock, in exchange for 100,000 shares of its
common stock. The Agreement eliminates securities that, if
exercised, would represent ownership of approximately 19% of the
Company's issued and outstanding shares.
Item 7. Financial Statements and Exhibits
(c) Exhibits
Attached hereto is a copy of the Agreement referred to in
Item 5 above.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
Hitox Corporation of America
(Registrant)
Date: July 12, 1999 CRAIG SCHKADE
-------------------------
Craig Schkade
Chief Financial Officer
and Treasurer
<PAGE> 2
Exhibit Index
Exhibit 99.1 Warrant Purchase Agreement Page 4
<PAGE> 3
WARRANT PURCHASE AGREEMENT
THIS WARRANT PURCHASE AGREEMENT (the "Agreement"), dated as
of July 1,1999, is between HITOX CORPORATION OF AMERICA, a
Delaware corporation ("Hitox"), and EACH OF THE HOLDERS named on
Exhibit A attached hereto (each individually a "Holder" and
collectively the "Holders").
R E C I T A L S
WHEREAS, Hitox has issued to Holders warrants ("Warrants")
to purchase One Million One Hundred Eleven Thousand One Hundred
Eleven (1,111,111) shares of its Common Stock, par value $.25 per
share (the "Common Stock"), pursuant to a Warrant Agreement,
dated as of February 28, 1995, between Hitox and Holders (the
"Warrant Agreement"), and Hitox desires to acquire and cancel the
Warrants and to cancel the Warrant Agreement in exchange for the
issuance of an aggregate of 100,000 shares of its Common Stock to
Holders in the proportions shown on Exhibit A hereto, and Holders
desire to cancel the Warrants and the Warrant Agreement in
exchange for the issuances of such shares.
A G R E E M E N T
NOW, THEREFORE, for and in consideration of the mutual
agreements herein and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows:
Section 1. The Exchange. Each Holder hereby surrenders,
assigns, transfers, conveys, sets over and delivers to Hitox the
Warrants, represented by Warrant Certificate Nos. 10, 13 and 16
(collectively, the "Warrant Certificates") and all rights, title,
interest and claims possessed by Holders under the Warrants and
the Warrant Agreement, together with all other right, title,
interest and claim in and to the Common Stock of Hitox issuable
thereunder. In exchange therefor, Hitox hereby issues to the
Holders stock certificates registered in the names of Holders for
an aggregate of 100,000 shares of Common Stock of Hitox (the
"Stock Certificates") on this date (the "Exchange"), allocated
among the Holders as shown on Exhibit A hereto. The Exchange
made by Hitox hereunder is in full and final settlement and
satisfaction of all obligations of whatsoever nature now or
hereafter due by Hitox to Holders, their legal representatives,
successors and assigns under the Warrants and the Warrant
Agreement. Holders hereby surrender unto Hitox the Warrant
Certificates and the Warrant Agreement for cancellation in
accordance with the terms hereof, and Hitox hereby acknowledges
receipt of the original Warrant Certificates and the Warrant
Agreement, and hereby agrees to promptly mark such instruments
"canceled." Holders hereby acknowledge receipt of the Stock
Certificates from Hitox, and Holders, on their own behalf and on
behalf of their legal representatives and their successors and
assigns, hereby unconditionally and forever waive, relinquish and
release all right, title, interest and claim accrued or accruing
to the benefit of Holders under the Warrants and the Warrant
Agreement.
<PAGE> 4
Section 2. Representations of Hitox.
(a) Validity of Actions. Hitox represents that it
has full power and authority to execute, deliver and perform this
Agreement; this Agreement has been duly authorized by all
requisite corporate action on the part of Hitox and has been duly
executed and delivered by Hitox; Hitox has obtained all consents
and approvals requisite to the transactions contemplated hereby;
and this Agreement constitutes a legal, valid and binding
obligation of Hitox, enforceable against Hitox, its legal
representatives, successors and assigns, in accordance with its
terms.
(b) Common Stock to be Issued. The shares of Common
Stock of Hitox to be issued to the Holders will, when issued and
delivered in accordance with the terms set forth herein, be duly
authorized, validly issued and fully paid and non-assessable, and
such shares will be free and clear of all liens, claims and
encumbrances.
