<PAGE>
<PAGE>
- ---------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
SCHEDULE 14D-1
TENDER OFFER STATEMENT
PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
_________________
R-B RUBBER PRODUCTS, INC.
(NAME OF SUBJECT COMPANY)
DASH MULTI-CORP, INC.
(BIDDER)
COMMON STOCK, NO PAR VALUE PER SHARE
(TITLE OF CLASS OF SECURITIES)
74920 10 9
(CUSIP NUMBER OF CLASS OF SECURITIES)
MARVIN S. WOOL
CHIEF EXECUTIVE OFFICER
DASH MULTI-CORP, INC.
2500 ADIE ROAD
MARYLAND HEIGHTS, MISSOURI 63043
TELEPHONE: (314) 432-3200
FACSIMILE: (314) 432-3210
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED
TO RECEIVE NOTICES AND COMMUNICATIONS ON BEHALF OF BIDDER)
COPIES TO:
THOMAS A. LITZ, ESQ.
THOMPSON COBURN
ONE MERCANTILE CENTER
ST. LOUIS, MISSOURI 63101
TELEPHONE: (314) 552-6000
FACSIMILE: (314) 552-7000
CALCULATION OF FILING FEE
===========================================================================
TRANSACTION VALUATION<F*> AMOUNT OF FILING FEE<F**>
- ---------------------------------------------------------------------------
$4,702,251 $940.45
===========================================================================
[FN]
<F*> For purposes of calculating the amount of filing fee only. The
amount assumes the purchase of 1,567,417 shares of Common Stock, no par
value per share, issued and outstanding as of April 8, 1999, according
to the subject company, at $3.00 net per share in cash.
<F**> Equal to 1/50th of one percent of the cash offered by the Bidder
for the purchase of 1,567,417 shares of Common Stock of the subject
company.
/ / Check box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify previous filing by registration statement
number, or the form or schedule and the date of its filing.
Amount Previously Paid: None Filing Party: N/A Page 1 of 23 Pages
Form or Registration No.: N/A Date filed: N/A Exhibit Index on Page 23
===========================================================================
<PAGE>
<PAGE>
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is R-B Rubber Products,
Inc., an Oregon corporation (the "Company"), and the address of its
principal executive offices is 904 E. 10th Avenue, McMinnville, Oregon
97128.
(b) The class of securities to which this statement relates is
the Common Stock, no par value per share (the "Common Stock" or the
"Shares"), of the Company. The information set forth in the
Introduction and Section 1 ("Terms of the Offer; Proration") of the
Offer to Purchase annexed hereto as Exhibit (a)(1) (the "Offer to
Purchase") is incorporated herein by reference.
(c) The information set forth in Section 6 ("Price Range of
Shares; Dividends") of the Offer to Purchase is incorporated herein by
reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d); (g) The information set forth in Section 9 ("Certain
Information Concerning Purchaser") of the Offer to Purchase is
incorporated herein by reference. The name, business address, present
principal occupation or employment, the material occupations, positions,
offices or employments during the last five years including citizenship
of each director and executive officer and controlling shareholder of
Dash Multi-Corp, Inc., a Missouri corporation ("Purchaser"), and the
name, principal business and address of any corporation or other
organization in which such occupations, positions, offices and
employments are carried on are set forth in Schedule A to the Offer to
Purchase and incorporated herein by reference.
(e); (f) During the last five years, neither Purchaser, nor, to
the best of Purchaser's knowledge, any of the directors or executive
officers of the Purchaser has been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors) or was a party to
a civil proceeding of a judicial or administrative body of competent
jurisdiction as a result of which any such person was or is subject to a
judgment, decree or final order enjoining future violations of, or
prohibiting activities subject to, federal or state securities laws or
finding any violation of such laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS
WITH THE SUBJECT COMPANY.
(a)-(b) The information set forth in the Introduction and
Sections 10 ("Background of the Offer; Contacts with the Company") and
11 ("Purpose of the Offer; Plans for the Company") of the Offer to
Purchase is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth in Section 12 ("Source and Amount
of Funds") of the Offer to Purchase is incorporated herein by reference.
(b)-(c) Not applicable.
- 2 -
<PAGE>
<PAGE>
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR
PROPOSALS OF THE BIDDER.
The information set forth in the Introduction and Sections
7("Effect of the Offer on Market for the Shares, Stock Exchange Listing,
and Exchange Act Registration") and 11("Purpose of the Offer; Plans for
the Company") of the Offer to Purchase is incorporated herein by
reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a)-(b) The information set forth in Sections 9 ("Certain
Information Concerning Purchaser") and 11 ("Purpose of the Offer; Plans
for the Company") of the Offer to Purchase is incorporated herein by
reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO THE SUBJECT COMPANY'S SECURITIES.
The information set forth in the Introduction and Sections 9
("Certain Information Concerning Purchaser"), 10 ("Background of the
Offer; Contacts with the Company") and 11 ("Purpose of the Offer; Plans
for the Company") of the Offer to Purchase is incorporated herein by
reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in Section 16 ("Fees and Expenses") of
the Offer to Purchase is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth in Section 9 ("Certain Information
Concerning Purchaser") of the Offer to Purchase is incorporated herein
by reference. The audited consolidated balance sheets of Purchaser and
its subsidiaries as of April 30, 1998 and 1997, the audited consolidated
statements of income, stockholders' equity and cash flows for the three
fiscal years in the period ended April 30, 1998, the unaudited
consolidated balance sheet of Purchaser and its subsidiaries as of
January 31, 1999, and the unaudited consolidated statements of earnings
and retained earnings, and cash flows for the nine-month periods ended
January 31, 1999 and 1998 are set forth in this Schedule 14D-1 beginning
at page F-1.
ITEM 10. ADDITIONAL INFORMATION.
(a)-(c) The information set forth in Section 15 ("Certain Legal
Matters") of the Offer to Purchase is incorporated herein by reference.
(d) The information set forth in Section 7 ("Effect of the Offer
on Market for the Shares, Stock Exchange Listing, and Exchange Act
Registration") of the Offer to Purchase is incorporated herein by
reference.
(e) Not applicable.
(f) Not applicable.
- 3 -
<PAGE>
<PAGE>
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(1) Offer to Purchase, dated April 14, 1999.
(a)(2) Letter of Transmittal with respect to the Shares.
(a)(3) Form of letter, dated April 14, 1999, to brokers, dealers,
commercial banks, trust companies and nominees.
(a)(4) Form of letter, dated April 14, 1999, to clients to be used
by brokers, dealers, commercial banks, trust companies and
nominees.
(a)(5) Press Release, dated April 9, 1999.
(a)(6) Form of newspaper advertisement, dated April 14, 1999.
(a)(7) Notice of Guaranteed Delivery.
(a)(8) IRS Guidelines to Substitute Form W-9.
(b) None.
(c)(1) Stock Purchase Agreement, dated as of April 8, 1999, between
the Company and Purchaser.
(c)(2) Shareholder Agreement, dated as of April 8, 1999, between
Ronald L. Bogh and Purchaser.
(c)(3) Shareholder Agreement, dated as of April 8, 1999, between
Douglas C. Nelson and Purchaser.
(c)(4) Shareholder Agreement, dated as of April 8, 1999, between
James V. Reimann and Purchaser.
(c)(5) Form of Employment Agreement between
Ronald L. Bogh and the Company.
(c)(6) Form of Employment Agreement between
Paul M. Gilson and the Company.
(c)(7) Form of Non-Competition Agreement between
Douglas C. Nelson and the Company.
(d) None.
(e) Not applicable.
(f) None.
- 4 -
<PAGE>
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true,
complete and correct.
DASH MULTI-CORP., INC.
By: /s/ Marvin S. Wool
--------------------------------
Name: Marvin S. Wool
Title: Chief Executive Officer
Dated: April 14, 1999
- 5 -
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
<CAPTION>
Page
----
<S> <C>
Independent Auditors' Report F-2
Consolidated Balance Sheets as of April 30, 1998 and 1997 F-3
Consolidated Statements of Income for the Years Ended April 30, 1998, 1997 and 1996 F-5
Consolidated Statements of Stockholders' Equity for the Years Ended April 30, 1998,
1997 and 1996 F-6
Consolidated Statements of Cash Flows for the Years Ended April 30, 1998, 1997 and
1996 F-7
Notes to Consolidated Financial Statements F-8
Consolidated Balance Sheet (Unaudited) as of January 31, 1999 F-15
Consolidated Statements of Earnings and Retained Earnings (Unaudited) for the Nine-
Month Periods Ended January 31, 1999 and 1998 F-16
Consolidated Statements of Cash Flows (Unaudited) for the Nine-Month Periods Ended
January 31, 1999 and 1998 F-17
</TABLE>
F-1
<PAGE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
Board of Directors
Dash Multi-Corp, Inc.
St. Louis, Missouri
We have audited the accompanying consolidated balance sheets of Dash
Multi-Corp, Inc., and subsidiaries as of April 30, 1998 and 1997, and
the consolidated statements of income, stockholders' equity and cash
flows for the three fiscal years in the period ended April 30, 1998.
These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe
that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly in all material respects, the consolidated financial
position of Dash Multi-Corp, Inc. and subsidiaries as of April 30, 1998
and 1997, and the results of their operations and their cash flows for
the three fiscal years in the period ended April 30, 1998 in conformity
with generally accepted accounting principles.
/s/ Brown Smith Wallace, L.L.C.
St. Louis, Missouri
June 26, 1998
F-2
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
APRIL 30,
-----------------------------
1998 1997
----------- -----------
<S> <C> <C>
ASSETS:
Current Assets
Cash and cash equivalents $ 3,764,879 $ 4,999,795
Accounts receivable
Trade (note J) 11,620,062 11,294,799
Other 84,750 67,735
----------- -----------
11,704,812 11,362,534
Less allowance for doubtful accounts 338,500 300,100
----------- -----------
11,366,312 11,062,434
Current portion of notes receivable (note B) 1,279,727 2,488,960
Inventories
Raw materials 6,826,016 5,165,745
Finished goods 3,510,577 1,998,554
----------- -----------
10,336,593 7,164,299
Prepaid expenses 152,249 175,116
Income taxes
Refundable 176,216 186,251
Deferred 310,986 243,781
----------- -----------
Total Current Assets 27,386,962 26,320,636
Property, Plant and Equipment
Buildings and improvements 3,318,541 2,296,483
Machinery and equipment 9,016,563 5,513,130
Furniture and fixtures 819,240 568,143
Automotive equipment 940,861 691,131
----------- -----------
14,095,205 9,068,887
Less accumulated depreciation 6,668,102 5,616,686
----------- -----------
7,427,103 3,452,201
Land 266,258 127,108
----------- -----------
7,693,361 3,579,309
----------- -----------
Other Assets
Notes receivable, less current portion (note B) 880,623 61,805
Deposits 52,306 24,036
Goodwill, net 762,837 903,484
Cash surrender value of life insurance -- 196,279
Investments, at cost 108,993 108,993
Deferred income taxes -- 64,634
----------- -----------
1,804,759 1,359,231
----------- -----------
Total Assets $36,885,082 $31,259,176
=========== ===========
See accompanying notes to consolidated financial statements.
</TABLE>
F-3
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(CONTINUED)
<CAPTION>
APRIL 30,
-----------------------------
1998 1997
----------- -----------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current Liabilities
Note payable (note C) $ 100,000 $ 100,000
Current maturities of long-term debt (note C) 159,743 227,619
Accounts payable
Trade 4,889,418 4,014,893
Sundry 112,964 91,572
Accrued liabilities
Salaries and commissions 818,431 607,040
Payroll and withholding taxes 72,454 401,422
Interest 5,703 5,820
Employees' pension and profit sharing-expense (note D) 910,545 753,036
Dividends payable 55,125 52,500
Sundry 301,674 457,302
Deferred income taxes 320,028 --
----------- -----------
Total Current Liabilities 7,746,085 6,711,204
Long-Term Debt, less current
maturities (note C) 372,405 532,145
Deferred Income Taxes 267,355 131,542
Commitments and Contingencies (notes E and I)
Minority Interest 619,192 402,343
Stockholders' Equity
Common stock - authorized 300,000 shares of
$3 par value; issued 120,500 shares 361,500 361,500
Additional paid-in capital 251,098 251,098
Retained earnings 27,518,807 23,120,704
----------- -----------
28,131,405 23,733,302
Less treasury stock - 15,500 shares
at cost 251,360 251,360
----------- -----------
27,880,045 23,481,942
----------- -----------
Total Liabilities and Stockholders' Equity $36,885,082 $31,259,176
=========== ===========
See accompanying notes to consolidated financial statements.
</TABLE>
F-4
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
YEARS ENDED APRIL 30,
-----------------------------------------------
1998 1997 1996
----------- ----------- -----------
<S> <C> <C> <C>
Net sales (note J) $89,125,239 $85,249,251 $79,984,365
Cost of goods sold 71,623,290 67,175,571 62,793,875
----------- ----------- -----------
Gross profit 17,501,949 18,073,680 17,190,490
Selling and administrative expenses 9,685,628 8,652,758 8,870,715
----------- ----------- -----------
Operating profit 7,816,321 9,420,922 8,319,775
Other income (expense)
Sundry 218,055 481,135 294,641
Gain on sale of assets 14,494 21,454 15,237
Employees' pension and profit-sharing
expense (note D) (497,975) (522,631) (445,473)
Interest expense (103,349) (117,212) (206,249)
Interest income 359,149 420,946 248,283
Officer's life insurance -- -- (3,938)
----------- ----------- -----------
(9,626) 283,692 (97,499)
----------- ----------- -----------
Income before income taxes and
minority interest 7,806,695 9,704,614 8,222,276
Income taxes
Currently payable 2,683,348 3,622,174 3,287,432
Deferred 453,270 61,118 (96,089)
----------- ----------- -----------
3,136,618 3,683,292 3,191,343
----------- ----------- -----------
Income before minority interest 4,670,077 6,021,322 5,030,933
Minority interest (216,849) (103,185) (60,741)
----------- ----------- -----------
Net income $ 4,453,228 $ 5,918,137 $ 4,970,192
=========== =========== ===========
Per Share Data (note K)
Net income $42.41 $56.36 $47.34
See accompanying notes to consolidated financial statements.
</TABLE>
F-5
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<CAPTION>
ADDITIONAL TOTAL
COMMON PAID-IN RETAINED TREASURY STOCKHOLDERS'
STOCK CAPITAL EARNINGS STOCK EQUITY
----- ------- -------- ----- ------
<S> <C> <C> <C> <C> <C>
BALANCE AT APRIL 30, 1995: $361,500 $251,098 $12,284,875 $(251,360) $12,646,113
Add:
Net income for the year ended
April 30, 1996 -- -- 4,970,192 -- 4,970,192
-------- -------- ----------- --------- -----------
BALANCE AT APRIL 30, 1996: $361,500 $251,098 $17,255,067 $(251,360) $17,616,305
Add:
Net income for the year ended
April 30, 1997 -- -- 5,918,137 -- 5,918,137
Less:
Dividends -- -- (52,500) -- (52,500)
-------- -------- ----------- --------- -----------
BALANCE AT APRIL 30, 1997: $361,500 $251,098 $23,120,704 $(251,360) $23,481,942
Add:
Net income for the year ended
April 30, 1998 -- -- 4,453,228 -- 4,453,228
Less:
Dividends -- -- (55,125) -- (55,125)
-------- -------- ----------- --------- -----------
BALANCE AT APRIL 30, 1998: $361,500 $251,098 $27,518,807 $(251,360) $27,880,045
======== ======== =========== ========= ===========
Stockholders' equity per share of
common stock (note K)
April 30, 1996 $ 167.77
April 30, 1997 $ 223.63
April 30, 1998 $ 265.52
See accompanying notes to consolidated financial statements.
</TABLE>
F-6
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
YEARS ENDED APRIL 30,
-----------------------------------------------
1998 1997 1996
----------- ----------- -----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 4,453,228 $ 5,918,137 $ 4,970,192
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 1,226,603 926,329 842,451
Minority interest in earnings of subsidiaries 216,849 103,185 60,741
Provision for doubtful accounts 38,400 5,000 19,500
Gain on sale of investments (14,630) -- --
Gain (loss) on sale of property and equipment 136 (21,454) (15,237)
Deferred income taxes 453,270 61,118 (164,751)
Change in assets and liabilities, net of effects from purchase of
subsidiary and asset purchase in fiscal year 1998:
Increase in accounts receivable (342,278) (1,792,009) (637,995)
Increase in inventories (2,620,912) (380,495) (504,264)
Decrease in prepaid expenses 135,061 248,603 107,150
(Increase) decrease in refundable income taxes 10,035 25,134 (161,120)
(Increase) decrease in deposits (4,063) 3,978 41,431
(Increase) decrease in cash surrender value of officer's life insurance 196,279 (12,215) (12,024)
Increase (decrease) in accounts payable 752,861 (697,597) (743,016)
Increase (decrease) in accrued liabilities (165,988) 192,906 1,161,594
----------- ----------- -----------
Net cash provided by operating activities 4,334,851 4,580,620 4,964,652
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of property and equipment 16,500 51,511 30,203
Proceeds from sale of investments 14,630 -- --
Principal payments on notes receivable 2,325,415 330,979 27,000
Payment for issuance of notes receivable (1,935,000) (1,200,000) (339,689)
Payments for purchase of plant and equipment (3,649,647) (506,576) (1,687,237)
Purchase of Harvin Reaction Technology, Inc. common stock (1,746,549) -- --
Purchase of assets of Polymer Development Labs, Inc. (600,000) -- --
Sales proceeds of purchased assets 285,000 -- --
----------- ----------- -----------
Net cash used in investing activities (5,289,651) (1,324,086) (1,969,723)
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal proceeds on long-term debt -- 80,828 --
Principal payments on short-term debt -- (20,000) (130,000)
Principal payments on long-term debt (227,616) (1,452,137) (1,470,996)
Purchase of minority interest of subsidiary -- (60,000) --
Dividends paid (52,500) -- --
----------- ----------- -----------
Net cash used in financing activities (280,116) (1,451,309) (1,600,996)
----------- ----------- -----------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS (1,234,916) 1,805,225 1,393,933
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 4,999,795 3,194,570 1,800,637
----------- ----------- -----------
CASH AND CASH EQUIVALENTS AT END OF YEAR $ 3,764,879 $ 4,999,795 $ 3,194,570
=========== =========== ===========
See accompanying notes to consolidated financial statements.
</TABLE>
F-7
<PAGE>
<PAGE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A - SUMMARY OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES
A summary of the Company's operations and significant accounting
policies consistently applied in the preparation of the accompanying
consolidated financial statements follows:
DESCRIPTION OF BUSINESS - Dash Multi-Corp, Inc. (the "Company") is
a manufacturer of diversified plastic chemicals and related products and
was incorporated in the State of Missouri in 1973. Through its various
subsidiaries, the Company manufactures plastic vinyls and urethanes,
carpet padding and backing, non-slip textiles, and coated fabrics. The
majority of the Company's sales come from manufacturing plastic vinyls
and urethanes sold to customers throughout the United States. As a part
of its normal course of business, the Company grants credit to its
customers.
PRINCIPLES OF CONSOLIDATION - The accompanying consolidated
financial statements of the Company include the accounts of Dash Multi-
Corp, Inc. and its wholly-owned and majority-owned subsidiaries, MarChem
Corporation, MarChem Southeast, Inc., M R S Chemicals, Inc., Dash
Chemicals, Inc., Bondafoam, Inc., MarChem Coated Fabrics, Inc., MarChem
Dublon, Inc., MarChem Pacific, Inc., Griptex Industries, Inc., Harvin
Reaction Technology, Inc., and Quick-Knit, Inc. All significant
intercompany balances and transactions have been eliminated.
USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS - The
preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
INVENTORIES - Inventories of raw materials and finished goods are
stated at the lower of cost or market. Cost is determined by the first-
in, first-out method.
PROPERTY, PLANT AND EQUIPMENT - Property, plant and equipment are
carried at cost. Major renewals and betterments are capitalized and
maintenance and repairs which do not improve or extend the life of the
respective assets are charged against earnings in the current period.
Depreciation is provided for in amounts sufficient to relate the cost of
depreciable assets to operations over their estimated useful lives,
principally on a straight-line basis. In computing its taxable income,
the Company uses the methods as prescribed by the current Internal
Revenue Code.
IMPAIRMENT OF LONG LIVED ASSETS - The Company evaluates whether
events and circumstances have occurred that indicate the remaining
estimated useful life of long lived assets may warrant revision or that
the remaining balance of an asset may not be recoverable. The
measurement of possible impairment is based on the ability to recover
the balance of assets from expected future operating cash flows on an
undiscounted basis. In the opinion of management, no such impairment
existed at April 30, 1998 and April 30, 1997.
INCOME TAXES - The Company and its subsidiaries file a
consolidated federal income tax return. State income tax returns are
filed separately or consolidated depending on the individual state.
Income
F-8
<PAGE>
<PAGE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
tax expense includes the federal and state taxes currently payable and
deferred taxes arising from temporary differences between income for
financial reporting and income tax purposes. These temporary
differences result primarily from different methods of accounting for
depreciation, pension expense and inventory.
BOND ISSUANCE COSTS - Bond issuance costs were being amortized on
the straight-line method over the life of the bonds and loans. During
1997, all bonds and loans for which the Company had incurred issuance
costs were paid in full. Accordingly, the remaining issuance costs
associated with such bonds and loans were expensed. Amortization
expense charged to operations was $0 in 1998, $67,370 in 1997 and $9,113
in 1996.
GOODWILL - Goodwill primarily relates to the acquisition of
subsidiaries and represents the difference between the purchase price
and the fair value of net tangible assets acquired. Goodwill is being
amortized on a straight-line basis over a ten-year period. Amortization
expense charged to operations in 1998, 1997 and 1996 was $115,183,
$109,681 and $103,499, respectively.
CASH AND CASH EQUIVALENTS - For purposes of reporting cash flows,
the Company considers all highly liquid debt instruments purchased with
a maturity of three months or less to be cash equivalents. At April 30,
1998, the Company had $5,566,655 on deposit at banks which exceeds
federal insurance coverage by $4,864,897. In addition, the Company had
cash and cash equivalents of $252,442 that was not federally insured at
April 30, 1998.
RECLASSIFICATIONS - Certain reclassifications have been made to
prior year's financial statement amounts to conform to the 1998
presentation.
NOTE B - NOTES RECEIVABLE
At April 30, 1998, the Company was due with respect to notes receivable
as follows:
<TABLE>
<CAPTION>
Current
Portion Long-term
------- ---------
<S> <C> <C>
Stockholder, Marvin S. Wool; unsecured; due April 30, 1999;
interest payable semi-annually at 5.77%. $800,000 $ --
Stockholder, Marvin S. Wool: unsecured; due June 30, 1998;
interest payable semi-annually at 5.77% (see note M) 250,000 --
Seven Gables Investments Company, L.L.C.; secured by a deed of
trust and a lien on property; interest payable quarterly
at a rate of 8.5% per annum; principal due in full on
September 1, 2002. -- 800,000
Pauli & Company, Inc.; unsecured; due October 31, 1998; interest
payable quarterly at 10.75%. 150,000 --
F-9
<PAGE>
<PAGE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
John F. and Marian Chilton; collateralized by 15,300 shares of
common stock of Passport Carpets, Inc. held in escrow;
principal payable in monthly installments of $3,000;
interest payable monthly at 6% per annum on the unpaid
principal balance with final payment due July 1998. 75,350 --
Employee, Joe Feduccia; unsecured; non-interest bearing note
due on February 16, 2002 -- 60,000
Employee, Don Artinger; unsecured; payable in monthly
installments of $789 with interest at prime (8.50% at
April 30, 1998); final payment due on September 16, 2001. 4,377 20,623
---------- --------
$1,279,727 $880,623
========== ========
<CAPTION>
NOTE C - NOTE PAYABLE AND LONG-TERM DEBT
Current
Maturities Long-term
---------- ---------
<S> <C> <C>
Note Payable. Stockholder, Marvin S. Wool; unsecured; payable
on demand; interest payable monthly at 3% over prime
(8.50% at April 30, 1998). $100,000 --
========
Long-Term Debt. Herbert S. Schottenfeld; unsecured; due April
30, 2005; monthly payments of $16,667 including interest
imputed at 8.75% through April 30, 1999 and $6,667
including interest at 8.75% through April 30, 2005, net
of unamortized discount of $147,853. $159,743 $372,405
======== ========
</TABLE>
Long-term debt maturing during each of the five years ending April 30,
2003 and thereafter is $159,743, $49,363, $53,860, $58,766, $64,120 and
$146,296, respectively.
NOTE D - EMPLOYEE BENEFIT PLANS
The Company has a profit-sharing plan for the benefit of the employees
who meet eligibility requirements as to length of service. It is the
Company's policy to fund profit-sharing costs accrued. During 1998,
1997 and 1996, contributions to the profit-sharing plan charged to
operations were $0, $362,383 and $275,989, respectively.
The Company sponsors a defined benefit pension plan that covers
employees who meet eligibility requirements. The plan calls for
benefits to be paid to eligible employees at retirement based primarily
upon years of service with the Company and compensation rates near
retirement. Contributions to the plan reflect benefits attributed to
employees' services to date, as well as services expected to be earned
in the future.
F-10
<PAGE>
<PAGE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
NOTE D - EMPLOYEE BENEFIT PLANS (CONTINUED)
<TABLE>
<CAPTION>
1998 1997 1996
--------- --------- ---------
<S> <C> <C> <C>
Service cost of the current period $ 285,689 $ 251,232 $ 218,664
Interest cost on the projected benefit obligations 270,353 225,315 188,569
Actual return on assets held in the plan (277,554) (319,245) (240,695)
Net amortization of transition liability (36,446) 2,946 2,946
--------- --------- ---------
Pension expense $ 242,042 $ 160,248 $ 169,484
========= ========= =========
</TABLE>
The following sets forth the funded status of the plan and the amounts
shown in the accompanying consolidated balance sheet at April 30, 1998
and 1997:
Actuarial present value of benefit obligations:
<TABLE>
<CAPTION>
1998 1997
----------- ----------
<S> <C> <C>
Vested benefits $ 3,513,461 $2,597,730
Nonvested benefits -- 117,338
----------- ----------
Accumulated benefit obligation 3,513,461 2,715,068
Effect of anticipated future compensation levels
and other events -- 898,117
----------- ----------
Projected benefit obligation 3,513,461 3,613,185
Fair value of assets held in the plan 4,572,744 3,709,207
----------- ----------
Plan assets in excess of projected
benefit obligation (1,059,283) (96,022)
Less:
Net unrecognized gain from past
experience different than assumed (1,711,301) (508,944)
Unamortized liability at transition 17,672 20,618
----------- ----------
Pension liability included in the balance sheet $ 634,346 $ 392,304
=========== ==========
</TABLE>
The weighted average discount rate used to measure the projected benefit
obligation is 6.5% and 7.5% in 1998 and 1997, respectively, the rate of
increase in future compensation levels is 0% and 5.0% in 1998 and 1997,
respectively, and the expected long-term rate of return on assets is
6.5% and 7.5% in 1998 and 1997, respectively. The Company uses the
straight-line method of amortization for prior service cost and
unrecognized gains and losses. Pension expense charged to operations in
1998, 1997 and 1996, respectively was $242,042, $160,248 and $169,484,
respectively.
The Company adopted a resolution on February 10, 1997 to freeze benefits
of pension plan participants as of February 28, 1997 and to terminate
the pension plan as of April 30, 1997.
The Company during the year ended April 30, 1998 chose not to terminate
the pension plan but to continue to accrue benefits to participants
already in the plan. The Company plans to terminate the
F-11
<PAGE>
<PAGE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
NOTE D - EMPLOYEE BENEFIT PLANS (CONTINUED)
pension plan during the year ending April 30, 1999. The Company's
actuary has determined that pension plan assets are sufficient to fund
accrued vested benefits as of February 28, 1998.
The Company established on January 1, 1998 a 401(k) profit-sharing plan
for all employees who meet both eligibility requirements as to length of
service and age. The Company matches dollar for dollar all employee
compensation contributed to the plan that is over 2% of that employee's
total eligible compensation to a maximum of 15% of that employee's
compensation. The Company also has a discretionary contribution that it
can elect to make. For the year ended April 30, 1998 the total employer
contributions charged to operations were $255,933.
NOTE E - RELATED PARTY TRANSACTIONS
MarChem Corporation leases an operating facility under terms of a lease
expiring in December 1999 from a partnership consisting of certain
stockholders and employees of the Company. The annual rental of this
facility in 1998, 1997 and 1996 was $306,000, $300,000 and $297,000,
respectively.
The Company also leases its corporate offices from the same partnership
under terms of a lease which commenced in August 1996 and which expires
in July 1999. The rental amount charged to operations in 1998, 1997 and
1996 was $240,000, $240,000 and $180,000, respectively. The Company
also guaranteed the debt of this partnership during the year ended
April 30, 1998.
The Company leases an operating facility under terms of a lease which
commenced in January 1995 and which expires in December 1998 from a
corporation owned by certain stockholders and employees of the Company.
During 1998 another of the Company's subsidiaries began operations in
the same facility. Another three year lease agreement was entered into
on January 1, 1998 and expiring on December 31, 2000. The total rental
amount charged to operations in 1998, 1997 and 1996 was $290,000,
$240,000 and $308,000.
The total rent expense for the Company in 1998, 1997 and 1996 was
$1,152,731, $904,953 and $1,002,097, respectively, which includes the
leases mentioned above.
The Company conducts business with various financial institutions, one
of which the primary stockholder acts as Chairman of the Board and Chief
Executive Officer.
NOTE F - ACQUISITION OF EQUIPMENT
On June 13, 1997, the Company acquired the inventory, fixed assets and
intellectual property of Polymer Development Labs, Inc. ("PDL") from a
California bankruptcy court for $600,000 in cash. The assets acquired
included those located at PDL's Orange, California and Atlanta, Georgia
facilities. On June 24, 1997, the Company sold for $285,000 in cash the
inventory and fixed assets located at PDL's Atlanta, Georgia facility.
F-12
<PAGE>
<PAGE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
NOTE G - ACQUISITION OF SUBSIDIARY
On August 14, 1997, the Company acquired all the outstanding capital
stock of SWS 3, Inc. from Sirrom Capital Corporation, the sole
shareholder, in a business combination treated for financial reporting
purposes as a purchase. In consideration for the stock of SWS 3, Inc.
the Company paid $1,746,549 in cash. The total purchase price
approximated the fair market value of the net assets of SWS 3, Inc. The
corporation's name was then changed to Harvin Reaction Technology, Inc.
NOTE H - START UP SUBSIDIARY
The Company during the year ended April 30, 1998 began operations of a
new subsidiary, Quick-Knit, Inc. Quick-Knit, Inc. manufactures the
fabric used by the Company's subsidiary, Griptex Industries, which makes
various non-slip products.
NOTE I - COMMITMENTS AND CONTINGENCIES
During the year ended April 30, 1998, MarChem Pacific entered into a
five-year lease for certain real property to be used as a manufacturing
facility. The minimum future lease payments under the operating lease
for each of the next five years and in aggregate are:
Year ending
April 30 Amount
-------- ------
1999 $137,470
2000 139,070
2001 139,070
2002 139,070
2003 11,589
--------
$566,269
========
The Company is involved in several legal proceedings incidental to the
conduct of its business. Management believes none of these legal
proceedings will result in any material impact on the Company's
financial condition or results of operations.
NOTE J - ECONOMIC DEPENDENCY
In the years ended April 30, 1998 and 1997, the Company sold
approximately 18% of total sales to three customers. In 1996, the
Company sold 17% of its total sales to one customer. Accounts
receivable from these customers totaled $1,874,906, $1,820,950 and
$332,708 at April 30, 1998, 1997 and 1996, respectively.
NOTE K - NET INCOME PER SHARE
Net income per share of common stock is computed based upon 105,000
shares for 1998, 1997 and 1996, the weighted average number of shares
outstanding during each period.
F-13
<PAGE>
<PAGE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
NOTE L - SUPPLEMENTAL CASH FLOW INFORMATION
<TABLE>
<CAPTION>
1998 1997 1996
---------- ---------- ----------
<S> <C> <C> <C>
Cash paid during year for:
Interest $ 103,466 $ 131,322 $ 274,229
Income taxes $2,670,540 $3,477,203 $3,437,450
</TABLE>
In 1997, the minority interest of Marchem Dublon was purchased by the
Company for $60,000 cash. The non-cash reduction of minority interest
was $56,900.
In 1998 and 1997, the Company declared a $.525 and $.50 per share
dividend which has been accrued at April 30, 1998 and April 30, 1997,
aggregating $55,125 and $52,500, respectively.
In 1996, the assets of Griptex Associates, Inc. were purchased in
exchange for cash of $20,000 and a note payable to Herbert S.
Schottenfeld (see note C) of $1,260,000. The note includes interest
imputed at 8.75%.
NOTE M - SUBSEQUENT EVENTS
In June 1998, a fire completely destroyed the warehouse and offices of
Bondafoam, Inc. The building, equipment and inventory were all insured
by full replacement cost insurance.
On June 30, 1998, Marvin S. Wool, repaid the $250,000 note to the
Company.
F-14
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<CAPTION>
January 31, 1999
----------------
<S> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 2,057,820
Investments 4,300,000
Accounts Receivable
Trade, net of allowance of $338,500 9,729,622
Other 26,241
Insurance Claim Receivable 45,139
Current Portion of Notes Receivable 122,515
Inventories
Raw Materials 6,731,117
Finished Goods 3,738,196
Prepaid Expenses 171,748
Deferred Taxes 310,986
Federal and State Income Taxes 702,944
-----------
Total Current Assets 27,936,328
Property, Plant and Equipment:
Buildings and Improvements 3,174,943
Machinery and Equipment 12,409,484
Furniture and Fixtures 829,935
Automotive Equipment 1,099,562
-----------
17,513,924
Less Accumulated Depreciation 6,731,074
-----------
10,782,850
Land 266,258
-----------
Total Property, Plant and Equipment 11,049,108
-----------
Other Assets:
Notes Receivable 898,477
Goodwill 735,887
Other Assets 94,131
Investment, at Cost 108,993
-----------
Total Other Assets 1,837,488
-----------
Total Assets $40,822,924
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes Payable
Current Maturities of Long-Term Debt $ 182,085
Accounts Payable
Trade 4,324,008
Accrued Liabilities
Salaries 313,952
Payroll and Withholding Taxes 46,602
Interest 2,899
Employee Benefits 1,547,901
Deferred Income Taxes 320,028
Other 436,603
-----------
Total Current Liabilities 7,174,078
Long-Term Debt 331,570
Deferred Income Taxes 267,355
Deferred Gain 58,585
Minority Interest 792,262
-----------
Total Liabilities 8,623,850
-----------
Stockholders' Equity:
Common Stock 361,500
Additional Paid-in Capital 251,114
Retained Earnings 31,837,820
-----------
32,450,434
Less, Treasury Stock 251,360
-----------
Total Stockholders' Equity 32,199,074
-----------
Total Liabilities and Stockholders' Equity $40,822,924
===========
</TABLE>
F-15
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS AND RETAINED EARNINGS
(UNAUDITED)
<CAPTION>
NINE MONTHS ENDED
JANUARY 31,
-----------------------------
1999 1998
----------- -----------
<S> <C> <C>
Net sales $63,079,792 $65,784,133
Cost of goods sold 50,071,139 52,412,504
----------- -----------
Gross profit 13,008,653 13,371,629
Selling, general and administrative 8,889,284 8,331,254
----------- -----------
Operating income 4,119,369 5,040,375
Other income (expense)
Interest income, net 234,715 75,737
Dividend income 67,646 122,931
Other (35,847) 66,574
----------- -----------
266,514 265,242
Income before gain on involuntary conversion of assets,
income taxes and minority interest 4,385,883 5,305,617
Gain on involuntary conversion of assets 2,388,028 --
----------- -----------
Income before income taxes and minority interest 6,773,911 5,305,617
Income taxes 2,281,828 1,915,366
----------- -----------
Income before minority interest 4,492,083 3,390,251
Minority interest (173,070) (152,965)
----------- -----------
Net income 4,319,013 3,237,286
Retained earnings, beginning of period 27,518,807 23,120,704
----------- -----------
Retained earnings, end of period $31,837,820 $26,357,990
=========== ===========
</TABLE>
F-16
<PAGE>
<PAGE>
<TABLE>
DASH MULTI-CORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<CAPTION>
NINE MONTHS ENDED
JANUARY 31,
-------------------------
1999 1998
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 4,319,013 $ 3,237,286
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 1,143,674 849,387
Minority interest in earnings of subsidiaries 173,070 152,965
Provision for doubtful accounts -- 7,500
Gain on sale of property and equipment (2,348,199) (11,716)
Decrease in accounts receivable 1,565,310 843,245
Increase in inventories (132,717) (3,349,204)
(Increase) decrease in prepaid expenses 161,267 (80,123)
Increase in deposits (14,329) (46,686)
Decrease in cash surrender value of officer's life insurance -- 196,279
Decrease in accounts payable (569,960) (266,402)
Increase (decrease) in accrued liabilities 2,352,893 (1,087,324)
----------- -----------
Net cash provided by operating activities 6,650,022 445,207
Cash flows from investing activities:
Purchase of government securities (4,300,000) --
Proceeds from sale of property and equipment 89,973 21,130
Principal payments on notes receivable 1,105,358 1,858,044
Payments for issuance of notes receivable (116,000) (1,050,000)
Payments for purchase of plant and equipment (5,030,707) (2,785,899)
Purchase of Harvin Reaction Technology, Inc. common stock -- (1,746,549)
Purchase of assets of Polymer Development Labs, Inc. -- (600,000)
Sales proceeds of purchased assets -- 285,000
----------- -----------
Net cash used in investing activities (8,251,376) (4,018,274)
Cash flows from financing activities:
Principal payments on long-term debt (105,705) (133,333)
Principal payments on short-term debt -- (81,213)
----------- -----------
Net cash used in financing activities (105,705) (214,546)
Increase (decrease) in cash and cash equivalents (1,707,059) (3,787,613)
Cash and cash equivalents at beginning of period 3,764,879 4,999,795
----------- -----------
Cash and cash equivalents at end of period $ 2,057,820 $ 1,212,182
=========== ===========
</TABLE>
F-17
<PAGE>
<PAGE>
EXHIBIT INDEX
Exhibit
Number
- ------
(a)(1) Offer to Purchase, dated April 14, 1999
(a)(2) Letter of Transmittal with respect to the Shares
(a)(3) Form of letter, dated April 14, 1999, to brokers, dealers,
commercial banks, trust companies and nominees
(a)(4) Form of letter, dated April 14, 1999, to clients to be used
by brokers, dealers, commercial banks, trust companies and
nominees
(a)(5) Press Release, dated April 9, 1999
(a)(6) Form of newspaper advertisement, dated April 14, 1999
(a)(7) Notice of Guaranteed Delivery
(a)(8) IRS Guidelines to Substitute Form W-9
(c)(1) Stock Purchase Agreement, dated as of April 8, 1999, between
the Company and Purchaser
(c)(2) Shareholder Agreement, dated as of April 8, 1999, between
Ronald L. Bogh and Purchaser
(c)(3) Shareholder Agreement, dated as of April 8, 1999, between
Douglas C. Nelson and Purchaser
(c)(4) Shareholder Agreement, dated as of April 8, 1999, between
James V. Reimann and Purchaser
(c)(5) Form of Employment Agreement between
Ronald L. Bogh and the Company
(c)(6) Form of Employment Agreement between
Paul M. Gilson and the Company
(c)(7) Form Non-Competition Agreement between
Douglas C. Nelson and the Company
(d) None
(e) Not applicable
(f) None
F-18
<PAGE>
<PAGE>
OFFER TO PURCHASE FOR CASH
UP TO 1,567,417 SHARES OF COMMON STOCK
OF
R-B RUBBER PRODUCTS, INC.
AT
$3.00 NET PER SHARE
BY
DASH MULTI-CORP, INC.
- ------------------------------------------------------------------------
THE OFFER, PRORATION PERIOD AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, ST. LOUIS, MISSOURI TIME, ON WEDNESDAY, MAY 12, 1999, UNLESS
THE OFFER IS EXTENDED.
- ------------------------------------------------------------------------
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING AT LEAST
1,567,417 OF SHARES OF COMMON STOCK, NO PAR VALUE (THE "COMMON STOCK"),
OF R-B RUBBER PRODUCTS, INC. (THE "COMPANY") VALIDLY TENDERED AND NOT
WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER. CERTAIN OTHER
CONDITIONS TO CONSUMMATION OF THE OFFER ARE DESCRIBED IN SECTION 13.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED THAT
THE OFFER IS FAIR TO AND IN THE BEST INTERESTS OF THE COMPANY AND ITS
STOCKHOLDERS AND HAS UNANIMOUSLY APPROVED THE OFFER AND THE STOCK
PURCHASE AGREEMENT AND THE OTHER TRANSACTIONS CONTEMPLATED THEREBY AND
UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
IMPORTANT
Any stockholder desiring to tender all or any portion of his Shares
should either (1) complete and sign the Letter of Transmittal or a
facsimile thereof in accordance with the instructions in the Letter of
Transmittal, including any required signature guarantees, and mail or
deliver the Letter of Transmittal or such facsimile with such
stockholder's certificate(s) for the tendered Shares and any other
required documents to the Depositary, (2) follow the procedure for book-
entry tender of Shares set forth in Section 3, or (3) request such
stockholder's broker, dealer, commercial bank, trust company or other
nominee to effect the transaction for such stockholder. Stockholders
having Shares registered in the name of a broker, dealer, commercial
bank, trust company or other nominee are urged to contact such broker,
dealer commercial bank, trust company or other nominee if they desire to
tender Shares so registered.
A stockholder who desires to tender Shares and whose certificates for
shares are not immediately available, or who cannot comply with the
procedure for book-entry transfer on a timely basis, may tender their
Shares by following the procedures for guaranteed delivery set forth in
Section 3.
Questions and requests for assistance may be directed to the Information
Agent (as defined herein) at its address and telephone number set forth
on the back cover of this Offer to Purchase. Requests for additional
copies of this Offer to Purchase and the Letter of Transmittal may be
directed to the Information Agent or to brokers, dealers, commercial
banks and trust companies.
The date of this Offer to Purchase is April 14, 1999.
<PAGE>
<PAGE>
TABLE OF CONTENTS
Page
----
INTRODUCTION 1
1. Terms of the Offer; Proration 2
2. Acceptance for Payment and Payment for Shares 4
3. Procedure for Tendering Shares 5
4. Right of Withdrawal 7
5. Certain Federal Income Tax Consequences of the Offer 8
6. Price Range of Shares; Dividends 8
7. Effect of the Offer on Market for the Shares, Stock Exchange
Listing, and Exchange Act Registration 9
8. Certain Information Concerning the Company 10
9. Certain Information Concerning Purchaser 12
10. Background of the Offer; Contacts with the Company 13
11. Purpose of the Offer; Plans for the Company 15
12. Source and Amount of Funds 20
13. Certain Conditions of the Offer 20
14. Dividends and Distributions 23
15. Certain Legal Matters 23
16. Fees and Expenses 24
17. Miscellaneous 24
<PAGE>
<PAGE>
TO THE HOLDERS OF SHARES OF
R-B RUBBER PRODUCTS, INC.:
INTRODUCTION
Dash Multi-Corp, Inc., a Missouri corporation ("Purchaser"),
hereby offers to purchase up to 1,567,417 of the outstanding shares
(representing approximately 70% of the issued and outstanding shares as
of April 8, 1999) of Common Stock, no par value per share (the "Common
Stock" or the "Shares"), of R-B Rubber Products, Inc., an Oregon
corporation (the "Company"), at a purchase price of $3.00 per Share, net
to the seller in cash, without interest, on the terms and subject to the
conditions set forth in this Offer to Purchase and in the related Letter
of Transmittal (which, together with any amendments or supplements
hereto or thereto, collectively constitute the "Offer").
