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UNITED STATES
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): FEBRUARY 18, 1998
THE UNIMARK GROUP, INC.
(Exact name of registrant as specified in its charter)
TEXAS 1-13242 75-2436543
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) (Identification No.)
UNIMARK HOUSE
BARTONVILLE
ARGYLE, TEXAS 76226
(Address of principal executive offices)(Zip Code)
Registrant's telephone number, including area code: (817) 491-2992
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ITEM 5. OTHER EVENTS
On February 18, 1998, The UniMark Group, Inc. (the "Company")
announced that, in a privately negotiated transaction, a group led by Rafael
Vaquero, the Company's Chief Operating Officer, have acquired from Jorn Budde,
the Company's President, Chief Executive Officer and Chairman, 500,000 shares
of Common Stock (approximately 5.8% of the Company's outstanding shares) for
$5.00 per share. In connection with this transaction, Mr. Budde has resigned
all his positions with UniMark. Rafael Vaquero, the Company's Chief Operating
Officer has been named President and Chief Executive Officer and Jakes Jordaan,
a director of the Company, has been named Chairman of the Board.
The Company also announced today that it anticipates reporting weaker
than expected financial results and record restructuring and certain other
charges in its fourth quarter ended December 31, 1997.
ITEM 7. EXHIBITS
Exhibit 99.1 Copy of the press release dated February 18, 1998.
Exhibit 99.2 Non Competition Agreement dated February 18, 1998
between Jorn Budde and The UniMark Group, Inc.
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SIGNATURE
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.
Date: February 19, 1998 THE UNIMARK GROUP, INC.
(A Texas Corporation)
By: /s/ RAFAEL VAQUERO BAZAN
------------------------------------
Rafael Vaquero Bazan
President, Chief Executive Officer
and Director
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INDEX TO EXHIBITS
EXHIBITS DESCRIPTION
-------- -----------
Exhibit 99.1 Copy of the press release dated February 18, 1998.
Exhibit 99.2 Non Competition Agreement dated February 18, 1998
between Jorn Budde and The UniMark Group, Inc.
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EXHIBIT 99.1
FOR IMMEDIATE RELEASE FOR FURTHER INFORMATION CONTACT:
February 18, 1998 Rafael Vaquero
Soren Bjorn
817-491-2992
THE UNIMARK GROUP, INC. ANNOUNCES
INSIDER STOCK TRANSACTION, ORGANIZATIONAL CHANGES
AND ANTICIPATED FOURTH QUARTER FINANCIAL RESULTS
Argyle, Texas February 18, 1998 -- The UniMark Group, Inc. (Nasdaq NMS
symbol: "UNMG") announced today that, in a privately negotiated transaction, a
group led by Rafael Vaquero, the Company's Chief Operating Officer, have
acquired from Jorn Budde, the Company's President, Chief Executive Officer and
Chairman, 500,000 shares of Common Stock (approximately 5.8% of the Company's
outstanding shares) for $5.00 per share. In connection with this transaction,
Mr. Budde has resigned all his positions with UniMark. Rafael Vaquero, the
Company's Chief Operating Officer has been named President and Chief Executive
Officer and Jakes Jordaan, a director of the Company, has been named Chairman
of the Board. In addition, the Company intends adding a Chief Financial
Officer, with cross-border experience, to its management team. "With the help
of Dain Rauscher, our financial advisors, the Board of Directors is actively
exploring all strategic alternatives to maximize shareholder value" said Mr.
Jakes Jordaan, the Company's new Chairman.
Said Mr. Rafael Vaquero, the Company's Chief Executive Officer: "The
management changes are supported by our primary lender and we believe that our
positive banking relationship will continue. We have made substantial progress
implementing our internal operating reorganization plan that involves
consolidating fruit processing operations in Mexico and distribution functions
in the United States. In this regard, we have ceased operations at the San
Rafael and Zamora plants (both of which are leased) and have moved this
production to our main Montemorelos plants. We believe that this internal
reorganization will result in a number of benefits, including increasing
operating efficiencies at existing plants, streamlining our organizational
structure and reducing overhead and administrative costs."
The Company also announced today that it anticipates reporting weaker
than expected financial results and to record restructuring and certain other
charges in its fourth quarter ended December 31, 1997. The Company's financial
performance was adversely impacted by an increase in inflation in Mexico, which
was not offset by a corresponding devaluation of the Mexican peso, resulting in
increased wages, benefits and other operating expenses in US dollar terms,
adverse conditions in the frozen orange juice concentrate market and charges
relating to the Company's internal operating reorganization plan.