Section 3. Representations of Holders. Holders represent
that:
(a) Validity of Actions. Each of Holders has full
power and authority to execute, deliver and perform this
Agreement; this Agreement has been duly authorized by all
requisite action on the part of each of Holders; each of Holders
has obtained all consents and approvals requisite to the
transactions contemplated hereby; and this Agreement has been
duly executed and delivered by each of Holders, and constitutes a
legal, valid and binding obligation of each of Holders,
enforceable against each of Holders, their legal representatives,
successors and assigns, in accordance with its terms.
(b) Surrender of Warrant. Any and all rights
Holders, their legal representatives, successors and assigns,
possess in and to the Warrants and in and to shares of Common
Stock issuable upon exercise of the Warrants or in and to any
other rights accrued or accruing under the Warrants, the Warrant
Certificates or the Warrant Agreement, are hereby and shall
hereafter be null and void and are of no further force or effect.
Upon consummation of the transactions contemplated hereby, Hitox
will be the owner of the Warrants and related Warrant
Certificates, free and clear of all liens, claims and
encumbrances relating thereto. Each of Holders is the true and
lawful owner of the Warrants issued in their respective names and
no part of the Warrants and related Warrant Certificates or
interests arising under the Warrant Agreement are in any respect
encumbered or committed to be encumbered, and there are no other
persons or entities claiming an interest therein, and none of the
Holders has assigned to any person or entity any interest or
rights under the Warrants, the Warrant Certificates or the
Warrant Agreement, and no other persons or entities have a claim
or any interest or rights thereunder.
<PAGE> 5
(c) Investment Intent. Each Holder represents that
it is acquiring the Common Stock for its own account (and not for
the account of others) for investment and not with a view to the
distribution thereof.
(d) Access. The Holders have received copies of
Hitox's Annual Report on Form 10-KSB for the year ended December
31, 1998 and Quarterly Report on Form 10-QSB for the quarter
ended March 31, 1999 ("SEC Reports"). The Holders are familiar
with the business and financial condition, properties, operations
and prospects of the Company, all as generally described in the
Company's SEC Reports, and at a reasonable time prior to the
execution of this Agreement, have been afforded the opportunity
to ask questions of and received satisfactory answers from the
Company's officers and director concerning the business and
financial condition, properties, operations and prospects of the
Company and concerning this Agreement, and has asked such
questions as they desired and all such questions have been
answered to the full satisfaction of the Holders.
(e) Securities Transfer Restrictions. Each Holder
understands that because the Common Stock to be issued hereunder
has not been registered under the Securities Act of 1933, as
amended (the "Act"), and applicable state securities laws, such
shares of Common Stock are "restricted securities" as that term
is defined under Rule 144 promulgated by the Securities and
Exchange Commission under the Act and none of the shares of
Common Stock may be sold or transferred in the absence of an
effective registration of such shares under such Act and all
other applicable securities laws or regulations or in a sale or
transfer that, in the opinion of counsel for Hitox, is exempt
from applicable securities laws or regulations. Each Holder
further understands that Hitox may, as a condition to the sale or
transfer of the Common Stock, require that the request for sale
or transfer be accompanied by opinion of counsel, in the form and
substance reasonably satisfactory to Hitox, to the effect that
the proposed transfer does not result in a violation of the Act.
The Certificates for the Common Stock to be issued for Holders
hereunder will contain a restrictive transfer legend restating in
similar terms the following restriction on transfer:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "ACT"), OR REGISTERED OR QUALIFIED
UNDER THE SECURITIES LAWS OF ANY STATE, AND THE HOLDER HEREOF
CANNOT MAKE ANY SALE, ASSIGNMENT OR OTHER TRANSFER OF ANY THESE
SECURITIES EXCEPT PURSUANT TO AN OFFERING OF SUCH SECURITIES DULY
REGISTERED UNDER THE ACT AND/OR REGISTRATION OR QUALIFICATION
UNDER ANY STATE SECURITIES LAW. THESE SECURITIES ARE "RESTRICTED
SECURITIES" WITHIN THE MEANING OF RULE 144 PROMULGATED BY THE
SECURITIES AND EXCHANGE COMMISSION UNDER THE ACT AND ARE SUBJECT
TO THE LIMITATIONS AND REPORTING REQUIREMENTS OF RULE 144 UPON
RESALE OR OTHER DISPOSITION THEREOF.