Tendering stockholders will not be obligated to pay brokerage
fees or commissions or, subject to instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Shares by Purchaser
pursuant to the Offer. However, any tendering stockholder or other
payee who fails to complete and sign the Substitute Form W-9 included in
the Letter of Transmittal may be subject to backup federal income tax
withholding of 31% of the gross proceeds payable to such stockholder or
other payee pursuant to the Offer. See Section 3. Stockholders who
hold their Shares through a bank or broker should check with such
institution as to whether they charge any service fees. Purchaser will
pay all charges and expenses of American Securities Transfer & Trust,
Inc. (the "Depositary") and D.F. King & Co., Inc. (the "Information
Agent") incurred in connection with the Offer in accordance with the
terms of the agreements entered into between Purchaser and each such
person.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING AT
LEAST 1,567,417 SHARES VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE
EXPIRATION OF THE OFFER. CERTAIN OTHER CONDITIONS TO CONSUMMATION OF
THE OFFER ARE DESCRIBED IN SECTION 13.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED
THAT THE OFFER IS FAIR TO AND IN THE BEST INTERESTS OF THE COMPANY AND
ITS STOCKHOLDERS AND HAS UNANIMOUSLY APPROVED THE OFFER AND THE STOCK
PURCHASE AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY AND
UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
The Offer is being made pursuant to a Stock Purchase Agreement
(the "Stock Purchase Agreement"), dated as of April 8, 1999, between the
Company and Purchaser. Pursuant to the Stock Purchase Agreement, in
certain circumstances if less than 70% of the issued and outstanding
Shares are tendered pursuant to the Offer Purchaser, at its sole option,
shall have the option to purchase from the Company, at a purchase price
equal to the greater of $3.00 per Share or the most recent price offered
by Purchaser in the Offer, up to an amount of Shares which, when
combined with Shares tendered pursuant to the Offer, would equal 70% of
the issued and outstanding Shares. As a result of the consummation of
the purchase of the Shares, the Company will become a majority-owned
subsidiary of Purchaser. Purchaser has entered into the Stock Purchase
Agreement and is undertaking the Offer to acquire control of the Company
with a view toward supporting its future growth. See "Purpose for the
Offer; Plans for the Company."
Pacific Crest Securities, Inc. ("Pacific Crest"), financial
advisor to the Company, has delivered to the Board of Directors of the
Company its opinion that the consideration to be received by holders of
Shares pursuant to the Offer is fair to such holders and the Company
from a financial point of view. A copy of Pacific Crest's opinion is
attached as an exhibit to the Company's Solicitation/Recommendation
Statement on Schedule 14D-9 which has been mailed to the holders of
Shares herewith.
According to the Company, as of April 8, 1999 there were 2,239,167
Shares issued and outstanding and there were 257,500 Shares reserved for
issuance under outstanding stock options pursuant to the Company's stock
option
<PAGE>
<PAGE>
and incentive plans and warrant agreements. Accordingly, based on the
foregoing and assuming that 1,567,417 Shares are validly tendered and
not withdrawn and Purchaser purchased all such tendered Shares, upon
consummation of the Offer Purchaser would own approximately 70% of the
Shares of Common Stock issued and outstanding as of April 8, 1999.
Principal stockholders of the Company have agreed to tender an aggregate
of 935,540 shares pursuant to the Offer. See "Purpose of the Offer;
Plans for the Company."
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ IN THEIR ENTIRETY BEFORE ANY
DECISION IS MADE WITH RESPECT TO THE OFFER.
1. TERMS OF THE OFFER; PRORATION
Upon the terms and subject to the conditions set forth in the
Offer (including the terms and conditions set forth in Section 13 (the
"Offer Conditions") and, if the Offer is extended or amended, the terms
and conditions of such extension or amendment), Purchaser will accept
for payment, and pay for, up to 1,567,417 Shares validly tendered on or
prior to the Expiration Date (as defined herein) and not withdrawn as
permitted by Section 4. The term "Expiration Date" means 12:00
midnight, St. Louis, Missouri time, on May 12, 1999, unless and until
Purchaser shall, in its sole discretion, have extended the period for
which the Offer is open, in which event the term "Expiration Date" shall
mean the latest time and date on which the Offer, as so extended by
Purchaser, shall expire.
Upon terms and subject to the conditions of the Offer, if more
than 1,567,417 Shares are validly tendered and not properly withdrawn
prior to the Expiration Date, Purchaser will accept for payment and pay
for only 1,567,417 Shares on a pro rata basis (with appropriate
adjustments to avoid the purchase of fractional Shares) based on the
number of Shares properly tendered by each stockholder prior to the
Expiration Date and not withdrawn. In the event that proration of
tendered Shares is required, because of the difficulty of determining
the precise number of Shares properly tendered and not withdrawn (due in
part to the guaranteed delivery procedures described in Section 3),
Purchaser does not expect that it will be able to announce the final
results of such proration or pay for any Shares until at least seven
Nasdaq trading days after the Expiration Date. Stockholders may obtain
such preliminary information from the Information Agent and may be able
to obtain such information from their broker. Purchaser will not pay
for any Shares accepted for payment pursuant to the Offer until the
final proration factor is known.
The Offer is conditioned upon the satisfaction of the Minimum
Condition and the other conditions set forth in Section 13. If such
conditions are not satisfied prior to the Expiration Date, Purchaser
reserves the right, subject to the terms of the Stock Purchase Agreement
and subject to complying with applicable rules and regulations of the
Securities and Exchange Commission (the "SEC"), to (i) decline to
purchase any Shares tendered in the Offer and terminate the Offer and
return all tendered Shares to the tendering stockholders, (ii) waive any
and all conditions to the Offer and, subject to complying with
applicable rules and regulations of the SEC, purchase all Shares validly
tendered, (iii) extend the Offer and, subject to the right of
stockholders to withdraw Shares until the Expiration Date, retain all
Shares which have been tendered during the period or periods for which
the Offer is extended or (iv) subject to the provisions described below,
amend the Offer. Pursuant to the Stock Purchase Agreement, until June
15, 1999, Purchaser is obligated to extend the Offer from time to time
in the event that, at a then-scheduled expiration date, any condition to
the Offer (other than the Minimum Condition) has not been satisfied or
waived as permitted by the Stock Purchase Agreement. Each such
extension shall be for a period of not more than 10 business days, or,
if longer, for any period required by any rule, resolution,
interpretation or position of the SEC or the staff thereto.
If Purchaser extends the Offer, or if Purchaser (whether before or
after its acceptance for payment of Shares) is delayed in its purchase
of, or payment for, Shares or is unable to pay for Shares pursuant to
the Offer for any reason, then, without prejudice to Purchaser's rights
under the Offer, the Depositary may retain tendered Shares on behalf of
Purchaser, and such Shares may not be withdrawn except to the extent
tendering stockholders are entitled to the
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withdrawal rights described in Section 4. However, the ability of
Purchaser to delay the payment for Shares which Purchaser has accepted
for payment is limited by Rule 14e-1(c) under the Exchange Act, which
requires that a bidder pay the consideration offered or return the
securities deposited by, or on behalf of, holders of securities promptly
after the termination or withdrawal of the Offer.
Pursuant to the terms of the Stock Purchase Agreement, and subject
to the proration and other terms of the Offer, Purchaser has agreed to
accept for payment and pay for Shares as soon as it is permitted to do
so under applicable law. However, subject to the terms of the Stock
Purchase Agreement and applicable rules and regulations of the SEC,
Purchaser expressly reserves the right, in its sole discretion, at any
time or from time to time, to extend the period of time during which the
Offer is open (and thereby delay acceptance for payment of and the
payment for any Shares) by giving oral or written notice of such
extension to the Depositary. During any such extension, all Shares
previously tendered and not withdrawn will remain subject to the Offer,
subject to the right of a tendering stockholder to withdraw such
stockholder's Shares. See Section 4. Additionally, subject to the
terms of the Stock Purchase Agreement and the applicable rules and
regulations of the SEC, Purchaser also expressly reserves the right, in
its sole discretion, at any time or from time to time to waive any
condition or otherwise amend the Offer in any respect, by giving oral or
written notice of such amendment to the Depositary and by making a
public announcement thereof; provided, however, that, unless previously
approved by the Company in writing, no provision may be set forth or
changed which decreases the price per share payable in the Offer,
changes the form of consideration payable in the Offer (other than
adding consideration), or imposes conditions to the Offer in addition to
those set forth in the Stock Purchase Agreement that are materially
adverse to the holders of the Shares. The Offer Conditions are for the
benefit of Purchaser and may be asserted by Purchaser regardless of the
circumstances that may rise to any such condition. If Purchaser accepts
any Shares for payment pursuant to the terms of the Offer, it will
accept for payment all Shares validly tendered prior to the Expiration
Date and not withdrawn, and will promptly pay for all Shares so accepted
for payment. Purchaser confirms that its reservation of the right to
delay payment for Shares which it has accepted for payment is limited by
Rule 14e-1(c) under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), which requires that a tender offeror pay the
consideration offered or return the tendered securities promptly after
the termination or withdrawal of a tender offer.
Any extension, delay, termination or amendment of the Offer will
be followed as promptly as practicable by public announcement thereof,
such announcement in the case of an extension to be issued no later than
9:00 A.M., St. Louis, Missouri time, on the next business day after the
previously scheduled Expiration Date. Subject to applicable law
(including Rules l4d-4(c) and 14d-6(d) under the Exchange Act, which
require that any material change in the information published, sent or
given to stockholders in connection with the Offer be promptly
disseminated to stockholders in a manner reasonably designed to inform
stockholders of such change) and without limiting the manner in which
Purchaser may choose to make any public announcement, Purchaser shall
have no obligation to publish, advertise or otherwise communicate any
such public announcement other than by issuing a press release or other
announcement.
Purchaser confirms that if it makes a material change in the terms
of the Offer or the information concerning the Offer, or if it waives a
material condition of the Offer, Purchaser will extend the Offer to the
extent required by Rules 14d-4(c) and 14d-6(d) under the Exchange Act.
If, prior to the Expiration Date, Purchaser, pursuant to the terms
of the Stock Purchase Agreement, shall decrease the number of Shares
being sought or the consideration offered to holders of Shares, such
decrease shall be applicable to all holders whose Shares are accepted
for payment pursuant to the Offer and, if at the time notice of any
increase or decrease is first published, sent or given to holders of
Shares, the Offer is scheduled to expire at any time earlier than the
tenth business day from and including the date that such notice is first
so published, sent or given, the Offer will be extended until the
expiration of such ten business day period. For purposes of the Offer,
a "business day" means any day other than a Saturday, Sunday or federal
holiday and consists of the time period from 12:01 A.M. through 12:00
Midnight, St. Louis, Missouri time.
Pursuant to the Stock Purchase Agreement, the Company and
Purchaser have agreed that if, immediately prior to the Expiration Date,
less than 70% of the issued and outstanding Shares have been tendered
pursuant to the Offer
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Purchaser may, at its sole option, purchase from the Company on the
Expiration Date at a purchase price equal to the greater of $3.00 per
share in cash or the most recent price offered by Purchaser an amount of
Shares designated by Purchaser in its sole discretion up to a maximum of
that number of Shares which, combined with the aggregate number of
Shares purchased pursuant to the Offer is equal to 70% of the issued and
outstanding Shares.
The Company has provided Purchaser with the Company's stockholder
lists and security position listings for the purpose of disseminating
the Offer to holders of Shares. This Offer to Purchase and the related
Letter of Transmittal will be mailed to record holders of Shares and
will be furnished to brokers, dealers, commercial banks, trust companies
and similar persons whose names, or the names of whose nominees, appear
in the stockholder lists or, if applicable, who are listed as
participants in a clearing agency's position listing, for subsequent
transmittal to beneficial owners of Shares.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES.
On the terms and subject to the conditions of the Offer (including
the Offer Conditions and, if the Offer is extended or amended, the terms
and conditions of any such extension or amendment), Purchaser will
accept for payment, and will pay for, up to 1,567,417 Shares validly
tendered and not withdrawn as promptly as practicable after the later of
(i) all required filings, consents, approvals, and authorizations of any
Governmental Entity (as defined in the Stock Purchase Agreement) shall
have been obtained on terms satisfactory to Purchaser in its reasonable
discretion and (ii) the Expiration Date, if at the time of the later of
the occurrence of (i) and (ii) above, the Minimum Condition (as defined
herein) has been satisfied or waived, provided that Purchaser reserves
the right, in its sole discretion, to extend the Offer from time to time
notwithstanding the prior satisfaction of the Offer Conditions. See
Sections 13 and 15. In addition, subject to applicable rules of the
SEC, Purchaser expressly reserves the right to delay acceptance for
payment of or payment for Shares in order to comply, in whole or in
part, with any applicable law. See Section 13. In all cases, payment
for Shares tendered and accepted for payment pursuant to the Offer will
be made only after timely receipt by the Depositary of certificates for
such Shares (or a confirmation of a book-entry transfer of such Shares
(a "Book-Entry Confirmation") into the Depositary's account at The
Depository Trust Company (the "Book-Entry Transfer Facility")), a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof) and any other required documents.
For purposes of the Offer, Purchaser will be deemed to have
accepted for payment Shares validly tendered and not withdrawn as, if
and when Purchaser gives oral or written notice to the Depositary of its
acceptance for payment of such Shares pursuant to the Offer. Payment
for Shares accepted for payment pursuant to the Offer will be made by
deposit of the purchase price therefor with the Depositary which will
act as agent for the tendering stockholders for the purpose of receiving
payments from Purchaser and transmitting such payments to the tendering
stockholders. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE
PRICE FOR SHARES BE PAID, REGARDLESS OF ANY DELAY IN MAKING SUCH
PAYMENT.
If any tendered Shares are not accepted for payment pursuant to
the terms and conditions of the Offer for any reason (including
proration due to the tenders of more than 1,567,417 Shares), or if
certificates are submitted for more Shares than are tendered,
certificates for such unpurchased Shares will be returned, without
expense to the tendering stockholder (or, in the case of Shares tendered
by book-entry transfer of such Shares into the Depositary's account at a
Book-Entry Transfer Facility pursuant to the procedures set forth in
Section 3, such Shares will be credited to an account maintained with
such Book-Entry Transfer Facility), as soon as practicable following
expiration or termination of the Offer.
Purchaser reserves the right to transfer or assign in whole or in
part from time to time to one or more direct or indirect subsidiaries of
Purchaser the right to purchase all or any portion of the Shares
tendered pursuant to the Offer, but any such transfer or assignment will
not relieve Purchaser of its obligations under the Offer and will in no
way prejudice the rights of tendering stockholders to receive payment
for Shares validly tendered and accepted for payment pursuant to the
Offer.
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3. PROCEDURE FOR TENDERING SHARES.
Valid Tender. To tender Shares pursuant to the Offer, either (a)
a properly completed and duly executed Letter of Transmittal (or a
facsimile thereof) in accordance with the instructions of the Letter of
Transmittal, with any required signature guarantees, certificates for
Shares to be tendered, and any other documents required by the Letter of
Transmittal, must be received by the Depositary prior to the Expiration
Date at the address set forth on the back cover of this Offer to
Purchase, (b) such Shares must be delivered pursuant to the procedures
for book-entry transfer described below (and a Book-Entry Confirmation
of such delivery received by Depositary, including an Agent's Message
(as defined herein) if the tendering stockholder has not delivered a
Letter of Transmittal), prior to the Expiration Date, or (c) the
tendering stockholder must comply with the guaranteed delivery
procedures set forth below. The term "Agent's Message" means a message,
transmitted by a Book-Entry Transfer Facility to, and received by, the
Depositary and forming a part of a Book-Entry Confirmation, which states
that such Book-Entry Transfer Facility has received an express
acknowledgment from the participant in such Book-Entry Transfer Facility
tendering the Shares which are the subject of such Book-Entry
Confirmation, that such participant has received and agrees to be bound
by the terms of the Letter of Transmittal and that Purchaser may enforce
such agreement against the participant.
Book-Entry Delivery. The Depositary will establish an account
with respect to the Shares at the Book-Entry Transfer Facility for
purposes of the Offer within two business days after the date of this
Offer to Purchase. Any financial institution that is a participant in
any of the Book-Entry Transfer Facility's systems may make a book-entry
transfer of Shares by causing a Book-Entry Transfer Facility to transfer
such Shares into the Depositary's account in accordance with the Book-
Entry Transfer Facility's procedures for such transfer. Although
delivery of Shares may be effected through book-entry transfer, either
the Letter of Transmittal (or facsimile thereof), properly completed and
duly executed, together with any required signature guarantees, or an
Agent's Message in lieu of the Letter of Transmittal, and any other
required documents, must, in any case, be transmitted to and received by
the Depositary by the Expiration Date at one of its addresses set forth
on the back cover of this Offer to Purchase, or the tendering
stockholder must comply with the guaranteed delivery procedures
described below. DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER
FACILITY IN ACCORDANCE WITH THE BOOK-ENTRY TRANSFER FACILITY'S
PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY
TRANSFER FACILITY, IS AT THE ELECTION AND RISK OF THE TENDERING
STOCKHOLDER. SHARES WILL BE DEEMED DELIVERED ONLY WHEN ACTUALLY
RECEIVED BY THE DEPOSITARY (INCLUDING, IN THE CASE OF A BOOK-ENTRY
TRANSFER, BY BOOK-ENTRY CONFIRMATION). IF DELIVERY IS BY MAIL, IT IS
RECOMMENDED THAT THE STOCKHOLDER USE PROPERLY INSURED REGISTERED MAIL
WITH RETURN RECEIPT REQUESTED. IN ALL CASES, SUFFICIENT TIME SHOULD BE
ALLOWED TO ENSURE TIMELY DELIVERY.
Signature Guarantees. Except as otherwise provided below, all
signatures on a Letter of Transmittal must be guaranteed by a financial
institution (including most commercial banks, savings and loan
associations and brokerage houses) that is a participant in the Security
Transfer Agents Medallion Program, the New York Stock Exchange Medallion
Signature Guarantee Program or the Stock Exchange Medallion Program (an
"Eligible Institution"). Signatures on a Letter of Transmittal need not
be guaranteed (a) if the Letter of Transmittal is signed by the
registered holders (which term, for purposes of this section, includes
any participant in the Book-Entry Transfer Facility's systems whose name
appears on a security position listing as the owner of the Shares) of
Shares and such registered holder has not completed the box entitled
"Special Payment Instructions" or the box entitled "Special Delivery
Instructions" on the Letter of Transmittal, or (b) if such Shares are
tendered for the account of an Eligible Institution. See Instructions 1
and 5 of the Letter of Transmittal. If the certificates for Shares are
registered in the name of a person other than the signer of the Letter
of Transmittal, or if payment is to be made or certificates
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for Shares not tendered or not accepted for payment are to be returned
to a person other than the registered holder of the certificates
surrendered, then the tendered certificates must be endorsed or
accompanied by appropriate stock powers, in either case signed exactly
as the name or names of the registered holders or owners appear on the
certificates, with the signatures on the certificates or stock powers
guaranteed as described above. See Instructions 1 and 5 of the Letter
of Transmittal.
Guaranteed Delivery. A stockholder who desires to tender Shares
pursuant to the Offer and whose certificates for Shares are not
immediately available or who cannot comply with the procedure for book-
entry transfer on a timely basis, or who cannot deliver all required
documents to the Depositary prior to the Expiration Date, may tender
such Shares by following all of the procedures set forth below:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by Purchaser, is received
by the Depositary (as provided below) prior to the Expiration Date; and
(iii) the certificates for all tendered Shares, in proper form for
transfer (or a Book-Entry Confirmation with respect to all such Shares),
together with a properly completed and duly executed Letter of
Transmittal (or facsimile thereof), with any required signature
guarantees (or, in the case of a book-entry transfer, an Agent's Message
in lieu of the Letter of Transmittal), and any other required documents,
are received by the Depositary within three trading days after the date
of execution of such Notice of Guaranteed Delivery. A "trading day" is
any day on which the The Nasdaq Stock Market is open for business.
The Notice of Guaranteed Delivery may be delivered by hand to the
Depositary or transmitted by telegram, facsimile transmission or mail to
the Depositary and must include a guarantee by an Eligible Institution
in the form set forth in such Notice of Guaranteed Delivery.
Other Requirements. Notwithstanding any provision hereof, payment
for Shares accepted for payment pursuant to the Offer will in all cases
be made only after timely receipt by the Depositary of (a) certificates
for (or a timely Book-Entry Confirmation with respect to) such Shares,
(b) a Letter of Transmittal (or facsimile thereof), properly completed
and duly executed, with any required signature guarantees (or, in the
case of a book-entry transfer, an Agent's Message in lieu of the Letter
of Transmittal), and (c) any other documents required by the Letter of
Transmittal. Accordingly, tendering stockholders may be paid at
different times depending upon when certificates for Shares are actually
received by the Depositary. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE
PURCHASE PRICE OF THE SHARES BE PAID BY PURCHASER, REGARDLESS OF ANY
EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH PAYMENT.
Tender Constitutes an Agreement. The valid tender of Shares
pursuant to one of the procedures described above will constitute a
binding agreement between the tendering stockholder and Purchaser on the
terms and subject to the conditions of the Offer.
Appointment. By executing a Letter of Transmittal as set forth
above, the tendering stockholder irrevocably appoints designees of
Purchaser as such stockholder's proxies, each with full power of
substitution, to the full extent of such stockholder's rights with
respect to the Shares tendered by such stockholder and accepted for
payment by Purchaser and with respect to any and all cash dividends,
distributions, rights, other Shares or other securities issued or
issuable in respect of such Shares on or after the date of this Offer to
Purchase. All such proxies will be considered coupled with an interest
in the tendered Shares. Such appointment is effective when, and only to
the extent that, Purchaser deposits the payment for such Shares with the
Depositary. Upon the effectiveness of such appointment, all prior
powers of attorney, proxies and consents given by such stockholder will
be revoked, and no subsequent powers of attorney, proxies and consents
may be given (and, if given, will not be deemed effective). Purchaser's
designees will, with respect to the Shares for which the appointment is
effective, be empowered to exercise all voting and other rights of such
stockholder as they, in their sole discretion, may deem proper at any
annual, special or adjourned meeting of the stockholders of the Company,
by written consent in lieu of any such
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meeting or otherwise. Purchaser reserves the right to require that, in
order for Shares to be deemed validly tendered, immediately upon
Purchaser's payment for such Shares, Purchaser must be able to exercise
full voting rights with respect to such Shares.
Determination of Validity. All questions as to the validity,
form, eligibility (including time of receipt) and acceptance of any
tender of Shares will be determined by Purchaser in its sole discretion,
which determination will be final and binding. Purchaser reserves the
absolute right to reject any and all tenders determined by it not to be
in proper form or the acceptance for payment of or payment for which
may, in the opinion of Purchaser's counsel, be unlawful. Purchaser also
reserves the absolute right to waive any defect or irregularity in the
tender of any Shares of any particular stockholder whether or not
similar defects or irregularities are waived in the case of other
stockholders. No tender of Shares will be deemed to have been validly
made until all defects and irregularities relating thereto have been
cured or waived. None of Purchaser, the Depositary, the Information
Agent or any other party will be under any duty to give notification of
any defects or irregularities in tenders or incur any liability for
failure to give any such notification. Purchaser's interpretation of
the terms and conditions of the Offer (including the Letter of
Transmittal and Instructions thereto) will be final and binding.
Backup Withholding. In order to avoid "backup withholding" of
Federal income tax on payments of cash pursuant to the Offer, a
stockholder surrendering Shares in the Offer must, unless an exemption
applies, provide the Depositary with such stockholder's correct taxpayer
identification number ("TIN") on a Substitute Form W-9 and certify under
penalties of perjury that such TIN is correct and that such stockholder
is not subject to backup withholding. If a stockholder does not provide
such stockholder's correct TIN or fails to provide the certifications
described above, the Internal Revenue Service (the "IRS") may impose a
penalty on such stockholder and payment of cash to such stockholder
pursuant to the Offer may be subject to backup withholding of 31%. All
stockholders surrendering Shares pursuant to the Offer should complete
and sign the main signature form and the Substitute Form W-9 included as
part of the Letter of Transmittal to provide the information and
certification necessary to avoid backup withholding (unless an
applicable exemption exists and is proved in a manner satisfactory to
Purchaser and the Depositary). Certain stockholders (including, among
others, all corporations and certain foreign individuals and entities)
are not subject to backup withholding. Non-corporate foreign
stockholders should complete and sign the main signature form and a Form
W-8, Certificate of Foreign Status, a copy of which may be obtained from
the Depositary, in order to avoid backup withholding. See Instruction 9
to the Letter of Transmittal.
4. RIGHT OF WITHDRAWAL.
Tenders of Shares made pursuant to the Offer are irrevocable
except that Shares tendered pursuant to the Offer may be withdrawn at
any time prior to the Expiration Date and, unless theretofore accepted
for payment by Purchaser pursuant to the Offer, may also be withdrawn at
any time after June 4, 1999.
For a withdrawal to be effective, a written, telegraphic, telex or
facsimile transmission notice of withdrawal must be timely received by
the Depositary at one of its addresses set forth on the back cover of
this Offer to Purchase. Any such notice of withdrawal must specify the
name of the person having tendered the Shares to be withdrawn, the
number of Shares to be withdrawn and the names in which the
certificate(s) evidencing the Shares to be withdrawn are registered, if
different from that of the person who tendered such Shares. The
signature(s) on the notice of withdrawal must be guaranteed by an
Eligible Institution, unless such Shares have been tendered for the
account of any Eligible Institution. If Shares have been tendered
pursuant to the procedures for book-entry tender as set forth in Section
3, any notice of withdrawal must specify the name and number of the
account at the Book-Entry Transfer Facility to be credited with the
withdrawn Shares. If certificates for Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, the name of the
registered holder and the serial numbers of the particular certificates
evidencing the Shares to be withdrawn must also be furnished to the
Depositary as aforesaid prior to the physical release of such
certificates. All questions as to the form and validity (including time
of receipt) of any notice of withdrawal, will be determined by Purchaser,
in its sole discretion, which determination shall be final and binding.
None of Purchaser, the Depositary, the Information Agent, or any other
person will be
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under any duty to give notification of any defects or irregularities in
any notice of withdrawal or incur any liability for failure to give such
notification. Withdrawals of tenders of Shares may not be rescinded,
and any Shares properly withdrawn will be deemed not to have been
validly tendered for purposes of the Offer. However, withdrawn Shares
may be re-tendered by following one of the procedures described in
Section 3 at any time prior to the Expiration Date.
If Purchaser extends the Offer, is delayed in its acceptance for
payment of Shares, or is unable to accept for payment pursuant to the
Offer, for any reason, then without prejudice to Purchaser's rights
under this Offer, the Depositary may, nevertheless, on behalf of
Purchaser, retain tendered Shares, and such Shares may not be withdrawn
except to the extent that tendering stockholders are entitled to
withdrawal rights as set forth in this Section 4.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE OFFER.
Sales of Shares pursuant to the Offer will be taxable transactions
for Federal income tax purposes and may also be taxable under applicable
state, local and other tax laws. For Federal income tax purposes, a
stockholder whose Shares are purchased pursuant to the Offer will
realize gain or loss equal to the difference between the adjusted basis
of the Shares sold or exchanged and the amount of cash received
therefor. Such gain or loss will be capital gain or loss if the Shares
are held as capital assets by such stockholder and generally will be
long-term capital gain or loss for stock held for more than one year.
Long-term capital gain of a non-corporate stockholder is generally
subject to a maximum tax rate of 20% in respect of property held for
more than one year.
THE INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY AND MAY NOT BE APPLICABLE TO STOCKHOLDERS IN SPECIAL
SITUATIONS SUCH AS STOCKHOLDERS WHO RECEIVED THEIR SHARES UPON THE
EXERCISE OF EMPLOYEE STOCK OPTIONS OR OTHERWISE AS COMPENSATION AND
STOCKHOLDERS WHO ARE NOT UNITED STATES PERSONS. STOCKHOLDERS SHOULD
CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE SPECIFIC TAX
CONSEQUENCES TO THEM OF THE OFFER, INCLUDING THE APPLICATION AND EFFECT
OF FEDERAL, STATE, LOCAL, FOREIGN OR OTHER TAX LAWS.
6. PRICE RANGE OF SHARES; DIVIDENDS.
The Shares are traded on the Nasdaq SmallCap Market under the
symbol "RBBR". The following table sets forth, based upon public
sources, for the calendar quarters indicated, the high and low quoted
sale prices for the Shares on the Nasdaq SmallCap Market:
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SALE PRICE
----------------------
CALENDAR YEAR HIGH LOW
- ------------- ------ -----
1997:
First Quarter $3.13 $1.75
Second Quarter 4.13 2.25
Third Quarter 4.88 2.84
Fourth Quarter 5.00 3.25
1998:
First Quarter 3.88 3.00
Second Quarter 4.00 2.38
Third Quarter 3.13 1.56
Fourth Quarter 2.38 1.11
1999:
First Quarter 4.00 1.25
Second Quarter (through
April 13, 1999) 2.75 2.06
No dividends have been paid on the Shares. On April 8, 1999, the
last full trading day prior to the public announcement of the terms of
the Offer, the quoted closing price on the Nasdaq SmallCap Market was
$2.13 per Share. On April 13, 1999, the last full trading day prior
to commencement of the Offer, the reported closing price on the Nasdaq
SmallCap Market was $2.50 per Share. STOCKHOLDERS ARE URGED TO OBTAIN
A CURRENT MARKET QUOTATION FOR THE SHARES.
7. EFFECT OF THE OFFER ON MARKET FOR THE SHARES, STOCK EXCHANGE
LISTING, AND EXCHANGE ACT REGISTRATION.
Market for Shares. The purchase of Shares by Purchaser pursuant
to the Offer will reduce the number of Shares that might otherwise trade
publicly and may reduce the number of holders of Shares, which could
adversely affect the liquidity and market value of the remaining Shares
held by the public.
Stock Quotation. Depending upon the aggregate market value and
per Share price of any Shares not purchased pursuant to the Offer, the
Shares may no longer meet the standards of the National Association of
Securities Dealers, Inc. (the "NASD") for continued designation for the
Nasdaq SmallCap Market. The maintenance of such designation requires
that an issuer meet the following criteria. The issuer must have (a) at
least 500,000 shares publicly held, (b) at least 300 stockholders of
round lots, (c) a market value of publicly held shares of at least $1
million, (d) a minimum bid price per share of $1, (e) at least two
registered and active market makers for its shares and either (f) (i)
net tangible assets of at least $2 million, (ii) market capitalization
of at least $35 million, or (iii) a net income of at least $500,000 in
the latest fiscal year or in two of the last three fiscal years. Shares
held directly or indirectly by directors, officers or beneficial owners
of more than 10% of the Shares outstanding are not considered as being
publicly held for this purpose.
Pursuant to the Stock Purchase Agreement, a condition to the
obligation of Purchaser to consummate the purchase of the Shares
pursuant to the Offer is the receipt by Purchaser of confirmation that
the Shares shall continue to be listed on the Nasdaq SmallCap Market
following the consummation of the Offer without any conditions which
Purchaser in its reasonable judgment shall deem materially adverse.
Such condition may be waived by Purchaser in its sole discretion. There
can be no assurance that such condition can be satisfied or that
Purchaser would not waive such condition if the condition is not
satisfied. If, as a result of the purchase of Shares pursuant to the
Offer or otherwise, the Shares no longer meet the requirements of the
NASD for continued inclusion in the Nasdaq SmallCap Market or in any
other tier of the Nasdaq, and the Shares are no longer included in
Nasdaq SmallCap Market or in any other tier of the Nasdaq, the market
for the Shares could be adversely affected.
In the event the Shares no longer meet the requirements of the
NASD for continued inclusion in any tier of Nasdaq, it is possible that
Shares would continue to trade in the over-the-counter market and that
price quotations would be reported by other sources. The extent of the
public market for the Shares and the availability of such quotations
would, however, depend upon the number of holders of Shares remaining at
such time, the interest in
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<PAGE>
maintaining a market in Shares on the part of securities firms, the
possible termination of registration of the Shares under the Exchange
Act, as described below, and other factors.
Margin Regulations. The shares of Common Stock are presently
"margin securities" under the regulations of the Board of Governors of
the Federal Reserve System (the "Federal Reserve Board"), which has the
effect, among, other things, of allowing brokers to extend credit on the
collateral of such shares of Common Stock. Depending upon factors
similar to those described above regarding listing and market
quotations, the shares of Common Stock might no longer constitute
"margin securities" for the purposes of the Federal Reserve Board's
margin regulations in which event the shares of Common Stock would be
ineligible as collateral for margin loans made by brokers.
Exchange Act Registration. The shares of Common Stock are
currently registered under the Exchange Act. Such registration may be
terminated by the Company upon application to the SEC if the outstanding
shares of Common Stock are not listed on a national securities exchange
and if there are fewer than 300 holders of record of shares of Common
Stock. Termination of registration of the shares of Common Stock under
the Exchange Act would reduce the information required to be furnished
by the Company to its stockholders and to the SEC and would make certain
provisions of the Exchange Act, such as the short-swing profit recovery
provisions of Section 16(b) and the requirement to furnish a proxy
statement in connection with stockholders' meetings pursuant to Section
14(a) and the related requirement to furnish an annual report to
stockholders, no longer applicable with respect to the shares of Common
Stock. Furthermore, the ability of "affiliates" of the Company and
persons holding "restricted securities" of the Company to dispose of
such securities pursuant to Rule 144 under the Securities Act of 1933,
as amended, may be impaired or eliminated. If registration of the
shares of Common Stock under the Exchange Act were terminated, the
shares of Common Stock would no longer be eligible for listing on the
Nasdaq SmallCap Market or for continued inclusion on the Federal Reserve
Board's list of "margin securities".
8. CERTAIN INFORMATION CONCERNING THE COMPANY.
The Company was incorporated in Oregon in September 1986. The
Company is a vertically integrated rubber recycler and manufacturer that
processes scrap tires and rubber to produce high quality, durable rubber
mats and other products and protective surfaces. The Company sells its
products to agribusiness concerns, sports and fitness facilities and
other commercial and industrial users.
Set forth below is certain summary consolidated financial
information for each of the Company's three fiscal years in the period
ended December 31, 1998. The consolidated financial information
presented below reflects historical financial information for the three
fiscal years in the period ended December 31, 1998 reported in the
Company's 1998 Annual Report on Form 10-KSB. More comprehensive
financial information is included in such report (including management's
discussion and analysis of financial condition and results of operation)
and other documents filed by the Company with the SEC, and the following
summary is qualified in its entirety by reference to such reports and
other documents and all of the financial information and notes contained
therein. Copies of such reports and other documents may be examined at
or obtained from the SEC and the Nasdaq SmallCap Market in the manner
set forth below.
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<PAGE>
<TABLE>
THE COMPANY
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<CAPTION>
YEARS ENDED DECEMBER 31,
------------------------------------
1998 1997 1996
------ ------ ------
<S> <C> <C> <C>
CONSOLIDATED STATEMENTS OF
OPERATIONS DATA:
Sales, net $8,592 $7,445 $5,294
Cost of sales 6,059 4,626 3,455
Gross profit 2,533 2,820 1,839
Operating expenses 2,556 1,848 1,551
Net income (loss) (85) 528 264
Net earnings (loss) per common share (0.04) 0.24 0.12
Weighted average number of common shares 2,222 2,173 2,173
CONSOLIDATED BALANCE SHEETS
DATA (AT YEAR END):
Current assets $1,912 $1,932 $1,460
Total assets 7,706 6,276 5,953
Current liabilities 1,234 631 732
Total liabilities 2,941 1,642 1,848
Total stockholders' equity 4,765 4,634 4,105
</TABLE>
Except as otherwise set forth herein, the information concerning
the Company contained in this Offer to Purchase has been taken from or
based upon publicly available documents and records on file with the SEC
and other public sources and is qualified in its entirety by reference
thereto. Although Purchaser has no knowledge that would indicate that
any statements contained herein based on such documents and records are
untrue, Purchaser cannot take responsibility for the accuracy or
completeness of the information contained in such documents and records,
or for any failure by the Company to disclose events which may have
occurred or may affect the significance or accuracy of any such
information but which are unknown to Purchaser.
The Company is subject to the information and reporting
requirements of the Exchange Act and in accordance therewith is
obligated to file reports and other information with the SEC relating to
its business, financial condition and other matters. Information, as of
particular dates, concerning the Company's directors and officers, their
remuneration, stock options granted to them, the principal holders of
the Company's securities, any material interests of such persons in
transactions with the Company and other matters is required to be
disclosed in proxy statements distributed to the Company's stockholders
and filed with the SEC. Such reports, proxy statements and other
information should be available for inspection at the public reference
room at the SEC's offices at 450 Fifth Street, N.W., Washington, DC
20549, and also should be available for inspection and copying at the
regional offices of the SEC located at Seven World Trade Center, 13th
Floor, New York, New York 10048 and Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. Copies may be obtained, by
mail, upon payment of the SEC's customary charges, by writing to its
principal office, 450 Fifth Street, N.W., Washington, D.C. 20549 and
can be accessed electronically on the SEC's Website at
http://www.sec.gov. Copies of such information should also be available
for inspection at the offices of Nasdaq Operations, 1735 K Street, N.W.,
Washington, D.C. 20006.
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<PAGE>
<PAGE>
9. CERTAIN INFORMATION CONCERNING PURCHASER.
Through its various subsidiaries, Purchaser manufactures and
markets plastic vinyls and urethanes, carpet padding and backing, non-
slip textiles and coated fabrics. The majority of Purchaser's sales are
derived from manufacturing plastic vinyls and urethanes which are sold
to customers throughout the United States. Purchaser is a Missouri
corporation organized in 1973. Unless the context otherwise indicates,
references to the "Purchaser" include Purchaser and its subsidiaries.
Purchaser is a private company; substantially all of its
outstanding stock is owned by Marvin S. Wool and trusts for the benefit
of his family. Set forth below is certain summary consolidated financial
information as of April 30, 1998, 1997 and 1996 and for each of
Purchaser's three fiscal years in the period then ended, and as of
January 31, 1999 and for the nine months ended January 31, 1999 and
1998. The consolidated financial information presented below for the
three fiscal years in the period ended April 30, 1998 has been derived
from Purchaser's audited financial statements. The consolidated
financial information presented below as of January 31, 1999 and for the
nine months ended January 31, 1999 and 1998 has been derived from
unaudited financial statements of Purchaser which, in the opinion of
Purchaser's management, reflect all adjustments (consisting of normally
recurring accruals) necessary for a fair presentation. Copies of the
Purchaser's consolidated financial statements from which the following
selected consolidated financial information has been derived may be
obtained from the SEC as set forth under "Certain Information Concerning
the Company."
<TABLE>
PURCHASER
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN MILLIONS, EXCEPT PER SHARE DATA)
<CAPTION>
NINE MONTHS ENDED
JANUARY 31, YEARS ENDED APRIL 30,
------------------- -------------------------------
1999 1998 1998 1997 1996
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENTS OF
EARNINGS DATA:
Net sales and operating revenue
and other revenue $63.1 $65.8 $89.1 $85.2 $80.0
Income before income taxes and
minority interest 6.8 5.3 7.8 9.7 8.2
Net income 4.3 3.2 4.5 5.9 5.0
Net income per common share 41.13 30.83 42.41 56.36 47.34
<CAPTION>
APRIL 30,
JANUARY 31, ------------------------------
1999 1998 1997 1996
----------- ----- ----- -----
<S> <C> <C> <C> <C>
CONSOLIDATED BALANCE SHEETS
DATA AT PERIOD END:
Working capital $20.8 $19.6 $19.6 $14.4
Total assets 40.8 36.9 31.3 27.2
Total indebtedness 0.5 0.6 0.9 2.3
Stockholders' equity 32.2 27.9 23.5 17.6
</TABLE>
Statements Purchaser may publish, including those in this Offer
to Purchase, that are not strictly historical are "forward-looking"
statements under the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Although Purchaser believes the
expectations reflected in such forward-looking statements are based on
reasonable assumptions, it can give no assurance that its expectations
will be realized. Forward-looking statements involve known and unknown
risks which may cause Purchaser's actual results and corporate
developments to differ materially from those expected. Factors that
could cause results and developments to differ materially from
Purchaser's expectations include, without limitation, changes in
manufacturing and shipment schedules, delays in completing plant
construction and acquisitions, new product and technology developments,
competition within each
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<PAGE>
business segment, cyclicality of the markets for the products of a major
segment, litigation, significant cost variances, the effects of
acquisitions and divestitures, and other risks.
The name, citizenship, business address, present principal
occupation, and material positions held during the past five years of
each of the directors and executive officers of Purchaser are set forth
in Schedule A to this Offer to Purchase.
Except as described elsewhere herein, neither Purchaser nor, to
the best of its knowledge, any of the persons listed in Schedule A
hereto nor any associate or majority-owned subsidiary of the foregoing,
beneficially owns or has a right to acquire any equity securities of the
Company. Neither Purchaser nor, to the best of its knowledge, any of
the persons or entities referred to above, nor any director, executive
officer or subsidiary of any of the foregoing, has effected any
transaction in such equity securities during the past 60 days.
Except as described elsewhere herein, neither Purchaser nor, to
the best of its knowledge, any of the persons listed in Schedule A
hereto, has any contract, arrangement, understanding or relationship
with any other person with respect to any securities of the Company,
including, but not limited to, any contract, arrangement, understanding
or relationship concerning the transfer or the voting of any such
securities, joint ventures, loan or option arrangements, puts or calls,
guaranties of loans, guaranties against loss or the giving or
withholding of proxies. Except as set forth in Sections 10 and 11,
there have been no contacts, negotiations or transactions between
Purchaser or, to the best of its knowledge, any of the persons listed in
Schedule A hereto, on the one hand, and the Company or its affiliates,
on the other hand, concerning a merger, consolidation or acquisition, a
tender offer or other acquisition of securities, an election of
directors, or a sale or other transfer of a material amount of assets.
Except as described in Sections 10 and 11, neither Purchaser nor, to the
best of its knowledge, any of the persons listed in Schedule A hereto,
has had any transaction with the Company or any of its executive
officers, directors or affiliates that would require disclosure under
the rules and regulations of the SEC applicable to the Offer.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
Purchaser became familiar with the Company over approximately the
past two years as a result of an existing supply relationship. Purchaser
supplies adhesive, a principal raw material used as a bonding agent for
the Company's rubber products. In 1996, 1997 and 1998, Purchaser had
sales to the Company of approximately $0, $120,000 and $800,000,
respectively. During the summer of 1998, an employee of the Company
contacted the general manager of MarChem Pacific, Inc., a Purchaser
subsidiary, who asked whether Purchaser would be interested in
participating in a buyout of the Company. MarChem Pacific, Inc. reported
the inquiry to Purchaser's executive management, who indicated an
interest in discussing such a transaction with the Company's Board of
Directors and principal stockholders. Subsequently, the Company informed
Purchaser that the individual who had initiated the contact on behalf of
the Company had not been authorized to do so. These communications,
however, led to an introduction of Ron Bogh, the Company's Chief
Executive Officer, and Marvin S. Wool, Purchaser's Chief Executive
Officer.