The Company's financial statements for the year ended December 31,
1997 are currently
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being audited by Ernst & Young LLP, the Company's independent auditors. It
is anticipated that the audit will be completed and the Company's results of
operations for the year and fourth quarter will be announced on or about March
25, 1998.
"We are confident that we have taken significant steps forward in our
efforts to reposition the Company for 1998 and future years. We look forward
to the Company experiencing benefits from the internal reorganization and
restructuring plan, the recent weakening of the Mexican peso and improvements
in the orange juice market," said Mr. Vaquero.
Certain of the above information is forward-looking and as such, only
reflects the Company's best assessment at this time. Investors are cautioned
that forward-looking statements involve risks and uncertainty, that actual
results may differ materially from such statements, and that investors should
not place undue reliance on such statements. For a discussion of factors that
may affect actual results, investors should refer to the Company's filings with
the Securities and Exchange Commission.
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EXHIBIT 99.2
NON-COMPETITION AGREEMENT
AGREEMENT, dated as of February 18, 1998, between undersigned
individual ("Founder") and The UniMark Group, Inc. (the "Company").
W I T N E S S E T H:
WHEREAS, Founder has been the President, Chief Execuitve Officer and
Chairman of the Board of the Company;
WHEREAS, Founder has resigned his positions as President, Chief
Execuitve Officer and Chairman of the Board of the Company;
WHEREAS, the Company is engaged in the business of processing,
distributing and marketing cut fruit and processed fruit products and juice
(the "Business");
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereto agree as follows:
(1) Covenant Not to Compete. Founder acknowledges and
agrees that for two (2) years from the date hereof (the "Term"),
Founder will not, directly or indirectly own, manage, operate,
control, be employed by or participate in the ownership, management,
operation or control of, or be connected in any manner with, any
business of the type and character engaged in and competitive with the
Business, excluding Business relating to Hearts of Palm products. For
these purposes, Founder's ownership of (a) securities of a public
company not in excess of one percent (1%) of any class of such
securities or (b) securities of a private company not in excess of
five percent (5%) of any class of such securities shall not be
considered to be competition with the Company. In addition, during
the Term, Founder agrees to refrain from interfering with the
employment relationship between the Company and its employees by
soliciting any of such individuals to participate in independent
business ventures and agrees, to refrain from soliciting business from
any client or prospective client of the Company for Founder or for any
entity in which Founder has an interest.
It is the desire and intent of the parties that the provisions
of this paragraph shall be enforced to the fullest extent permissible
under the laws and public policies applied in each jurisdiction in
which enforcement is sought. If any particular provisions or portion
of this paragraph shall be adjudicated to be invalid or unenforceable,
this paragraph shall be deemed amended to delete therefrom such
provision or portion adjudicated to be invalid or unenforceable, such
amendment to apply only with respect to the operation of this
paragraph in the particular jurisdiction in which such adjudication is
made.
(2) Payment. In consideration for the covenant not to
compete as set forth in Section 1 above, the Company will pay Founder
a lump sum amount in cash a equal to $120,000.00 upon execution of
this Agreement.
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(3) Confidentiality. Founder agrees that Founder will
not divulge to anyone (other than the Company or any persons employed
or designated by the Company) any knowledge or information of any type
whatsoever of a confidential nature relating to the business of the
Company or any of its subsidiaries or affiliates, including, without
limitation, all type of trade secrets (unless readily ascertainable
from public or published information or trade sources). Founder
further agrees not to disclose, publish or make use of any such
knowledge or information of a confidential nature without the prior
written consent of the Company.
(4) Governing Law. This Agreement shall be governed by
and construed in accordance with domestic laws of the State of Texas
without giving effect to any choice or conflict of law provision or
rule (whether of the State of Texas or any other jurisdiction) that
would cause the application of the laws of any jurisdiction other than
the State of Texas.
IN WITNESS WHEREOF, the Company has by its appropriate officer signed
this Agreement, and Founder has signed this Agreement, on and as of the date
first above written.
THE UNIMARK GROUP, INC.
By: /s/ RAFAEL VAQUERO BAZAN
------------------------------------
Rafael Vaquero Bazan
President, Chief Executive Officer
and Director
FOUNDER
/s/ JORN BUDDE
------------------------------------
Name: Jorn Budde
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