<PAGE> 6
Section 4. Mutual Release of Claims. Each Holder, and its
officers, directors, agents and its investment advisors, releases
Hitox and its officers, directors, agents, and its investment
advisors, and Hitox releases each Holder, and its officers,
directors, agents and its investment advisors, from any and all
claims, liabilities, obligations, demands, causes of action,
and/or lawsuits, except that the foregoing release shall not
extend to (i) any obligation arising hereunder or any future
breach of or default under this Agreement, and (ii) the rights
and benefits of the Holders created under Warrant Certificate
Nos. 1 through 6 issued by Hitox to the Holders or the related
Warrant Agreements related to such specific Warrant Certificate
Nos. 1 through 6. Without limitation on the generality of the
foregoing, the parties acknowledge and agree that (i) this mutual
release shall extend to and from Pecks Management Partners, Ltd.,
its Managing Director, Robert J. Cresci, and shall also extend to
and from each officer and director of Hitox, and (ii) except for
the obligations arising under this Agreement or hereunder Warrant
Certificate Nos. 1 through 6 and the related Warrant Agreements
under which such Warrants were issued, all contracts and
agreements between the Holders and Hitox are hereby terminated.
Section 5. Miscellaneous.
(a) Binding Effect. This Agreement may not be
assigned by either party hereto. Subject to the foregoing, this
Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors or permitted
assigns.
(b) Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall,
in such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
(c) Entire Agreement; Modifications. This
instrument contains the entire agreement between the parties
hereto with respect to the transactions contemplated hereby.
Neither this Agreement nor any provisions hereof may be waived,
modified, amended, discharged or terminated except by an
instrument in writing signed by the party to be charged, and then
only to the extent set forth in such instrument.
(d) Headings. Descriptive headings contained herein
are for convenience of reference only and shall not affect the
meaning or interpretation hereof.
(e) Counterparts. This Agreement may be executed
simultaneously or in two or more counterparts, each of which
together shall constitute one and the same instrument,
<PAGE> 7
(f) Applicable Law. The rights and obligations of
the parties to this Agreement shall be governed by the laws of
the State of Texas applicable to contracts made or to be
performed entirely within such state.
(g) Further Assurances. Each party hereto agrees to
execute any and all documents, and to perform such other acts,
whether before or after the date hereof, that may be reasonably
necessary or expedient to further the purposes of this Agreement
or to further assure the benefits intended to be conferred
hereby.
(h) Survival. All representations, warranties,
obligations and undertakings of the parties set forth herein
shall survive the execution and delivery of this Agreement and
Exchange and other transactions contemplated hereby.
<PAGE> 8
The parties execute this Agreement as of the date first above
written.
HITOX CORPORATION OF AMERICA
By: BERNARD A. PAULSON
------------------
Name: Bernard A. Paulson
Title: President & CEO
HOLDERS:
TRUST FOR DEFINED BENEFIT PLAN OF
ICI AMERICAN HOLDINGS, INC.
By: Pecks Management Partners,Ltd.,
its Investment Advisor
By: ROBERT J. CRESCI
------------------
Robert J. Cresci, Managing Director
DELAWARE STATE EMPLOYEE RETIREMENT FUND
By: Pecks Management Partners,Ltd.,
its Investment Advisor
By: ROBERT J. CRESCI
------------------
Robert J. Cresci, Managing Director
ZENECA HOLDINGS, INC.
By: Pecks Management Partners,Ltd.,
its Investment Advisor
By: ROBERT J. CRESCI
------------------
Robert J. Cresci, Managing Director
<PAGE> 9
Exhibit A
Holders and Share Allocation
Shares to be Issued
Holders to Holders
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Trust for Defined Benefit Plan
of ICI American Holdings, Inc. 16,440
Delaware State Employee Retirement Fund 70,000
Zeneca Holdings, Inc. 13,560
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100,000
<PAGE> 10