Initial contacts did not directly result in negotiations regarding a
strategic alliance between the Company and Purchaser. However, Purchaser
began to follow the Company's business as described in its periodic SEC
filings and news releases and, after considering that information, Mr.
Wool contacted Mr. Bogh in mid-November 1998 and suggested that they
meet to discuss whether the parties had a mutual interest in a strategic
transaction. On November 20, 1998, after entering into a confidentiality
agreement, Mr. Wool and other members of Purchaser's senior management,
including Michael Deering, Paul Simons and Greg Divis met in
McMinnville, Oregon with Mr. Bogh, counsel for the Company, and an
accountant from a local office of a large accounting firm. At that
meeting, the parties discussed their respective businesses and Purchaser
reviewed its historical approach to acquisitions. Mr. Wool also advised
Mr. Bogh that Purchaser's preliminary valuation of the Common Stock for
a transaction of this type was $2.00 to $2.25 per Share.
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<PAGE>
At a meeting of the Board on November 23, 1998, Mr. Bogh reported on
the preliminary discussions. At that point, the Board determined that
it would not support a transaction at the suggested valuation range. The
Board did not believe the price would be adequate under the
circumstances because the two largest shareholders, Messrs. Bogh and
Nelson, would not be willing to sell at that price. The Board advised
Mr. Bogh and Mr. Nelson that the Board would entertain a revised offer
only if it were acceptable to Messrs. Bogh and Nelson. Mr. Bogh
communicated the Board's discussion to Mr. Wool by telephone the next
day.
Following the Board's decision, in a subsequent telephone
conversation on December 1, 1998, Mr. Wool and Mr. Bogh discussed a
proposal in which Purchaser would pay between $2.75 and $3.00 per share
in a tender offer for 80% of the Shares, while purchasing all Shares
owned by stockholders of the Company owning 1,000 or fewer Shares. From
time to time during the remainder of December 1998 and January 1999,
Messrs. Wool and Bogh discussed various terms of a possible transaction,
including arrangements for employment agreements with Messrs. Bogh,
Nelson and Gilson.
On February 7 and 8, 1999, at Mr. Wool's request, Mr. Bogh met in
St. Louis with Mr. Wool and other Purchaser representatives and discussed
a proposed purchase price of $3.00 per share and more detailed terms of
possible employment agreements with the Company's executives which would
be applicable if Purchaser effected the transaction, including the term,
salary, bonus, equity participation and insurance and other benefits.
Following that meeting, Mr. Bogh communicated with Mr. Wool and Michael
Deering, Purchaser's Director of Human Resources, to resolve issues
connected with the employment agreements. At this point, Mr. Bogh
decided to present the revised proposal to the Board.
At the Board meeting on February 16, 1999, the directors considered
Purchaser's revised proposal and price structure. The Board generally
favored a transaction on that valuation, subject to agreement on
specific details of the transaction, and authorized Mr. Bogh to
communicate this fact to Purchaser. During a break in the meeting, Mr.
Bogh and the Company's counsel telephoned Mr. Wool and advised him of
the Board's reaction and suggested that if Purchaser wished to pursue a
transaction he should submit a written proposal.
On February 22, 1999, Purchaser submitted a written proposal to the
Board for a tender offer to purchase 70% of the Shares at $3.00 per
Share, with Purchaser designees to comprise a majority of the Company's
Board of Directors following the closing. The proposal also included
terms of employment agreements for Messrs. Bogh, Nelson and Gilson.
Purchaser's proposal was conditioned on certain events, including a
requirement that the Board would obtain an opinion from a qualified
independent financial advisor that the transaction is fair to the
Company's stockholders from a financial perspective, and a requirement
that the Shares would continue to be listed on the Nasdaq SmallCap
Market after closing.
The next day, Mr. Bogh and the Company's counsel conveyed to
Purchaser and its counsel the Company's comments on the transaction,
based on the review of Mr. Bogh and the Company's counsel, and discussed
Messrs. Bogh, Gilson and Nelson's comments on the proposed employment
agreement terms. Negotiations over Purchaser's proposed employment terms
for the Company's executives were conducted over the next several days
in telephonic discussions among Mr. Wool, Mr. Bogh, Mr. Gilson, counsel
to the Company and counsel to Purchaser. Following a resolution of those
terms, Mr. Bogh telephoned Mr. Wool and indicated a willingness to
proceed.
On March 3, 1999, representatives of Purchaser, including its
attorneys and accountants, met with the Board in McMinnville. At that
meeting the parties reviewed Purchaser's written proposal and discussed
certain changes to that proposal. A revised draft of Purchaser's
proposal was circulated to the Board on March 5, 1999 to reflect the
agreed changes and, after a telephonic meeting of the Board, at which
the Board approved the letter of intent and authorized Mr. Bogh to
execute it on behalf of the Company. Thereupon, Mr. Bogh executed the
letter of intent on behalf of the Company. Representatives of
Purchaser's management performed on-site due diligence at the Company's
facilities on March 12, 13 and 14, 1999.
A draft of the definitive Stock Purchase Agreement was submitted to
the Company on March 10, 1999. The draft implemented the terms set forth
in the letter of intent, as well as certain representations, warranties,
covenants
- 14 -
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<PAGE>
and closing conditions. In the draft, Purchaser also proposed that, if
fewer than 70% of the outstanding Shares were tendered pursuant to the
Offer, the Company would agree to issue to Purchaser, at a price of
$2.00 per Share, that number of Shares that would result in Purchaser
owning 70% of the outstanding Shares. After considering that provision,
the Board declined to proceed unless the price for all Shares to be
purchased in the Offering was $3.00. Purchaser discussed, but did not
offer, an alternative in the form of a cash merger offer in which
Purchaser would purchase all of the Shares for $3.00 per Share. During
subsequent negotiations, however, the parties agreed that if fewer than
70% of the Shares were tendered, Purchaser could elect (i) to terminate
the Offer, or (ii) to cause the Company to issue to Purchaser, at a
price of $3.00 per Share, a number of additional Shares that would
result in Purchaser owning 70% of the outstanding Shares.
At a meeting of the Company's Board of Directors on April 8, 1999,
Pacific Crest rendered its opinion that the Stock Purchase Agreement was
fair to the Company's stockholders from a financial perspective. After
reviewing the form and terms of the Stock Purchase Agreement and the
related agreements and transactions, the Board unanimously approved the
Stock Purchase Agreement, the Offer, and transactions contemplated
thereby. Promptly thereafter, the parties executed and delivered the
Agreement. Thereupon, the Company issued a press release to announce the
transaction publicly.
11. PURPOSE OF THE OFFER; PLANS FOR THE COMPANY.
Purpose. Purchaser has extensive investments in various businesses
which are complementary to the business of the Company. In addition to
being a principal supplier of the Company for its requirements of
adhesive, Purchaser owns businesses which sell various rubber products,
and products used by manufacturers of floor covering. As a result of its
complementary business interests and background of making acquisitions,
Purchaser has identified the Company as an attractive investment
opportunity.
Purchaser would like to obtain a controlling investment in the
Company and has caused the Offer to be made in order to allow the
Company's existing stockholders the opportunity to sell their Shares at
a price above recent levels of the market price for the Shares and/or
continue their investment in the Company as Purchaser seeks to grow
stockholder value. If Purchaser were to acquire Shares pursuant to the
Offer, Purchaser would have the ability to formulate and implement the
Company's strategies.
Purchaser is undertaking the Offer and the related transactions to
facilitate the growth of the Company's existing business by making
Purchaser's management, manufacturing, marketing and financial resources
available to the Company for the benefit of all of the Company's
stockholders. To fund the growth of the Company's business, Purchaser
expects to make available up to $3 million of subordinated debt
financing and/or facilitate the refinancing and possible increase of the
Company's existing credit facilities on terms more favorable than
currently apply. Purchaser plans to operate the Company as a stand-alone
business with its existing capital structure, and with the Company's
operations separate from those of other businesses owned by Purchaser.
Purchaser also plans to maintain the quotation of the Company's Common
Stock on Nasdaq for the foreseeable future. Purchaser anticipates that
any transactions between Purchaser and its affiliates, on the one hand,
and the Company, on the other hand, will be on terms no less favorable
to the Company than could be obtained by the Company from an unrelated
third party.
Purchaser, from time to time, intends to evaluate and review the
Company's assets, operations, management and personnel and consider
what, if any, changes would be desirable in light of circumstances which
then exist (which may include an assessment of industry trends and
conditions, and general economic circumstances prevailing from time to
time). Thereafter, Purchaser may, among other things, seek to (i)
acquire additional securities of the Company, enter into an
extraordinary transaction such as a merger, reorganization or
liquidation of the Company, (ii) sell or transfer all or substantially
all of the Company's assets, (iii) change the Company's current Board of
Directors (including changing the number or term of directors or filling
existing vacancies on the Board), (iv) change the present capitalization
or dividend policy of the Company, (v) materially change the Company's
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<PAGE>
business or corporate structure, (vi) change the Company's articles of
incorporation or by-laws, (vii) cause the Company's Common Stock to be
delisted from Nasdaq, (viii) cause the Company's Common Stock to become
eligible for termination of registration under the Exchange Act, or (ix)
take actions similar to any of those referred to above. Purchaser has no
present plans or proposals to implement such changes, however, there can
be no assurance that Purchaser would not seek to implement such changes
in the future.
Termination Provisions. According to its terms, the Stock
Purchase Agreement may be terminated and the transactions contemplated
thereby abandoned at any time prior to the closing of the purchase of
Shares pursuant to the Offer (the "Closing") by the mutual consent of
Purchaser and the Company, by action of their respective Boards of
Directors. In addition, the Stock Purchase Agreement may be terminated
and the transactions contemplated thereby abandoned at any time prior to
the Closing by action of the Board of Directors of either Purchaser or
the Company if (i) Purchaser shall have terminated the Offer without
purchasing any Shares pursuant thereto; (ii) any court of competent
jurisdiction or other Governmental Entity located or having jurisdiction
within the United States or any country in which either the Company or
Purchaser, directly or indirectly, has material assets or operations,
shall have issued a final order, decree or ruling or taken any other
final action restraining, enjoining or otherwise prohibiting the Offer
and such order, decree, ruling or other action is or shall have become
final and nonappealable; or (iii) the Closing shall not have occurred on
or before June 30, 1999. The Stock Purchase Agreement may also be
terminated and the transactions contemplated thereby may be abandoned at
any time prior to the Closing by action of the Board of Directors of
Purchaser if (i) the Company shall have breached or failed to perform in
any material respect any of the covenants or agreements contained in the
Stock Purchase Agreement to be complied with or performed by the Company
prior to such date of termination which breach or failure shall not have
been cured prior to the earlier of (A) five business days following the
giving of written notice to the Company of such breach or failure and
(B) two business days prior to the date on which the Offer is then
scheduled to expire, or any representation or warranty of the Company
set forth in the Stock Purchase Agreement shall have been inaccurate or
incomplete when made except for such failures to be complete or accurate
that, individually or in the aggregate, could not reasonably be expected
to have a material adverse effect on the financial condition,
properties, business or results of operations of the Company and its
subsidiaries taken as a whole or could prevent or materially delay the
transactions contemplated by the Stock Purchase Agreement or impair the
ability of Purchaser, the Company or any of their respective affiliates,
following consummation of the Offer, to conduct any material business or
operations in any jurisdiction where they are now being conducted, (ii)
the Board of Directors of the Company (or a special committee thereof)
shall have amended, modified or withdrawn in a manner adverse to
Purchaser its approval or recommendation of the Offer or the Stock
Purchase Agreement or the Board of Directors of the Company (or a
special committee thereof), upon request by Purchaser, shall fail to
reaffirm such approval or recommendation, or shall have endorsed,
approved or recommended any other Acquisition Proposal (as defined in
the Stock Purchase Agreement), or shall have resolved to do any of the
foregoing, or (iii) the Company or any of the other persons or entities
described in Section 5.2 of the Stock Purchase Agreement shall take any
actions that would be proscribed by Section 5.2 of the Stock Purchase
Agreement but for the exception therein allowing certain actions to be
taken if required by fiduciary obligations under applicable law as
advised in writing by counsel. The Stock Purchase Agreement may be
terminated and the transactions contemplated thereby may be abandoned at
any time prior to the Closing by action of the Board of Directors of the
Company, (i) if Purchaser (x) shall have breached or failed to perform
in any material respect any of the covenants or agreements contained in
the Stock Purchase Agreement to be complied with or performed by
Purchaser prior to such date of termination which shall not have been
cured prior to the earlier of: (A) five business days following the
giving of written notice to Purchaser of such breach or failure and (B)
two business days prior to the date on which the Offer is then scheduled
to expire, or (y) shall have failed to commence the Offer within the
time required in Section 1.1 of the Stock Purchase Agreement, or (ii) if
(w) the Company is not in material breach of any of the terms of the
Stock Purchase Agreement, (x) the Board of Directors of the Company
authorizes the Company, subject to complying with the terms of the Stock
Purchase Agreement, to enter into a binding written agreement concerning
a transaction that constitutes a Superior Proposal (as defined in the
Stock Purchase Agreement) and the Company notifies Purchaser in writing
that it intends to enter into such an agreement, attaching the most
current version of such agreement (which shall include all of the
material terms, including the price proposed to be paid for Shares
pursuant thereto) to such notice, (y) Purchaser does not make, within
two business days of receipt of the Company's written notification of
its intention to enter into a binding agreement for a Superior Proposal,
an offer that the Board of Directors of the Company determines, in good
faith
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<PAGE>
after consultation with its financial advisors, is at least as
favorable, from a financial point of view, to the stockholders of the
Company as the Superior Proposal and (z) the Company, prior to such
termination, pays to Purchaser in immediately available funds the fees
required to be paid pursuant to Section 7.5(b) of the Stock Purchase
Agreement.
In the event of the termination of the Stock Purchase Agreement,
no party to the Stock Purchase Agreement (or any of its directors or
officers) shall have any liability or further obligation to any other
party to the Stock Purchase Agreement, except as provided in Sections
7.5(b) or (c) and Section 8.2 therein and except that nothing therein
will relieve any party from liability for any willful breach of the
Stock Purchase Agreement; provided, however, that if the Stock Purchase
Agreement is terminated by Purchaser pursuant to Section 7.3(i) or the
Company pursuant to Section 7.4(i) therein, the terminating party's
rights to pursue all legal remedies will survive such termination
unimpaired; provided further, however, that in no event shall the
liability of the non-terminating party exceed the sum of $75,000.
If (i) (x) the Offer shall have remained open for a minimum of
at least 20 business days, (y) after the date of the Stock Purchase
Agreement any corporation, partnership, person, other entity or group
(as defined in Section 13(d)(3) of the Exchange Act) other than
Purchaser or any of their respective subsidiaries or affiliates
(collectively, a "Person") shall have become the beneficial owner of 20%
or more of the outstanding Shares after the date of the Stock Purchase
Agreement or shall have publicly announced a proposal or intention to
make an Acquisition Proposal or any Person shall have commenced, or
shall have publicly announced an intention to commence, a tender offer
or exchange offer for 20% or more of the outstanding Shares, and (z) the
Minimum Condition shall not have been satisfied and the Offer is
terminated without the purchase of any Shares thereunder, or (ii)
Purchaser shall have terminated the Stock Purchase Agreement pursuant to
Section 7.3(ii) or Section 7.3(iii) thereof or (iii) the Company shall
have terminated the Stock Purchase Agreement pursuant to Section 7.4(ii)
thereof; then the Company shall promptly, but in no event later than two
days after the date of such termination, reimburse Purchaser (not later
than one business day after request by Purchaser) for all of the
attorney's fees and other out-of-pocket charges, and expenses reasonably
incurred by Purchaser in connection with the Stock Purchase Agreement
and the transactions contemplated by the Stock Purchase Agreement, in
each case payable by wire transfer in same day funds. If the Company
fails to promptly pay the amount due pursuant to Section 7.5(b) of the
Stock Purchase Agreement, and, in order to obtain such payment,
Purchaser commences a suit which results in a judgment against the
Company for the fee set forth in such Section, the Company shall pay to
Purchaser its costs and expenses (including attorneys' fees) in
connection with such suit.
If the Offer shall have been terminated prior to Closing by
Purchaser because the Minimum Condition shall not have been satisfied or
waived on or before the Expiration Date, then Purchaser shall reimburse
the Company for one-half of the amount paid by the Company to the
Financial Advisor within five business days after the Company has made
written demand to Purchaser therefor and delivered to Purchaser
documentation reasonably evidencing the amount of such payment;
provided, however, that Purchaser's reimbursement obligation shall not
exceed $15,000 in the aggregate. If Purchaser fails to promptly pay the
amount due pursuant to Section 7.5(c) of the Stock Purchase Agreement,
and in order to obtain such payment, the Company commences a suit which
results in a judgment against Purchaser for the fees set forth in such
Section 7.5(c), Purchaser shall pay to the Company its costs and
expenses (including reasonable attorneys' fees) in connection with such
suit.
Amendment. Subject to the provisions of applicable law, at any
time prior to the Closing Date, the Stock Purchase Agreement may be
modified or amended by written agreement executed and delivered by duly
authorized officers of the respective parties.
Composition of the Board of Directors. Pursuant to the Stock
Purchase Agreement, at the Closing and subject to compliance with
applicable law, the Company will use its best efforts to cause the
Company's Board of Directors to consist of Ronald L. Bogh, Paul M.
Gilson and, at Purchaser's option, up to four additional persons
designated by Purchaser, two of whom shall be Marvin S. Wool and Gregory
J. Divis. In furtherance thereof, the Company will increase the size of
the Board of Directors of the Company, or use its reasonable efforts to
secure the resignation of directors, or both, as is necessary to permit
Purchaser's designees to be elected to the Board of Directors of the
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Company. At such time, the Company, if so requested, will use its
reasonable efforts to cause persons designated by Purchaser to
constitute the same proportionate representation of each committee of
the Board of Directors of the Company, each board of directors of each
subsidiary of the Company and each committee of each such board (in each
case to the extent of the Company's ability to elect such persons). The
Company's obligations to appoint designees to the Board of Directors of
the Company shall be subject to Section 14(f) of the Exchange Act and
Rule 14f-1 promulgated thereunder. The Company shall promptly take all
actions required pursuant to such Section and Rule in order to fulfill
its obligations under the Stock Purchase Agreement and shall include in
the Schedule 14D-9, or in a separate Rule 14f-1 information statement
provided to stockholders, such information with respect to the Company
and its officers and directors as is required under Section 14(f) and
Rule 14f-1 to fulfill its obligations under the Stock Purchase
Agreement. Purchaser will supply to the Company and will be solely
responsible for any information with respect to Purchaser and its
nominees, officers, directors and affiliates required by Section 14(f)
and Rule 14f-1.
Acquisition Proposals. Pursuant to the Stock Purchase Agreement,
the Company has agreed that the Company, its affiliates and its and
their respective officers, directors, employees, representatives and
agents (including, without limitation, any investment banker, attorney
or accountant retained by the Company or its subsidiary) shall
immediately cease all existing discussions or negotiations, if any, with
any parties conducted before the date of the Stock Purchase Agreement
with respect to any acquisition or exchange of all or any material
portion of the assets of, or any of the equity interest in, the Company
or its subsidiary (by direct purchase from the Company or its
subsidiary, tender or exchange offer or otherwise) or any business
combination, merger, consolidation or similar transaction (including an
exchange of stock or assets) with or involving the Company or its
subsidiary or any division of the Company or its subsidiary (an
"Acquisition Transaction"). Neither the Company nor any of its
affiliates, nor any of its or their respective officers, directors,
employees, representatives or agents (including, without limitation, any
investment banker, attorney or accountant retained by the Company or its
subsidiary) shall, directly or indirectly, encourage, solicit,
participate in or initiate discussions or negotiations with, or provide
any information to, any corporation, partnership, person or other entity
or group (other than Purchaser, any affiliate or associate of Purchaser
or any designees of Purchaser) with respect to any inquiries or the
making of any offer or proposal (including, without limitation, any
offer or proposal to the stockholders of the Company) concerning an
Acquisition Transaction (an "Acquisition Proposal"), unless the Board of
Directors of the Company determines in good faith after consultation
with outside legal counsel that such action is necessary in order for
its directors to comply with their respective fiduciary duties under
applicable law (any such more favorable Acquisition Proposal being
referred to in the Stock Purchase Agreement as a "Superior Proposal").
The Company will take the necessary steps to inform the individuals or
entities referred to in the first sentence of this paragraph of the
obligations undertaken pursuant to the Stock Purchase Agreement. The
Company will notify Purchaser immediately if any such inquiries or
proposals are received by, any such information is requested from, or
any such negotiations or discussions are sought to be initiated or
continued with the Company, the name of the person making such
proposals, the material terms and conditions of such proposals and
thereafter shall keep Purchaser informed, on a current basis, of the
status and terms of such proposal and the status of such negotiations or
discussions. The Company has agreed not to release any third party
from, or waive any provisions of, any confidentiality or standstill
agreement to which the Company is a party, unless the Board of Directors
of the Company shall have determined in good faith, based upon the
advice of outside counsel to the Company, that failing to release such
third party or waive such provisions would constitute a breach of the
fiduciary duties of the Board of Directors of the Company under
applicable law.
Covenants. The Stock Purchase Agreement also contains certain
other restrictions as to the conduct of business by the Company, as well
as representations and warranties of each of the parties customary in
transactions of this kind.
Employment and Noncompetition Agreements. In connection with the
execution of the Stock Purchase Agreement, Purchaser required that
Ronald L. Bogh and Paul M. Gilson enter into employment agreements with
the Company and Douglas C. Nelson enter into a non-competition agreement
with the Company.
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Mr. Bogh's agreement provides that the Company shall employ him as
President of the Company for a period of three years, unless terminated
earlier in accordance with the agreement. Mr. Bogh shall perform such
duties as the Company's Board of Directors may assign to him. The
Company shall pay Mr. Bogh a base annual salary of $160,800 during the
first year of the term, $170,400 during the second year of the term and
$180,000 during the third year of the term. The Company also shall pay
to Mr. Bogh a bonus calculated pursuant to a formula based on the amount
by which the pre-tax profits of the Company exceed a baseline amount
determined by the Company's Board of Directors. Mr. Bogh shall be
eligible to participate in such benefit plans as are provided to the
employees of the Company. The agreement requires Mr. Bogh to enter into
an additional agreement with the Company pursuant to which the Company
shall employ Mr. Bogh as a business technician from the time of
termination of the previous employment agreement until December 31, 2008
at an annual salary of $60,000. The agreement requires Mr. Bogh to
execute a confidentiality agreement which confirms his obligation to
keep the Company's proprietary information confidential for a period of
one year following the termination of his employment with the Company as
well as the Company's ownership of inventions and discoveries conceived
of by Mr. Bogh during his employment. The confidentiality agreement
also contains a covenant by Mr. Bogh not to become engaged in the
manufacture or sales of products similar to those manufactured or sold
by the Company for a period of three years following the termination of
Mr. Bogh's employment with the Company.
Mr. Gilson's agreement provides that the Company shall employ him
as Chief Operating Officer and Senior Vice President of the Company for
a period of four years, unless terminated earlier in accordance with the
agreement. Mr. Gilson shall perform such duties as the Company's Board
of Directors or President may assign to him. The Company shall pay Mr.
Gilson a base annual salary of $114,000 during the first year of the
term, $120,000 during the second year of the term, $126,000 during the
third year of the term and $132,000 during the fourth year of the term.
The Company also shall pay to Mr. Gilson a bonus calculated pursuant to
a formula based on the amount by which the pre-tax profits of the
Company exceed a baseline amount determined by the Company's Board of
Directors. Mr. Gilson shall be eligible to participate in such benefit
plans as are provided to the employees of the Company. The agreement
requires Mr. Gilson to execute a confidentiality agreement which
confirms his obligation to keep the Company's proprietary information
confidential for a period of one year following the termination of his
employment with the Company as well as the Company's ownership of
inventions and discoveries conceived of by Mr. Gilson during his
employment. The confidentiality agreement also contains a covenant by
Mr. Gilson not to become engaged in the manufacture or sales of products
similar to those manufactured or sold by the Company for a period of one
year following the termination of Mr. Gilson's employment with the
Company.
Mr. Nelson's non-competition agreement consists of two agreements.
The first is a letter agreement which provides that for a maximum term
of four years following the Closing the Company will reimburse Mr.
Nelson for the cost of his COBRA medical coverage to the extent he is
eligible for such coverage and for the remainder of the term shall
reimburse Mr. Nelson for the cost of a personal medical insurance plan,
not to exceed $1,350 per month. In consideration thereof, the letter
agreement requires Mr. Nelson to enter into the second agreement, a
confidentiality and non-compete agreement, which provides that during
the term of payments required by the letter agreement and for a period
of one year thereafter, Mr. Nelson is prohibited from engaging in any
activity with any business competitive with the Company. The
confidentiality and non-compete agreement further confirms Mr. Nelson's
obligation to keep confidential the proprietary information of the
Company.
Agreement to Tender Shares By Certain Stockholders. In connection
with the execution of the Stock Purchase Agreement, Purchaser required
that each of Ronald L. Bogh, Douglas C. Nelson and James V. Reimann
enter into stockholder agreements requiring them to tender a certain
number of Shares pursuant to the Offer. Pursuant to such agreements,
Messrs. Bogh, Nelson and Reimann have agreed to tender 481,040, 407,000
and 47,500 Shares, respectively, which constitute approximately 80%,
100% and 100%, respectively, of their respective Share holdings. In
addition, Mr. Bogh's agreement provides that if within five business
days prior to the expiration of the Offer, fewer than 70% of the
Company's outstanding shares shall have been validly tendered pursuant
to the Offer and not withdrawn, upon the request of Purchaser, Mr. Bogh
shall tender all of his Shares if so directed by Purchaser. Such
agreements also require Messrs. Bogh, Nelson and Reimann to refrain from
exercising any options to purchase any Shares held by them prior to the
Closing.
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Appraisal Rights. No appraisal rights are available in connection
with the Offer.
Rule 13e-3. Rule 13e-3 under the Exchange Act, which Purchaser
does not believe would be applicable to the Offer, requires, among other
things, that certain financial information concerning the Company and
certain information relating to the fairness of the proposed transaction
and the consideration offered to stockholders of the Company therein, be
filed with the SEC and disclosed to stockholders of the Company prior to
consummation of the transaction.
12. SOURCE AND AMOUNT OF FUNDS.
Purchaser estimates that the total amount of funds required to purchase
all of the outstanding Shares pursuant to the Offer and to pay related
fees and expenses will be approximately $4.9 million. Purchaser expects
to obtain these funds from existing available cash on hand of Purchaser.
13. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Offer, Purchaser shall
not be required to accept for payment or, subject to any applicable
rules and regulations of the SEC, including Rule 14e-l(c) under the
Exchange Act (relating to Purchaser's obligation to pay for or return
tendered Shares promptly after termination or withdrawal of the Offer),
pay for, or may delay the acceptance for payment of or payment for, any
tendered Shares, or may, in its sole discretion, terminate or amend the
Offer as to any Shares not then paid for if, (i) prior to the expiration
of the Offer, (x) a number of Shares which constitutes more than 30% of
the voting power (determined on a fully-diluted basis) of all the
securities of the Company entitled to vote generally in the election of
directors shall not have been validly tendered and not withdrawn prior
to the expiration of the Offer (the "Minimum Condition") or (y) any
consent, registration, approval, permit or authorization of any
Governmental Entity applicable to the Offer shall not have been obtained
on terms satisfactory to Purchaser in its reasonable judgment, or (ii)
on or after April 8, 1999, and at or before the time of payment for any
of such Shares (whether or not any Shares have theretofore been accepted
for payment), any of the following events shall occur:
(a) there shall have occurred (i) any general suspension of, or
limitation on prices for, trading in securities on the Nasdaq SmallCap
Market, (ii) a declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States, (iii) a commencement
or escalation of a war, armed hostilities or other international or
national calamity directly involving the United States, other than the
current hostilities in Serbia and Kosovo, (iv) any limitation (whether
or not mandatory) by any Governmental Entity on, or any other event that
might affect, the extension of credit by banks or other lending
institutions, (v) a material change in United States or any other
currency exchange rates or a suspension of, or limitation on, the
markets therefor, (vi) or in the case of any of the foregoing existing
at the time of the commencement of the Offer, a material acceleration or
worsening thereof, or (vii) any extraordinary or material adverse change
in the market price of the Shares or in the United States securities or
financial markets generally, including, without limitation, a decline of
at least 20% in either the Dow Jones Average of Industrial Stocks or the
Standard & Poor's 500 index from the date of the Stock Purchase
Agreement.
(b) the Company shall have breached or failed to perform in any
material respect any of its obligations, covenants or agreements
contained in the Stock Purchase Agreement or any representation or
warranty of the Company set forth in the Stock Purchase Agreement shall
have been inaccurate or incomplete in any material respect when made or
thereafter shall become inaccurate or incomplete in any material
respect;
(c) there shall be threatened, instituted or pending any civil,
criminal or administrative action, suit, claim, hearing, investigation
or proceeding (an "Action") before any court or other Governmental
Entity by any Governmental Entity or instituted or pending any Action by
any other person, domestic or foreign: (i) challenging
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the acquisition by Purchaser of Shares, seeking to restrain or prohibit
the consummation of the transactions contemplated by the Offer, seeking
to obtain any material damages or otherwise directly or indirectly
relating to the transactions contemplated by the Offer; (ii) seeking to
prohibit, or impose any material limitations on, Purchaser's ownership
or operation of all or any portion of its or the Company's business or
assets (including the business or assets of their respective affiliates
and subsidiaries), or to compel Purchaser to dispose of or hold separate
all or any portion of Purchaser's or the Company's business or assets
(including the business or assets of their respective affiliates and
subsidiaries) as a result of the transactions contemplated by the Offer;
(iii) seeking to make the acceptance for payment, purchase of, or
payment for, some or all of the Shares illegal or render Purchaser
unable to, or result in a delay in, or restrict, the ability of
Purchaser to, accept for payment, purchase or pay for some or all of the
Shares; (iv) seeking to impose material limitations on the ability of
Purchaser effectively to acquire or hold or to exercise full rights of
ownership of the Shares including, without limitation, the right to vote
the Shares purchased by Purchaser on an equal basis with all other
Shares on all matters properly presented to the stockholders; or (v)
that, in any event, in the judgment of Purchaser, is reasonably likely
to have a material adverse effect on the financial condition,
properties, business or operations of the Company or Purchaser (or any
of their respective affiliates or subsidiaries) or the value of the
Shares to Purchaser or the benefits expected to be derived by Purchaser
as a result of consummation of the transactions contemplated by the
Offer;
(d) any statute, rule, regulation, order or injunction shall be
sought, proposed, promulgated, entered, enforced, or deemed or become
applicable to the Offer or the Stock Purchase Agreement or any other
action shall have been taken, proposed or threatened, by any court or
other Governmental Entity that, in the judgment of Purchaser, could be
expected to, directly or indirectly, result in any of the effects of, or
have any of the consequences sought to be obtained or achieved in, any
Action referred to in clauses (i) through (v) of paragraph (c) above;
(e) A tender or exchange offer for any portion or all of the
Shares shall have been commenced or publicly proposed to be made by
another person (including the Company or its subsidiaries), or it shall
have been publicly disclosed or Purchaser shall have learned that (i)
any person (including the Company or its subsidiaries), entity, or
"group" (as defined in Section 13(d) of the Exchange Act and the rules
promulgated thereunder) shall have become the beneficial owner (as
defined in Section 13(d) of the Exchange Act and the rules promulgated
thereunder) of more than 20% of any class or series of capital stock of
the Company (including the Shares) other than for bona fide arbitrage
purposes or (ii) any person, entity or group shall have entered into a
definitive agreement or an agreement in principle or made a proposal
with respect to a tender offer or exchange offer for some portion or all
of the Shares or a merger, consolidation or other business combination
with or involving the Company;
(f) any change shall have occurred (or any development shall
have occurred involving a prospective change) or Purchaser shall have
become aware of any fact (including, but not limited to, any such
change) that has had, or is reasonably likely to have, a material
adverse effect on the financial condition, properties, business or
results of operations of the Company and its subsidiaries taken as a
whole;
(g) the Board of Directors of the Company (or a special
committee thereof) shall have amended, modified or withdrawn its
approval or recommendation of the Offer or the Stock Purchase Agreement,
or shall have failed to publicly reconfirm such approval or
recommendation upon request by Purchaser, or shall have endorsed,
approved or recommended any other Acquisition Proposal, or shall have
resolved to do any of the foregoing; or
(h) the Stock Purchase Agreement shall have been terminated by
the Company or Purchaser in accordance with its terms or Purchaser shall
have reached an agreement or understanding in writing with the Company
providing for termination or amendment of the Offer or delay in payment
for the Shares.
The foregoing conditions are for the sole benefit of Purchaser and
may be asserted by Purchaser regardless of the circumstances (including
any action or inaction by Purchaser) giving rise to such condition or
may be waived by Purchaser, by express and specific action to that
effect, in whole or in part at any time and from time to time in its
sole discretion. Any determination by Purchaser concerning any event
described in this section will be final and binding upon all parties.
The failure by Purchaser at any time to exercise any of the foregoing
rights will not be deemed a waiver of any such right, the waiver of any
such right with respect to particular facts and other
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circumstances will not be deemed a waiver with respect to any other
facts and circumstances, and each such right will be deemed an ongoing
right that may be asserted at any time and from time to time.
In addition to the conditions set forth above, under the Stock
Purchase Agreement the obligation of Purchaser to consummate the
purchase of the Shares pursuant to the Offer and the other transactions
contemplated by the Stock Purchase Agreement are subject to the
fulfillment of the following conditions:
(a) the Company shall have entered into employment agreements
with Ronald L. Bogh and Paul M. Gilson, and a non-competition agreement
with Douglas C. Nelson, each substantially in the form attached to the
Stock Purchase Agreement;
(b) The Company shall have received the written opinion of the
Financial Advisor that the terms of the Offer are fair, from a financial
point of view, to the stockholders of the Company and such opinion shall
not have been withdrawn;
(c) Purchaser shall have received confirmation that the
Company's Common Stock shall continue to be listed on the Nasdaq
SmallCap Market following the Closing without any conditions which
Purchaser in its reasonable judgment shall deem to be materially
adverse;
(d) Douglas C. Nelson shall have entered into an agreement with
the Company, in form and substance satisfactory to Purchaser in
Purchaser's sole discretion, waiving the Company's existing obligations
to guarantee a price per share on shares of the Common Stock which may
be sold by Douglas C. Nelson and providing for the surrender by Douglas
C. Nelson of all of his options to purchase shares of Common Stock;
(e) The Company's Board of Directors shall consist of Ronald L.
Bogh, Paul M. Gilson and, at Purchaser's option, up to four additional
persons designated by Purchaser, two of whom shall be Marvin S. Wool and
Gregory J. Divis;
(f) Purchaser shall have received the legal opinion of Davis
Wright Tremaine LLP, counsel to the Company, in the form attached to the
Stock Purchase Agreement;
(g) Purchaser shall have entered into agreements in
substantially the form attached to the Stock Purchase Agreement with
each of Ronald L. Bogh, Douglas C. Nelson and James V. Reimann providing
for the tender of such amounts of their shares of Common Stock pursuant
to the Offer, as Purchaser and such stockholders shall agree in order to
facilitate the transactions contemplated hereby;
(h) No United States or state court or other Governmental Entity
of competent jurisdiction shall have enacted, issued, promulgated,
enforced or entered any statute, rule, regulation, judgment, decree,
injunction or other order (whether temporary, preliminary or permanent)
which is in effect and prohibits consummation of the transactions
contemplated by this Stock Purchase Agreement or imposes material
restrictions on Purchaser in connection with consummation of the
purchase of the Shares pursuant to the Offer or with respect to
Purchaser's or the Company's business operations, either prior to or
subsequent to the purchase of the Shares pursuant to the Offer;
(i) Purchaser shall have entered into an agreement with each of
Edward DeRaeve and Jerry K. Brown, directors of the Company, providing
that he shall not exercise on or prior to the Closing any stock option
issued to him pursuant to the Stock Plan; and
(j) The Company shall have taken all actions required by Section
7.1.3 of the Stock Plan to prevent the acceleration of the vesting of
stock options issued pursuant to the Stock Plan by reason of the
transactions contemplated by the Stock Purchase Agreement.
A public announcement will be made of a material change in, or
waiver of, such conditions, and the Offer may, in certain circumstances,
be extended in connection with any such change or waiver.
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14. DIVIDENDS AND DISTRIBUTIONS.
If, on or after April 8, 1999, the Company should split, combine
or otherwise change the Shares or its capitalization or shall disclose
that it has taken any such action, then Purchaser, in its discretion,
may make such adjustments to the consideration and other terms of the
Offer as it deems appropriate to reflect such split, combination or
other change.
If, on or after April 8, 1999, the Company should declare or pay
any cash or stock dividend or other distribution on or issue any rights
with respect to the shares of Common Stock, payable or distributable to
stockholders of record on a date occurring on or after April 8, 1999 and
prior to the transfer to the name of Purchaser or its nominees or
transferees on the Company's stock transfer records of the shares of
Common Stock purchased pursuant to the Offer, then, without prejudice to
Purchaser's rights under Section 13, (i) the price payable by Purchaser
pursuant to the Offer will be reduced by the amount of any such cash
dividend or distribution and (ii) the whole of any non-cash dividend or
distribution (including additional Shares of Common Stock or rights as
aforesaid) received by a tendering stockholder shall be required to be
promptly remitted and transferred by the tendering stockholder to the
Depositary for the account of Purchaser, accompanied by appropriate
documentation of transfer. Pending such remittance or appropriate
assurance thereof, Purchaser will be, subject to applicable law,
entitled to all rights and privileges as the owner of any such non-cash
dividend, distribution or right and may withhold the entire purchase
price or deduct from the purchase price the amount or value thereof, as
determined by Purchaser in its sole discretion.
15. CERTAIN LEGAL MATTERS.
General. Except as otherwise disclosed herein, based upon an
examination of publicly available filings with respect to the Company,
Purchaser is not aware of any licenses or other regulatory permits which
appear to be material to the business of the Company and which might be
adversely affected by the acquisition of Shares by Purchaser pursuant to
the Offer or of any approval or other action by any governmental,
administrative or regulatory agency or authority which would be required
for the acquisition or ownership of Shares by Purchaser pursuant to the
Offer. Should any such approval or other action be required, it is
currently contemplated that such approval or action would be sought or
taken. There can be no assurance that any such approval or action, if
needed, would be obtained or, if obtained, that it will be obtained
without substantial conditions or that adverse consequences might not
result to the Company's or Purchaser's business or that certain parts of
the Company's or Purchaser's business might not have to be disposed of
in the event that such approvals were not obtained or such other actions
were not taken, any of which could cause Purchaser to elect to terminate
the Offer without the purchase of the Shares thereunder. Purchaser's
obligation under the Offer to accept for payment and pay for Shares is
subject to certain conditions. See Section 13.
State Takeover Laws. A number of states have adopted laws and
regulations applicable to offers to acquire securities of corporations
which are incorporated in such states and/or which have substantial
assets, stockholders, principal executive offices or principal places of
business therein. In Edgar v. MITE Corporation, the Supreme Court of
the United States held that the Illinois Business Takeover Statute,
which made the takeover of certain corporations more difficult, imposed
a substantial burden on interstate commerce and was therefore
unconstitutional. In CTS Corporation v. Dynamics Corporation of
America, the Supreme Court held that as a matter of corporate law, and
in particular, those laws concerning corporate control, a state may
constitutionally disqualify an acquirer of "Control Shares" (ones
representing ownership in excess of certain voting power thresholds
(e.g. 20%, 33% or 50%) of a corporation incorporated in its state and
meeting certain other jurisdictional requirements from exercising voting
power with respect to those shares without the approval of a majority of
all disinterested stockholders.
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As a result of the approval of the Offer by the Company's Board of
Directors, Purchaser does not believe that any state takeover laws apply
to the Offer and it has not complied with any state takeover laws. See
Section 11. Should any government official or third party seek to apply
any state takeover law to the Offer, Purchaser will take such action as
then appears desirable.
If it is asserted that one or more state takeover laws applies to
the Offer, and it is not determined by an appropriate court that such
act or acts do not apply or are invalid as applied to the Offer,
Purchaser might be required to file certain information with, or receive
approvals from, the relevant state authorities. In addition, if
enjoined, Purchaser might be unable to accept for payment any Shares
tendered pursuant to the Offer, or be delayed in consummating the Offer.
In such case, Purchaser may not be obligated to accept for payment any
Shares tendered. See Section 13.
Federal Reserve Board Regulations. Regulations G, T, U and X (the
"Margin Regulations") promulgated by the Federal Reserve Board place
restrictions on the amount of credit that may be extended for the
purpose of purchasing margin stock (including the Shares) if such credit
is secured directly or indirectly by margin stock. Purchaser will
attempt to ensure that the financing of the acquisition of the Shares
will be in compliance with the Margin Regulations.
16. FEES AND EXPENSES.
Purchaser has also retained D.F. King & Co., Inc. to act as the
Information Agent in connection with the Offer. The Information Agent
may contact holders of Shares by mail, telephone, telex, telegraph and
personal interview, and may request brokers, dealers and other nominee
stockholders to forward materials relating to the Offer to beneficial
owners of Shares. The Information Agent will receive reasonable and
customary compensation for such services, plus reimbursement of out-of-
pocket expenses and Purchaser will indemnify the Information Agent
against certain liabilities and expenses in connection with the Offer,
including liabilities under the federal securities laws.
Purchaser will pay the Depositary reasonable and customary
compensation for its services in connection with the Offer, plus
reimbursement for out-of-pocket expenses, and will indemnify the
Depositary against certain liabilities and expenses in connection
therewith, including liabilities under the federal securities laws.
Brokers, dealers, commercial banks and trust companies will be
reimbursed by Purchaser for customary mailing and handling expenses
incurred by such persons in forwarding material to their customers.
17. MISCELLANEOUS.
The Offer is not being made to (nor will tenders be accepted from
or on behalf of) holders of Shares in any jurisdiction in which the
making of the Offer or the acceptance thereof would not be in compliance
with the laws of such jurisdiction. However, Purchaser may, in its sole
discretion, take such action as it may deem necessary to make the Offer
in any jurisdiction and extend the Offer to holders of Shares in such
jurisdiction.
Purchaser is not aware of any jurisdiction in which the making of
the Offer or the acceptance of Shares in connection therewith would not
be in compliance with the laws of such jurisdiction.
Purchaser has filed with the SEC a Statement on Schedule 14D-1
pursuant to Rule 14d-3 of the General Rules and Regulations under the
Exchange Act, furnishing certain additional information with respect to
the Offer and may file amendments thereto. Such Statement and any
amendments thereto, including exhibits, may be examined and copies may
be obtained from the principal office of the SEC in the manner set forth
in Section 8.
- 24 -
<PAGE>
<PAGE>
No person has been authorized to give any information nor make any
representation on behalf of Purchaser not contained in this Offer to
Purchase or in the Letter of Transmittal and, if given or made, such
information or representation must not be relied upon as having been
authorized.
DASH MULTI-CORP, INC.
April 14,1999
- 25 -
<PAGE>
<PAGE>
Facsimile copies of the Letter of Transmittal will be accepted.
The Letter of Transmittal, certificates for Shares and any other
required documents should be sent by each stockholder of the Company or
his broker-dealer, commercial bank, trust company or other nominee to
the Depositary as follows:
The Depositary for the Offer is:
American Securities Transfer & Trust, Inc.
By Hand/Overnight Delivery:
American Securities Transfer & Trust, Inc.
c/o J. Harmann
938 Quail Street
Suite 101
Lakewood, CO 80215
By Registered or Certified Mail:
American Securities Transfer & Trust, Inc.
c/o J. Harmann
P.O. Box 1596
Denver, CO 80201
Facsimile Transmission Number:
(For Eligible Institutions Only)
(303) 234-5340
Confirm Receipt of Facsimile by Telephone:
(303) 234-5309
Any questions or requests for assistance or additional copies of
the Offer to Purchase and the Letter of Transmittal may be directed to
the Information Agent at its telephone number and location listed below.
You may also contact your broker, dealer, commercial bank or trust
company or other nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
D.F. King & Co., Inc.
77 Water Street
New York, New York 10005
Banks and Brokers Call Collect: (212) 269-5550
Call Toll Free: (800) 549-6697
- 26 -
<PAGE>
<PAGE>
SCHEDULE A
INFORMATION CONCERNING THE DIRECTORS
AND EXECUTIVE OFFICERS OF PURCHASER
The following tables set forth the name, business address, present
principal occupation and material positions held within the past five
years of each director and executive officer of Purchaser. Each person
listed below is a citizen of the United States and has his or her
principal business address at 2500 Adie Road, Maryland Heights, Missouri
63043.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT, MATERIAL POSITIONS
NAME AND BUSINESS ADDRESS HELD DURING THE PAST FIVE YEARS
------------------------- -------------------------------
<S> <C>
Marvin S. Wool Director, Chief Executive Officer and Chairman of the Board
since 1973.
Gregory J. Divis Director since 1988. Senior Vice President--Subsidiaries of
Purchaser since 1995. Vice President--Subsidiaries of
Purchaser from 1990 to 1995.
Roger D. Davis Director since 1980. Vice President--Engineering of
Purchaser since 1995. Vice President--Engineering of
Purchaser's MarChem Corp. subsidiary from 1973 to 1995.
John Lockard Director since 1994. Vice President--Technical Development
of Purchaser's MarChem Corp. subsidiary since 1988.
Michael Deering Director Human Resources of Purchaser since 1996. Human
Resource and Benefits Manager of Western Surety Company
from 1993 to 1995.
Sandon Wool Director since 1980. Vice President and Secretary of
Purchaser since 1994. President of Purchaser's MarChem
Corp. subsidiary since 1997. Vice President of Purchaser's
MarChem Corp. subsidiary from 1994 to 1997.
Paul C. Simons Vice President-Finance of Purchaser since 1990.
</TABLE>
- 27 -
<PAGE>
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
OF
R-B RUBBER PRODUCTS, INC.
AT
$3.00 NET PER SHARE
BY
DASH MULTI-CORP, INC.
- ----------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
ST. LOUIS, MISSOURI TIME, ON WEDNESDAY, MAY 12, 1999, UNLESS THE OFFER
IS EXTENDED.
- ----------------------------------------------------------------------
The Depositary for the Offer is:
AMERICAN SECURITIES TRANSFER & TRUST, INC.
<TABLE>
<C> <C> <C>
Facsimile Transmission Number: By Hand/Overnight Delivery: By Registered or Certified Mail:
(For Eligible Institutions Only) American Securities Transfer & American Securities Transfer &
(303) 234-5340 Trust, Inc. Trust, Inc.
c/o J. Harmann c/o J. Harmann
Confirm Receipt of 938 Quail St. P.O. Box 1596
Facsimile by Telephone: Suite 101 Denver, Colorado
(303) 234-5309 Lakewood, Colorado 80201
80215
</TABLE>
________________________
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
- --------------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED OWNER(S)
PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) SHARES TENDERED
APPEAR(S) ON CERTIFICATE(S) (ATTACH ADDITIONAL LIST IF NECESSARY)
- --------------------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES NUMBER
CERTIFICATE REPRESENTED BY OF SHARES
NUMBER(S)<F1> CERTIFICATE(S)<F1> TENDERED<F2>
- --------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------
TOTAL SHARES
- --------------------------------------------------------------------------------------------------------------------------
<FN>
<F1> Need not be completed by Book-Entry Stockholders.
<F2> Unless otherwise indicated, it will be assumed that all shares described above are being tendered. See Instruction 4.
</TABLE>
<PAGE>
<PAGE>
This Letter of Transmittal is to be used either if certificates
for Shares (as defined below) are to be forwarded herewith or, unless an
Agent's Message (as defined in Section 3 of the Offer to Purchase (as
defined below)) is utilized, if delivery of Shares is to be made by
book-entry transfer to an account maintained by the Depositary (as
defined in the Introduction of the Offer to Purchase) at the Book-Entry
Transfer Facility (as defined in Section 2 of the Offer to Purchase)
pursuant to the procedures set forth in Section 3 of the Offer to
Purchase. Stockholders who deliver Shares by book-entry transfer are
referred to herein as "Book-Entry Stockholders" and other stockholders
are referred to herein as "Certificate Stockholders." Stockholders
whose certificates for Shares not immediately available or who cannot
comply with the procedure for book-entry transfer on a timely basis, or
who cannot deliver all required documents to the Depositary prior to the
Expiration Date (as defined in Section 1 of the Offer to Purchase), may
tender their Shares in accordance with the guaranteed delivery procedure
set forth in Section 3 of the Offer to Purchase. See Instruction 2.
DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE
WITH SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE
DELIVERY TO THE DEPOSITARY.
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER MADE TO AN ACCOUNT MAINTAINED BY THE DEPOSITARY WITH THE
BOOK-ENTRY TRANSFER FACILITY AND COMPLETE THE FOLLOWING (ONLY
FINANCIAL INSTITUTIONS THAT ARE PARTICIPANTS IN THE SYSTEM OF THE
BOOK-ENTRY TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY
TRANSFER):
Name of Tendering Institution
----------------------------------
Account Number
-------------------------------------------------
Transaction Code Number
----------------------------------------
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A
NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY
AND COMPLETE THE FOLLOWING:
Name(s) of Registered Owner(s)
---------------------------------
Date of Execution of Notice of Guaranteed Delivery
-------------
Name of Institution which Guaranteed Delivery
------------------
If delivered by book-entry transfer, complete the following:
DTC Account Number
---------------------------------------------
Transaction Code Number
----------------------------------------
<PAGE>
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to Dash Multi-Corp, Inc., a
Missouri corporation (the "Purchaser"), the above-described shares, no
par value per share (the "Common Stock" or the "Shares"), of R-B Rubber
Products, Inc., an Oregon corporation (the "Company"), pursuant to the
Offer to Purchase, dated April 14, 1999 (the "Offer to Purchase"), up to
1,567,417 of the outstanding Shares (representing approximately 70% of
the issued and outstanding shares of as April 8, 1999) at a purchase
price of $3.00 per Share, net to the seller in cash, without interest,
on the terms and subject to the conditions set forth in the Offer to
Purchase, receipt of which is hereby acknowledged, and in this Letter of
Transmittal (which, together with the Offer to Purchase, constitute the
"Offer").
On the terms and subject to the conditions of the Offer (including
the Offer Conditions and together with, if the Offer is extended or
amended, the terms and conditions of such extension or amendment),
subject to, and effective upon, acceptance for payment of, and payment
for, the Shares tendered herewith in accordance with the terms of the
Offer, the undersigned hereby sells, assigns and transfers to, or upon
the order of, the Purchaser, all right, title and interest in and to all
of the Shares being tendered hereby and any and all cash dividends,
distributions, rights, other Shares or other securities issued or
issuable in respect of such Shares on or after April 14, 1999
(collectively, "Distributions"), and appoints American Securities
Transfer & Trust, Inc. (the "Depositary") the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Shares (and any
Distributions) with full power of substitution (such power of attorney
being deemed to be an irrevocable power coupled with an interest) to the
fullest extent of such stockholder's rights with respect to such Shares
(and any Distributions) (a) to deliver such Share Certificates (as
defined herein) (and any Distributions) or transfer ownership of such
Shares (and any Distributions) on the account books maintained by the
Book-Entry Transfer Facility, together in either such case with all
accompanying evidences of transfer and authenticity, to or upon the
order of the Purchaser, (b) to present such Shares (and any
Distributions) for transfer on the books of the Company and (c) to
receive all benefits and otherwise exercise all rights of beneficial
ownership of such Shares (and any Distributions), all in accordance with
the terms and the conditions of the Offer.
The undersigned hereby irrevocably appoints the designees of the
Purchaser, and each of them, the attorneys-in-fact and proxies of the
undersigned, each with full power of substitution, to the full extent of
such stockholder's rights with respect to the Shares tendered hereby
which have been accepted for payment and with respect to any
Distributions. The designees of the Purchaser will, with respect to the
Shares (and any associated Distributions) for which the appointment is
effective, be empowered to exercise all voting and any other rights of
such stockholder, as they, in their sole discretion, may deem proper at
any annual, special or adjourned meeting of the Company's stockholders,
by written consent in lieu of any such meeting or otherwise. This proxy
and power of attorney shall be irrevocable and coupled with an interest
in the tendered Shares. Such appointment is effective when, and only to
the extent that, the Purchaser deposits the payment for such Shares with
the Depositary. Upon the effectiveness of such appointment, without
further action, all prior powers of attorney, proxies and consents given
by the undersigned with respect to such Shares (and any associated
Distributions) will be revoked, and no subsequent powers of attorney,
proxies, consents or revocations may be given (and, if given, will not
be deemed effective). The Purchaser reserves the right to require that,
in order for Shares to be deemed validly tendered, immediately upon the
Purchaser's acceptance for payment of such Shares, the Purchaser must be
able to exercise full voting rights with respect to such Shares (and any
associated Distributions), including voting at any meeting of
stockholders.
The undersigned hereby represents and warrants that the
undersigned has full power and authority to tender, sell, assign and
transfer the Shares (and any Distributions) tendered hereby and, when
the same are accepted for payment by the Purchaser, the Purchaser will
acquire good, marketable and unencumbered title thereto, free and clear
of all liens, restrictions, charges and encumbrances, and the same will
not be subject to any adverse claim. The undersigned will, upon
request, execute and deliver any additional documents deemed by the
Depositary or the Purchaser to be necessary or desirable to complete the
sale, assignment and transfer of the Shares (and any Distributions)
tendered hereby. In addition, the undersigned shall promptly remit and
transfer to the Depositary for the account of the Purchaser any and all
distributions in respect of the Shares tendered hereby, accompanied by
<PAGE>
<PAGE>
appropriate documentation of transfer; and, pending such remittance or
appropriate assurance thereof, the Purchaser shall be entitled to all
rights and privileges as owner of any such Distributions and may
withhold the entire purchase price or deduct from the purchase price the
amount or value thereof, as determined by the Purchaser in its sole
discretion.
All authority conferred or agreed to be conferred pursuant to this
Letter of Transmittal shall not be affected by, and shall survive, the
death or incapacity of the undersigned and any obligation of the
undersigned hereunder shall be binding upon the heirs, personal
representatives, successors and assigns of the undersigned. Except as
stated in the Offer to Purchase, this tender is irrevocable.
The undersigned understands that the valid tender of Shares
pursuant to one of the procedures described in Section 3 of the Offer to
Purchase will constitute a binding agreement between the undersigned and
the Purchaser upon the terms and subject to the conditions of the Offer.
The undersigned understands that if more than 1,567,417 Shares are
validly tendered prior to the expiration of the Offer and not validly
withdrawn in accordance with Section 3 of the Offer to Purchase, Shares
so tendered and not validly withdrawn shall be accepted for payment on a
pro rata basis according to the number of Shares validly tendered and
not withdrawn by the Expiration Date (with appropriate adjustments to
avoid the purchase of fractional shares).
Unless otherwise indicated herein under "Special Payment
Instructions," please issue the check for the purchase price and/or
return any certificates for Shares not tendered or accepted for payment
in the name(s) of the registered owner(s) appearing under "Description
of Shares Tendered." Similarly, unless otherwise indicated under
"Special Delivery Instructions," please mail the check for the purchase
price and/or return any certificates for Shares not tendered or accepted
for payment (and accompanying documents, as appropriate) to the
address(es) of the registered owner(s) appearing under "Description of
Shares Tendered." In the event that both the Special Delivery
Instructions and the Special Payment Instructions are completed, please
issue the check for the purchase price and/or issue any certificates for
Shares not tendered or accepted for payment (and any accompanying
documents, as appropriate) in the name of, and deliver such check and/or
return such certificates (and any accompanying documents, as
appropriate) to, the person or persons so indicated. The undersigned
recognizes that the Purchaser has no obligation pursuant to the Special
Payment Instructions to transfer any Shares from the name of the
registered owner thereof if the Purchaser does not accept for payment
any of the Shares so tendered.
<PAGE>
<PAGE>
- --------------------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if certificate(s) for Shares not tendered or
not accepted for payment and/or the check for the purchase price of
Shares accepted for payment are to be issued in the name of someone
other than the undersigned.
Issue: / / Check / / Certificate(s) to:
Name:
-----------------------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------------------
- ------------------------------------------------------------------------
(INCLUDE ZIP CODE)
- ------------------------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 5 AND 7)
To be completed ONLY if certificate(s) for Shares not tendered or
not accepted for payment and/or the check for the purchase price of
Shares accepted for payment are to be sent to someone other than the
undersigned, or to the undersigned at an address other than that shown
above.
Deliver: / / Check / / Certificate(s) to:
Name:
-----------------------------------------------------------------
(PLEASE PRINT)
Address:
--------------------------------------------------------------
- ------------------------------------------------------------------------
(INCLUDE ZIP CODE)
- ------------------------------------------------------------------------
<PAGE>
- -------------------------------------------------------------------------
IMPORTANT
SIGN HERE
(ALSO COMPLETE SUBSTITUTE FORM W-9 BELOW)
.....................................................................
.....................................................................
(SIGNATURE(S) OF HOLDER(S))
Dated: , 1999
...............
(Must be signed by registered owner(s) exactly as name(s) appear(s) on
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered owner(s) by certificates and documents
transmitted herewith. If signature is by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations
or others acting in a fiduciary or representative capacity, please set
forth full title and see Instruction 5.)
Name(s)
..............................................................
..............................................................
(PLEASE PRINT)
Capacity (full title)
................................................
Address
..............................................................
..............................................................
(INCLUDE ZIP CODE)
Area Code and Telephone Number
.......................................
Tax Identification or
Social Security No.
..................................................
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5)
Authorized Signature
.................................................
Name
.................................................................
(PLEASE TYPE OR PRINT)
Address
..............................................................
..............................................................
(INCLUDE ZIP CODE)
Name of Firm
.........................................................
Dated: , 1999
..............
- -------------------------------------------------------------------------
<PAGE>
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below,
all signatures on this Letter of Transmittal must be guaranteed by a
financial institution (including most commercial banks, savings and loan
associations and brokerage houses) which is a participant in the
Securities Transfer Agents Medallion Program, the New York Stock
Exchange Medallion Signature Guarantee Program or the Stock Exchange
Medallion Program (an "Eligible Institution"). Signatures on this
Letter of Transmittal need not be guaranteed (a) if this Letter of
Transmittal is signed by the registered owners (which term, for purposes
of this document, includes any participant in the Book-Entry Transfer
Facility's system whose name appears on a security position listing as
the owner of the Shares) of Shares tendered herewith and such registered
owner has not completed the box entitled "Special Payment Instructions"
or the box entitled "Special Delivery Instructions" on this Letter of
Transmittal or (b) if such Shares are tendered for the account of an
Eligible Institution. See Instruction 5 of this Letter of Transmittal.
2. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES OR BOOK-
ENTRY CONFIRMATIONS. This Letter of Transmittal is to be used either if
certificates are to be forwarded herewith or if tenders are to be made
pursuant to the procedures for tender by book-entry transfer set forth
in Section 3 of the Offer to Purchase. Certificates for all physically
tendered Shares ("Share Certificates"), or confirmation of any book-
entry transfer into the Depositary's account at one of the Book-Entry
Transfer Facility of Shares tendered by book-entry transfer, as well as
this Letter of Transmittal properly completed and duly executed with any
required signature guarantees, and any other documents required by this
Letter of Transmittal, must be received by the Depositary at one of its
addresses set forth herein on or prior to the Expiration Date (as
defined in the Offer to Purchase).
Stockholders whose certificates for Shares are not immediately
available or who cannot deliver all other required documents to the
Depositary on or prior to the Expiration Date or who cannot comply with
the procedures for book-entry transfer on a timely basis may
nevertheless tender their Shares by properly completing and duly
executing a Notice of Guaranteed Delivery pursuant to the guaranteed
delivery procedure set forth in Section 3 of the Offer to Purchase.
Pursuant to such procedure: (i) such tender must be made by or through
an Eligible Institution; (ii) a properly completed and duly executed
Notice of Guaranteed Delivery substantially in the form provided by the
Purchaser must be received by the Depositary prior to the Expiration
Date; and (iii) Share Certificates or confirmation of any book-entry
transfer into the Depositary's account at a Depositary Institution of
Shares tendered by book-entry transfer, as well as a Letter of
Transmittal, properly completed and duly executed with any required
signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message), and all other documents required by this Letter of
Transmittal, must be received by the Depositary within three Nasdaq
trading days after the date of execution of such Notice of Guaranteed
Delivery.
If Share Certificates are forwarded separately to the Depositary,
a properly completed and duly executed Letter of Transmittal must
accompany each such delivery.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER
REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER
FACILITY, IS AT THE ELECTION AND RISK OF THE TENDERING STOCKHOLDER.
THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
DEPOSITARY (INCLUDING, IN THE CASE OF A BOOK-ENTRY TRANSFER, BY BOOK-
ENTRY CONFIRMATION). IF SUCH DELIVERY IS BY MAIL, IT IS RECOMMENDED
THAT SUCH CERTIFICATES AND DOCUMENTS BE SENT BY REGISTERED MAIL,
PROPERLY INSURED, WITH RETURN RECEIPT REQUESTED. IN ALL CASES,
SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted
and no fractional Shares will be purchased. All tendering stockholders,
by execution of this Letter of Transmittal (or facsimile thereof), waive
any right to receive any notice of the acceptance of their Shares for
payment.
<PAGE>
<PAGE>
3. INADEQUATE SPACE. If the space provided herein is inadequate,
the certificate numbers and/or the number of Shares should be listed on
a separate schedule attached hereto.
4. PARTIAL TENDERS (APPLICABLE TO CERTIFICATE STOCKHOLDERS ONLY).
If fewer than all the Shares evidenced by any certificate submitted are
to be tendered, fill in the number of Shares which are to be tendered in
the box entitled "Number of Shares Tendered." In such cases, new
certificate(s) for the remainder of the Shares that were evidenced by
the old certificate(s) will be sent to the registered owner, unless
otherwise provided in the appropriate box on this Letter of Transmittal,
as soon as practicable after the Expiration Date. All Shares
represented by certificates delivered to the Depositary will be deemed
to have been tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND
ENDORSEMENTS. If this Letter of Transmittal is signed by the registered
owners of the Shares tendered hereby, the signature must correspond with
the names as written on the face of the certificates without alteration,
enlargement or any other change whatsoever.
If any of the Shares tendered hereby are owned of record by two or
more joint owners, all such owners must sign this Letter of Transmittal.
If any of the tendered Shares are registered in different names on
several certificates, it will be necessary to complete, sign and submit
as many separate Letters of Transmittal as there are different
registrations of certificates.
If this Letter of Transmittal or any certificates or stock powers
are signed by trustees, executors, administrators, guardians, attorneys-
in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing,
and proper evidence satisfactory to the Purchaser of their authority so
to act must be submitted.
If this Letter of Transmittal is signed by the registered owner(s)
of the Shares listed and transmitted hereby, no endorsements of
certificates or separate stock powers are required unless payment is to
be made to, or certificates for Shares not tendered or accepted for
payment are to be issued in the name of, a person other than the
registered owner(s). Signatures on such certificates or stock powers
must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner of the certificate(s) listed, the certificate(s) must
be endorsed or accompanied by the appropriate stock powers, in either
case signed exactly as the name or names of the registered owner or
holders appears on the certificate(s). Signatures on such certificates
or stock powers must be guaranteed by an Eligible Institution.
6. STOCK TRANSFER TAXES. The Purchaser will pay any stock
transfer taxes with respect to the transfer and sale of Shares to it or
its order pursuant to the Offer. If, however, payment of the purchase
price is to be made to, or (in the circumstances permitted hereby) if
certificates for Shares not tendered or accepted for payment are to be
registered in the name of, any person other than the registered owner,
or if tendered certificates are registered in the name of any person
other than the person(s) signing this Letter of Transmittal, the amount
of any stock transfer taxes (whether imposed on the registered owner or
such person) payable on account of the transfer to such person will be
deducted from the purchase price if satisfactory evidence of the payment
of such taxes or exemption therefrom, is not submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY
FOR TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATES LISTED IN THIS
LETTER OF TRANSMITTAL.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check is to
be issued in the name of, and/or certificates for Shares not tendered or
accepted for payment are to be issued or returned to, a person other
than the signer of this Letter of Transmittal or if a check and/or such
certificates are to be mailed to a person other than the signer of this
Letter of Transmittal or to an address other than that shown above, the
appropriate boxes on this Letter of Transmittal should be completed.
<PAGE>
<PAGE>
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions or
requests for assistance may be directed to the Information Agent at its
address set forth below or from your broker, dealer, commercial bank or
trust company. Additional copies of the Offer to Purchase, this Letter
of Transmittal, the Notice of Guaranteed Delivery and other tender offer
material may be obtained from the Information Agent.
9. SUBSTITUTE FORM W-9. Each tendering stockholder is required
to provide the Depositary with a correct Taxpayer Identification Number
("TIN"), generally the stockholder's social security or federal employer
identification number, on Substitute Form W-9 below. Failure to provide
the information on the form may subject the tendering stockholder to 31%
federal income tax backup withholding on the payment of the purchase
price. The box in Part 3 of the form may be checked if the tendering
stockholder has not been issued a TIN and has applied for a TIN or
intends to apply for a TIN in the near future. If the box in Part 3 is
checked and the Depositary is not provided with a TIN within 60 days,
the Depositary will withhold 31% of all payments of the purchase price
thereafter until a TIN is provided to the Depositary.
IMPORTANT: THIS LETTER OF TRANSMITTAL (TOGETHER WITH SHARE
CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER
REQUIRED DOCUMENTS) OR THE NOTICE OF GUARANTEED DELIVERY MUST BE
RECEIVED BY THE DEPOSITARY PRIOR TO THE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under the federal income tax law, a stockholder whose tendered
Shares are accepted for purchase is required by law to provide the
Depositary (as payer) with such stockholder's correct TIN on Substitute
Form W-9 below and to certify that such TIN is correct (or that such
stockholder is awaiting a TIN) or otherwise establish a basis for
exemption from backup withholding. If such stockholder is an
individual, the TIN is his or her social security number. If a
stockholder fails to provide a TIN to the Depositary, such stockholder
may be subject to a $50 penalty imposed by the Internal Revenue Service.
In addition, payments that are made to such stockholder with respect to
Shares purchased pursuant to the Offer may be subject to backup
withholding of 31% (see below).
Certain stockholders (including, among others, all corporations and
certain foreign individuals) are not subject to these backup withholding
and reporting requirements. In order for a foreign individual to qualify
as an exempt recipient, that stockholder must generally submit a Form W-8,
signed under penalties of perjury, attesting to that individual's exempt
status. A Form W-8 can be obtained from the Depositary. See the enclosed
Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9 for additional instructions.
If backup withholding applies, the Depositary is required to
withhold 31% of any payments made to the stockholder or payee. Backup
withholding is not an additional tax. Rather, the tax liability of
persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may
be obtained from the Internal Revenue Service.
The box in Part 3 of the Substitute Form W-9 may be checked if the
tendering stockholder has not been issued a TIN and has applied for a TIN
or intends to apply for a TIN in the near future. If the box in Part 3 is
checked, the stockholder or other payee must also complete the
Certification of Awaiting Taxpayer Identification Number below in order to
avoid backup withholding. If a stockholder's TIN is provided to the
Depositary within in 60 days of the date of the Substitute Form W-9,
payment will be made to such stockholder without the imposition of backup
withholding. If a stockholder's TIN is not provided to the Depositary
within such 60-day period, the Depositary will make such payment, subject
to backup withholding.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments made to a stockholder
whose tendered Shares are accepted for purchase, the stockholder is
required to notify the Depositary of its correct TIN by completing
Substitute Form W-9 certifying that the Tin provided on such Form is
correct (or that such stockholder is awaiting a TIN, in which case the
stockholder should check the box in Part 3 of the Substitute Form W-9)
and that (A) such stockholder is exempt
<PAGE>
<PAGE>
from backup withholding, (B) such stockholder has not been notified by
the Internal Revenue Service that such stockholder is subject to backup
withholding as a result of failure to report all interest or dividends
or (C) the Internal Revenue Service has notified the stockholder that
the stockholder is no longer subject to backup withholding. The
stockholder must sign and date the Substitute Form W-9 where indicated,
certifying that the information on such Form is correct.
Alternatively, a stockholder that qualifies as an exempt recipient
(other than a stockholder required to complete Form W-8 as described
above) should write "Exempt" in Part I of the Substitute Form W-9, enter
its correct TIN and sign and date such form where indicated.
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the Depositary the social
security number or employer identification number of the record owner of
the Shares or of the last transferee appearing on the transfers attached
to, or endorsed on, the Shares. If the Shares are in more than one name
or are not in the name of the actual owner, consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9 for additional guidance on which number to report.
<PAGE>
<PAGE>
TO BE COMPLETED BY ALL TENDERING STOCKHOLDERS
(SEE INSTRUCTION 9)
PAYER: AMERICAN SECURITIES TRANSFER & TRUST, INC.
- --------------------------------------------------------------------------
SUBSTITUTE
FORM W-9
PART 1--PLEASE PROVIDE YOUR TIN IN
THE BOX AT RIGHT AND CERTIFY BY
SIGNING AND DATING BELOW.
Social security number
OR
Employer identification number
----------------------------
- --------------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
PART 2--CERTIFICATION--UNDER PENALTIES OF PERJURY, I CERTIFY THAT:
(1) The number shown on this form is my correct Taxpayer
Identification Number (or I am waiting for a number to be issued
to me); and
(2) I am not subject to backup withholding because (i) I am exempt
from backup withholding, (ii) I have not been notified by the
Internal Revenue Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all interest or
dividends, or (iii) the IRS has notified me that I am no longer
subject to backup withholding.
- --------------------------------------------------------------------------
PAYER'S REQUEST FOR TAXPAYER IDENTIFICATION NUMBER (TIN)
Certification Instructions-You must cross out item (2) in Part 2 above
if you have been notified by the IRS that you are subject to backup
withholding because of under-reporting interest or dividends on your
tax return. However, if after being notified by the IRS that you were
subject to backup withholding you received another notification from the
IRS stating that you are no longer subject to backup withholding, do not
cross out item (2).
SIGNATURE DATE
------------------------- -----------------
NAME (Please Print):
------------------------------------
PART 3--
AWAITING TIN / /
- --------------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE
OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF
TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR
ADDITIONAL INFORMATION.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU
CHECKED THE BOX IN PART 3 OF SUBSTITUTE FORM W-9.
- --------------------------------------------------------------------------
CERTIFICATION OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer
identification number has not been issued to me, and either (i) I have
mailed or delivered an application to receive a taxpayer identification
number to the appropriate Internal Revenue Service Center or Social
Security Administration Office or (ii) I intend to mail or deliver an
application in the near future. I understand that if I do not provide a
taxpayer identification number within 60 days, 31% of all reportable
payments made to me thereafter will be withheld until I provide a
taxpayer identification number to the Depositary.
----------------------------- -------------------------------------
Signature Date
-----------------------------
Name (Please Print)
- --------------------------------------------------------------------------
<PAGE>
<PAGE>
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 WATER STREET
NEW YORK, NY 10005
Bankers and Brokers Call Collect (212) 269-5550
All others Call Toll Free (800) 549-6697
April 14, 1999
<PAGE>
<PAGE>
OFFER TO PURCHASE FOR CASH
UP TO 1,567,417 SHARES OF COMMON STOCK
OF
R-B RUBBER PRODUCTS, INC.
AT
$3.00 NET PER SHARE
BY
DASH MULTI-CORP, INC.
- ----------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
ST. LOUIS, MISSOURI TIME, ON WEDNESDAY, MAY 12, 1999, UNLESS THE OFFER
IS EXTENDED.
- ----------------------------------------------------------------------
April 14, 1999
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
Dash Multi-Corp, Inc., a Missouri corporation (the "Purchaser"),
has commenced an offer to purchase up to 1,567,417 of the outstanding
shares of Common Stock, no par value per share (the "Common Stock" or
the "Shares"), of R-B Rubber Products, Inc., an Oregon corporation (the
"Company"), at $3.00 per Share, net to the seller in cash, without
interest, on the terms and subject to the conditions set forth in the
Offer to Purchase, dated April 14, 1999, and the related Letter of
Transmittal (which, together with any amendments or supplements thereto
collectively constitute the "Offer"). Please furnish copies of the
enclosed materials to those of your clients for whom you hold Shares
registered in your name or in the name of your nominee.
Enclosed herewith are the following documents:
1. Offer to Purchase, dated April 14, 1999;
2. Letter of Transmittal to be used by stockholders of the
Company in accepting the Offer;
3. The Company's Solicitation/Recommendation Statement on
Schedule 14D-9;
4. A printed form of letter that may be sent to your clients
for whose account you hold Shares in your name or in the
name of your nominee, with space provided for obtaining such
clients' instructions with respect to the Offer;
5. Notice of Guaranteed Delivery;
6. Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9; and
<PAGE>
<PAGE>
7. Return envelope addressed to American Securities Transfer &
Trust, Inc., the Depositary.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING AT
LEAST 1,567,417 SHARES OF COMMON STOCK VALIDLY TENDERED AND NOT
WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER. THE OFFER IS ALSO
SUBJECT TO CERTAIN OTHER CONDITIONS DESCRIBED IN SECTION 13 OF THE OFFER
TO PURCHASE.
WE URGE YOU TO CONTACT YOUR CLIENTS PROMPTLY. PLEASE NOTE THAT
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
ST. LOUIS, MISSOURI TIME, ON WEDNESDAY, MAY 12, 1999, UNLESS THE OFFER
IS EXTENDED.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED
THAT THE OFFER IS FAIR TO AND IN THE BEST INTERESTS OF THE COMPANY AND
ITS STOCKHOLDERS AND HAS UNANIMOUSLY APPROVED THE OFFER AND THE STOCK
PURCHASE AGREEMENT AND THE OTHER TRANSACTIONS CONTEMPLATED THEREBY AND
UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
The Offer is being made pursuant to a Stock Purchase Agreement
(the "Stock Purchase Agreement"), dated as of April 8, 1999, between the
Company and the Purchaser. Pursuant to the Stock Purchase Agreement, in
certain circumstances if fewer than 1,567,417 Shares are tendered
pursuant to the Offer the Purchaser, at its sole option, shall have the
option to purchase from the Company, at a purchase price equal to the
greater of $3.00 per Share or the most recent price offered by Purchaser
in the Offer, up to an amount of Shares which, when combined with Shares
tendered pursuant to the Offer, would be equal to 70% of the outstanding
Shares, after taking into account such newly issued Shares.
Upon terms and subject to the conditions of the Offer, if more
than 1,567,417 Shares are validly tendered and not properly withdrawn
prior to the Expiration Date, Purchaser will accept for payment and pay
for only 1,567,417 Shares on a pro rata basis (with appropriate
adjustments to avoid the purchase of fractional Shares) based on the
number of Shares properly tendered by each stockholder prior to the
Expiration Date and not withdrawn. In the event that proration of
tendered Shares is required, because of the difficulty of determining
the precise number of Shares properly tendered and not withdrawn (due in
part to the guaranteed delivery procedures described in Section 3 of the
Offer to Purchase), Purchaser does not expect that it will be able to
announce the final results of such proration or pay for any Shares until
at least seven Nasdaq trading days after the Expiration Date.
Stockholders may obtain such preliminary information from the
Information Agent and may be able to obtain such information from their
broker. Purchaser will not pay for any Shares accepted for payment
pursuant to the Offer until the final proration factor is known.
In all cases, payment for Shares accepted for payment pursuant to
the Offer will be made only after timely receipt by the Depositary of
(i) certificates for such Shares or timely confirmation of the book-
entry transfer of such Shares into the Depositary's account at the Book-
Entry Transfer Facility (as defined in the Offer to Purchase) pursuant
to the procedures set forth in Section 3 of the Offer to Purchase,
(ii) the Letter of Transmittal (or a facsimile thereof), properly
completed and duly executed, with any required signature guarantees (or,
in the case of a book-entry transfer, an Agent's Message (as defined in
the Offer to Purchase)) and (iii) any other documents required by such
Letter of Transmittal. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON
THE PURCHASE PRICE FOR SHARES, REGARDLESS OF ANY EXTENSION OF THE OFFER
OR ANY DELAY IN MAKING SUCH PAYMENT PURSUANT TO THE OFFER.
- 2 -
<PAGE>
<PAGE>
Purchaser will not pay any fees or commissions to any broker or
dealer or other person in connection with the solicitation of tenders of
Shares pursuant to the Offer. You will be reimbursed upon request for
customary mailing and handling expenses incurred by you in forwarding
the enclosed offering materials to your clients.
Questions and requests for assistance may be directed to the
Information Agent at its address and telephone number set forth on the
back cover of the enclosed Offer to Purchase. Requests for additional
copies of the enclosed materials may be directed to the Information
Agent or to brokers, dealers, commercial banks or trust companies.
Very truly yours,
DASH MULTI-CORP, INC.
Marvin S. Wool
Chief Executive Officer and Chairman
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL RENDER
YOU OR ANY OTHER PERSON THE AGENT OF PURCHASER, THE DEPOSITARY OR THE
INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR AUTHORIZE YOU OR
ANY OTHER PERSON TO GIVE ANY INFORMATION OR USE ANY DOCUMENT OR MAKE ANY
REPRESENTATION ON BEHALF OF ANY OF THEM WITH RESPECT TO THE OFFER NOT
CONTAINED IN THE OFFER TO PURCHASE OR THE LETTER OF TRANSMITTAL.
- 3 -
<PAGE>
<PAGE>
OFFER TO PURCHASE FOR CASH
UP TO 1,567,417 SHARES OF COMMON STOCK
OF
R-B RUBBER PRODUCTS, INC.
AT
$3.00 NET PER SHARE
BY
DASH MULTI-CORP, INC.
- -----------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
ST. LOUIS, MISSOURI TIME, ON WEDNESDAY, MAY 12, 1999, UNLESS THE OFFER
IS EXTENDED.
- -----------------------------------------------------------------------
April 14, 1999
To Our clients:
Enclosed for your consideration is an Offer to Purchase, dated
April 14, 1999 (the "Offer to Purchase"), and the related Letter of
Transmittal (which, together with any amendments or supplements thereto,
collectively constitute the "Offer") relating to the offer by Dash
Multi-Corp, Inc., a Missouri corporation (the "Purchaser"), to purchase
for cash, up to 1,567,417 of the outstanding shares of Common Stock, no
par value per share (the "Common Stock" or the "Shares"), of R-B Rubber
Products, Inc., an Oregon corporation (the "Company"), on the terms and
subject to the conditions set forth in the Offer (together with, if the
Offer is extended or amended, the terms of such extension or amendment).
Also enclosed is a copy of the Company's Solicitation/Recommendation
Statement on Schedule 14D-9.
WE ARE THE HOLDER OF RECORD OF SHARES HELD BY US FOR YOUR ACCOUNT.
A TENDER OF SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD
AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS
FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED TO TENDER
SHARES HELD BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish to tender any of or
all the Shares held by us for your account, pursuant to the terms and
conditions set forth in the Offer.
Your attention is directed to the following:
1. The Offer price is $3.00 per Share, net to the Seller
in cash, without interest thereon, upon the terms and subject to
the conditions of the Offer.
2. The Offer is being made for up to 1,567,417 of the
outstanding Shares. Upon the terms and subject to the conditions
of the Offer, if more than 1,567,417 Shares are validly tendered
prior to the expiration of the Offer and not properly withdrawn in
accordance with Section 3 of the Offer to Purchase, Purchaser will
accept for payment and pay for only 1,567,417 Shares on a pro rata
basis (with appropriate adjustments to avoid the purchase of
fractional Shares) based upon the number of Shares properly
tendered by each stockholder prior to the Expiration Date and not
withdrawn.
3. The Offer is being made pursuant to a Stock Purchase
Agreement (the "Stock Purchase Agreement"), dated as of April 8,
1999, between the Company and the Purchaser. Pursuant to the
Stock Purchase Agreement, in certain circumstances if less than
1,567,417 Shares are tendered pursuant to the Offer the Purchaser,
at its sole option, shall have the option to purchase from the
Company, at a purchase price equal to the greater of $3.00 per
<PAGE>
<PAGE>
Share or the most recent price offered by Purchaser in the Offer,
up to an amount of Shares which, when combined with Shares
tendered pursuant to the Offer, would be equal to 70% of the
outstanding Shares, after taking into account such newly issued
Shares.
4. THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY
DETERMINED THAT THE OFFER IS FAIR TO AND IN THE BEST INTERESTS OF
THE COMPANY AND ITS STOCKHOLDERS AND HAS UNANIMOUSLY APPROVED THE
OFFER AND THE STOCK PURCHASE AGREEMENT AND THE OTHER TRANSACTIONS
CONTEMPLATED THEREBY AND UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S
STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT TO
THE OFFER.
5. The Offer is conditioned upon, among other things,
there being validly tendered and not withdrawn prior to the
expiration of the Offer at least 1,567,417 Shares. The Offer is
also subject to certain other conditions described in Section 13
of the Offer to Purchase.
6. THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00
MIDNIGHT, ST. LOUIS, MISSOURI TIME, ON MAY 12, 1999, UNLESS THE
OFFER IS EXTENDED BY THE PURCHASER (THE "EXPIRATION DATE").
7. Any stock transfer taxes applicable to a sale of
Shares to the Purchaser will be borne by the Purchaser, except as
otherwise provided in Instruction 6 of the Letter of Transmittal.
Your instructions to us should be forwarded promptly to permit us
to submit a tender on your behalf prior to the Expiration Date.
If you wish to have us tender any or all of the Shares held by us
for your account, please so instruct us by completing, executing and
returning to us the instruction form included with this letter. Your
instructions should be forwarded to us in ample time to permit us to
submit a tender on your behalf prior to the Expiration Date.
Payment for Shares accepted for payment pursuant to the Offer will
be in all cases made only after timely receipt by American Securities
Transfer & Trust, Inc. (the "Depositary"), of (a) certificates for (or a
timely Book-Entry Confirmation (as defined in the Offer to Purchase)
with respect to) such Shares, (b) a Letter of Transmittal, properly
completed and duly executed, with any required signature guarantees, or,
in the case of a book-entry transfer effected pursuant to the procedure
set forth in Section 3 of the Offer to Purchase, an Agent's Message, and
(c) any other documents required by the Letter of Transmittal.
Accordingly, tendering stockholders may be paid at different times
depending upon when certificates for Shares or Book-Entry Confirmation
with respect to Shares are actually received by the Depositary. UNDER
NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE FOR SHARES,
REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING PAYMENT
PURSUANT TO THE OFFER.
The Offer is not being made to, nor will tenders be accepted from,
or on behalf of, holders of Shares in any jurisdiction in which the
making or acceptance of the Offer would not be in compliance with the
laws of such jurisdiction. An envelope in which to return your
instructions to us is enclosed. If you authorize tender of your Shares,
all such Shares will be tendered unless otherwise indicated in such
instruction form. Please forward your instructions to us as soon as
possible to allow us ample time to tender Shares on your behalf prior to
the expiration of the Offer.
- 2 -
<PAGE>
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE
OFFER TO PURCHASE FOR CASH
UP TO 1,567,417 SHARES OF COMMON STOCK
OF
R-B RUBBER PRODUCTS, INC.
The undersigned acknowledge(s) receipt of your letter, the Offer
to Purchase, dated April 14, 1999 (the "Offer to Purchase"), and the
related Letter of Transmittal relating to shares of Common Stock, no par
value per share (the "Common Stock" or the "Shares"), of R-B Rubber
Products, Inc., an Oregon corporation.
This will instruct you to tender the number of Shares indicated
below held by you for the account of the undersigned, on the terms and
subject to the conditions set forth in the Offer to Purchase and the
related Letter of Transmittal.
Number of Shares to be Tendered:<F*>
Shares
- -------------------------------------
Daytime Area Code
and Telephone No.
- -------------------------------------------
Taxpayer Identification
No. or Social Security No.
- -------------------------------------------
Dated: , 1999
-------------------------------
SIGN HERE
- -------------------------------------------
- -------------------------------------------
Signature(s)
- -------------------------------------------
- -------------------------------------------
(Please print name(s) and address(es))
[FN]
- ------------
<F*> Unless otherwise indicated, it will be assumed that all your Shares
are to be tendered.
<PAGE>
<PAGE>
Company Press Release
- ---------------------
RB RUBBER ENTERS INTO AGREEMENT FOR
TENDER OFFER
McMinnville, Ore.--April 9, 1999--RB Rubber Products, Inc.
(Nasdaq:RBBR) an integrated tire recycler and producer of rubber mats
and other molded products, today announced that it has entered into an
agreement that provides for a tender offer to be made by Dash Multi-Corp,
Inc., a private company based in St. Louis, Missouri.
Through its tender offer, Dash intends to purchase RB Rubber stock for
$3.00 cash per share. The offer is contingent upon several factors,
including Dash being able to purchase a minimum of 1,567,417 shares
(approximately 70% of RB Rubber's outstanding shares). Dash has entered
into agreements with RB Rubber's three largest shareholders who have
agreed to tender a total of 935,540 shares to Dash pursuant to its
offer.
"This alliance creates new business synergies as Dash is our primary
supplier of bonding materials used in our mat-making process and has
significant technical expertise that should improve our processes," said
Ron Bogh, RB Rubber President, Chairman and CEO. "Dash also has greater
financial resources, which will be important as we continue to grow and
expand our company."
Marvin S. Wool, Dash's principal shareholder and Chief Executive
Officer, added, "RB Rubber has tremendous potential for future growth.
We look forward to supporting their continued growth on an accelerated
basis with our financial and business resources."
Other conditions of the offer require RB Rubber to maintain its public
company standing and its listing on the Nasdaq Small-Cap Market.
The offer commences April 14, 1999 and expires on May 12, 1999.
Materials, including a letter of transmittal, will be mailed to all
shareholders of RB Rubber explaining the tender offer in greater detail.
For 1998 RB Rubber reported revenues of $8.6 million, a 15% increase
over 1997. Due to a one-time charge to earnings related to the Iowa Mat
acquisition, the net loss for 1998 was $85,000, or $.04 per diluted
share. Without the charge of $396,000, net income would have been
$311,000 or $.14 per diluted share.
RB Rubber Products, Inc. is an integrated recycler and manufacturer that
transforms scrap tires and rubber into high quality, durable rubber mats
and other protective surfaces. Applications of
<PAGE>
<PAGE>
the company's products include surfacing for agribusiness, sports and
fitness facilities and other commercial and industrial uses. The
company was founded in 1985 and went public in 1995.
Dash Multi-Corp, Inc. manufactures and markets plastic, vinyls and
urethanes, carpet padding and backing, non-slip textiles and coated
fabrics.
This news release contains forward-looking statements that involve a
number of risks and uncertainties. Some of the factors that could cause
actual results to differ materially include: ability to negotiate and
execute business agreements, and unanticipated difficulties in
integrating acquired technologies or businesses. Investors are directed
to the company's filings with the Securities and Exchange Commission,
including the company's 1998 10-KSB for additional information on the
risks and uncertainties as well as other aspects of the company's
business.
- 2 -
<PAGE>
<PAGE>
This announcement is neither an offer to purchase nor a solicitation of
an offer to sell Shares. The Offer is made solely by the Offer to
Purchase, dated April 14, 1999, and the related Letter of Transmittal
and any amendments or supplements thereto, and is being made to all
holders of Shares. The Offer is not being made to (nor will tenders be
accepted from or on behalf of) holders of Shares in any jurisdiction in
which the making of the Offer or the acceptance thereof would not be in
compliance with the laws of such jurisdiction. The Offer shall not be
effective in any jurisdiction where the securities, blue sky or other
laws require the Offer to be made solely by a licensed broker or dealer.
NOTICE OF OFFER TO PURCHASE FOR CASH
UP TO 1,567,417 SHARES OF COMMON STOCK
OF
R-B RUBBER PRODUCTS, INC.
AT
$3.00 NET PER SHARE
BY
DASH MULTI-CORP, INC.
Dash Multi-Corp, Inc., a Missouri corporation (the "Purchaser"),
is offering to purchase up to 1,567,417 of the outstanding shares
(representing approximately 70% of the issued and outstanding shares as
of April 8, 1999) of common stock, no par value per share (the "Common
Stock" or the "Shares"), of R-B Rubber Products, Inc., an Oregon
corporation (the "Company"), at $3.00 per Share, net to the seller in
cash, upon the terms and subject to the conditions set forth in the
Offer to Purchase, dated April 14, 1999, and in the related Letter of
Transmittal (which, together with any amendments or supplements thereto,
collectively constitute the "Offer"). Tendering stockholders will not
be obligated to pay brokerage fees or commissions or, subject to
Instruction 6 of the Letter of Transmittal, transfer taxes on the
purchase of Shares by the Purchaser pursuant to the Offer.
- ------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, ST.
LOUIS, MISSOURI TIME, ON WEDNESDAY, MAY 12, 1999 UNLESS THE OFFER IS
EXTENDED.
- ------------------------------------------------------------------------
The Offer is being made pursuant to a Stock Purchase Agreement
(the "Stock Purchase Agreement"), dated as of April 8, 1999, between the
Company and the Purchaser. Pursuant to the Stock Purchase Agreement, in
certain circumstances if fewer than 1,567,417 Shares are tendered
pursuant to the Offer the Purchaser, at its sole option, shall have the
option to purchase from the Company, at a purchase price equal to the
greater of $3.00 per Share or the most recent price offered by Purchaser
in the Offer, up to an amount of Shares which, when combined with Shares
tendered pursuant to the Offer, would equal 1,567,417 Shares. As a
result of the consummation of the purchase of the Shares, the Company
will become a majority-owned subsidiary of the Purchaser. The Purchaser
has entered into the Stock Purchase Agreement and is undertaking the
Offer to acquire control of the Company with a view toward supporting
its future growth.
The Offer is conditioned upon, among other things, there being at
least 1,567,417 Shares validly tendered and not withdrawn prior to the
expiration of the Offer. Certain other conditions to consummation of
the Offer are described in Section 13 of the Offer to Purchase.
<PAGE>
<PAGE>
The Board of Directors of the Company has unanimously determined
that the Offer is fair to, and in the best interests of, the Company and
its stockholders and has unanimously approved the Offer and the Stock
Purchase Agreement and the transactions contemplated thereby and
unanimously recommends that the Company's stockholders accept the Offer
and tender their Shares pursuant to the Offer.
For purposes of the Offer, the Purchaser will be deemed to have
accepted for payment Shares validly tendered and not withdrawn as, if
and when the Purchaser gives oral or written notice to American
Securities Transfer & Trust, Inc. (the "Depositary") of its acceptance
for payment of such Shares pursuant to the Offer. Payment for Shares
accepted for payment pursuant to the Offer will be made by deposit of
the purchase price therefor with the Depositary, which will act as agent
for the tendering stockholders for the purpose of receiving payments
from the Purchaser and transmitting such payments to the tendering
stockholders. Under no circumstances will interest on the purchase
price for Shares be paid, regardless of any delay in making such
payment.
In all cases, payment for Shares tendered and accepted for payment
pursuant to the Offer will be made only after timely receipt by the
Depositary of (i) certificates for such Shares (or confirmation of a
book-entry transfer of such Shares into the Depositary's account at The
Depository Trust Company (the "Book-Entry Transfer Facility")) pursuant
to the procedures set forth in Section 3 of the Offer to Purchase,
(ii) a properly completed and duly executed Letter of Transmittal (or
facsimile thereof) in accordance with the instructions of the Letter of
Transmittal, with any required signature guarantees (or, in the case of
a book-entry transfer, an Agent's Message (as defined in Section 3 of
the Offer to Purchase)) and (iii) any other documents required by such
Letter of Transmittal.
Subject to the applicable rules and regulations of the Securities
and Exchange Commission, the Purchaser expressly reserves the right, in
its sole discretion, at any time or from time to time, to extend the
period of time during which the Offer is open by giving oral or written
notice of such extension to the Depositary. Any such extension will
also be publicly announced by press release issued no later than 9:00
A.M., St. Louis, Missouri time, on the next business day after the
previously scheduled expiration date of the Offer.
Upon terms and subject to the conditions of the Offer, if more
than 1,567,417 Shares are validly tendered and not properly withdrawn
prior to the Expiration Date, Purchaser will accept for payment and pay
for only 1,567,417 Shares on a pro rata basis (with appropriate
adjustments to avoid the purchase of fractional Shares) based on the
number of Shares properly tendered by each stockholder prior to the
Expiration Date and not withdrawn. In the event that proration of
tendered Shares is required, because of the difficulty of determining
the precise number of Shares properly tendered and not withdrawn (due in
part to the guaranteed delivery procedures described in Section 3),
Purchaser does not expect that it will be able to announce the final
results of such proration or pay for any Shares until at least seven
Nasdaq trading days after the Expiration Date. Stockholders may obtain
such preliminary information from the Information Agent and may be able
to obtain such information from their broker. Purchaser will not pay
for any Shares accepted for payment pursuant to the Offer until the
final proration factor is known.
Tenders of Shares made pursuant to the Offer are irrevocable
except that Shares tendered pursuant to the Offer may be withdrawn at
any time prior to the Expiration Date (as defined in Section 1 of the
Offer to Purchase) and, unless theretofore accepted for payment by the
Purchaser pursuant to the Offer, may also be withdrawn at any time after
June 4, 1999.
For withdrawal to be effective, a written, telegraphic, telex or
facsimile transmission notice of withdrawal must be timely received by
the Depositary at one of its addresses set forth on the back cover
<PAGE>
<PAGE>
of the Offer to Purchase. Any such notice of withdrawal must specify
the name of the person having tendered the Shares to be withdrawn, the
number of Shares to be withdrawn and the names in which the
certificate(s) evidencing the Shares to be withdrawn are registered, if
different from that of the person who tendered such Shares. If
certificates for Shares to be withdrawn have been delivered or otherwise
identified to the Depositary, the name of the registered holder and the
serial numbers of the particular certificates evidencing the Shares to
be withdrawn must also be furnished to the Depositary as aforesaid prior
to the physical release of such certificates and, unless such Shares
have been tendered for the account of Eligible Institution (as defined
in Section 3 of the Offer to Purchase), the signature on the notice of
withdrawal must be guaranteed by an Eligible Institution. If Shares
have been tendered pursuant to the procedures for book-entry transfer as
set forth in Section 3 of the Offer to Purchase, any notice of
withdrawal specify the name and number of the account at the Book-Entry
Transfer Facility to be credited, with the withdrawn Shares and
otherwise comply with such Book-Entry Transfer Facility's procedures for
such withdrawal, in which case a notice of withdrawal will be effective
if delivered to the Depositary in writing. Withdrawals of tenders of
Shares may not be rescinded, and any Shares properly withdrawn will
thereafter be deemed not validly tendered for the purposes of the Offer.
However, withdrawn Shares may be retendered by again following one of
the procedures described in Section 3 of the Offer to Purchase at any
time on or prior to the Expiration Date.
The information required to be disclosed by paragraph (e)(1)(vii)
of Rule 14d-6 of the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended, is contained in the Offer to Purchase
and is incorporated herein by reference.
The Company has provided the Purchaser with the Company's
stockholder list and security position listings for the purpose of
disseminating the Offer to holders of Shares. The Offer to Purchase and
the Letter of Transmittal and, if required, other relevant materials,
will be mailed by the Purchaser to record holders of Shares and will be
furnished to brokers, dealers, commercial banks, trust companies and
similar persons whose names, or the names of whose nominees, appear on
the Company's stockholder list or, if applicable, who are listed as
participants in a clearing agency's security position listing for
subsequent transmittal to beneficial owners of Shares.
The Offer to Purchase and the Letter of the Transmittal contain
important information which should be read carefully before any decision
is made with respect to the Offer.
Questions and requests for assistance may be directed to the
Information Agent at its address and telephone number set forth below.
Requests for additional copies of the Offer to Purchase, the related
Letter of Transmittal and other tender offer materials may be directed
to the Information Agent. Such additional copies will be furnished at
the Purchaser's expense. All questions as to the form and validity
(including time of receipt) of any notice of withdrawal will be
determined by the Purchaser, in its sole discretion, which determination
shall be final and binding. The Purchaser will not pay any fees or
commissions to any broker or dealer or any other person for soliciting
tenders of Shares pursuant to the Offer.
The Information Agent for the Offer is:
D.F. KING & CO., INC.
77 Water Street
New York, New York 10005
Banks and Brokers Call Collect: (212) 269-5550
Call Toll Free: 1-800-549-6697
<PAGE>
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
OF
R-B RUBBER PRODUCTS
As set forth in Section 3 of the Offer to Purchase (as defined
below), this form or one substantially equivalent may be used to accept
the Offer (as defined below) if certificates for shares of Common Stock,
no par value per share (the "Common Stock" or the "Shares"), of R-B
Rubber Products, Inc., an Oregon corporation (the "Company"), are not
immediately available, or if the procedure for book-entry transfer
cannot be complied with on a timely basis, or all required documents
cannot be delivered to the Depositary prior to the Expiration Date (as
defined in Section 1 of the Offer to Purchase). This form may be
delivered by hand to the Depositary or transmitted by telegram,
facsimile transmission or mail to the Depositary and must include a
guarantee by an Eligible Institution (as defined in Section 3 of the
Offer to Purchase). See Section 3 of the Offer to Purchase.
The Depositary:
<TABLE>
<CAPTION>
AMERICAN SECURITIES TRANSFER & TRUST, INC.
<C> <C> <C>
Facsimile Transmission Number: By Hand/Overnight Delivery: By Registered or Certified Mail:
(For Eligible Institutions Only) American Securities Transfer & American Securities Transfer &
(303) 234-5340 Trust, Inc. Trust, Inc.
c/o J. Harmann c/o J. Harmann
Confirm Receipt of 938 Quail St. P.O. Box 1596
Facsimile by Telephone: Suite 101 Denver, Colorado
(303) 234-5309 Lakewood, Colorado 80201
80215
</TABLE>
__________________
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION OF
INSTRUCTIONS VIA A FACSIMILE NUMBER, OTHER THAN AS SET FORTH ABOVE, DOES
NOT CONSTITUTE A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a
signature on a Letter of Transmittal is required to be guaranteed by an
Eligible Institution under the instructions thereto, such signature
guarantee must appear in the applicable space provided in the signature
box on the Letter of Transmittal.
<PAGE>
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a participant in the Security Transfer Agents
Medallion Program, the New York Stock Exchange Medallion Signature
Guarantee Program or the Stock Exchange Medallion Program, hereby
guarantees to deliver to the Depositary either the certificates
representing the Shares tendered hereby, in proper form for transfer, or
a Book-Entry Confirmation (as defined in the Offer to Purchase) with
respect to such Shares, in any such case together with a properly
completed and duly executed Letter of Transmittal, with any required
signature guarantees, or an Agent's Message (as defined in the Offer to
Purchase), and any other required documents, within THREE trading days
after the date hereof.
The Eligible Institution that completes this form must communicate
this guarantee to the Depositary and must deliver the Letter of
Transmittal and certificates for Shares to the Depositary within the
time period shown herein. Failure to do so could result in a financial
loss to such Eligible Institution.
Name of Firm:
------------------------ ----------------------------------
AUTHORIZED SIGNATURE
Address: Name:
----------------------------- -----------------------------
ZIP CODE PLEASE PRINT
Title:
- ------------------------------------- ----------------------------
Area Code and Tel. No.: Dated:
-------------- --------------------------
NOTE: DO NOT SEND CERTIFICATES FOR SHARES WITH THIS NOTICE.
CERTIFICATES FOR SHARES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
<PAGE>
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Dash Multi-Corp, Inc., a
Missouri corporation, on terms and subject to the conditions set forth
in the Offer to Purchase, dated April 14, 1999 (the "Offer to
Purchase"), and the related Letter of Transmittal (which, together with
any amendments or supplements thereto, collectively constitute the
"Offer"), receipt of which is hereby acknowledged, the number of Shares
set forth below, all pursuant to the guaranteed deliver procedures set
forth in Section 3 of the Offer to Purchase.
Number of Shares: Name(s) of Record Holder(s)
----------------- ---------------
------------------------------------------
Certificate Nos.
(if available):
------------------- ------------------------------------------
PLEASE PRINT
(CHECK BOX IF SHARES WILL BE Address(es):
TENDERED BY BOOK-ENTRY TRANSFER) ------------------------------
------------------------------------------
/ / The Depository Trust Company
Daytime Area Code
and Tel. No.:
-----------------------------
DTC Account Number:
---------------
Dated: Signature(s):
---------------------------- -----------------------------
<PAGE>
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER NAME AND IDENTIFICATION NUMBER TO
GIVE THE PAYER. Social Security numbers have nine digits separated by
two hyphens: i.e., 000-00-0000. Employer identification numbers have
nine digits separated by only one hyphen: i.e., 00-0000000. The table
below will help determine the name and number to give the payer.
- ------------------------------------------------------------------------
GIVE THE NAME AND
SOCIAL SECURITY
FOR THIS TYPE OF ACCOUNT NUMBER OF
- ------------------------------------------------------------------------
1. An individual's account. The individual
2. Two or more individuals The actual owner of the account
(joint account) or, if combined funds, any one
of the individuals<F1>
3. Custodian account of a minor The minor<F2>
(Uniform Gifts to Minors Act)
4. a. The usual revocable savings The grantor-trustee<F1>
trust account (grantor is also
trustee)
b. So-called trust account that is The actual owner<F1>
not a legal or valid trust
under State law
5. Sole proprietorship account The owner<F3>
- ------------------------------------------------------------------------
- ------------------------------------------------------------------------
GIVE THE NAME AND
EMPLOYER
IDENTIFICATION
FOR THIS TYPE OF ACCOUNT NUMBER OF
- ------------------------------------------------------------------------
6. Sole proprietorship account The owner<F3>
7. A valid trust, estate, or pension The legal entity<F4>
trust
8. Corporate account The corporation
9. Association, club, religious, The organization
charitable, educational or other
tax-exempt organization account
10. Partnership The partnership
11. A broker or registered nominee The broker or nominee
12. Account with the Department of
Agriculture in the name of a public
entity (such as a State or local
government, school district, or
prison) that receives agricultural
program payments The public entity
- ------------------------------------------------------------------------
[FN]
<F1> List first and circle the name of the person whose number you
furnish.
<F2> Circle the minor's name and furnish the minor's social security
number.
<F3> You must show your individual name, but you may also enter your
business or "doing business as" name. You may use either your
Social Security Number or Employer Identification Number.
<F4> List first and circle the name of the legal trust, estate, or
pension trust. (Do not furnish the identifying number of the
personal representative or trustee unless the legal entity itself
is not designated in the account title.)
NOTE: If no name is circled when more than one name is listed, the number
will be considered to be that of the first name listed.
<PAGE>
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know
your number, obtain Form SS-5, Application for a Social Security Number
Card (for individuals), or Form SS-4, Application for Employer
Identification Number (for businesses and all other entities), at the
local office of the Social Security Administration or the Internal
Revenue Service and apply for a number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
The following is a list of payees specifically exempted from backup
withholding depending upon the type of payment (see below):
(1) A corporation.
(2) An organization exempt from tax under section 501(a), or an IRA
or a custodial account under section 403(b)(7).
(3) The United States or any agency or instrumentality thereof.
(4) A State, the District of Columbia, a possession of the United
States, or any subdivision or instrumentality thereof.
(5) A foreign government, a political subdivision of a foreign
government, or any agency or instrumentality thereof.
(6) An international organization or any agency or instrumentality
thereof.
(7) A foreign central bank of issue.
(8) A dealer in securities or commodities required to register in
the U.S. or a possession of the U.S.
(9) A futures commission merchant registered with the Commodity
Futures Trading Commission.
(10) A real estate investment trust.
(11) An entity registered at all times during the tax year under the
Investment company Act of 1940.
(12) A common trust fund operated by a bank under section 584(a).
(13) A financial institution.
(14) A middleman known in the investment community as a nominee or
listed in the most recent publication of the American Society
of Corporate Secretaries, Inc., Nominee List.
(15) A trust exempt from tax under section 664 or described in
section 4947.
For Interest and dividends, all listed payees are exempt except item
(9). for broker transactions, payees, listed in items (1) through (13)
and a person registered under the Investment Advisers Act of 1940 who
regularly acts as a broker are exempt.
Exempt payees described above should file Form W-9 to avoid possible
erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH
YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" IN PART 1 OF THE
FORM, AND RETURN IT TO THE PAYER. If you are a nonresident alien or a
foreign entity not subject to backup withholding, give the payer a
completed Form W-8, Certificate of Foreign Status.
PRIVACY ACT NOTICE. Section 6109 requires most recipients of dividend,
Interest, or other payments to give taxpayer identification numbers to
payers who must report the payments to IRS. The IRS uses the numbers
for identification purposes. Payers must be given the numbers whether
or not recipients are required to file tax returns. Payers must
generally withhold 31% of taxable Interest, dividend, and certain other
payments to a payee who does not furnish a taxpayer identification
number to a payer. Certain penalties may also apply.
<PAGE>
PENALTIES
(1) FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. If you fail to
furnish your correct taxpayer identification number to a payer, you are
subject to a penalty of $50 for each such failure unless your failure is
due to reasonable cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.
If you make a false statement with no reasonable basis which results in
no imposition of backup withholding, you are subject to a penalty of
$500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. Willfully falsifying
certifications or affirmations may subject you to criminal penalties
including fines and/or Imprisonment.
FOR ADDITIONAL INFORMATION CON-TACT YOUR TAX CONSULTANT OR THE INTERNAL
REVENUE SERVICE.
<PAGE>
<PAGE>
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is entered into
---------
as of April 8, 1999, between Dash Multi-Corp, Inc., a Missouri
corporation ("Purchaser"), and R-B Rubber Products, Inc., an Oregon
---------
corporation (the "Company").
-------
RECITALS
WHEREAS, the respective Boards of Directors of Purchaser and the
Company have approved the acquisition of majority ownership of the
Company by Purchaser on the terms and conditions set forth herein;
WHEREAS, it is intended that such acquisition be accomplished by
Purchaser's effecting a cash tender offer (the "Offer") to purchase
-----
70% of the issued and outstanding shares of common stock, no par value,
of the Company (the "Shares"); and
------
WHEREAS, the Company and Purchaser desire to make certain
representations, warranties, covenants and agreements in connection with
this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements
contained herein, the parties hereto hereby agree as follows:
ARTICLE I
THE TENDER OFFER
1.1 Tender Offer. (a) Provided that this Agreement shall not
------------
have been terminated in accordance with Article VII hereof and none of
the events set forth in Annex A hereto shall have occurred or be
-------
existing, as promptly as practicable (but in no event later than five
business days following the public announcement of the execution
hereof), Purchaser shall commence a tender offer (within the meaning of
Rule 14d-2 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) (the "Offer") for the Shares at a price of $3.00
------------ -----
per Share, net to the seller in cash (as such Offer may be amended in
accordance with the terms of this Agreement) (the "Offer Price"),
-----------
subject to the terms and conditions set forth in Annex A hereto (the
-------
"Offer Conditions"). The initial expiration date of the Offer shall
----------------
be the date 20 business days from and including the date (the
"Commencement Date") the Offer Documents (as hereinafter defined) are
-----------------
first filed with the Securities and Exchange Commission (the "SEC").
---
Purchaser expressly reserves the right, in its sole discretion, to waive
any condition and to set forth or change any other term and condition of
the Offer, provided that, unless previously approved by the Company in
--------
writing, no provision may be set forth or changed which decreases the
price per Share payable in the Offer, changes the form of consideration
payable in the Offer (other than by adding consideration), or
<PAGE>
<PAGE>
imposes conditions to the Offer in addition to those set forth herein
that are materially adverse to holders of the Shares. Purchaser
covenants and agrees that, subject to the terms and conditions of the
Offer, including but not limited to the Offer Conditions, it will accept
for payment and pay for Shares as soon as it is permitted to do so under
applicable law, provided that Purchaser shall have the right, in its
--------
sole discretion, to extend the Offer from time to time notwithstanding
the prior satisfaction of the Offer Conditions. Notwithstanding the
foregoing, Purchaser shall extend the Offer at any time up to June 15,
1999 for one or more periods of not more than 10 business days, or, if
longer, for any period required by any rule, regulation, interpretation
or position of the Securities and Exchange Commission (the "SEC") or
---
the staff thereof applicable to the Offer, if at the initial expiration
date of the Offer, or any extension thereof, any condition to the Offer
(other than the Minimum Condition) is not satisfied or waived. In
addition, the Offer Price may be increased and the Offer may be extended
to the extent required by law in connection with such increase in each
case without the consent of the Company. It is agreed that the terms
and conditions set forth in the Offer, including but not limited to the
Offer Conditions, are for the benefit of Purchaser and may be asserted
by Purchaser regardless of the circumstances giving rise to any such
condition.
(b) The Company hereby approves of and consents to the Offer and
represents and warrants that: (i) its Board of Directors, at a meeting
duly called and held on April 8, 1999, has unanimously (A) determined
that this Agreement and the transactions contemplated hereby, including
the Offer, are fair to and in the best interests of the holders of
Shares, (B) approved this Agreement and the transactions contemplated
hereby, including the Offer, and (C) resolved to recommend that the
stockholders of the Company accept the Offer, tender their Shares to
Purchaser thereunder and approve this Agreement and the transactions
contemplated hereby; and (ii) Pacific Crest Securities (the "Financial
----------
Advisor") has delivered to the Board of Directors of the Company its
- -------
opinion that the consideration to be received by holders of Shares,
other than Purchaser, pursuant to the Offer is fair to such holders and
the Company from a financial point of view. The Company has been
authorized by the Financial Advisor to permit, subject to prior review
and consent by such Financial Advisor (such consent not to be
unreasonably withheld), the inclusion of such fairness opinion (or a
reference thereto) in a Solicitation/Recommendation Statement on
Schedule 14D-9 (the "Schedule 14D-9") to be filed with the SEC upon
--------------
commencement of the Offer. The Company hereby consents to the inclusion
in the Offer Documents (as defined in Section 1.1(c)) of the
recommendations of the Board of Directors of the Company described
herein.
(c) As soon as reasonably practicable on the date the Offer is
commenced, Purchaser shall file with the SEC a Tender Offer Statement on
Schedule 14D-1 with respect to the Offer (together with all amendments
and supplements thereto and including the exhibits thereto, the
"Schedule 14D-1"). The Schedule 14D-1 will include, as exhibits, the
--------------
Offer to Purchase and a form of letter of transmittal and summary
advertisement (collectively, together with any amendments and
supplements thereto, the "Offer Documents"). The Offer Documents will
---------------
comply in all material respects with the provisions of applicable
federal securities laws and, on the date filed with the SEC and on the
date first published, sent or given to the Company's
- 2 -
<PAGE>
<PAGE>
stockholders, shall not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
Notwithstanding the foregoing, no representation is made by Purchaser
with respect to information supplied by the Company for inclusion in the
Offer Documents. Purchaser further agrees to use commercially
reasonable efforts to cause the Offer Documents to be filed with the SEC
and to be disseminated to holders of Shares, in each case as and to the
extent required by applicable federal securities laws. Purchaser, on
the one hand, and the Company, on the other hand, agrees promptly to
correct any information provided by it for use in the Offer Documents if
and to the extent that it shall have become false and misleading in any
material respect and Purchaser further agrees to use commercially
reasonable efforts to cause the Offer Documents as so corrected to be
filed with the SEC and to be disseminated to holders of Shares, in each
case as and to the extent required by applicable federal securities
laws. The Company and its counsel shall be given the opportunity to
review the initial Schedule 14D-1 before it is filed with the SEC. In
addition, Purchaser agrees to provide the Company and its counsel copies
of any written comments or other communications that Purchaser or its
counsel may receive from time to time from the SEC or its staff with
respect to the Offer Documents promptly after the receipt of such
comments or other communications.
(d) Concurrently with the commencement of the Offer, the Company
shall file with the SEC a Solicitation/Recommendation Statement on
Schedule 14D-9 (together with all amendments and supplements thereto and
including the exhibits thereto, the "Schedule 14D-9") which shall
--------------
contain the recommendation referred to in clause (i)(C) of Section
1.1(b) hereof; provided, however, that in the event of a Superior
Proposal (as defined in Section 5.2) prior to such filing, the Company
shall not be required to make such filing with such recommendations if a
majority of the Company's Board of Directors determines in good faith,
after receiving written advice from its Financial Advisor and outside
counsel, that making such filing would constitute a breach of the
fiduciary duties of the Company's Board of Directors under applicable
law. The Schedule 14D-9 will comply in all material respects with the
provisions of applicable federal securities laws and, on the date filed
with the SEC and on the date first published, sent or given to the
Company's stockholders, shall not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading.
Notwithstanding the foregoing, no representation is made by the Company
with respect to information supplied by Purchaser in writing for
inclusion in the Schedule 14D-9. The Company further agrees to use
commercially reasonable efforts to cause the Schedule 14D-9 to be filed
with the SEC and to be disseminated to holders of Shares, in each case
as and to the extent required by applicable federal securities laws.
The Company, on the one hand, and Purchaser, on the other hand, agrees
promptly to correct any information provided by it for use in the
Schedule 14D-9 if and to the extent that it shall have become false and
misleading in any material respect and the Company further agrees to use
commercially reasonable efforts to cause the Schedule 14D-9 as so
corrected to be filed with the SEC and to be disseminated to holders of
the Shares, in each case as and to the extent required by applicable
federal securities laws. Purchaser and its counsel shall be given the
opportunity to review the initial Schedule 14D-9 before it is filed with
the SEC. In addition, the Company agrees to provide Purchaser and its
- 3 -
<PAGE>
<PAGE>
counsel copies of any written comments or other communications that the
Company or its counsel may receive from time to time from the SEC or its
staff with respect to the Schedule 14D-9 promptly after the receipt of
such comments or other communications.
(e) In connection with the Offer, the Company will promptly
furnish or cause to be furnished to Purchaser mailing labels, security
position listings and any available listing or computer file containing
the names and addresses of the record holders of the Shares as of the
most recent practicable date, and shall furnish Purchaser with such
information and assistance as Purchaser or its agents may reasonably
request in communicating the Offer to the stockholders of the Company.
Except for such steps as are necessary to disseminate the Offer
Documents, Purchaser shall hold in confidence the information contained
in any of such labels and lists and the additional information referred
to in the preceding sentence, will use such information only in
connection with the Offer, and, if this Agreement is terminated, will
upon request of the Company, deliver or cause to be delivered to the
Company all copies of such information then in its possession or the
possession of its agents or representatives.
(f) If immediately prior to the expiration of the Offer, as
extended pursuant to Section 1.1(a) above, less than 70% of the
outstanding Shares have been tendered pursuant to the Offer, at
Purchaser's sole option, the Company shall, concurrently with such
expiration, issue to Purchaser at a purchase price equal to the greater
of $3.00 or the most recent price offered by Purchaser per Share in cash
an amount of Shares designated by Purchaser in its sole discretion up to
a maximum of that number of Shares necessary to make the aggregate
number of Shares purchased by Purchaser pursuant to the Offer plus the
number of Shares issued pursuant to this Section 1.1(f) equal to 70% of
the outstanding Shares, after taking into account such newly issued
Shares.
ARTICLE II
CLOSING; CLOSING DATE
The closing of the purchase of Shares pursuant to the Offer (the
"Closing") shall take place at the offices of Thompson Coburn, One
-------
Mercantile Center, St. Louis, Missouri 63101 at 10:00 a.m. (i) on the
first business day on which the last to be fulfilled or waived of the
conditions set forth in Article VI hereof shall be fulfilled or waived
in accordance with this Agreement or (ii) on such other date as the
Company and Purchaser may agree (the "Closing Date").
------------
- 4 -
<PAGE>
<PAGE>
ARTICLE III
DIRECTORS
OF THE COMPANY
At the Closing and subject to compliance with applicable law, the
Company will use its best efforts to cause the Company's Board of
Directors to consist of Ronald L. Bogh, Paul M. Gilson and, at
Purchaser's option, up to four additional persons designated by
Purchaser, two of whom shall be Marvin S. Wool and Gregory J. Divis. In
furtherance thereof, the Company will increase the size of the Board of
Directors of the Company, or use its reasonable efforts to secure the
resignation of directors, or both, as is necessary to permit Purchaser's
designees to be elected to the Board of Directors of the Company. At
such time, the Company, if so requested, will use its reasonable efforts
to cause persons designated by Purchaser to constitute the same
proportionate representation of each committee of the Board of Directors
of the Company, each board of directors of each subsidiary of the
Company and each committee of each such board (in each case to the
extent of the Company's ability to elect such persons). The Company's
obligations to appoint designees to the Board of Directors of the
Company shall be subject to Section 14(f) of the Exchange Act and Rule
14f-1 promulgated thereunder. The Company shall promptly take all
actions required pursuant to such Section and Rule in order to fulfill
its obligations under this Article III and shall include in the Schedule
14D-9, or in a separate Rule 14f-1 information statement provided to
stockholders, such information with respect to the Company and its
officers and directors as is required under Section 14(f) and Rule 14f-1
to fulfill its obligations under this Article III. Purchaser will
supply to the Company and will be solely responsible for any information
with respect to Purchaser and its nominees, officers, directors and
affiliates required by Section 14(f) and Rule 14f-1.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of the Company. Subject to
---------------------------------------------
the information set forth in Schedule IV (the "Disclosure Schedule")
-------------------
and/or the Company Reports (as defined below in Section 4.1(f)), the
Company hereby represents and warrants to Purchaser that:
- -
(a) Corporate Organization and Qualification. Each of the
----------------------------------------
Company and the Subsidiary (as hereinafter defined) is a corporation
duly organized and validly existing under the laws of its respective
jurisdiction of incorporation and is in good standing as a foreign
corporation in each jurisdiction where the properties owned, leased or
operated, or the business conducted, by it require such qualification,
except for such failure to so qualify or be in such good standing,
which, when taken together with all other such failures, is not
reasonably likely to have a material adverse effect on the financial
condition, properties, business or results of operations of the Company
and its subsidiaries taken as a whole. Each of the Company and the
Subsidiary has the requisite corporate power and authority to carry on
its respective businesses as
- 5 -
<PAGE>
<PAGE>
they are now being conducted. The Company has made available to
Purchaser a complete and correct copy of the Company's Articles of
Incorporation (the "Company Articles") and the Company's By-Laws (the
----------------
"Company By-Laws"), each as amended to date. The Company Articles and
---------------
Company By-Laws so delivered are in full force and effect. Except for
RB Recycling, Inc., an Oregon corporation (the "Subsidiary"), the
----------
Company has no subsidiaries (as defined in Rule 1.02(v) of Regulation S-
X promulgated pursuant to the Exchange Act) and owns no equity security
of, investment in or loan or advance to any business enterprise or
person or any agreement or commitment for such (other than trade terms
extended to customers in the ordinary course of business or employee
salary or business expense advances made in the ordinary course of
business). Neither the Company nor the Subsidiary is subject to any
arrangement that could be treated as a partnership for federal income
tax purposes.
(b) Authorized Capital. The authorized capital stock of the
------------------
Company consists of 20,000,000 Shares, of which 2,239,167 Shares were
outstanding on April 8, 1999. All of the outstanding Shares have been
duly authorized and are validly issued, fully paid and nonassessable.
The Company has no shares reserved for issuance, except that, as of
April 8, 1999, there were an aggregate of 162,500 shares reserved for
issuance under outstanding stock options pursuant to the 1995 Stock
Option Plan (the "Stock Plan"), and an aggregate of 95,000 shares
----------
reserved for issuance pursuant to a warrant issued to Paulson Investment
Company, Inc. The Disclosure Schedule contains a true and complete list
of each holder of an option granted under the Stock Plan, the date of
grant of such option, the number of shares subject to the option, the
exercise price of a share subject to such option, the vesting schedule
applicable to such option and the expiration date of such option. Each
of the outstanding shares of capital stock of the Subsidiary is duly
authorized, validly issued, fully paid and nonassessable and owned,
either directly or indirectly, by the Company free and clear of all
liens, pledges, security interests, claims or other encumbrances.
Except as set forth above, there are no shares of capital stock of the
Company authorized, issued or outstanding and, except as set forth
above, there are no pre-emptive rights nor any outstanding
subscriptions, options, warrants, rights, convertible securities or
other agreements or commitments of any character relating to the issued
or unissued capital stock or other securities of the Company or the
Subsidiary. Immediately prior to the Closing, the Company will have no
obligation to issue, transfer or sell any Shares or common stock of the
Company pursuant to any Benefit Plan (as defined in Section 5.1(d)).
(c) Corporate Records. The corporate record books (including
-----------------
the stock records) of the Company have been made available to Purchaser
and are complete, accurate and up to date in all material respects with
all necessary signatures and set forth all meetings and actions taken by
the shareholders and directors of the Company as required by law or the
Company By-Laws and all transactions involving the Shares.
(d) Authorization. The Company has the requisite corporate
-------------
power and authority and has taken all corporate action necessary in
order to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. This Agreement is a valid and binding
- 6 -
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<PAGE>
agreement of the Company enforceable against the Company in accordance
with its terms, assuming the due authorization, execution and delivery
hereof by Purchaser.
(e) Absence of Violations or Conflicts. (i) Other than as
----------------------------------
required under the Exchange Act (the "Regulatory Filings"), no
------------------
notices, reports or other filings are required to be made by the Company
with, nor are any consents, registrations, approvals, permits or
authorizations required to be obtained by the Company from, any
governmental or regulatory authority, agency, commission, court or other
entity, domestic or foreign ("Governmental Entity"), in connection
-------------------
with the execution and delivery of this Agreement by the Company and the
consummation by the Company of the transactions contemplated hereby, the
failure to make or obtain any or all of which is reasonably likely to
have a material adverse effect on the financial condition, properties,
business or results of operations of the Company and the Subsidiary
taken as a whole, or could prevent or materially delay the transactions
contemplated by this Agreement.
(ii) The execution and delivery of this Agreement by the Company
do not, and the consummation by the Company of the transactions
contemplated by this Agreement will not, constitute or result in (i) a
breach or violation of, or a default under, the Company Articles or
Company By-Laws or the comparable governing instruments of the
Subsidiary or (ii) a breach or violation of, a default under, the
acceleration of or the creation of a lien, pledge, security interest or
other encumbrance on assets (with or without the giving of notice or the
lapse of time) pursuant to, any provision of any law, ordinance, rule or
regulation or judgment, decree, order, award or governmental or non-
governmental permit or license to which the Company or the Subsidiary
are subject, except, in the case of clause (ii) above, for such
breaches, violations, defaults or accelerations or changes that, alone
or in the aggregate, could not prevent or materially delay the
transactions contemplated by this Agreement.
(f) Company Reports; Financial Statements. The Company has
-------------------------------------
delivered to Purchaser each registration statement, schedule, report,
proxy statement or information statement required to be filed or
otherwise filed with the SEC (the "Company Reports") prepared by it
---------------
since December 31, 1998 (the "Audit Date"), including, without
----------
limitation, (i) the Company's Annual Report on Form 10-KSB for the year
ended December 31, 1998 (the "1998 10-K") and (ii) the Company's Form
---------
8-K dated January 29, 1999, each in the form (including exhibits and any
amendments thereto) filed with the SEC. As of their respective dates,
the Company Reports complied in all material respects with the
applicable requirements under the Exchange Act and did not, and any
Company Reports filed with the SEC subsequent to the date hereof and
prior to the Closing Date will 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 in which they were made, not misleading. Each of the
consolidated balance sheets and statements of financial position
included in or incorporated by reference into the Company Reports
(including the related notes and schedules) fairly presents
- 7 -
<PAGE>
<PAGE>
the consolidated financial position of the Company and its subsidiaries
as of its date and each of the consolidated statements of earnings,
stockholders' equity and cash flows included in or incorporated by
reference into the Company Reports (including any related notes and
schedules) fairly presents the results of operations, stockholders'
equity and cash flows, as the case may be, of the Company and its
subsidiaries for the periods set forth therein (subject, in the case of
unaudited statements, to normal year-end audit adjustments which will
not be material in amount or effect), in each case in accordance with
generally accepted accounting principles consistently applied during the
periods involved, except as may be noted therein. Other than the
Company Reports specifically recited above, the Company has not filed
any other definitive reports or statements with the SEC since the Audit
Date. The Company's audited consolidated financial statements for the
fiscal year ended December 31, 1998 appearing in the 1998 10-K are
hereinafter referred to as the "1998 Financial Statements," and the
-------------------------
consolidated balance sheet of the Company as of December 31, 1998
included in the 1998 Financial Statements is hereinafter referred to as
the "Company Balance Sheet."
---------------------
(g) Absence of Certain Changes. Except as disclosed in the
--------------------------
Company Reports filed with the SEC prior to the date hereof or otherwise
disclosed in the Disclosure Schedule or as to which Purchaser has
consented in writing, since the Audit Date, the Company and the
Subsidiary have conducted their respective businesses only in, and have
not engaged in any material transaction other than according to, the
ordinary and usual course of such businesses and there has not been:
(i) any material adverse change in the financial
condition, properties, business or results of operations of
the Company and the Subsidiary taken as a whole or any
development or combination of developments of which
management of the Company has knowledge that is reasonably
likely to result in any such change;
(ii) any change by the Company in accounting
principles, practices or methods;
(iii) any damage, destruction or casualty loss to the
assets of the Company or the Subsidiary or other equipment
used by the Company or the Subsidiary in performing its
obligations under its Contracts or Leases (as defined below)
(whether or not owned by the Company or the Subsidiary or
covered by insurance);
(iv) any increase in the compensation payable by the
Company or the Subsidiary to any director, officer, employee
or agent of the Company or the Subsidiary (other than
routine increases made in the ordinary course of business
consistent with past practice) or any bonus, incentive
compensation, service award or other like benefit, granted,
made or accrued, contingently or otherwise, to or to the
credit of any of such director, officer, employee or agent
or any employee welfare, pension, retirement or similar
payment or arrangement made or agreed to by the Company or
the Subsidiary with respect to any such director, officer,
employee or agent;
- 8 -
<PAGE>
<PAGE>
(v) any sale, assignment or transfer (including
without limitation any collateral assignment or the granting
or permitting of any lien, encumbrance or other claim) of
any asset, property or right of the Company or the
Subsidiary other than the sale of inventory in the ordinary
course of business;
(vi) any amendment, modification, waiver or
cancellation of any debt owed to, or claim of, the Company
or the Subsidiary, or settlement by the Company or the
Subsidiary of any dispute involving any payment or other
obligation due to or owed by the Company or the Subsidiary,
in an amount greater than $5,000, to be made or performed
after the Closing Date;
(vii) any borrowing of money by the Company or the
Subsidiary, or the incurrence of any obligation or liability
(whether absolute or contingent), in an amount greater than
$5,000, other than current liabilities incurred in the
ordinary course of the Company's and the Subsidiary's
business;
(viii) any payment by the Company or the Subsidiary
of any obligation or liability (whether absolute or
contingent) in an amount greater than $5,000, other than
current liabilities incurred in the ordinary course of
business;
(ix) any capital expenditure or commitment to make
a capital expenditure by the Company or the Subsidiary
(exclusive of expenditures for repair or maintenance of
equipment in the ordinary course of business) in an amount
greater than $5,000;
(x) any incurrence of any extraordinary loss or
knowing waiver of any rights of substantial value by the
Company or the Subsidiary in connection with an aspect of
its business in an amount greater than $5,000, whether or
not in the ordinary course of business;
(xi) any cancellation, termination or amendment by
the Company or the Subsidiary of any Contract, Lease or
Intellectual Property License to which the Company or the
Subsidiary is a party or by which the Company or the
Subsidiary is bound that would change the amount owed to or
by the Company or the Subsidiary by more than $5,000;
(xii) any merger or consolidation of the Company or
the Subsidiary into or with any other corporation or
enterprise, or any corporate action by the Company or the
Subsidiary toward or effecting such a merger or
consolidation or a complete or partial liquidation or
dissolution of the Company or the Subsidiary or any material
portion of its assets;
- 9 -
<PAGE>
<PAGE>
(xiii) any failure on the part of the Company or the
Subsidiary to operate its business in the ordinary course so
as to preserve its business organization reasonably intact,
including the services of its present officers and the
goodwill of its suppliers, customers and others having
business relations with the Company or the Subsidiary;
(xiv) any redemption or repurchase, directly or
indirectly, of any Shares or other equity securities of the
Company or the Subsidiary, or, any setting aside or payment
of dividends or other distributions (whether in cash or in
kind), with respect to the Shares or other equity securities
of the Company or the Subsidiary; or
(xv) any agreement by or commitment of the Company
or the Subsidiary to do or permit (through any authorized
representative or agent of the Company or the Subsidiary)
any of the foregoing.
(h) Taxes.
-----
(i) Definitions. For purposes of this Agreement:
-----------
(A) the term "Code" shall mean the Internal
----
Revenue Code of 1986, as amended. All citations to the Code
or to the regulations promulgated thereunder shall include
any amendments or any substitute or successor provisions
thereto;
(B) the term "Returns" shall mean, collectively,
-------
(1) all reports, declarations, estimates, returns,
information statements, and similar documents relating to,
or required to be filed in respect of, any Taxes; and
(2) any statements, returns, reports, or similar documents
required to be filed pursuant to Part III of Subchapter A of
Chapter 61 of the Code or pursuant to any similar income,
excise, or other tax provision of federal, territorial,
state, local, or foreign law; and the term "Return" means
any one of the foregoing Returns;
(C) the term "Tax Asset" shall mean any net
---------
operating loss, net capital loss, investment Tax credit,
foreign Tax credit, charitable deduction or any other credit
or Tax attribute (determined without regard to the Tax
period in which such loss, credit or other attribute arose)
which could reduce Taxes; and
(D) the term "Taxes" shall mean (1) all income,
-----
net income, gross income, gross receipts, sales, use, ad
valorem, franchise, profits, license, lease, service,
service use, withholding, employment, payroll, excise,
severance, transfer, documentary, mortgage, registration,
stamp, occupation, environmental, premium, property,
windfall profits, customs, duties, and other taxes, fees,
- 10 -
<PAGE>
<PAGE>
assessments or charges of any kind whatever, together with
any interest, penalties and other additions with respect
thereto, imposed by any federal, territorial, state, local
or foreign government; and (2) any penalties, interest, or
other additions to tax for the failure to collect, withhold,
or pay over any of the foregoing, or to accurately file any
Return; and the term "Tax" shall mean any one of the
foregoing Taxes. When used with reference to specified
persons (for example and without limitation, "Taxes of the
Company"), the terms "Taxes" and "Tax" shall include only
amounts of, or in respect of, Taxes for which such person
is, or could become, liable in whole or part (including,
without limitation, any obligation in connection with a duty
to collect, withhold, or pay over any Tax, any obligation to
contribute to the payment of any Taxes determined on a
consolidated, combined, or unitary basis, any liability as a
transferee, or any liability as a result of any express or
implied obligation to indemnify or pay the Tax obligations
of another person).
(ii) Returns Filed and Taxes Paid. (A) the Company has
----------------------------
duly filed or caused to be filed, on or before the due date thereof (as
appropriately extended) with the appropriate taxing authorities, all
Returns that it is required to file (other than those sales and use Tax
Returns the failure of which to file would not have a material adverse
effect on the Company); (B) each such Return (including any amendment
thereto) is true, correct, and complete; (C) all Taxes of the Company
due with respect to, or shown to be due on, each such Return (or
amendment) have been timely paid; (D) to the best of the Company's
knowledge, there is no valid basis for the assessment of any deficiency
with regard to any such Return; and (E) there are no extensions of time
to file which are pending. There are no liens, attachments, or similar
encumbrances on any of the assets of the Company with respect to any
Taxes, other than liens for Taxes that are not yet due and payable.
(iii) Miscellaneous. The Company has collected or
-------------
withheld all Taxes that it is required to collect or withhold, and the
Company is not a party to or bound by any tax indemnity, tax sharing or
tax allocation agreement, or any other contractual obligation to pay the
Tax obligations of another person or to pay Tax obligations relating to
transactions of another person. None of the Company's assets (A) is
property which is required to be treated as being owned by any other
person pursuant to the so-called "safe harbor lease" provisions of
former section 168(f)(8) of the Code; (B) directly or indirectly secures
any debt the interest on which is tax exempt under section 103(a) of the
Code; (C) is "tax-exempt use property" within the meaning of section
168(h) of the Code, or (D) is stock of a domestic or foreign corporation
(including any entity that properly may be treated as a corporation for
Federal income tax purposes) meeting the requirements of Code section
1504(a)(2). The transactions contemplated by this Agreement are not
subject to the tax withholding provisions of Code section 3406, or of
subchapter A of Chapter 3 of the Code, or of any other comparable
provision of law.
(iv) Audit History and Other Proceedings. (A) there are
-----------------------------------
no pending or, to the best of the Company's knowledge, threatened
audits, investigations, claims, suits or other
- 11 -
<PAGE>
<PAGE>
proceedings for or relating to any liability in respect of Taxes of the
Company; (B) since December 31, 1993, no deficiencies for Taxes of the
Company have been claimed, proposed or assessed by any taxing or other
Governmental Entity; (C) there are no matters under discussion by the
Company with any Governmental Entity with respect to Taxes that could
result in any additional amount of Taxes of the Company; (D) no
extension of a statute of limitations (whether arising by reason of a
waiver, claim for refund, or otherwise) relating to Taxes of the Company
is in effect; and (E) there are no requests for rulings or
determinations in respect of Taxes of the Company pending with any
governmental authority. Since December 31, 1993, there have been no
audits of any of the Company's Federal, state or local Returns.
(i) Real and Personal Property. For purposes of this
--------------------------
Agreement, "Property" or "Properties" means those real and personal
properties owned or used by the Company, the Subsidiary or any
partnership, joint venture or similar entity in which the Company has an
ownership interest. The Disclosure Schedule lists all of the real
property to which the Company or the Subsidiary holds legal or equitable
title (whether or not of record). (A) each of the Company and the
Subsidiary has good and marketable title to all of the Properties owned
by it; and (B) none of the Properties is subject to any lien, claim or
other encumbrance whatsoever, except (1) liens for Taxes not yet due and
payable, (2) liens shown and described in the Company Balance Sheet, and
(3) liens imposed by law and incurred in the ordinary course of business
for obligations not yet due and payable to landlords, carriers,
warehousemen, laborers, materialmen and the like (collectively, the
"Permitted Liens"). No part of the Properties is "tax-exempt use
property" under Section 168(h) of the Code.
(j) Leases; Subleases. For purposes of this Agreement,
-----------------
"Lease" means any written or oral lease, sublease or rental agreement
(and any related contract and agreement), and all amendments,
modifications and supplements thereof and waivers and consents
thereunder pursuant to which the Company or the Subsidiary leases,
subleases or rents any real or personal property, either as lessor,
lessee, landlord or tenant. The Disclosure Schedule lists all Leases,
except those which (A) can be canceled by the Company or the Subsidiary
upon 30 or fewer days' notice without penalty or the acceleration of
rentals, (B) do not grant an option to purchase the leased property,
and (C) involve an annual rental of $5,000 or less. The Disclosure
- ---
Schedule describes all oral Leases required to be disclosed therein, and
true and complete copies of all written Leases required to be disclosed
have been heretofore delivered to Purchaser. With respect to each of
the Leases: (1) neither the Company nor the Subsidiary nor, to the best
of the Company's knowledge, any other party is in default in connection
with such Lease; (2) no act or event has occurred which, with notice or
lapse of time or both, would constitute a default under such Lease with
respect to the Company or the Subsidiary or, to the best of the
Company's knowledge, any other party; (3) there is no basis for any
claim of default under such Lease with respect to the Company or the
Subsidiary or, to the best of the Company's knowledge, any other party;
(4) neither the Company nor the Subsidiary has given or received any
notice of cancellation or termination in connection with such Lease;
(5) such Lease is the valid and binding agreement of the Company or the
Subsidiary, and, to the best of the Company's knowledge, the other party
thereto, which is in full force and effect and is enforceable in
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<PAGE>
<PAGE>
accordance with its terms, except, with respect to such other party, to
the extent that such enforceability may be limited by, or subject to:
(A) the effect of any applicable bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws affecting the
enforcement of creditors' rights generally; (B) the availability of the
remedies of specific performance or injunctive relief, which may be
subject to the discretion of the court before which any proceeding for
such remedies may be brought; and (C) the exercise by any court of
equitable judicial discretion before which any proceeding may be
brought; (6) such Lease will not be affected by, or require the consent
of or payment to any other party to avoid an event of default, an event
of termination or other adverse effect with respect to such by reason of
the transactions contemplated by this Agreement; and (7) such Lease is a
"true" lease for federal income tax purposes.
(k) Adequacy; Condition. (i) The Properties and the
-------------------
properties subject to a Lease are fit for use in the business of the
Company and the Subsidiary as presently conducted in all material
respects; (ii) the Properties and all of the properties subject to a
Lease are each in good repair and operating condition, normal wear and
tear excepted, and structurally and mechanically sound, as applicable;
(iii) the Company and the Subsidiary are in compliance with all
applicable building, zoning, land use or other similar statutes, laws,
ordinances, regulations, permits, health and safety codes or other
requirements in respect of any of the Properties or any of the
properties subject to a Lease (and the Company's and the Subsidiary's
current use of such properties does not constitute a nonconforming use),
except where the failure to comply would not have a material adverse
effect on the Company and the Subsidiary taken as a whole, and neither
the Company nor the Subsidiary has received any notice alleging such a
violation; (iv) to the best of the Company's knowledge, none of the
properties subject to a Lease has ever been used as a landfill or
otherwise been used for the disposal of any waste, trash, garbage,
industrial by-product or chemical or the storage or treatment of
hazardous substance of any nature; and (v) to the best of the Company's
knowledge, there are no outstanding requirements or recommendations by
fire underwriters or rating boards, any insurance companies or holders
of mortgages or other security interests requiring or recommending any
repairs or work to be done with reference to any of the properties
subject to a Lease.
(l) All Necessary Properties. The Properties and the Leases
------------------------
(together with the intangible properties disclosed, or not required to
be disclosed, pursuant to Sections 4.1(n), 4.1(p) and 4.1(q) of this
Agreement) constitute all of the properties which the Company and the
Subsidiary use in connection with the operation of their respective
businesses as presently conducted and the consummation of the
transactions contemplated by this Agreement (provided that all required
consents relating to the Properties and the Leases have been obtained)
will not materially alter the rights or impair the ability of the
Company or the Subsidiary to use such properties in the conduct of its
business as it is now being conducted.
(m) Accounts Receivable; Inventory; Customers; Suppliers.
----------------------------------------------------
(i) The accounts receivable of the Company and the Subsidiary as
reflected on the Company Balance Sheet or the books of the Company:
(A) are valid, existing and, to the extent uncollected, will be
collected in
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<PAGE>
full within 90 days after the day on which it first becomes due and
payable without resort to legal proceedings or the use of collection
agencies, except to the extent of the allowance for doubtful accounts
contained in the Company Balance Sheet; (B) represents monies due for
services rendered; and (C) are subject to no material refunds or other
material adjustments or to any defenses, rights of set-off, assignments,
restrictions, security interests, encumbrances or conditions enforceable
by third parties on or affecting any thereof.
(ii) Except as set forth in the 1998 Financial Statements,
all of the Company's and the Subsidiary's inventory (including raw
materials and work in process) is usable in the ordinary course of its
business and is free from material defects, and all finished goods are
salable in the ordinary course of its business.
(iii) A complete and accurate list of the ten largest
customers (by dollar volume) of the Company and the Subsidiary, taken as
a whole, during the twelve months ended December 31, 1998 is set forth in
the Disclosure Schedule.
(iv) A complete and accurate list of the ten largest
suppliers (by dollar volume) of the Company and the Subsidiary, taken as
a whole, during the twelve months ended December 31, 1998 is set forth in
the Disclosure Schedule.
(n) Intellectual Property; Patents; Trademarks, Trade Names.
-------------------------------------------------------
All patents, trademarks, service marks, trade names or copyrights owned
by or used or proposed to be used by the Company or the Subsidiary and
all applications or registrations therefor ("Intellectual Property") and
all contracts, agreements, commitments, arrangements, undertakings and
understandings relating to the use or license of technology, know-how or
processes by the Company or the Subsidiary (the "Intellectual Property
Licenses") are listed in the Disclosure Schedule. (i) The Company or
the Subsidiary owns, or has the sole and exclusive right to use, all
Intellectual Property, whether under Intellectual Property Licenses or
otherwise, used in or necessary for the ordinary conduct of its
business; (ii) the consummation of the transactions contemplated by this
Agreement will not alter or impair any such rights; and (iii) no
Intellectual Property owned, licensed or used by the Company or the
Subsidiary, or Intellectual Property License of the Company or the
Subsidiary is the subject of a lawsuit or any other proceeding, nor has
any party challenged or, to the best of the Company's knowledge,
threatened to challenge the Company's or the Subsidiary's respective
right to use such Intellectual Property or Intellectual Property License
or application for any of the foregoing; and, to the best of the
Company's knowledge, there is no basis for any such challenge.
(o) Indebtedness. The Disclosure Schedule sets forth (i) a
------------
complete and accurate list or description of all instruments or other
documents ("Debt Instruments") relating to any direct or indirect
indebtedness for borrowed money of the Company or the Subsidiary, as
well as indebtedness by way of capital leases, lease-purchase
arrangements, guarantees, undertakings on which others rely in
extending credit and all conditional sales contracts, chattel
mortgages and other security arrangements with respect to personal
property used or owned by the Company or
- 14 -
<PAGE>
<PAGE>
the Subsidiary, as well as indebtedness by way of capital leases, lease-
purchase arrangements, guarantees, undertakings on which others rely in
extending credit and all conditional sales contracts, chattel mortgages
and other security arrangements with respect to personal property used
or owned by the Company or the Subsidiary and (ii) a list of all loans
of money to the respective officers, employees or shareholders of the
Company or the Subsidiary (specifically excluding travel and similar
advances in the ordinary course of business).
(p) Other Contracts. The Disclosure Schedule lists each
---------------
contract, agreement, commitment, arrangement, undertaking or
understanding of the type listed below (except where the same does not
call for the payment or receipt by the Company or the Subsidiary of cash
or other property or services having a value in excess of $5,000) to
which the Company or the Subsidiary is a party or bound or to which the
Company or the Subsidiary or any of their respective properties are
subject, whether written or oral ("Contract," but such list and the term
"Contract" shall not include Leases, Intellectual Property Licenses,
Debt Instruments, Insurance Policies and employee-related matters
disclosed elsewhere in this Agreement):
(i) for the purchase or rental of materials,
inventory and supplies by the Company or the Subsidiary
entered into in the ordinary course of business which are
not reasonably expected to be fully performed within 45 days
of their respective dates;
(ii) for the purchase of services by the Company or
the Subsidiary entered into in the ordinary course of
business which are not reasonably expected to be fully
performed within 45 days of their respective dates;
(iii) that were entered into in the ordinary course
of business and which are not reasonably expected to be
fully performed within 45 days of their respective dates;
(iv) for matters not in the ordinary course of the
Company's or the Subsidiary's business;
(v) making the Company or the Subsidiary liable,
by guaranty, suretyship agreement, indemnification
agreement, contribution agreement or otherwise, upon or with
respect to, or obligating the Company or the Subsidiary in
any way to provide funds in respect of, or obligating the
Company or the Subsidiary to guarantee, serve as surety for
or assume, any debt, dividend or other liability or
obligation of any person, corporation, association,
partnership or other entity (except endorsements made in the
ordinary course of business in connection with the deposit
of items for collection and except for immaterial
obligations or liabilities incurred in the ordinary course
of business);
(vi) granting a power of attorney;
- 15 -
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<PAGE>
(vii) relating to participation in a cooperative,
partnership or joint venture;
(viii) imposing confidentiality requirements (other
than agreements relating to confidentiality requirements
between Purchaser and/or the Company or the Subsidiary); and
(ix) restricting or limiting the freedom of the
Company or the Subsidiary to compete in any line of
business.
The Disclosure Schedule describes all oral Contracts required to be
disclosed therein, and true and complete copies of all written Contracts
(as amended) required to be disclosed in the Disclosure Schedule have
been delivered to Purchaser.
(q) Insurance. All insurance policies of the Company or the
---------
Subsidiary now in force (including comprehensive general liability,
personal and professional liability, comprehensive general casualty and
extended coverage, automobile, boiler and machinery, fire and lightning,
marine, endowment, life, and worker's compensation) ("Insurance
Policies") are listed in the Disclosure Schedule, together with a
listing of the type of policy, the policy number, the limits of
coverage, the carrier, the annual premium and the expiration date), and
true and complete copies of such policies have been provided or made
available to Purchaser. The Company has provided to Purchaser a true
and complete summary of the loss experience under each such insurance
policy during the preceding five policy years. Neither the Company nor
the Subsidiary has received any notice that any insurance carrier has
cancelled, intends to cancel or intends not to renew any of such
policies.
(r) Status. (i) Neither the Company nor the Subsidiary has
------
assigned any of its rights or obligations under (and, to the best of the
Company's knowledge, is not otherwise restricted for any reason from
enjoying the full benefits under) any Intellectual Property License,
Debt Instrument, Contract or Insurance Policy; (ii) neither the Company
nor the Subsidiary nor, to the best of the Company's knowledge, any
other party is in default in connection with any Intellectual Property
License, Debt Instrument, Contract or Insurance Policy; (iii) to the
best of the Company's knowledge, no act or event has occurred which,
with notice or lapse of time or both, would constitute a default under
any Intellectual Property License, Debt Instrument, Contract or
Insurance Policy; (iv) to the best of the Company's knowledge, there is
no basis for any claim of default under any Intellectual Property
License, Debt Instrument, Contract or Insurance Policy; (v) there is no
outstanding notice of cancellation or termination received by the
Company or the Subsidiary in connection with any Intellectual Property
License, Debt Instrument, Contract or Insurance Policy; (vi) each
Intellectual Property License, Debt Instrument, Contract and Insurance
Policy is the valid and binding agreement of the Company or the
Subsidiary, as the case may be, and, to the best of the Company's
knowledge, the other parties thereto, which is in full force and effect
and is enforceable in accordance with its terms, except, with respect to
such other party, to the extent that such enforceability may be limited
by,
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<PAGE>
<PAGE>
or subject to: (A) the effect of any applicable bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws
affecting the enforceability of creditors' rights generally, (B) the
availability of specific performance or injunctive relief, which may be
subject to the discretion of the court before which any proceeding for
such remedies may be brought, and (C) the exercise by any court of
equitable judicial discretion before which any proceeding may be
brought; (vii) no Intellectual Property License, Debt Instrument,
Contract or Insurance Policy will require the consent of or payment to
any other party to avoid an event of default or an event of termination
with respect to such Intellectual Property License, Debt Instrument,
Contract or Insurance Policy (assuming that any required notice of
default or termination has been given and any periods for cure have
expired) by reason of the transactions contemplated by this Agreement;
and (viii) neither the Company nor the Subsidiary has received any
communication proposing any termination, amendment or change to any
Intellectual Property License, Debt Instrument, Contract or Insurance
Policy.
(s) Employee Benefits.
-----------------
(i) All bonus, deferred compensation, pension, retirement,
profit-sharing, thrift savings, employee stock ownership, stock bonus,
stock purchase, restricted stock and stock option, employment,
termination, severance, compensation, medical, health or other plan,
contract, policy or arrangement which covers current or former employees
of the Company or the Subsidiary (the "Employees") and current or
---------
former directors of the Company or the Subsidiary (the "Compensation
-------------
and Benefit Plans") including, but not limited to, "employee benefit
- -----------------
plans" within the meaning of section 3(3) of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA") are listed in the
-----
Disclosure Schedule and any "change of control" or similar provisions
therein are specifically identified in the Disclosure Schedule. True
and complete copies of all Compensation and Benefit Plans and such other
benefit plans, contracts or arrangements, including, but not limited to,
any trust instruments and insurance contracts, if any, forming a part of
any such plans and agreements, and all amendments thereto have been made
available to Purchaser. The Company has filed all Form 5500's required
to be filed with respect to the Compensation and Benefit Plans and each
such form is complete and accurate in all material respects and complies
in all material respects with all applicable law.
(ii) All Compensation and Benefit Plans are in substantial
compliance with applicable law and all Compensation and Benefit Plans
which are employee benefit plans, other than "multiemployer plans"
within the meaning of sections 3(37) of ERISA, covering employees (the
"Plans") to the extent subject to ERISA, are in substantial compliance
with ERISA. Each Plan which is an "employee pension benefit plan"
within the meaning of section 3(2) of ERISA ("Pension Plan") and which
------------
is intended to be qualified under section 401(a) of the Code, has
received a favorable determination letter from the Internal Revenue
Service with respect to "TRA" (as defined in Section 1 of Internal
Revenue Service Revenue Procedure 93-39), and the Company is not aware
of any circumstances likely to result in revocation of any such
favorable determination letter. There is no material pending or, to the
knowledge of the Company, threatened litigation relating to the
Compensation and Benefit Plans. Neither the Company nor
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<PAGE>
<PAGE>
the Subsidiary has engaged in a transaction with respect to any Plan
that, assuming the taxable period of such transaction expired as of the
date hereof, could subject the Company or the Subsidiary to a material
tax or penalty imposed by either section 4975 of the Code or section
502(i) of ERISA.
(iii) No liability under Subtitle C or D of Title IV of ERISA has
been or is expected to be incurred by the Company or the Subsidiary with
respect to any ongoing, frozen or terminated "single-employer plan",
within the meaning of section 4001(a)(15) of ERISA, currently or
formerly maintained by any of them, or the single-employer plan of any
entity which is considered one employer with the Company under section
4001 of ERISA or section 414 of the Code (an "ERISA Affiliate"). The
---------------
Company and the Subsidiary have not incurred and do not expect to incur
any withdrawal liability with respect to a multiemployer plan under
Subtitle E of Title IV of ERISA. No notice of a "reportable event",
within the meaning of section 4043 of ERISA for which the 30-day
reporting requirement has not been waived, has been required to be filed
for any Pension Plan or by any ERISA Affiliate within the 12-month
period ending on the date hereof.
(iv) All contributions required to be made under the terms of any
Plan have been timely made. Neither any Pension Plan nor any single-
employer plan of an ERISA Affiliate has an "accumulated funding
deficiency" (whether or not waived) within the meaning of section 412 of
the Code or section 302 of ERISA. Neither the Company nor the
Subsidiary has provided, or is required to provide, security to any
Pension Plan or to any single-employer plan of an ERISA Affiliate
pursuant to section 401(a)(29) of the Code.
(v) Under each Pension Plan which is a single-employer plan, as
of the last day of the most recent plan year ended prior to the date
hereof, the actuarially determined present value of all "benefit
liabilities", within the meaning of section 4001(a)(16) of ERISA (as
determined on the basis of the actuarial assumptions contained in the
Plan's most recent actuarial valuation), did not exceed the then current
value of the assets of such Plan, and there has been no material change
in the financial condition of such Plan since the last day of the most
recent Plan Year. The withdrawal liability of the Company and the
Subsidiary under each Benefit Plan which is a multiemployer plan to
which the Company, the Subsidiary or an ERISA Affiliate has contributed
during the preceding 12 months, determined as if a "complete
withdrawal", within the meaning of section 4203 of ERISA, had occurred
as of the date hereof, does not exceed $10,000.
(vi) Neither the Company nor the Subsidiary has any obligations
for retiree health and life benefits under any Plan, except as set forth
in the Disclosure Schedule. The Company or the Subsidiary may amend or
terminate any such Plan pursuant to the terms thereof.
(vii) The consummation of the transactions contemplated by this
Agreement will not (x) entitle any employees of the Company or the
Subsidiary to severance pay, (y) accelerate the time of payment or
vesting or trigger any payment of compensation or benefits under,
increase the amount payable or trigger any other material obligation
pursuant to, any of the Compensation
- 18 -
<PAGE>
<PAGE>
and Benefit Plans or (z) result in any breach or violation of, or a
default under any of the Compensation and Benefit Plans.
(viii) All Compensation and Benefit Plans covering non-U.S.
Employees comply in all material respects with applicable local law.
The Company and the Subsidiary have no material unfunded liabilities
with respect to any Pension Plan which covers non-U.S. Employees.
(t) Takeover Statutes. No "fair price", "moratorium",
-----------------
"control share acquisition," "business combination" or other similar
antitakeover statute or regulation (each a "Takeover Statute") is
----------------
applicable to the Company, the Subsidiary, the Shares, the Offer or the
transactions contemplated hereby.
(u) Environmental Matters. Except to the extent that the
---------------------
Company's noncompliance with the following would not reasonably be
likely to have a material adverse effect on the financial condition,
properties, business or results of operations of the Company and the
Subsidiary taken as a whole: (i) the Company and the Subsidiary have
complied at all times with all applicable Environmental Laws; (ii) to
the best of the Company's knowledge after reasonable inquiry, all
properties currently owned or operated by the Company or the Subsidiary
(including soils, groundwater, surface water, buildings or other
structures) have not been contaminated with any Hazardous Substances;
(iii) to the best of the Company's knowledge after reasonable inquiry,
any properties formerly owned or operated by the Company or the
Subsidiary were not contaminated with Hazardous Substances on or prior
to such period of ownership or operation; (iv) neither the Company nor
the Subsidiary is subject to liability for any Hazardous Substance
disposal or contamination on any third party property; (v) to the best
of the Company's knowledge after reasonable inquiry, neither the Company
nor the Subsidiary is subject to liability for any release or threat of
release of any Hazardous Substance; (vi) neither the Company nor the
Subsidiary has received any notice, demand, letter, claim or request for
information indicating that it may be in violation of or liable under
any Environmental Law; (vii) neither the Company nor the Subsidiary is
subject to any order, decree, injunction or other arrangement with any
governmental entity or any indemnity or other agreement with any third
party relating to liability under any Environmental Law; (viii) none of
the properties of the Company or the Subsidiary contain any underground
storage tanks, asbestos-containing material, lead products, or
polychlorinated biphenyls; (ix) there are no other circumstances or
conditions involving the Company or the Subsidiary known to the Company
after reasonable inquiry that could reasonably be expected to result in
any claims, liability, investigations, costs or restrictions on the
ownership, use, or transfer of any property pursuant to any
Environmental Law; and (x) the Company has delivered or made available
to Purchaser copies of all environmental reports, studies, assessments,
sampling data and all other information in its possession relating to
asbestos and silica liability and claims including without limitation
product and sales information, filing rates, settlements, projected
claims, legal advice, reserves, insurance and the use and disposal of
asbestos containing material.
- 19 -
<PAGE>
<PAGE>
As used herein, the term "Environmental Law" means any federal,
-----------------
state or local law, regulation, order, decree, permit, authorization,
opinion, common law or agency requirement relating to: (A) the
protection, investigation or restoration of the environment, health,
safety, or natural resources, (B) the handling, use, presence, disposal,
release or threatened release of any Hazardous Substance, (C) noise,
odor, wetlands, pollution, contamination or any injury or threat of
injury to persons or property or (D) standards of conduct concerning
protection of human health (including, without limitation, employee
health and safety), in each case as amended and as now or hereafter in
effect, and the term "Hazardous Substance" means any substance that
-------------------
is: (A) listed, classified or regulated pursuant to any Environmental
Law; (B) any petroleum product or by-product, asbestos-containing
material, silica, lead-containing paint or plumbing, polychlorinated
biphenyls, radioactive materials or radon; or (C) any other substance
which may be the subject of regulatory action by any governmental
authority pursuant to any Environmental Law.
(v) Labor Relations. (i) The Company and the Subsidiary are
---------------
(and, since January 1, 1994, have been) in material compliance with all
federal, state, local and other applicable law respecting employment and
employment practices, terms and conditions of employment and wages and
hours; (ii) there is (and, since January 1, 1994, has been) no unfair
labor practice, complaint, charge or other matter against or involving
the Company or the Subsidiary pending or threatened before any
Governmental Entity; (iii) there is no (and, since January 1, 1994 has
not been) labor strike, dispute, organizing effort, slow down, stoppage
or other labor difficulty pending, involving or, to the best of the
Company's knowledge, threatened, against or affecting the Company or the
Subsidiary; (iv) no representation question exists, or has existed since
January 1, 1994, with respect to the respective employees of the Company
or the Subsidiary; (v) no grievance which might have an adverse effect
on the Company or the Subsidiary or on the conduct of its business nor
any arbitration proceeding arising out of or under collective bargaining
agreements is pending, and no claim therefor exists; and (vi) there is
(and, since January 1, 1994, has been) no collective bargaining
agreement which is binding on the Company or the Subsidiary.
(w) Litigation. There are no (i) civil, criminal or
----------
administrative actions, suits, claims, hearings, investigations or
proceedings (collectively, "Actions") pending or, to the knowledge of
-------
the management of the Company, threatened against the Company or the
Subsidiary or (ii) obligations or liabilities, whether or not accrued,
contingent or otherwise, including, without limitation, those relating
to matters involving any Environmental Law (as defined in
Section 4.1(u)).
(x) Compliance with Laws.
--------------------
(i) Generally. The Company and the Subsidiary
---------
are (and during the preceding five years have been) in material
compliance with all applicable law (including those involving antitrust,
unfair competition, trade regulation, antipollution, environmental,
employment, safety, health and food and drug matters). Without limiting
the foregoing, neither
- 20 -
<PAGE>
<PAGE>
the Company nor the Subsidiary has at any time made any illegal payment
for political contributions, any bribe or illegal kickback payment, or
any practice or procedure which results or will result in the illegal
payment by or on behalf of the Company or the Subsidiary to a person in
connection with a referral to the Company or the Subsidiary by such
person.
(ii) Charges or Violations. The Company and
---------------------
the Subsidiary are not (and, during the preceding five years, have not
been) either charged with, in receipt of any notice or warning of, or
under investigation with respect to, any failure or alleged failure to
materially comply with any provision of any applicable law.
(iii) Permits. Without limiting the
-------
foregoing: (A) a list of all occupancy certificates and other licenses,
permits and certificates ("Permits") required of the Company or the
Subsidiary in connection with its ownership, possession, use, occupancy
or operation of any of the Properties owned, leased or used by it are
set forth in the Disclosure Schedule; (B) all of the Permits are in full
force and effect in all material respects; (C) the Company and the
Subsidiary are (and have been) in material compliance with the Permits;
and (D) none of the Permits will be affected by, or require the consent
of any party by reason of, the transactions contemplated by this
Agreement where such effect or failure to obtain such consent would
restrict or hamper the operation of any operating facility owned, leased
or used by the Company or the Subsidiary.
(y) Bank Accounts. The Disclosure Schedule lists all bank,
-------------
money market, savings and similar accounts and safe deposit boxes of the
Company and the Subsidiary, specifying the account numbers and the
authorized signatories or persons having access to them.
(z) Transactions with Affiliates. No holder of 10% or more of
----------------------------
the outstanding common stock of the Company nor any person controlled by
some combination of them, no officer or director of the Company or the
Subsidiary, nor any "affiliate" or "associate" (as such terms are
defined in the rules and regulations of the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "1933
Act")) of any of the foregoing:
(i) is a party to any lease, sublease,
contract, agreement, commitment, understanding or other arrangement of
any kind whatsoever, involving any such person and the Company or the
Subsidiary;
(ii) owns directly or indirectly, in whole or
in part, any property that the Company or the Subsidiary uses or
otherwise has rights in respect of; or
(iii) has any cause of action or other claim
whatsoever against, or owes any amount to, the Company or the Subsidiary
other than (i) for compensation (including fringe benefits) to officers
and employees disclosed pursuant to Section 4.1(s) and for reimbursement
of ordinary and necessary expenses incurred in connection with
employment by the Company or the Subsidiary and (ii) as otherwise
disclosed pursuant to this Agreement.
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<PAGE>
<PAGE>
(aa) Commissions. No person, firm or corporation is entitled
-----------
to any commission or broker's or finder's fee in connection with the
transactions contemplated by this Agreement by reason of any act or
omission of the Company or the Subsidiary, other than payment to Pacific
Crest Securities with respect to the issuing of its fairness opinion in
accordance with its engagement agreement with the Company, a true and
complete copy of which has been provided to Purchaser.
(bb) Generally. No representation or warranty by the Company
---------
in this Agreement or in the Disclosure Schedule, any Exhibit or closing
certificate furnished or to be furnished to Purchaser pursuant to this
Agreement or in connection with the transactions contemplated by this
Agreement contains or will contain any untrue statement of a material
fact, or omits or will omit to state a material fact, necessary to make
the statements herein or therein, in light of the circumstances in which
they were made, not misleading.
4.2 Representations and Warranties of Purchaser. Purchaser
-------------------------------------------
represents and warrants to the Company that:
(a) Corporate Organization and Qualification. Each of
----------------------------------------
Purchaser and its subsidiaries is a corporation duly organized and
validly existing under the laws of its jurisdiction of incorporation and
is in good standing as a foreign corporation in each jurisdiction where
the properties owned, leased or operated, or the business conducted, by
it require such qualification except for such failure to so qualify or
to be in such good standing, which, when taken together with all other
such failures, is not reasonably likely to have a material adverse
effect on the financial condition, properties, business or results of
operations of Purchaser and its subsidiaries, taken as a whole. Each of
Purchaser and its subsidiaries has the requisite corporate power and
authority to carry on its respective businesses as they are now being
conducted.
(b) Corporate Authority. Purchaser has full corporate power
-------------------
and authority to execute and deliver this Agreement and to consummate
the transactions contemplated hereby. The execution, delivery and
performance by Purchaser of this Agreement, and the consummation of the
transactions contemplated hereby, have been duly authorized by
Purchaser's Board of Directors and no corporate action on the part of
Purchaser is necessary to authorize the execution and delivery by
Purchaser of this Agreement and the consummation by Purchaser of the
transactions contemplated hereby. This Agreement has been duly executed
and delivered by Purchaser and, assuming due and valid authorization,
execution and delivery hereof by the Company, is a valid and binding
obligation of Purchaser enforceable against Purchaser in accordance with
its terms, except that (i) such enforcement may be subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws, now or hereafter in effect, affecting
creditors' rights generally, and (ii) the remedy of specific performance
and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
- 22 -
<PAGE>
<PAGE>
(c) Governmental Filings; No Violations.
-----------------------------------
(i) Other than the Regulatory Filings (including the Offer
Documents), no notices, reports or other filings are required to be made
by Purchaser with, nor are any consents, registrations, approvals,
permits or authorizations required to be obtained by Purchaser from, any
Governmental Entity in connection with the execution and delivery of
this Agreement by Purchaser and the consummation by Purchaser of the
transactions contemplated hereby, the failure to make or obtain any or
all of which could prevent, delay or materially burden the transactions
contemplated by this Agreement.
(ii) The execution and delivery of this Agreement by Purchaser do
not, and the consummation by Purchaser of the transactions contemplated
by this Agreement will not, constitute or result in (i) a breach or
violation of, or a default under, the Articles of Incorporation or By-
Laws of Purchaser or the comparable governing instruments of any of its
subsidiaries or (ii) a breach or violation of, a default under, the
acceleration of or the creation of a lien, pledge, security interest or
other encumbrance on assets (with or without the giving of notice or the
lapse of time) pursuant to, any provision of any contract of Purchaser
or any of its subsidiaries or any law, ordinance, rule or regulation or
judgment, decree, order, award or governmental or non-governmental
permit or license to which Purchaser or any of its subsidiaries are
subject, except, in the case of clause (ii) above, for such breaches,
violations, defaults or accelerations or changes that, alone or in the
aggregate, could not prevent or delay or materially burden the
transactions contemplated by this Agreement. None of the information
supplied by Purchaser for inclusion in the Schedule 14D-9 will, at the
time first sent or given to the Company's stockholders contains any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they are
made, not misleading.
(d) Funds. Purchaser has and will have the funds necessary to
-----
consummate the transactions contemplated by this Agreement.
ARTICLE V
COVENANTS
5.1 Interim Operations of the Company. The Company covenants
---------------------------------
and agrees, as to itself and the Subsidiary, that, except as set forth
in the Disclosure Schedule, after the date hereof and prior to the
Closing Date (unless Purchaser shall otherwise agree in writing and
except as otherwise permitted or required by this Agreement):
(a) the business of the Company and the Subsidiary shall be
conducted only in the ordinary and usual course and, to the extent
consistent therewith, the Company and the
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<PAGE>
Subsidiary shall use commercially reasonable efforts to preserve its
business organization intact and maintain its existing relations with
customers, suppliers, employees and business associates;
(b) the Company shall not (i) sell or pledge or agree to sell or
pledge any stock owned by it in the Subsidiary; (ii) amend the Company
Articles or Company By-Laws; (iii) split, combine or reclassify the
outstanding Shares; or (iv) declare, set aside or pay any dividend
payable in cash, stock or property with respect to the Shares;
(c) neither the Company nor the Subsidiary shall (i) other than
pursuant to the exercise of options outstanding on the date hereof,
issue, sell, pledge, dispose of or encumber any additional shares of, or
securities convertible or exchangeable for, or options, warrants, calls,
commitments or rights of any kind to acquire, any shares of its capital
stock of any class of the Company or the Subsidiary or any other
property or assets other than, in the case of the Company, Shares
issuable pursuant to options outstanding on the date hereof under the
Stock Plan; (ii) transfer, lease, license, guarantee, sell, mortgage,
pledge, dispose of or encumber any assets or incur or modify any
indebtedness or other liability other than in the ordinary and usual
course of business; (iii) acquire directly or indirectly by redemption
or otherwise any shares of the capital stock of the Company; (iv)
authorize capital expenditures for items in excess of $5,000; or (v)
make any acquisition of another person or entity (by merger,
consolidation or acquisition of stock or assets) or any investment in,
assets or stock of any other person or entity;
(d) except for the employment agreements and non-competition
agreement contemplated by Section 6.1(b), neither the Company nor the
Subsidiary shall grant any severance or termination pay to, or enter
into any employment or severance agreement with any director, officer or
other employee of the Company or the Subsidiary; and neither the Company
nor the Subsidiary shall establish, adopt, enter into, make any new
grants or awards under or amend, any collective bargaining, bonus,
profit sharing, thrift, compensation, stock option, restricted stock,
pension, retirement, employee stock ownership, deferred compensation,
employment, termination, severance or other plan, agreement, trust,
fund, policy or arrangement for the benefit of any directors, officers
or employees (the "Benefit Plans");
-------------
(e) except with the consent of Purchaser, neither the Company
nor the Subsidiary shall settle or compromise any material claims or
litigation or, modify, amend or terminate any of its joint venture
agreements, partnership agreements or material contracts or waive,
release or assign any material rights or claims;
(f) neither the Company nor the Subsidiary shall make any tax
election or permit any insurance policy naming it as a beneficiary or a
loss payable payee to be canceled or terminated without notice to
Purchaser;
(g) except as may be required as a result of a change in law or
in generally accepted accounting principles, neither the Company nor the
Subsidiary shall change any of their respective accounting practices or
principles;
- 24 -
<PAGE>
<PAGE>
(h) neither the Company nor the Subsidiary shall adopt a plan of
complete or partial liquidation, dissolution, merger, consolidation,
restructuring, recapitalization, or other reorganization of the Company
or the Subsidiary; and
(i) neither the Company nor the Subsidiary will authorize or
enter into an agreement to do any of the foregoing or take any action
that would make any of the representations or warranties of the Company
contained in this Agreement untrue or incorrect as of the date when made
if such action had then been taken, or would result in any of the Offer
Conditions set forth in Annex A not being satisfied.
-------
5.2 Acquisition Proposals. The Company, its affiliates and
---------------------
its and their respective officers, directors, employees, representatives
and agents (including, without limitation, any investment banker,
attorney or accountant retained by the Company or the Subsidiary) shall
immediately cease all existing discussions or negotiations, if any, with
any parties conducted heretofore with respect to any acquisition or
exchange of all or any material portion of the assets of, or any of the
equity interest in, the Company or the Subsidiary (by direct purchase
from the Company or the Subsidiary, tender or exchange offer or
otherwise) or any business combination, merger, consolidation or similar
transaction (including an exchange of stock or assets) with or involving
the Company or the Subsidiary or any division of the Company or the
Subsidiary (an "Acquisition Transaction"). Neither the Company nor
-----------------------
any of its affiliates, nor any of its or their respective officers,
directors, employees, representatives or agents (including, without
limitation, any investment banker, attorney or accountant retained by
the Company or the Subsidiary) shall, directly or indirectly, encourage,
solicit, participate in or initiate discussions or negotiations with, or
provide any information to, any corporation, partnership, person or
other entity or group (other than Purchaser, any affiliate or associate
of Purchaser or any designees of Purchaser) with respect to any
inquiries or the making of any offer or proposal (including, without
limitation, any offer or proposal to the stockholders of the Company)
concerning an Acquisition Transaction (an "Acquisition Proposal"),
--------------------
unless the Board of Directors of the Company determines in good faith
after consultation with outside legal counsel that such action is
necessary in order for its directors to comply with their respective
fiduciary duties under applicable law (any such more favorable
Acquisition Proposal being referred to in this Agreement as a "Superior
---------
Proposal"). The Company will take the necessary steps to inform the
- --------
individuals or entities referred to in the first sentence hereof of the
obligations undertaken in this Section 5.2. The Company will notify
Purchaser immediately if any such inquiries or proposals are received
by, any such information is requested from, or any such negotiations or
discussions are sought to be initiated or continued with the Company,
the name of the person making such proposals, the material terms and
conditions of such proposals and thereafter shall keep Purchaser
informed, on a current basis, of the status and terms of such proposals
and the status of such negotiations or discussions. The Company agrees
not to release any third party from, or waive any provisions of, any
confidentiality or standstill agreement to which the Company is a party,
unless the Board of Directors of the Company shall have determined in
good faith, based upon the advice of outside counsel to the Company,
that failing to release such third party or waive such provisions would
- 25 -
<PAGE>
<PAGE>
constitute a breach of the fiduciary duties of the Board of Directors of
the Company under applicable law.
5.3 Filings; Other Action. (a) Subject to the terms and
---------------------
conditions herein provided, the Company and Purchaser shall: (i)
promptly make their respective Regulatory Filings with respect to the
Offer; and (ii) use all reasonable efforts to promptly take, or cause to
be taken, all other action and do, or cause to be done, all other things
necessary, proper or appropriate under applicable laws and regulations
to consummate and make effective the transactions contemplated by this
Agreement, including but not limited to cooperating in the preparation
and filing of the Offer Documents, the Schedule 14D-9 and any amendments
to any thereof. The Company shall use all reasonable efforts to obtain
all licenses, permits, consents, approvals, authorizations,
qualifications and orders of governmental authorities and parties to
contracts with the Company and the Subsidiary as are necessary for the
consummation of the transactions contemplated by this Agreement and to
fulfill the conditions to the Offer. Notwithstanding anything contained
herein to the contrary, Purchaser shall be under no obligation
whatsoever to make or accept or engage in negotiations for any
settlement with any governmental entity or any other arrangement
involving the sale, disposition, or separate holding, through the
establishment of a trust, or otherwise, of the business or any of the
assets of the Company or the Subsidiary acquired pursuant to this
Agreement, or any portion thereof, or particular assets of Purchaser or
its subsidiaries or any of Purchaser Companies in order to complete the
transactions contemplated herein.
(b) The Company and Purchaser each shall keep the other apprised
of the status of matters relating to completion of the transactions
contemplated hereby, including promptly furnishing the other with copies
of notices or other communications received by Purchaser or the Company,
as the case may be, or any of their subsidiaries, from any Governmental
Entity with respect to the Offer or any of the other transactions
contemplated by this Agreement.
5.4 Access. The Company shall (and shall cause the Subsidiary
------
to) afford Purchaser's officers, employees, counsel, lenders,
accountants and other authorized representatives ("Representatives")
---------------
reasonable access, during normal business hours throughout the period
prior to the Closing Date, to the Representatives of the Company (and
the Subsidiary) and its properties, books, contracts and records and,
during such period, the Company shall (and shall cause the Subsidiary
to) furnish promptly to Purchaser all information concerning its
business, properties and personnel as Purchaser or its Representatives
may reasonably request, provided that no investigation pursuant to
--------
this Section 5.4 shall affect or be deemed to modify any representation
or warranty made by the Company. All requests for information made
pursuant to this Section shall be directed to an executive officer of
the Company or such person as may be designated by any such officer.
5.5 Notification of Certain Matters. Except as otherwise
-------------------------------
disclosed herein, the Company shall give prompt notice to Purchaser of:
(a) any notice of, or other communication relating to, any environmental
matter, a default or event that, with notice or lapse of time or both,
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<PAGE>
<PAGE>
would become a default, received by the Company or the Subsidiary
subsequent to the date of this Agreement and prior to the Closing Date,
under any Contract, Lease, Debt Instrument, Intellectual Property
License or Insurance Policy to which the Company or the Subsidiary is a
party or is subject; (b) any changes or developments relating to any
Action pending or, to the knowledge of management of the Company,
threatened against the Company or the Subsidiary existing as of the date
hereof; (c) any new Actions pending or, to the knowledge of management
of the Company, threatened against the Company or the Subsidiary since
the date hereof; (d) any material adverse change in the financial
condition or results of operations of the Company and the Subsidiary
taken as a whole as compared to the financial condition and results of
operations of the Company and the Subsidiary disclosed in the
consolidated financial statements of the Company as of and for the
fiscal year ended December 31, 1998 or the occurrence of any event
which, so far as reasonably can be foreseen at the time of its
occurrence, is reasonably likely to result in any such change; and
(e) any material adverse change in the properties or business of the
Company and the Subsidiary taken as a whole or the occurrence of any
event which, so far as reasonably can be foreseen at the time of its
occurrence, is reasonably likely to result in any such change. Each of
the Company and Purchaser shall give prompt notice to the other party of
any notice or other communication from any third party alleging that the
consent of such third party is or may be required in connection with the
transactions contemplated by this Agreement.
5.6 Publicity. The initial press release relating to the
---------
execution of this Agreement shall be a joint press release and
thereafter the Company and Purchaser, unless they have previously agreed
in writing to the contrary, will not issue any press release or
otherwise make a public statement with respect to the transactions
contemplated hereby or make any filings with any Governmental Entity or
with any national securities exchange with respect thereto, unless in
the written opinion of counsel to the party desiring to make such
disclosure, a copy of which opinion shall be delivered to the other
party as promptly as practicable under the circumstances, such
disclosure is required by law or stock exchange rule or regulation.
5.7 Environmental Filings. The Company shall promptly make
---------------------
all filings, notifications, applications, permit transfers and other
submissions relating to the Offer that may be required pursuant to any
Environmental Laws including without limitation those relating to the
ownership, operation or transfer of real property, underground storage
tanks, waste disposal locations or landfills and closure and post
closure financial assurances ("Environmental Submissions"). The
-------------------------
Company shall provide Purchaser with copies of all Environmental
Submissions at the time of filing and Purchaser shall cooperate with the
Company in the preparation and execution of all Environmental
Submissions.
5.8 Takeover Statutes. If any Takeover Statute shall become
-----------------
applicable to the transactions contemplated hereby, the Company and the
members of the Board of Directors of the Company shall grant such
approvals and take such actions as are necessary so that the
transactions contemplated hereby may be consummated as promptly as
practicable on the terms contemplated hereby and otherwise act to
eliminate or minimize the effects of such statute or regulation on the
transactions contemplated hereby.
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<PAGE>
<PAGE>
5.9 Availability of Financing. To fund the growth of the
-------------------------
Company's business after the Closing, Purchaser shall make available to
the Company up to $3,000,000 of subordinated debt financing and/or
facilitate the refinancing and possible increase of the Company's
existing credit facilities on more favorable terms, all as then
determined by the Company's Board of Directors to be in the best
interest of the Company.
ARTICLE VI
CONDITIONS
6.1 Conditions to Obligations of Purchaser. The obligation of
--------------------------------------
Purchaser to consummate the purchase of Shares pursuant to the Offer and
the other transactions contemplated by this Agreement is subject to the
fulfillment of each of the following conditions, any or all of which may
be waived in whole or in part by Purchaser:
(a) each of the Offer Conditions shall have been fulfilled;
(b) the Company shall have entered into employment agreements
with Ronald L. Bogh and Paul M. Gilson, and a non-competition agreement
with Douglas C. Nelson, each substantially in the form of Annexes B, C
and D hereto, respectively;
(c) The Company shall have received the written opinion of the
Financial Advisor that the terms of the Offer are fair, from a financial
point of view, to the stockholders of the Company and such opinion shall
not have been withdrawn;
(d) Purchaser shall have received confirmation that the
Company's common stock shall continue to be listed on the Nasdaq
SmallCap Market following the Closing without any conditions which
Purchaser in its reasonable judgment shall deem to be materially
adverse;
(e) Douglas C. Nelson shall have entered into an agreement with
the Company, in form and substance satisfactory to Purchaser in
Purchaser's sole discretion, waiving the Company's existing obligations
to guarantee a price per share on shares of the Common Stock which may
be sold by Douglas C. Nelson and providing for the surrender by Douglas
C. Nelson of all of his options to purchase shares of Common Stock;
(f) The Company's Board of Directors shall consist of Ronald L.
Bogh, Paul M. Gilson and, at Purchaser's option, up to four additional
persons designated by Purchaser, two of whom shall be Marvin S. Wool and
Gregory J. Divis;
(g) Purchaser shall have received the legal opinion of Davis
Wright Tremaine LLP, counsel to the Company, in the form attached hereto
as Annex E;
-------
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<PAGE>
<PAGE>
(h) Purchaser shall have entered into agreements in
substantially the form of Annex F hereto with each of Ronald L. Bogh,
-------
Douglas C. Nelson and James V. Reimann providing for the tender of such
amounts of their shares of Common Stock pursuant to the Offer, as
Purchaser and such stockholders shall agree in order to facilitate the
transactions contemplated hereby;
(i) No United States or state court or other Governmental Entity
of competent jurisdiction shall have enacted, issued, promulgated,
enforced or entered any statute, rule, regulation, judgment, decree,
injunction or other order (whether temporary, preliminary or permanent)
which is in effect and prohibits consummation of the transactions
contemplated by this Agreement or imposes material restrictions on
Purchaser in connection with consummation of the purchase of the Shares
pursuant to the Offer or with respect to Purchaser's or the Company's
business operations, either prior to or subsequent to the purchase of
the Shares pursuant to the Offer (collectively, an "Order");
(j) Purchaser shall have entered into an agreement with each of
Edward DeRaeve and Jerry K. Brown, directors of the Company, providing
that he shall not exercise on or prior to the Closing any stock option
issued to him pursuant to the Stock Plan; and
(k) The Company shall have taken all actions required by Section
7.1.3 of the Stock Plan to prevent the acceleration of the vesting of
stock options issued pursuant to the Stock Plan by reason of the
transactions contemplated by this Agreement.
6.2 Conditions to Obligations of the Company. The obligation
----------------------------------------
of the Company to consummate the transactions contemplated by this
Agreement is subject to the fulfillment of each of the following
conditions, any or all of which may be waived in whole or in part by the
Company:
(a) Purchaser shall not have breached or failed to perform in
any material respect any of its obligations, covenants or agreements
contained in this Agreement and no representation or warranty of
Purchaser set forth in this Agreement shall have been inaccurate or
incomplete in any material respect when made or thereafter shall have
become inaccurate or incomplete in any material respect;
(b) The Company shall have received the written opinion of the
Financial Advisor that the terms of the Offer are fair, from a financial
point of view, to the stockholders of the Company and such opinion shall
not have been withdrawn;
(c) The Company shall have received confirmation that the
Company's common stock shall continue to be listed on the Nasdaq
SmallCap Market following the Closing without any conditions which the
Company in its reasonable judgment shall deem to be materially adverse;
and
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<PAGE>
<PAGE>
(d) There shall be in effect no Order.
ARTICLE VII
TERMINATION
7.1 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 of Purchaser
and the Company, by action of their respective Boards of Directors.
7.2 Termination by Either Purchaser or the Company. This
----------------------------------------------
Agreement may be terminated and the transactions contemplated hereby may
be abandoned at any time prior to the Closing Date, by action of the
Board of Directors of either Purchaser or the Company if (i) Purchaser
shall have terminated the Offer without purchasing any Shares pursuant
thereto; (ii) any court of competent jurisdiction or other Governmental
Entity located or having jurisdiction within the United States or any
country in which either the Company or Purchaser, directly or
indirectly, has material assets or operations, shall have issued a final
order, decree or ruling or taken any other final action restraining,
enjoining or otherwise prohibiting the Offer and such order, decree,
ruling or other action is or shall have become final and nonappealable;
or (iii) the Closing shall not have occurred on or before June 30, 1999.
7.3 Termination by Purchaser. This Agreement may be
------------------------
terminated and the transactions contemplated hereby may be abandoned at
any time prior to the Closing Date, by action of the Board of Directors
of Purchaser, if (i) the Company shall have breached or failed to
perform in any material respect any of the covenants or agreements
contained in this Agreement to be complied with or performed by the
Company prior to such date of termination which breach or failure shall
not have been cured prior to the earlier of (A) five business days
following the giving of written notice to the Company of such breach or
failure and (B) two business days prior to the date on which the Offer
is then scheduled to expire, or any representation or warranty of the
Company set forth in this Agreement shall have been inaccurate or
incomplete when made except for such failures to be complete or accurate
that, individually or in the aggregate, could not reasonably be expected
to have a material adverse effect on the financial condition,
properties, business or results of operations of the Company and its
subsidiaries taken as a whole or could prevent or materially delay the
transactions contemplated by this Agreement or impair the ability of
Purchaser, the Company or any of their respective affiliates, following
consummation of the Offer, to conduct any material business or
operations in any jurisdiction where they are now being conducted, (ii)
the Board of Directors of the Company (or a special committee thereof)
shall have amended, modified or withdrawn in a manner adverse to
Purchaser its approval or recommendation of the Offer or this Agreement
or the Board of Directors of the Company (or a special committee
thereof), upon request by Purchaser, shall fail to reaffirm such
approval or recommendation, or shall have endorsed, approved or
recommended any other Acquisition Proposal, or shall have resolved to do
any of the foregoing, or (iii) the Company or
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<PAGE>
<PAGE>
any of the other persons or entities described in Section 5.2 shall take
any actions that would be proscribed by Section 5.2 but for the
exception therein allowing certain actions to be taken if required by
fiduciary obligations under applicable law as advised in writing by
counsel.
7.4 Termination by the Company. This Agreement may be
--------------------------
terminated and the transactions contemplated hereby may be abandoned at
any time prior to the Closing Date, by action of the Board of Directors
of the Company, (i) if Purchaser (x) shall have breached or failed to
perform in any material respect any of the covenants or agreements
contained in this Agreement to be complied with or performed by
Purchaser prior to such date of termination which shall not have been
cured prior to the earlier of (A) five business days following the
giving of written notice to Purchaser of such breach or failure and (B)
two business days prior to the date on which the Offer is then scheduled
to expire, or (y) shall have failed to commence the Offer within the
time required in Section 1.1, or (ii) if (w) the Company is not in
material breach of any of the terms of this Agreement, (x) the Board of
Directors of the Company authorizes the Company, subject to complying
with the terms of this Agreement, to enter into a binding written
agreement concerning a transaction that constitutes a Superior Proposal
and the Company notifies Purchaser in writing that it intends to enter
into such an agreement, attaching the most current version of such
agreement (which shall include all of the material terms, including the
price proposed to be paid for Shares pursuant thereto) to such notice,
(y) Purchaser does not make, within two business days of receipt of the
Company's written notification of its intention to enter into a binding
agreement for a Superior Proposal, an offer that the Board of Directors
of the Company determines, in good faith after consultation with its
financial advisors, is at least as favorable, from a financial point of
view, to the stockholders of the Company as the Superior Proposal and
(z) the Company, prior to such termination, pays to Purchaser in
immediately available funds the fees required to be paid pursuant to
Section 7.5(b).
7.5 Effect of Termination and Abandonment. (a) In the event
-------------------------------------
of the termination of this Agreement pursuant to this Article VII, no
party hereto (or any of its directors or officers) shall have any
liability or further obligation to any other party to this Agreement,
except as provided in Section 7.5(b) or (c) below and Section 8.2 and
except that nothing herein will relieve any party from liability for any
willful breach of this Agreement; provided, however, that if this
-------- -------
Agreement is terminated by Purchaser pursuant to Section 7.3(i) or the
Company pursuant to Section 7.4(i), the terminating party's rights to
pursue all legal remedies will survive such termination unimpaired;
provided further, however, that in no event shall the liability of
- ---------------- -------
the non-terminating party exceed the sum of $75,000.
(b) If (i) (x) the Offer shall have remained open for a minimum
of at least 20 business days, (y) after the date hereof any corporation,
partnership, person, other entity or group (as defined in Section
13(d)(3) of the Exchange Act) other than Purchaser or any of its
subsidiaries or affiliates (collectively, a "Person") shall have
------
become the beneficial owner of 20% or more of the outstanding Shares
after the date of this Agreement or shall have publicly announced a
proposal or intention to make an Acquisition Proposal or any Person
shall have commenced, or shall have publicly announced an intention to
commence, a tender offer or exchange offer for
- 31 -
<PAGE>
<PAGE>
20% or more of the outstanding Shares, and (z) the Minimum Condition (as
defined in Annex A) shall not have been satisfied and the Offer is
-------
terminated without the purchase of any Shares thereunder, or (ii)
Purchaser shall have terminated this Agreement pursuant to Section
7.3(ii) or Section 7.3(iii) or (iii) the Company shall have terminated
this Agreement pursuant to Section 7.4(ii), then the Company shall
promptly, but in no event later than two days after the date of such
termination, reimburse Purchaser (not later than one business day after
request by Purchaser) for all of the attorneys' fees and other out-of-
pocket fees and expenses reasonably incurred by Purchaser in connection
with this Agreement and the transactions contemplated by this Agreement,
in each case payable by wire transfer in same day funds. The Company
acknowledges that the agreements contained in this Section 7.5(b) are an
integral part of the transactions contemplated in this Agreement, and
that, without these agreements, Purchaser would not enter into this
Agreement; accordingly, if the Company fails to promptly pay the amount
due pursuant to this Section 7.5(b), and, in order to obtain such
payment, Purchaser commences a suit which results in a judgment against
the Company for the fee set forth in this paragraph (b), the Company
shall pay to Purchaser its costs and expenses (including attorneys'
fees) in connection with such suit.
(c) If the Offer shall have been terminated prior to Closing by
Purchaser because the Minimum Condition shall not have been satisfied or
waived on or before the expiration date of the Offer (as such expiration
date may be required to be extended pursuant to Section 1.1(a)), then
Purchaser shall reimburse the Company for one-half of the amount paid by
the Company to the Financial Advisor within five business days after the
Company has made written demand to Purchaser therefor and delivered to
Purchaser documentation reasonably evidencing the amount of such
payment; provided, however, that Purchaser's reimbursement obligation
hereunder shall not exceed $15,000 in the aggregate. Purchaser
acknowledges that the agreements contained in this Section 7.5(c) are an
integral part of the transactions contemplated in this Agreement, and
that, without these agreements, the Company would not enter into this
Agreement; accordingly, if Purchaser fails to promptly pay the amount
due pursuant to this Section 7.5(c), and in order to obtain such
payment, the Company commences a suit which results in a judgment
against Purchaser for the fees set forth in this Section 7.5(c),
Purchaser shall pay to the Company its costs and expenses (including
reasonable attorneys' fees) in connection with such suit.
ARTICLE VIII
MISCELLANEOUS AND GENERAL
8.1 Payment of Expenses. Whether or not the purchase of
-------------------
Shares pursuant to the Offer shall be consummated, each party hereto
shall, subject to Section 7.5(b), pay its own expenses incident to
preparing for, entering into and carrying out this Agreement and the
consummation of the purchase of Shares pursuant to the Offer.
- 32 -
<PAGE>
<PAGE>
8.2 Survival. The agreements of the Company and Purchaser
--------
contained in Section 8.1 (Payment of Expenses) shall survive the
consummation of the purchase of Shares pursuant to the Offer. The
agreements of the Company and Purchaser contained in Sections 5.5
(Access), 5.9 (Availability of Financing), 7.5 (Effect of Termination
and Abandonment), 8.1 (Payment of Expenses), 8.6 (Governing Law), 8.7
(Notices), 8.8 (Severability), 8.9 (Entire Agreement, etc.), 8.10
(Parties in Interest), 8.11 (Definition of "Subsidiary") and 8.13
(Captions) shall survive the termination of this Agreement. All other
representations, warranties, agreements and covenants in this Agreement
shall not survive the consummation of the purchase of Shares pursuant to
the Offer or the termination of this Agreement.
8.3 Modification or Amendment. At any time prior to the
-------------------------
Closing Date, the parties hereto may modify or amend this Agreement, by
written agreement executed and delivered by duly authorized officers of
the respective parties.
8.4 Waiver of Conditions. The conditions to each of the
--------------------
parties' obligations to consummate the purchase of Shares pursuant to
the Offer are for the sole benefit of such party and may be waived by
such party in whole or in part to the extent permitted by applicable
law.
8.5 Counterparts. For the convenience of the parties hereto,
------------
this Agreement may be executed in any number of counterparts, each such
counterpart being deemed to be an original instrument, and all such
counterparts shall together constitute the same agreement.
8.6 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Missouri.
8.7 Notices. Any notice, request, instruction or other
-------
document to be given hereunder by any party to the others shall be in
writing and delivered personally or sent by registered or certified
mail, postage prepaid, if to Purchaser, addressed to Purchaser at Dash
---------------
Multi-Corp, Inc., 2500 Adie Road, Maryland Heights, Missouri 63043,
Attention: Marvin S. Wool, Chief Executive Officer (with a copy to
Thomas A. Litz, Esq., Thompson Coburn LLP, One Mercantile Center, St.
Louis, Missouri 63101); and if to the Company, addressed to the
---------------------
Company at R-B Rubber Products, Inc., 904 E. 10th Avenue, McMinnville,
Oregon 97128, Attention: Ronald L. Bogh, Chief Executive Officer (with a
copy to David C. Baca, Esq., Davis Wright Tremaine LLP, 1300 SW Fifth
Avenue, Suite 2300, Portland, Oregon, 97201-5682), or to such other
persons or addresses as may be designated in writing by the party to
receive such notice.
8.8 Severability. If any term or other provision of this
------------
Agreement is invalid, illegal or incapable of being enforced by any rule
of law or public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as
the economic or legal substance of the transactions contemplated hereby
is not affected in any manner adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good
faith to modify this Agreement so as to effect the original intent of
the parties as closely as possible in an
- 33 -
<PAGE>
<PAGE>
acceptable manner to the end that the transactions contemplated hereby
are fulfilled to the fullest extent possible.
8.9 Entire Agreement, etc. This Agreement (including the
---------------------
Disclosure Schedule and any exhibits or Annexes hereto) (a) constitutes
the entire agreement, and supersedes all other prior agreements,
understandings, representations and warranties both written and oral,
among the parties, with respect to the subject matter hereof, and (b)
shall not be assignable by operation of law or otherwise and is not
intended to create any obligations to, or rights in respect of, any
persons other than the parties hereto.
8.10 Parties in Interest. This Agreement shall be binding upon
-------------------
and inure solely to the benefit of each party hereto, and nothing in
this Agreement, express or implied, is intended to or shall confer upon
any other person any rights, benefits or remedies of any nature
whatsoever under or by reason of this Agreement.
8.11 Definition of "Subsidiary". When a reference is made in
--------------------------
this Agreement to a subsidiary of a party, the word "subsidiary" means
any corporation or other organization whether incorporated or
unincorporated of which at least a majority of the securities or
interests having by the terms thereof ordinary voting power to elect at
least a majority of the board of directors or others performing similar
functions with respect to such corporation or other organization is
directly or indirectly owned or controlled by such party or by any one
or more of its subsidiaries, or by such party and one or more of its
subsidiaries.
8.12 Captions. The Article, Section and paragraph captions
--------
herein are for convenience of reference only, do not constitute part of
this Agreement and shall not be deemed to limit or otherwise affect any
of the provisions hereof.
[The remainder of this page is intentionally left blank.]
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<PAGE>
<PAGE>
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of the parties hereto on the
date first hereinabove written.
R-B RUBBER PRODUCTS, INC.
By /s/ Ronald L. Bogh
-----------------------------------------
Ronald L. Bogh
President, Chief Executive Officer
and Chairman
DASH MULTI-CORP, INC.
By /s/ Marvin S. Wool
-----------------------------------------
Marvin S. Wool
Chief Executive Officer
- 35 -
<PAGE>
<PAGE>
ANNEX A
CERTAIN CONDITIONS OF THE OFFER. The capitalized terms used in
-------------------------------
this Annex A have the meanings set forth in the attached Agreement.
-------
Notwithstanding any other provision of the Offer, Purchaser shall not be
required to accept for payment or, subject to any applicable rules and
regulations of the SEC, including Rule 14e-1(c) under the Exchange Act
(relating to Purchaser's obligation to pay for or return tendered Shares
promptly after termination or withdrawal of the Offer), pay for, or may
delay the acceptance for payment of or payment for, any tendered Shares,
or may, in its sole discretion, terminate or amend the offer as to any
Shares not then paid for if, (i) prior to the expiration of the Offer,
(x) a number of Shares which constitutes more than 30% of the voting
power (determined on a fully-diluted basis) of all the securities of the
Company entitled to vote generally in the election of directors or in
connection with a merger shall not have been validly tendered and not
withdrawn prior to the expiration of the Offer (the "Minimum
-------
Condition") or (y) any consent, registration, approval, permit or
- ---------
authorization of any Governmental Entity applicable to the Offer shall
not have been obtained on terms satisfactory to Purchaser in its
reasonable judgment, or (ii) on or after April 8, 1999, and at or before
the time of payment for any of such Shares (whether or not any Shares
have theretofore been accepted for payment), any of the following events
shall occur:
(a) there shall have occurred (i) any general suspension
of, or limitation on prices for, trading in securities on the
Nasdaq SmallCap Market, (ii) a declaration of a banking moratorium
or any suspension of payments in respect of banks in the United
States, (iii) a commencement or escalation of a war, armed
hostilities or other international or national calamity directly
or indirectly involving the United States, other than the current
hostilities in Serbia and Kosovo, (iv) any limitation (whether or
not mandatory) by any Governmental Entity on, or any other event
which might affect, the extension of credit by banks or other
lending institutions, (v) a material change in United States or
any other currency exchange rates or a suspension of, or
limitation on, the markets therefor, (vi) or in the case of any of
the foregoing existing at the time of the commencement of the
Offer, a material acceleration or worsening thereof, or (vii) any
extraordinary or material adverse change in the market price of
the Shares or in the United States securities or financial markets
generally, including, without limitation, a decline of at least
20% in either the Dow Jones Average of Industrial Stocks or the
Standard & Poor's 500 index from the date of the Agreement;
(b) the Company shall have breached or failed to perform
in any material respect any of its obligations, covenants or
agreements contained in the Agreement or any representation or
warranty of the Company set forth in the Agreement shall have been
inaccurate or incomplete in any material respect when made or
thereafter shall become inaccurate or incomplete in any material
respect;
A-1
<PAGE>
<PAGE>
(c) there shall be threatened, instituted or pending any
Action before any court or other Governmental Entity by any
Governmental Entity or instituted or pending any Action by any
other person, domestic or foreign: (i) challenging the
acquisition by Purchaser of Shares, seeking to restrain or
prohibit the consummation of the transactions contemplated by the
Offer, seeking to obtain any material damages or otherwise
directly or indirectly relating to the transactions contemplated
by the Offer; (ii) seeking to prohibit, or impose any material
limitations on, Purchaser's ownership or operation of all or any
portion of its or the Company's business or assets (including the
business or assets of their respective affiliates and
subsidiaries), or to compel Purchaser to dispose of or hold
separate all or any portion of Purchaser's or the Company's
business or assets (including the business or assets of their
respective affiliates and subsidiaries) as a result of the
transactions contemplated by the Offer; (iii) seeking to make the
acceptance for payment, purchase of, or payment for, some or all
of the Shares illegal or render Purchaser unable to, or result in
a delay in, or restrict, the ability of Purchaser to, accept for
payment, purchase or pay for some or all of the Shares; (iv)
seeking to impose material limitations on the ability of Purchaser
effectively to acquire or hold or to exercise full rights of
ownership of the Shares including, without limitation, the right
to vote the Shares purchased by it on an equal basis with all
other Shares on all matters properly presented to the
stockholders; or (v) that, in any event, in the judgment of
Purchaser, is reasonably likely to have a material adverse effect
on the financial condition, properties, business or operations of
the Company or Purchaser (or any of their respective affiliates or
subsidiaries) or the value of the Shares to Purchaser or the
benefits expected to be derived by Purchaser as a result of
consummation of the transactions contemplated by the Offer;
(d) any statute, rule, regulation, order or injunction
shall be sought, proposed, enacted, promulgated, entered, enforced
or deemed or become applicable to the Offer or the Agreement, or
any other action shall have been taken, proposed or threatened, by
any court or other Governmental Entity that, in the judgment of
Purchaser, could be expected to, directly or indirectly, result in
any of the effects of, or have any of the consequences sought to
be obtained or achieved in, any Action referred to in clauses (i)
through (v) of paragraph (c) above;
(e) a tender or exchange offer for some portion or all of
the Shares shall have been commenced or publicly proposed to be
made by another person (including the Company or its
subsidiaries), or it shall have been publicly disclosed or
Purchaser shall have learned that (i) any person (including the
Company or its subsidiaries), entity or "group" (as defined in
Section 13(d) of the Exchange Act and the rules promulgated
thereunder) shall have become the beneficial owner (as defined in
Section 13(d) of the Exchange Act and the rules promulgated
thereunder) of more than 20% of any class or series of capital
stock of the Company (including the Shares) other than for bona
fide arbitrage purposes or (ii) any person, entity or group shall
have entered into a definitive agreement or an agreement in
principle or made a proposal with respect to a tender offer
A-2
<PAGE>
<PAGE>
or exchange offer for some portion or all of the Shares or a
merger, consolidation or other business combination with or
involving the Company;
(f) any change shall have occurred (or any development
shall have occurred involving a prospective change) or Purchaser
shall have become aware of any fact (including, but not limited
to, any such change) that has had, or is reasonably likely to
have, a material adverse effect on the financial condition,
properties, business or results of operations of the Company and
its subsidiaries taken as a whole;
(g) the Board of Directors of the Company (or a special
committee thereof) shall have amended, modified or withdrawn its
approval or recommendation of the Offer, or the Agreement, or
shall have failed to publicly reconfirm such approval or
recommendation upon request by Purchaser, or shall have endorsed,
approved or recommended any other Acquisition Proposal, or shall
have resolved to do any of the foregoing; or
(h) the Agreement shall have been terminated by the
Company or Purchaser in accordance with its terms or Purchaser
shall have reached an agreement or understanding in writing with
the Company providing for termination or amendment of the Offer or
delay in payment for the Shares;
which, in the sole judgment of Purchaser, in any such case, and
regardless of the circumstances (including any action or inaction by
Purchaser) giving rise to any such conditions, makes it inadvisable to
proceed with the Offer and/or with such acceptance for payment of or
payment for Shares.
The foregoing conditions are for the sole benefit of Purchaser and
may be asserted by Purchaser regardless of the circumstances (including
any action or inaction by Purchaser) giving rise to such condition or
may be waived by Purchaser, by express and specific action to that
effect, in whole or in part at any time and from time to time in its
sole discretion. Any determination by Purchaser concerning any event
described in this Annex A shall be final and binding upon all parties.
-------
The failure by Purchaser at any time to exercise any of the foregoing
rights shall not be deemed a waiver of any such right, the waiver of any
such right with respect to particular facts and other circumstances
shall not be deemed a waiver with respect to any other facts and
circumstances, and each such right shall be deemed an ongoing right that
may be asserted at any time and from time to time.
A-3
<PAGE>
<PAGE>
SHAREHOLDER AGREEMENT
THIS SHAREHOLDER AGREEMENT (this "Agreement"), dated as of April
8, 1999, by and between Dash Multi-Corp., Inc. a Missouri corporation
("Purchaser"), and Ronald L. Bogh (the "Shareholder").
WHEREAS, the Shareholder is, as of the date hereof, the record and
beneficial owner of the shares of common stock, no par value (the
"Common Stock"), of R-B Rubber Products, Inc., an Oregon corporation
(the "Company"), set forth on Annex I hereto;
WHEREAS, Purchaser and the Company concurrently herewith are
entering into a Stock Purchase Agreement dated as of the date hereof
(the "Stock Purchase Agreement"), which provides, among other things,
for the acquisition by means of a cash tender offer (the "Offer") of 70%
of the outstanding shares of Common Stock upon the terms and subject to
the conditions set forth in the Stock Purchase Agreement; and
WHEREAS, in order to induce Purchaser to enter into the Stock
Purchase Agreement, the Shareholder has agreed to enter into this
Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
execution and delivery by Purchaser of the Stock Purchase Agreement and
the mutual representations, warranties, covenants and agreements set
forth herein and therein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Representations and Warranties of the Shareholder. The
-------------------------------------------------
Shareholder hereby represents and warrants to Purchaser as follows:
(a) Such Shareholder is the record and beneficial owner of the
shares of Common Stock (as may be adjusted from time to time pursuant to
Section 5 hereof, the "Shares") set forth opposite his name on Annex I
to this Agreement.
(b) Such Shareholder has the legal capacity to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby.
(c) This Agreement has been validly executed and delivered by
such Shareholder and constitutes the legal, valid and binding obligation
of such Shareholder, enforceable against such Shareholder in accordance
with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors' rights generally, and
(ii) the availability of the remedy of specific performance or
injunctive or other forms of equitable relief may be subject to
equitable defenses and would be subject to the discretion of the court
before which any proceeding therefor may be brought.
<PAGE>
<PAGE>
(d) Neither the execution and delivery of this Agreement nor the
consummation by such Shareholder of the transactions contemplated hereby
will violate any other agreement to which such Shareholder is a party.
(e) The Shares and the certificates representing the Shares
owned by such Shareholder are now and at all times during the term
hereof will be held by such Shareholder, or by a nominee or custodian
for the benefit of such Shareholder, free and clear of all liens,
claims, security interests, proxies, voting trusts or agreements,
understandings or arrangements or any other encumbrances whatsoever,
except for any such encumbrances or proxies arising hereunder.
2. Representations and Warranties of Purchaser. Purchaser
-------------------------------------------
hereby represents and warrants to the Shareholder as follows:
(a) Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Missouri, and
Purchaser has all requisite corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby, and has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement.
(b) This Agreement has been duly authorized, executed and
delivered by Purchaser and constitutes the legal, valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance
with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors' rights generally and
(ii) the availability of the remedy of specific performance or
injunctive or other forms of equitable relief may be subject to
equitable defenses and would be subject to the discretion of the court
before which any proceeding therefor may be brought.
(c) Neither the execution and delivery of this Agreement nor the
consummation by Purchaser of the transactions contemplated hereby will
result in a violation of, or a default under, or conflict with, any
contract, trust, commitment, agreement, understanding, arrangement or
restriction of any kind to which Purchaser is a party or bound. The
consummation by Purchaser of the transactions contemplated hereby will
not violate, or require any consent, approval, or notice under, any
provision of any judgment, order, decree, statute, law, rule or
regulation applicable to Purchaser, except for any necessary filing
under state takeover laws.
3. Purchase and Sale of the Shares. (a) The Shareholder
-------------------------------
hereby agrees that he shall tender the number of Shares set forth on
Annex I into the Offer promptly, and in any event no later than the
tenth business day following the commencement of the Offer pursuant to
Section 1.1 of the Stock Purchase Agreement, and that such Shareholder
shall not withdraw any Shares so tendered unless the Offer is terminated
or has expired. Purchaser shall agree to purchase all the Shares so
tendered at a price per Share equal to $3.00 per Share or any higher
price that may be paid in the Offer; provided, however, that Purchaser's
obligation to accept for payment and pay for the Shares in the Offer is
subject to all the terms and conditions of the Offer set forth in the
Stock Purchase Agreement and Annex A thereto.
- 2 -
<PAGE>
<PAGE>
(b) In the event that within five business days prior to the
expiration of the Offer, fewer than 70% of the Company's outstanding
shares shall have been validly tendered pursuant to the Offer and not
withdrawn, upon the request of Purchaser, the Shareholder shall tender
such number of Shares in addition to those to be tendered pursuant to
Section 3(a) as set forth in Annex I as Shareholder is directed by
Purchaser, but in no event shall Shareholder be obligated to tender more
than the total number of shares then owned by the Shareholder.
4. Transfer of the Shares. Prior to the termination of this
----------------------
Agreement, except as otherwise provided herein, the Shareholder shall
not: (i) transfer (which term shall include, without limitation, for
the purposes of this Agreement, any sale, gift, pledge or other
disposition), or consent to any transfer of, any or all of the Shares;
(ii) enter into any contract, option or other agreement or understanding
with respect to any transfer of any or all of the Shares or any interest
therein; (iii) grant any proxy, power-of-attorney or other authorization
or consent in or with respect to the Shares; (iv) deposit the Shares
into a voting trust or enter into a voting agreement or arrangement with
respect to the Shares, or (v) take any other action that would in any
way restrict, limit or interfere with the performance of such
Shareholder's obligations hereunder or the transactions contemplated
hereby.
5. Certain Events. In the event of any stock split, stock
--------------
dividend, merger, reorganization, recapitalization or other change in
the capital structure of the Company affecting the Common Stock or the
acquisition of additional shares of Common Stock or other securities or
rights of the Company by the Shareholder, the number of Shares shall be
adjusted appropriately, and this Agreement and the obligations hereunder
shall attach to any additional shares of Common Stock or other
securities or rights of the Company issued to or acquired by the
Shareholder.
6. Certain Other Agreements. (a) The Shareholder will notify
------------------------
Purchaser immediately if any proposals are received by, any information
is requested from, or any negotiations or discussions are sought to be
initiated or continued with such Shareholder or its representatives or
agents, if any, in each case in connection with any Acquisition Proposal
(as such term is defined in the Stock Purchase Agreement) indicating, in
connection with such notice, the name of the person making such
Acquisition Proposal and the terms and conditions of any proposals or
offers. The Shareholder agrees that it will immediately cease and cause
to be terminated any existing activities, discussions or negotiations
with any parties conducted heretofore with respect to any Acquisition
Proposal. Such Shareholder agrees that it shall keep Purchaser
informed, on a current basis, of the status and terms of any Acquisition
Proposal. Such Shareholder agrees that it will not, directly or
indirectly: (i) initiate, solicit or encourage, or take any action to
facilitate the making of, any offer or proposal which constitutes or is
reasonably likely to lead to any Acquisition Proposal, or (ii) in the
event of an unsolicited written Acquisition Proposal, engage in
negotiations or discussions with, or provide any information or data to,
any person (other than Purchaser, any of its affiliates or
representatives and except for information which has been previously
publicly disseminated by the Company) relating to any Acquisition
Proposal. The foregoing shall not apply to the extent that it is
inconsistent with any of Shareholder's duties as a director and/or
officer of the Company.
- 3 -
<PAGE>
<PAGE>
(b) Shareholder agrees that he shall not exercise on or prior to
the Closing (as defined in the Stock Purchase Agreement) any option to
purchase shares of Common Stock.
7. Further Assurances. The Shareholder shall, upon request
------------------
of Purchaser, execute and deliver any additional documents and take such
further actions as may reasonably be deemed by Purchaser to be necessary
or desirable to carry out the provisions hereof.
8. Termination. This Agreement, and all rights and
-----------
obligations of the parties hereunder, shall terminate immediately upon
the termination of the Stock Purchase Agreement in accordance with its
terms; provided, however, that Sections 8 and 9 shall survive any
termination of this Agreement.
9. Expenses. All fees and expenses incurred by any one party
--------
hereto shall be borne by the party incurring such fees and expenses;
provided, that if any legal action is instituted to enforce or interpret
the terms of this Agreement, the prevailing party in such action shall
be entitled, in addition to any other relief to which the party is
entitled, to reimbursement of its actual attorneys fees.
10. Public Announcements. The Shareholder and Purchaser each
--------------------
agree that it will not issue any press release or otherwise make any
public statement with respect to this Agreement or the transactions
contemplated hereby without the prior consent of the other party, which
consent shall not be unreasonably withheld or delayed; provided,
however, that such disclosure can be made without obtaining such prior
consent if (i) the disclosure is required by law, and (ii) the party
making such disclosure has first used its best efforts to consult with
the other party about the form and substance of such disclosure.
11. Miscellaneous.
-------------
(a) Capitalized terms used and not otherwise defined in this
Agreement shall have the respective meanings assigned to such terms in
the Stock Purchase Agreement.
(b) All notices and other communications hereunder shall be in
writing and shall be deemed given upon (i) transmitter's confirmation of
a receipt of a facsimile transmission, (ii) confirmed delivery by a
standard overnight carrier or when delivered by hand or (iii) the
expiration of five business days after the day when mailed in the United
States by certified or registered mail, postage prepaid, addressed at
the following addresses (or at such other address for a party as shall
be specified by like notice):
(A) if to the Shareholder, to:
Ronald L. Bogh
904 East 10th Ave.
McMinnville, Or. 97128
- 4 -
<PAGE>
<PAGE>
(B) if to Purchaser, to:
Dash Multi-Corp., Inc.
2500 Adie Road
Maryland Heights, Missouri 63043
Telephone: (314) 432-3200
Facsimile: (314) 432-3210
Attention: Marvin S. Wool
Chief Executive Officer
with a copy to:
Thompson Coburn LLP
One Mercantile Center
St. Louis, Missouri 63101
Telephone: (314) 552-6000
Facsimile: (314) 552-7000
Attention: Thomas A. Litz, Esq.
(c) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(d) This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which shall be
considered one and the same agreement.
(e) This Agreement (including the Stock Purchase Agreement and
any other documents and instruments referred to herein or therein)
constitutes the entire agreement, and supersedes all prior agreements
and understandings, whether written and oral, among the parties hereto
with respect to the subject matter hereof.
(f) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Missouri without giving effect
to the principles of conflicts of laws thereof.
(g) Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto
(whether by operation of law or otherwise) without the prior written
consent of the other parties. Subject to the preceding sentence, this
Agreement will be binding upon, inure to the benefit of and be
enforceable by, the parties and their respective heirs, legatees,
successors and permitted assigns, and the provisions of this Agreement
are not intended to confer upon any person other than the parties hereto
any rights or remedies hereunder.
(h) If any term, provision, covenant or restriction herein is
held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable or against its regulatory policy, the
remainder of the terms, provisions, covenants and restrictions of this
- 5 -
<PAGE>
<PAGE>
Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.
(i) Each of the parties hereto acknowledges and agrees that in
the event of any breach of this Agreement, each non-breaching party
would be irreparably and immediately harmed and could not be made whole
by monetary damages. It is accordingly agreed that the parties hereto
(i) will waive, in any action for specific performance, the defense of
adequacy of a remedy at law, and (ii) shall be entitled, in addition to
any other remedy to which they may be entitled at law or in equity, to
compel specific performance of this Agreement.
(j) No amendment, modification or waiver in respect of this
Agreement shall be effective against any party unless it shall be in
writing and signed by such party.
IN WITNESS WHEREOF, Purchaser and the Shareholder have caused this
Agreement to be duly executed and delivered as of the date first written
above.
DASH MULTI-CORP., INC.
By /s/ Marvin S. Wool
-----------------------------------------
Marvin S. Wool, Chief Executive Officer
/s/ Ronald L. Bogh
-----------------------------------------
Ronald L. Bogh
- 6 -
<PAGE>
<PAGE>
Annex I
-------
(1) Number of Shares Owned
Beneficially and of Record: 601,300
(2) Number of Shares Which
Shareholder Will Tender
Pursuant to Section 3(a): 481,040
- 7 -
<PAGE>
<PAGE>
SHAREHOLDER AGREEMENT
THIS SHAREHOLDER AGREEMENT (this "Agreement"), dated as of April
8, 1999, by and between Dash Multi-Corp., Inc. a Missouri corporation
("Purchaser"), and Douglas C. Nelson (the "Shareholder").
WHEREAS, the Shareholder is, as of the date hereof, the record and
beneficial owner of the shares of common stock, no par value (the
"Common Stock"), of R-B Rubber Products, Inc., an Oregon corporation
(the "Company"), set forth on Annex I hereto;
WHEREAS, Purchaser and the Company concurrently herewith are
entering into a Stock Purchase Agreement dated as of the date hereof
(the "Stock Purchase Agreement"), which provides, among other things,
for the acquisition by means of a cash tender offer (the "Offer") of 70%
of the outstanding shares of Common Stock upon the terms and subject to
the conditions set forth in the Stock Purchase Agreement; and
WHEREAS, in order to induce Purchaser to enter into the Stock
Purchase Agreement, the Shareholder has agreed to enter into this
Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
execution and delivery by Purchaser of the Stock Purchase Agreement and
the mutual representations, warranties, covenants and agreements set
forth herein and therein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Representations and Warranties of the Shareholder. The
-------------------------------------------------
Shareholder hereby represents and warrants to Purchaser as follows:
(a) Such Shareholder is the record and beneficial owner of the
shares of Common Stock (as may be adjusted from time to time pursuant to
Section 5 hereof, the "Shares") set forth opposite his name on Annex I
to this Agreement.
(b) Such Shareholder has the legal capacity to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby.
(c) This Agreement has been validly executed and delivered by
such Shareholder and constitutes the legal, valid and binding obligation
of such Shareholder, enforceable against such Shareholder in accordance
with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors' rights generally, and
(ii) the availability of the remedy of specific performance or
injunctive or other forms of equitable relief may be subject to
equitable defenses and would be subject to the discretion of the court
before which any proceeding therefor may be brought.
<PAGE>
<PAGE>
(d) Neither the execution and delivery of this Agreement nor the
consummation by such Shareholder of the transactions contemplated hereby
will violate any other agreement to which such Shareholder is a party.
(e) The Shares and the certificates representing the Shares
owned by such Shareholder are now and at all times during the term
hereof will be held by such Shareholder, or by a nominee or custodian
for the benefit of such Shareholder, free and clear of all liens,
claims, security interests, proxies, voting trusts or agreements,
understandings or arrangements or any other encumbrances whatsoever,
except for any such encumbrances or proxies arising hereunder.
2. Representations and Warranties of Purchaser. Purchaser
-------------------------------------------
hereby represents and warrants to the Shareholder as follows:
(a) Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Missouri, and
Purchaser has all requisite corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby, and has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement.
(b) This Agreement has been duly authorized, executed and
delivered by Purchaser and constitutes the legal, valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance
with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors' rights generally and
(ii) the availability of the remedy of specific performance or
injunctive or other forms of equitable relief may be subject to
equitable defenses and would be subject to the discretion of the court
before which any proceeding therefor may be brought.
(c) Neither the execution and delivery of this Agreement nor the
consummation by Purchaser of the transactions contemplated hereby will
result in a violation of, or a default under, or conflict with, any
contract, trust, commitment, agreement, understanding, arrangement or
restriction of any kind to which Purchaser is a party or bound. The
consummation by Purchaser of the transactions contemplated hereby will
not violate, or require any consent, approval, or notice under, any
provision of any judgment, order, decree, statute, law, rule or
regulation applicable to Purchaser, except for any necessary filing
under state takeover laws.
3. Purchase and Sale of the Shares. (a) The Shareholder
-------------------------------
hereby agrees that he shall tender the number of Shares set forth on
Annex I into the Offer promptly, and in any event no later than the
tenth business day following the commencement of the Offer pursuant to
Section 1.1 of the Stock Purchase Agreement, and that such Shareholder
shall not withdraw any Shares so tendered unless the Offer is terminated
or has expired. Purchaser shall agree to purchase all the Shares so
tendered at a price per Share equal to $3.00 per Share or any higher
price that may be paid in the Offer; provided, however, that Purchaser's
obligation to accept for payment and pay for the Shares in the Offer is
subject to all the terms and conditions of the Offer set forth in the
Stock Purchase Agreement and Annex A thereto.
- 2 -
<PAGE>
<PAGE>
(b) In the event that within five business days prior to the
expiration of the Offer, fewer than 70% of the Company's outstanding
shares shall have been validly tendered pursuant to the Offer and not
withdrawn, upon the request of Purchaser, the Shareholder shall tender
such number of Shares in addition to those to be tendered pursuant to
Section 3(a) as set forth in Annex I as Shareholder is directed by
Purchaser, but in no event shall Shareholder be obligated to tender more
than the total number of shares then owned by the Shareholder.
4. Transfer of the Shares. Prior to the termination of this
----------------------
Agreement, except as otherwise provided herein, the Shareholder shall
not: (i) transfer (which term shall include, without limitation, for
the purposes of this Agreement, any sale, gift, pledge or other
disposition), or consent to any transfer of, any or all of the Shares;
(ii) enter into any contract, option or other agreement or understanding
with respect to any transfer of any or all of the Shares or any interest
therein; (iii) grant any proxy, power-of-attorney or other authorization
or consent in or with respect to the Shares; (iv) deposit the Shares
into a voting trust or enter into a voting agreement or arrangement with
respect to the Shares, or (v) take any other action that would in any
way restrict, limit or interfere with the performance of such
Shareholder's obligations hereunder or the transactions contemplated
hereby.
5. Certain Events. In the event of any stock split, stock
--------------
dividend, merger, reorganization, recapitalization or other change in
the capital structure of the Company affecting the Common Stock or the
acquisition of additional shares of Common Stock or other securities or
rights of the Company by the Shareholder, the number of Shares shall be
adjusted appropriately, and this Agreement and the obligations hereunder
shall attach to any additional shares of Common Stock or other
securities or rights of the Company issued to or acquired by the
Shareholder.
6. Certain Other Agreements. (a) The Shareholder will notify
------------------------
Purchaser immediately if any proposals are received by, any information
is requested from, or any negotiations or discussions are sought to be
initiated or continued with such Shareholder or its representatives or
agents, if any, in each case in connection with any Acquisition Proposal
(as such term is defined in the Stock Purchase Agreement) indicating, in
connection with such notice, the name of the person making such
Acquisition Proposal and the terms and conditions of any proposals or
offers. The Shareholder agrees that it will immediately cease and cause
to be terminated any existing activities, discussions or negotiations
with any parties conducted heretofore with respect to any Acquisition
Proposal. Such Shareholder agrees that it shall keep Purchaser
informed, on a current basis, of the status and terms of any Acquisition
Proposal. Such Shareholder agrees that it will not, directly or
indirectly: (i) initiate, solicit or encourage, or take any action to
facilitate the making of, any offer or proposal which constitutes or is
reasonably likely to lead to any Acquisition Proposal, or (ii) in the
event of an unsolicited written Acquisition Proposal, engage in
negotiations or discussions with, or provide any information or data to,
any person (other than Purchaser, any of its affiliates or
representatives and except for information which has been previously
publicly disseminated by the Company) relating to any Acquisition
Proposal. The foregoing shall not apply to the extent that it is
inconsistent with any of Shareholder's duties as a director and/or
officer of the Company.
- 3 -
<PAGE>
<PAGE>
(b) Shareholder agrees that he shall not exercise on or prior to
the Closing (as defined in the Stock Purchase Agreement) any option to
purchase shares of Common Stock.
(c) Shareholder hereby irrevocably waives, effective from and
after the Closing, his right to require the Company to guarantee a price
per share on shares of the Common Stock which he may sell, as more
particularly described in Section 5 of that certain Non-Competition,
Price Guaranty and Release Agreement dated as of January 31, 1998.
(d) Shareholder hereby represents and warrants to Purchaser that
Shareholder does not own or possess any option, right or warrant to
acquire any Common Stock.
7. Further Assurances. The Shareholder shall, upon request
------------------
of Purchaser, execute and deliver any additional documents and take such
further actions as may reasonably be deemed by Purchaser to be necessary
or desirable to carry out the provisions hereof.
8. Termination. This Agreement, and all rights and
-----------
obligations of the parties hereunder, shall terminate immediately upon
the termination of the Stock Purchase Agreement in accordance with its
terms; provided, however, that Sections 8 and 9 shall survive any
termination of this Agreement.
9. Expenses. All fees and expenses incurred by any one party
--------
hereto shall be borne by the party incurring such fees and expenses;
provided, that if any legal action is instituted to enforce or interpret
the terms of this Agreement, the prevailing party in such action shall
be entitled, in addition to any other relief to which the party is
entitled, to reimbursement of its actual attorneys fees.
10. Public Announcements. The Shareholder and Purchaser each
--------------------
agree that it will not issue any press release or otherwise make any
public statement with respect to this Agreement or the transactions
contemplated hereby without the prior consent of the other party, which
consent shall not be unreasonably withheld or delayed; provided,
however, that such disclosure can be made without obtaining such prior
consent if (i) the disclosure is required by law, and (ii) the party
making such disclosure has first used its best efforts to consult with
the other party about the form and substance of such disclosure.
11. Miscellaneous.
-------------
(a) Capitalized terms used and not otherwise defined in this
Agreement shall have the respective meanings assigned to such terms in
the Stock Purchase Agreement.
(b) All notices and other communications hereunder shall be in
writing and shall be deemed given upon (i) transmitter's confirmation of
a receipt of a facsimile transmission, (ii) confirmed delivery by a
standard overnight carrier or when delivered by hand or (iii) the
expiration of five business days after the day when mailed in the United
States by certified or
- 4 -
<PAGE>
<PAGE>
registered mail, postage prepaid, addressed at the following addresses
(or at such other address for a party as shall be specified by like
notice):
(A) if to the Shareholder, to:
Douglas C. Nelson
1002 Bel Aire Circle
Las Vegas, NV 89109
(B) if to Purchaser, to:
Dash Multi-Corp., Inc.
2500 Adie Road
Maryland Heights, Missouri 63043
Telephone: (314) 432-3200
Facsimile: (314) 432-3210
Attention: Marvin S. Wool
Chief Executive Officer
with a copy to:
Thompson Coburn LLP
One Mercantile Center
St. Louis, Missouri 63101
Telephone: (314) 552-6000
Facsimile: (314) 552-7000
Attention: Thomas A. Litz, Esq.
(c) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(d) This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which shall be
considered one and the same agreement.
(e) This Agreement (including the Stock Purchase Agreement and
any other documents and instruments referred to herein or therein)
constitutes the entire agreement, and supersedes all prior agreements
and understandings, whether written and oral, among the parties hereto
with respect to the subject matter hereof.
(f) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Missouri without giving effect
to the principles of conflicts of laws thereof.
(g) Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto
(whether by operation of law or otherwise) without
- 5 -
<PAGE>
<PAGE>
the prior written consent of the other parties. Subject to the
preceding sentence, this Agreement will be binding upon, inure to the
benefit of and be enforceable by, the parties and their respective
heirs, legatees, successors and permitted assigns, and the provisions of
this Agreement are not intended to confer upon any person other than the
parties hereto any rights or remedies hereunder.
(h) If any term, provision, covenant or restriction herein is
held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable or against its regulatory policy, the
remainder of the terms, provisions, covenants and restrictions of this
Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.
(i) Each of the parties hereto acknowledges and agrees that in
the event of any breach of this Agreement, each non-breaching party
would be irreparably and immediately harmed and could not be made whole
by monetary damages. It is accordingly agreed that the parties hereto
(i) will waive, in any action for specific performance, the defense of
adequacy of a remedy at law, and (ii) shall be entitled, in addition to
any other remedy to which they may be entitled at law or in equity, to
compel specific performance of this Agreement.
(j) No amendment, modification or waiver in respect of this
Agreement shall be effective against any party unless it shall be in
writing and signed by such party.
IN WITNESS WHEREOF, Purchaser and the Shareholder have caused this
Agreement to be duly executed and delivered as of the date first written
above.
DASH MULTI-CORP., INC.
By /s/ Marvin S. Wool
---------------------------------------
Marvin S. Wool, Chief Executive Officer
/s/ Douglas C. Nelson
---------------------------------------
Douglas C. Nelson
- 6 -
<PAGE>
<PAGE>
Annex I
-------
(1) Number of Shares Owned
Beneficially and of Record: 407,000
(2) Number of Shares Which
Shareholder Will Tender
Pursuant to Section 3(a): 407,000
- 7 -
<PAGE>
<PAGE>
SHAREHOLDER AGREEMENT
THIS SHAREHOLDER AGREEMENT (this "Agreement"), dated as of April
8, 1999, by and between Dash Multi-Corp., Inc. a Missouri corporation
("Purchaser"), and James V. Reimann (the "Shareholder").
WHEREAS, the Shareholder is, as of the date hereof, the record and
beneficial owner of the shares of common stock, no par value (the
"Common Stock"), of R-B Rubber Products, Inc., an Oregon corporation
(the "Company"), set forth on Annex I hereto;
WHEREAS, Purchaser and the Company concurrently herewith are
entering into a Stock Purchase Agreement dated as of the date hereof
(the "Stock Purchase Agreement"), which provides, among other things,
for the acquisition by means of a cash tender offer (the "Offer") of 70%
of the outstanding shares of Common Stock upon the terms and subject to
the conditions set forth in the Stock Purchase Agreement; and
WHEREAS, in order to induce Purchaser to enter into the Stock
Purchase Agreement, the Shareholder has agreed to enter into this
Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
execution and delivery by Purchaser of the Stock Purchase Agreement and
the mutual representations, warranties, covenants and agreements set
forth herein and therein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Representations and Warranties of the Shareholder. The
-------------------------------------------------
Shareholder hereby represents and warrants to Purchaser as follows:
(a) Such Shareholder is the record and beneficial owner of the
shares of Common Stock (as may be adjusted from time to time pursuant to
Section 5 hereof, the "Shares") set forth opposite his name on Annex I
to this Agreement.
(b) Such Shareholder has the legal capacity to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby.
(c) This Agreement has been validly executed and delivered by
such Shareholder and constitutes the legal, valid and binding obligation
of such Shareholder, enforceable against such Shareholder in accordance
with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors' rights generally, and
(ii) the availability of the remedy of specific performance or
injunctive or other forms of equitable relief may be subject to
equitable defenses and would be subject to the discretion of the court
before which any proceeding therefor may be brought.
<PAGE>
<PAGE>
(d) Neither the execution and delivery of this Agreement nor the
consummation by such Shareholder of the transactions contemplated hereby
will violate any other agreement to which such Shareholder is a party.
(e) The Shares and the certificates representing the Shares
owned by such Shareholder are now and at all times during the term
hereof will be held by such Shareholder, or by a nominee or custodian
for the benefit of such Shareholder, free and clear of all liens,
claims, security interests, proxies, voting trusts or agreements,
understandings or arrangements or any other encumbrances whatsoever,
except for any such encumbrances or proxies arising hereunder.
2. Representations and Warranties of Purchaser. Purchaser
-------------------------------------------
hereby represents and warrants to the Shareholder as follows:
(a) Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Missouri, and
Purchaser has all requisite corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby, and has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement.
(b) This Agreement has been duly authorized, executed and
delivered by Purchaser and constitutes the legal, valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance
with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors' rights generally and
(ii) the availability of the remedy of specific performance or
injunctive or other forms of equitable relief may be subject to
equitable defenses and would be subject to the discretion of the court
before which any proceeding therefor may be brought.
(c) Neither the execution and delivery of this Agreement nor the
consummation by Purchaser of the transactions contemplated hereby will
result in a violation of, or a default under, or conflict with, any
contract, trust, commitment, agreement, understanding, arrangement or
restriction of any kind to which Purchaser is a party or bound. The
consummation by Purchaser of the transactions contemplated hereby will
not violate, or require any consent, approval, or notice under, any
provision of any judgment, order, decree, statute, law, rule or
regulation applicable to Purchaser, except for any necessary filing
under state takeover laws.
3. Purchase and Sale of the Shares. (a) The Shareholder
-------------------------------
hereby agrees that he shall tender the number of Shares set forth on
Annex I into the Offer promptly, and in any event no later than the
tenth business day following the commencement of the Offer pursuant to
Section 1.1 of the Stock Purchase Agreement, and that such Shareholder
shall not withdraw any Shares so tendered unless the Offer is terminated
or has expired. Purchaser shall agree to purchase all the Shares so
tendered at a price per Share equal to $3.00 per Share or any higher
price that may be paid in the Offer; provided, however, that Purchaser's
obligation to accept for payment and pay for the Shares in the Offer is
subject to all the terms and conditions of the Offer set forth in the
Stock Purchase Agreement and Annex A thereto.
- 2 -
<PAGE>
<PAGE>
(b) In the event that within five business days prior to the
expiration of the Offer, fewer than 70% of the Company's outstanding
shares shall have been validly tendered pursuant to the Offer and not
withdrawn, upon the request of Purchaser, the Shareholder shall tender
such number of Shares in addition to those to be tendered pursuant to
Section 3(a) as set forth in Annex I as Shareholder is directed by
Purchaser, but in no event shall Shareholder be obligated to tender more
than the total number of shares then owned by the Shareholder.
4. Transfer of the Shares. Prior to the termination of this
----------------------
Agreement, except as otherwise provided herein, the Shareholder shall
not: (i) transfer (which term shall include, without limitation, for
the purposes of this Agreement, any sale, gift, pledge or other
disposition), or consent to any transfer of, any or all of the Shares;
(ii) enter into any contract, option or other agreement or understanding
with respect to any transfer of any or all of the Shares or any interest
therein; (iii) grant any proxy, power-of-attorney or other authorization
or consent in or with respect to the Shares; (iv) deposit the Shares
into a voting trust or enter into a voting agreement or arrangement with
respect to the Shares, or (v) take any other action that would in any
way restrict, limit or interfere with the performance of such
Shareholder's obligations hereunder or the transactions contemplated
hereby.
5. Certain Events. In the event of any stock split, stock
--------------
dividend, merger, reorganization, recapitalization or other change in
the capital structure of the Company affecting the Common Stock or the
acquisition of additional shares of Common Stock or other securities or
rights of the Company by the Shareholder, the number of Shares shall be
adjusted appropriately, and this Agreement and the obligations hereunder
shall attach to any additional shares of Common Stock or other
securities or rights of the Company issued to or acquired by the
Shareholder.
6. Certain Other Agreements. (a) The Shareholder will notify
------------------------
Purchaser immediately if any proposals are received by, any information
is requested from, or any negotiations or discussions are sought to be
initiated or continued with such Shareholder or its representatives or
agents, if any, in each case in connection with any Acquisition Proposal
(as such term is defined in the Stock Purchase Agreement) indicating, in
connection with such notice, the name of the person making such
Acquisition Proposal and the terms and conditions of any proposals or
offers. The Shareholder agrees that it will immediately cease and cause
to be terminated any existing activities, discussions or negotiations
with any parties conducted heretofore with respect to any Acquisition
Proposal. Such Shareholder agrees that it shall keep Purchaser
informed, on a current basis, of the status and terms of any Acquisition
Proposal. Such Shareholder agrees that it will not, directly or
indirectly: (i) initiate, solicit or encourage, or take any action to
facilitate the making of, any offer or proposal which constitutes or is
reasonably likely to lead to any Acquisition Proposal, or (ii) in the
event of an unsolicited written Acquisition Proposal, engage in
negotiations or discussions with, or provide any information or data to,
any person (other than Purchaser, any of its affiliates or
representatives and except for information which has been previously
publicly disseminated by the Company) relating to any Acquisition
Proposal. The foregoing shall not apply to the extent that it is
inconsistent with any of Shareholder's duties as a director and/or
officer of the Company.
- 3 -
<PAGE>
<PAGE>
(b) Shareholder agrees that he shall not exercise on or prior to
the Closing (as defined in the Stock Purchase Agreement) any option to
purchase shares of Common Stock.
7. Further Assurances. The Shareholder shall, upon request
------------------
of Purchaser, execute and deliver any additional documents and take such
further actions as may reasonably be deemed by Purchaser to be necessary
or desirable to carry out the provisions hereof.
8. Termination. This Agreement, and all rights and
-----------
obligations of the parties hereunder, shall terminate immediately upon
the termination of the Stock Purchase Agreement in accordance with its
terms; provided, however, that Sections 8 and 9 shall survive any
termination of this Agreement.
9. Expenses. All fees and expenses incurred by any one party
--------
hereto shall be borne by the party incurring such fees and expenses;
provided, that if any legal action is instituted to enforce or interpret
the terms of this Agreement, the prevailing party in such action shall
be entitled, in addition to any other relief to which the party is
entitled, to reimbursement of its actual attorneys fees.
10. Public Announcements. The Shareholder and Purchaser each
--------------------
agree that it will not issue any press release or otherwise make any
public statement with respect to this Agreement or the transactions
contemplated hereby without the prior consent of the other party, which
consent shall not be unreasonably withheld or delayed; provided,
however, that such disclosure can be made without obtaining such prior
consent if (i) the disclosure is required by law, and (ii) the party
making such disclosure has first used its best efforts to consult with
the other party about the form and substance of such disclosure.
11. Miscellaneous.
-------------
(a) Capitalized terms used and not otherwise defined in this
Agreement shall have the respective meanings assigned to such terms in
the Stock Purchase Agreement.
(b) All notices and other communications hereunder shall be in
writing and shall be deemed given upon (i) transmitter's confirmation of
a receipt of a facsimile transmission, (ii) confirmed delivery by a
standard overnight carrier or when delivered by hand or (iii) the
expiration of five business days after the day when mailed in the United
States by certified or registered mail, postage prepaid, addressed at
the following addresses (or at such other address for a party as shall
be specified by like notice):
- 4 -
<PAGE>
<PAGE>
(A) if to the Shareholder, to:
James V. Reimann
5605 Inland Shores Way N.
Suite 202
Keizer, OR 97303
(B) if to Purchaser, to:
Dash Multi-Corp., Inc.
2500 Adie Road
Maryland Heights, Missouri 63043
Telephone: (314) 432-3200
Facsimile: (314) 432-3210
Attention: Marvin S. Wool
Chief Executive Officer
with a copy to:
Thompson Coburn LLP
One Mercantile Center
St. Louis, Missouri 63101
Telephone: (314) 552-6000
Facsimile: (314) 552-7000
Attention: Thomas A. Litz, Esq.
(c) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
(d) This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original but all of which shall be
considered one and the same agreement.
(e) This Agreement (including the Stock Purchase Agreement and
any other documents and instruments referred to herein or therein)
constitutes the entire agreement, and supersedes all prior agreements
and understandings, whether written and oral, among the parties hereto
with respect to the subject matter hereof.
(f) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Missouri without giving effect
to the principles of conflicts of laws thereof.
(g) Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto
(whether by operation of law or otherwise) without the prior written
consent of the other parties. Subject to the preceding sentence, this
Agreement will be binding upon, inure to the benefit of and be
enforceable by, the parties and their
- 5 -
<PAGE>
<PAGE>
respective heirs, legatees, successors and permitted assigns, and the
provisions of this Agreement are not intended to confer upon any person
other than the parties hereto any rights or remedies hereunder.
(h) If any term, provision, covenant or restriction herein is
held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable or against its regulatory policy, the
remainder of the terms, provisions, covenants and restrictions of this
Agreement shall remain in full force and effect and shall in no way be
affected, impaired or invalidated.
(i) Each of the parties hereto acknowledges and agrees that in
the event of any breach of this Agreement, each non-breaching party
would be irreparably and immediately harmed and could not be made whole
by monetary damages. It is accordingly agreed that the parties hereto
(i) will waive, in any action for specific performance, the defense of
adequacy of a remedy at law, and (ii) shall be entitled, in addition to
any other remedy to which they may be entitled at law or in equity, to
compel specific performance of this Agreement.
(j) No amendment, modification or waiver in respect of this
Agreement shall be effective against any party unless it shall be in
writing and signed by such party.
IN WITNESS WHEREOF, Purchaser and the Shareholder have caused this
Agreement to be duly executed and delivered as of the date first written
above.
DASH MULTI-CORP., INC.
By /s/ Marvin S. Wool
---------------------------------------
Marvin S. Wool, Chief Executive Officer
/s/ James V. Reimann
---------------------------------------
James V. Reimann
- 6 -
<PAGE>
<PAGE>
Annex I
-------
(1) Number of Shares Owned
Beneficially and of Record: 47,500
(2) Number of Shares Which
Shareholder Will Tender
Pursuant to Section 3(a): 47,500
- 7 -
<PAGE>
<PAGE>
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, dated as of the _____ day of __________
1999, by and between RB RUBBER PRODUCTS, INC. (hereinafter referred to
as "Employer" and which, together with its parent company, Dash Multi-
Corp, Inc., and any other subsidiaries of Dash Multi-Corp, Inc., are
called the "Company" herein) and RONALD BOGH (hereinafter referred to as
"Employee").
WHEREAS, The Company is desirous of having Employee employed by
Employer in an executive capacity and Employee wishes to be employed by
Employer in such capacity;
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth, the parties hereto mutually agree as follows:
1. EMPLOYMENT. Employer hereby employs Employee in an
----------
executive capacity, and Employee hereby accepts such
employment and agrees to perform for Employer the duties
described herein, faithfully, diligently and to the best of
his ability. Employee will be employed to act as the
President of Employer.
2. TERM OF EMPLOYMENT. Employee's employment hereunder shall
------------------
become effective on the _____ day of _______________ 1999
and shall have a term of three (3) years. Upon mutual
agreement between Employee, Employer and Company, said
Agreement may be extended beyond the term of employment in
Paragraph 2. All employment under this Agreement shall be
subject to the Termination provisions of Paragraph 9
hereunder.
3. DUTIES. Employee agrees to devote his time and attention to
------
the business and affairs of Employer and to use his best
efforts to promote the interests of Employer as directed by
the Employer, with direction from or as assigned by the
Company. Employee agrees to carry out such duties as
required to perform his job, assigned or directed by
Employer or Company, or mutually agreed on between Employee,
Employer and Company.
4. COMPENSATION.
------------
(a) Employer will pay Employee for services rendered
hereunder as President with a compensation at the rate
of: (i) Year One, one hundred sixty thousand eight
hundred dollars and no cents ($160,800.00) per annum;
(ii) Year Two, one hundred seventy thousand four
hundred dollars and no cents ($170,400.00) per annum;
Year Three, one hundred eighty thousand dollars and no
cents ($180,000.00) per annum; payable in equal
monthly installments, at the end of each month.
(b) The compensation rate described in Section 4(a) may be
increased at the sole discretion of the Employer, as
directed by the Company.
(c) In addition to the compensation in Section 4(a) of
this Agreement, Employee, while employed by Employer
pursuant to this Agreement, shall be provided with the
use of a company owned vehicle and reimbursement of
all expenses in connection with the use of the
aforementioned vehicle. In return, Employee agrees to
comply with all policies and procedures of the
Employer for use of said vehicle and expenses. Upon
termination of this Agreement, Employee has the right
to purchase the company owned vehicle at the then
prevailing book value.
<PAGE>
<PAGE>
(d) Payments to Employee pursuant to this Agreement shall
be subject to any applicable Federal, State and Local
withholdings.
5. BENEFITS. During the term of this Agreement, Employer shall
--------
furnish to Employee:
(a) Medical and Health Care Coverage as provided to the
employees of the Employer under the terms and
conditions of those Plans as they currently exist, or
may exist from time to time during the term of this
Agreement.
(b) Life Insurance as provided to the employees of the
Employer under the terms and conditions of those Plans
as they currently exist or may exist from time to time
during the term of this Agreement.
(c) Current Life Insurance Policies with The Guardian Life
Insurance Company under policy numbers 3326661,
3340193, 3363011, and 3388094, will continue in force
under their current terms and conditions. Employer
guarantees that upon attaining age sixty-five (65),
Employee will have a cash value for these policies of
one hundred fifty thousand dollars ($150,000.00),
including the value of any Employee loans.
(d) Employer, as directed by the Company, has the right to
terminate life insurance policies 3908036 and 3913470
issued by The Guardian Life Insurance Company, upon
thirty (30) days written notice to Employee. Prior to
the expiration of this thirty (30) day notice period,
Employee has the option of assuming the ownership and
premium payments for the aforementioned life insurance
policies.
(e) Employer to pay Michelbook Country Club monthly dues
for a period of three (3) years commencing on _____
day of ________________ 1999 with a current cost of
one hundred seventy-seven dollars ($177.00) per month.
(f) Terms and Conditions of any and all benefits now
provided or may be provided are at the sole discretion
of the Employer as directed by the Company. The
Employer, with the consent and direction of the
Company, maintains the right to modify, add to, or
terminate these programs at any time. Provided that
changes to (a) and (b) are done judiciously, and (c)
and (e) with comparable benefits.
6. BONUS. Company to provide a "Base Return Plan" patterned
-----
after the other Company subsidiaries (attached Addendum A).
In the event Employee is terminated under the conditions set
forth in Section 9 of this Agreement, Employee shall
participate in the "Base Return Plan" for the year of
termination. In such circumstances, Employee would receive
a pro rated share based on the total number of months
employed during the Base Return Year of termination. Should
Employee be deceased during a Base Return Year, Employer
will assume Employee worked the full Base Return Year. Base
Return Year is defined as the Employer's fiscal year.
7. EXPENSES. Employer will reimburse Employee for all
--------
reasonable expenses properly incurred by Employee in
furtherance of or in connection with the business of
Employer, upon submission of such vouchers, received or
other evidence as may reasonably be required by Employer or
Company.
8. CONFIDENTIALITY AGREEMENT.
-------------------------
On or before ______ day of _____________ 1999, Employee will
duly execute a mutually agreed upon Confidentiality
Agreement between the Employee and Employer (attached
Addendum B). Both Employee and Employer agree that said
Confidentiality Agreement when executed shall stand alone,
and shall be performed in accordance with its own terms and
provisions, and that the obligations of
<PAGE>
<PAGE>
Employee under said Confidentiality Agreement shall not be
affected in any way by the termination of this Agreement.
9. TERMINATION. Upon furnishing of notice to the Employee, the
-----------
Employer at the direction of the Company may terminate the
employment of the Employee for cause, as determined by the
Employer or Company at their discretion, at any time during
the Employment period by reason of the Employee's (i)
neglect of his duties hereunder, (ii) breach of or
negligence with respect to his obligations under this
Agreement, (iii) engaging in misconduct deemed inconsistent
with the Employer's best interest, (iv) the Employee's
commission of an act constituting common law fraud or a
felony, or (v) the entering a plea of nolo contendere to a
charge of a felony or a misdemeanor involving moral
turpitude.
10. MODIFICATION AND CONSTRUCTION. This Agreement embodies the
-----------------------------
entire Agreement between the parties and there have not been
and are no agreements, representations or warranties between
the parties other than those set forth or provided for
herein. The paragraph headings in this Agreement are
inserted for convenience only. This Agreement shall not be
changed or modified in whole or in part except by a
supplemental written agreement signed by both parties. The
failure by any party to insist upon strict compliance by the
other party with respect to any of the terms or conditions
hereof shall not be deemed a waiver of any such term or
condition, nor shall any waiver or relinquishment of any
right or power hereunder, at one or more times, be deemed a
waiver or relinquishment of such right or power at any other
time or times. This Agreement shall be governed and
construed by the laws of the State of Oregon, without
reference to choice of law principles.
11. TERMINATION OF AGREEMENT. Upon termination of this
------------------------
Agreement for any reason by either party, whether before the
expiration date or by death, the Employment Agreement for
position of business technician (attached Addendum C) shall
immediately become in full force and effect without delay.
12. POLICIES. Employee agrees to comply with all current
--------
policies and procedures of the Employer that exist for the
employees of the Employer or may exist for the employees of
the Employer during the term of this Agreement. Employee
further agrees to comply with all policies and procedures as
directed or assigned by Company during the term of this
Agreement.
13. SEVERABILITY. The invalidity or un-enforceability of a
------------
particular provision of this Agreement shall not affect the
other provisions hereof, and this Agreement shall be
enforced in all respects to the fullest extent permitted by
applicable law.
14. ASSIGNMENT, BENEFIT AND BINDING EFFECT. This Agreement
--------------------------------------
shall not be assignable by RB Rubber Products except that
Dash may assign this Agreement to any of its subsidiaries,
whether current or hereafter acquired or formed; provided,
however, no such assignment shall require Employee to
relocate as long as RB Rubber Products is a functioning
operation in McMinnville, Oregon. Upon proper assignment
all of the rights and obligations of RB Rubber Products
shall inure to the benefit of and be binding upon such
subsidiary in place of RB Rubber Products, which shall
thereupon be released therefrom. This Agreement shall inure
to the benefit of and be binding upon RB Rubber Products,
its successors and assigns, and Employee, his heirs, legal
representatives and assigns.
* * * * * * * * * * *
<PAGE>
<PAGE>
RB RUBBER PRODUCTS, INC.
ATTEST:
BY:_______________________________
_______________________________
Secretary
EMPLOYEE
[SEAL]
__________________________________
Ronald Bogh
Employment Agreement for Ronald Bogh signature page
page 4 of 4
<PAGE>
<PAGE>
ADDENDUM A
RB RUBBER PRODUCTS, INC.
BASE RETURN PLAN
25%, 30%, 35%
I. 25%
PTP = Pre Tax Profit
BRL = Base Return Level (Assigned By Company)
B = Bonus
BE = Employee Performance Bonus
Be = All employees (including Employee)
B = 0.25[(PTP - BRL) - B]
B = 0.25(PTP - BRL) - 0.25B
1.25B = 0.25(PTP - BRL)
B = 0.20(PTP - BRL)
B = BE + Be
BE = 0.05(PTP - BRL)
Be = 0.15(PTP - BRL)
II. 30%
Maximum amount of Bonus for Employee under formula "Be" in
aforementioned I.
III. 35%
Maximum percentage that Base Return Level can increase for the next
year.
<PAGE>
<PAGE>
ADDENDUM B
RB RUBBER PRODUCTS, INC.
CONFIDENTIALITY AGREEMENT
In consideration of my employment or continued employment in any
capacity by RB Rubber Products, Inc. (which together with any
subsidiaries of Dash Multi-Corp are called the "Company" herein) and in
consideration of the salary, wages or other compensation paid for my
services in the course of such employment, I agree:
(A) To communicate promptly to the Company all inventions,
discoveries and improvements (whether or not they are patentable)
conceived or reduced to practice by me, solely or in collaboration with
others, from the time of entering the Company's employ until I leave,
(1) which are useful in the business, work or investigations of the
Company, or (2) which result from or are suggested by any work which I
may do for or on behalf of the Company. If an application for patent
for any such invention, discovery or improvement be made by me within
six (6) months after I leave the Company's employ, such invention,
discovery or improvement shall be presumed to have been conceived during
the period of my employment.
(B) To assist the Company during and subsequent to such
employment in every proper way (without charge to the Company but at its
expense) to obtain patents or otherwise protect such inventions,
discoveries and improvements in any and all countries against
appropriation by others; all such inventions, discoveries and
improvements (whether patented or not) and any patents that may issue
thereon to be the sole and exclusive property of the Company and being
hereby assigned thereto; and for the purpose of this clause to execute
and do all such documents, acts and things as the Company may deem
necessary or desirable.
(C) To make and maintain adequate and current written records of
all such inventions, discoveries and improvements, in the form of notes,
sketches, drawings, or reports relating thereto, which records shall be
and remain the property of and available to the Company at all times.
(D) Except as the Company may otherwise consent in writing not
to disclose or to discuss with others outside the Company at any time
(except as my company duties may require) during my employment, any
information, knowledge or data of a confidential nature I may receive
during the course of my employment relating to the Company's and/or the
Company's customers' business procedures, formulae, methods, machines,
manufactures, compositions, inventions, discoveries, improvements or
other matters of a confidential nature. (The aforesaid term
"confidential" is used in its ordinary sense and does not refer to any
governmental security classification.)
<PAGE>
<PAGE>
(E) To notify the Company in writing before I make any
disclosure or perform or cause to be performed any work for or on behalf
of the Company which appears to threaten conflict with:
(1) rights I claim in any invention, discovery, or improvement -
(a) made by me or others prior to my employment, or
(b) otherwise outside the scope of this agreement
(2) rights of others arising out of obligations incurred by me -
(a) prior to this agreement, or
(b) otherwise outside the scope of this agreement
In the event of my failure to give notice under the circumstances
specified in (1) of the foregoing, the Company may assume that no such
conflicting invention, discovery or improvement exists, and I agree that
I will make no claim with respect thereto.
(F) During and after termination (for any reason) of my
employment with the Company, for a period of one (1) year from the time
my employment with the Company ceases, I will maintain the
confidentiality of trade secrets, customer lists, technical data and
other information not in the public domain obtained from or made
available to me by the Company and/or customers and/or suppliers of the
Company in the course of my employment by the Company; and I will not
utilize such information for my individual gain or benefit.
Furthermore, I agree to indemnify and hold harmless the Company against
any legal liability or damages suffered by it as a result of my breach
of this clause or clause (D) above.
(G) During and after termination (for any reason) of my
employment with the Company, I will not, whether through any individual,
firm or corporation, or otherwise, become engaged in the development,
sales, marketing or management for any individual, firm, or corporation
engaged in the development, manufacture or sales of products similar to
those developed, manufactured, or sold by the Company for a period of
three (3) years from the time my employment with the Company ceases.
(H) I acknowledge that (a) the separate and distinct promises in
this Agreement are reasonable and necessary in order to protect the
Company's legitimate business interest; (b) any violation would result
in irreparable injury to the Company; and (c) the enforcement of a
remedy by way of injunction would not prevent me from earning a living.
In the event the Company incurs expenses to retain attorneys to enforce
this Agreement, I promise to pay all costs, court costs, fees and
expenses of enforcement, including actual attorneys fees, whether or not
litigation be commenced.
<PAGE>
<PAGE>
(I) It is the intention of the parties to restrict my activities
only to the extent necessary for the protection of the Company's
legitimate business interest. If any one or more of the promises
contained in this Agreement shall for any reason be held to be
excessively broad as to time, activity or subject, it shall be construed
by limiting and reducing it so as to be enforceable to the extent
compatible with the applicable law.
(J) The Company's failure to exercise any of its rights in the
event I breach any of the separate and distinct promises in this
Agreement shall not be construed as a waiver of such breach or prevent
the Company from later enforcing strict compliance with any and all
promises in this Agreement.
(K) In the event any one or more provisions contained in this
Agreement or any application shall be invalid, illegal, or unenforceable
in any respect, the validity, legality or enforceability of the
remaining provisions of this Agreement and any other application shall
not in any way be affected or impaired.
(L) This Agreement is binding upon and shall benefit the
Company, its successors and assigns, and my heirs, executors,
administrators and legal representatives.
(M) The Agreement contains the parties' complete understanding,
and there are no other agreements, oral or written, pertaining to the
subject matter of this Agreement. Any amendments to this Agreement must
be in writing and signed by the parties.
(N) In order to preserve the Company's rights under this
Agreement, the Company may advise any third party with whom I may
consider, establish, or contract a relationship, the existence of this
Agreement and its terms, and the Company shall have no liability for
doing so.
(O) By providing me with this Agreement, the company does not
guarantee or otherwise alter my at-will employment status. I am
otherwise free to voluntarily resign from employment and the Company
continues to maintain the complete right to terminate this employment
relationship, without notice and without recourse; however, the terms of
this Agreement will apply after such termination, as applicable.
(P) In the event the Employer terminates Employee for cause, the
laws of the State of Missouri shall apply as to the application and
interpretation of this document. In the event the Employee rescinds or
otherwise voluntarily terminates his employment the laws of the State of
Oregon shall apply as to the application interpretation of this
document. The Company and I submit exclusively to the jurisdiction of
the courts of St. Louis County, State of Missouri for the purpose of
deciding any questions, disputes, causes, whether for injunctive relief
or otherwise, arising under this Agreement, and the Secretary of State
of the State of Missouri is hereby designated as my agent for service of
process for any actions commenced under or to enforce this Agreement in
the courts of St. Louis County, State of
<PAGE>
<PAGE>
Missouri, provided that a copy of such notice shall be mailed to me at
my last known address.
(Q) ACKNOWLEDGEMENT. BY SIGNING THIS AGREEMENT, I ACKNOWLEDGE
---------------
THAT I HAVE READ IT, THAT I UNDERSTAND AND INTEND TO FULFILL EACH AND
EVERY ONE OF THE PROMISES IN THIS AGREEMENT, THAT I UNDERSTAND THIS IS A
LEGALLY BINDING AGREEMENT, AND THAT I HAVE RECEIVED A COPY OF THIS
AGREEMENT.
The parties have executed this Agreement as of ,
----------------
1999.
-----------------------------
(Employee's Signature)
By:
- ------------------------------ --------------------------
WITNESS "The Company"
/ /
- ----- ----- -----
DATE
<PAGE>
<PAGE>
ADDENDUM C
CONTINUANCE OF EMPLOYMENT AGREEMENT
THIS CONTINUANCE OF EMPLOYMENT AGREEMENT, dated as of the _____
day of ______________________ 1999, by and between RB RUBBER PRODUCTS,
INC. (hereinafter referred to as "Employer" and which, together with its
parent company, Dash Multi-Corp, Inc., and any other subsidiaries of
Dash Multi-Corp, Inc., are called the "Company" herein) and RONALD BOGH,
his successors and assigns (hereinafter jointly referred to as
"Employee").
WHEREAS, The Company is desirous of having Employee employed by
Employer in the capacity of a business technician and Employee wishes to
be employed by Employer in such capacity;
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth, the parties hereto mutually agree as follows:
1. EMPLOYMENT. Employer hereby employs Employee in the
----------
capacity of business technician, and Employee hereby accepts
such employment and agrees to perform for Employer the
duties described herein, faithfully, diligently and to the
best of his ability.
2. TERM OF EMPLOYMENT. Employee's employment hereunder shall
------------------
become effective upon the termination of the Employment
Agreement attached hereto as Addendum A and shall continue
until the 31st day of December 2008. All employment under
this Agreement shall be subject to the Termination
provisions of Paragraph 9 hereunder.
3. DUTIES. Employee agrees to devote his time and attention to
------
the business as a technical advisor to operational and
management functions of the Employer as directed by the
Employer, with direction from or as assigned by the Company.
Employee agrees to carry out such duties as required to
perform his job, assigned or directed by Employer or
Company, or mutually agreed on between Employee Employer
and Company. Employer shall not require of Employee a
minimum number of hours to perform the duties of this
Agreement.
4. COMPENSATION.
------------
(a) Employer will pay Employee for services rendered
hereunder as a business technician with a compensation
at the rate of sixty thousand dollars and no cents
($60,00.00) per annum during the term of this
Agreement payable in equal monthly installments, at
the end of each month.
(b) Payments to Employee pursuant to this Agreement shall
be subject to any applicable Federal, State and Local
withholdings.
5. BENEFITS. During the term of this Agreement, Employer shall
--------
furnish to Employee:
(a) Medical and Health Care Coverage as provided to the
employees of the Employer under the terms and
conditions of those Plans as they currently exist, or
may exist during the term of this Agreement.
(b) Employee waives any and all benefits not stipulated to
in this Agreement.
<PAGE>
<PAGE>
(c) Current Life Insurance Policies with The Guardian Life
Insurance Company under policy numbers 3326661,
3340193, 3363011, and 3388094, will continue in force
under their current terms and conditions.
(d) Employer, as directed by the Company, has right to
terminate life insurance policies 3908036 and 3913470
issued by The Guardian Life Insurance Company, upon
thirty (30) days written notice to Employee. Prior to
the expiration of this thirty (30) day notice period,
Employee has the option of assuming the ownership and
premium payment for the aforementioned life insurance
policy.
(e) Upon the conclusion of this Agreement, Employer will
reimburse Employee for the cost of Supplemental
Medicare Insurance, not to exceed three hundred
dollars ($300.00) per month, provided Employee pays
for Medicare Part B.
(f) Terms and Conditions of any and all benefits now
provided or may be provided are at the sole discretion
of the Employer as directed by the Company. The
Employer, with the consent and direction of the
Company, maintains the right to modify, add to, or
terminate these programs at any time. Provided that
changes to (a) are done judiciously, and (c) and (e)
with comparable benefits.
6. CONFIDENTIALITY AGREEMENT.
-------------------------
On or before ______ day of __________________ 1999, Employee
will duly execute a mutually agreed upon Confidentiality
Agreement between the Employee and Employer (attached
Addendum B). Both Employee and Employer agree that said
Confidentiality Agreement when executed shall stand alone,
and shall be performed in accordance with its own terms and
provisions, and that the obligations of Employee under said
Confidentiality Agreement shall not be affected in any way
by the termination of this Agreement.
7. TERMINATION. Upon furnishing of notice to the Employee, the
-----------
Employer, at the direction of the Company, may terminate the
employment of the Employee for cause, as determined by the
Employer or Company at their discretion, at any time during
the employment period by reason of the Employee's (i)
commission of an act constituting common law fraud or a
felony, or (ii) entering a plea of nolo contendere to a
charge of a felony or a misdemeanor involving moral
turpitude.
8. MODIFICATION AND CONSTRUCTION. This Agreement embodies the
-----------------------------
entire Agreement between the parties and there have not been
and are no agreements, representations or warranties between
the parties other than those set forth or provided for
herein. The paragraph headings in this Agreement are
inserted for convenience only. This Agreement shall not be
changed or modified in whole or in part except by a
supplemental written agreement signed by both parties. The
failure by any party to insist upon strict compliance by
the other party with respect to any of the terms or
conditions hereof shall not be deemed a waiver of any such
term or condition, nor shall any waiver or relinquishment of
any right or power hereunder, at one or more times, be
deemed a waiver or relinquishment of such right or power at
any other time or times. This Agreement shall be governed
and construed by the laws of the State of Oregon, without
reference to choice of law principles.
9. SUCCESSION OF AGREEMENT. In the event Employee is unable to
-----------------------
fulfill the terms of this Agreement due to death, or total
disability as determined by the Social Security
Administration, the surviving spouse, if any, will
immediately assume the position of business technician for
the remaining term of the Agreement provided she duly
executes Employer's Confidentiality Agreement.
Aforementioned spouse may, at any time during the term of
this Agreement, decline
<PAGE>
<PAGE>
by written notification to Employer and Company the
Succession and all terms of this Agreement.
10. POLICIES. Employee agrees to comply with all current
--------
policies and procedures of the Employer that exist for the
employees of the Employer or may exist for the employees of
the Employer during the term of this Agreement. Employee
further agrees to comply with all policy and procedures as
directed or assigned by Company during the term of this
Agreement.
11. SEVERABILITY. The invalidity or un-enforceability of a
------------
particular provision of this Agreement shall not affect the
other provisions hereof, and this Agreement shall be
enforced in all respects to the fullest extent permitted by
applicable law.
12. ASSIGNMENT, BENEFIT AND BINDING EFFECT. This Agreement
--------------------------------------
shall not be assignable by RB Rubber Products except that
Dash may assign this Agreement to any of its subsidiaries,
whether current or hereafter acquired or formed; provided,
however, no such assignment shall require Employee to
relocate. Upon proper assignment all of the rights and
obligations of RB Rubber Products shall inure to the benefit
of and be binding upon such subsidiary in place of RB Rubber
Products, which shall thereupon be released therefrom. This
Agreement shall inure to the benefit of and be binding upon
RB Rubber Products, its successors and assigns, and
Employee, his heirs, legal representatives and assigns.
* * * * * * * * * * * * * * * * * * *
RB RUBBER PRODUCTS, INC.
ATTEST:
BY:_______________________________
_______________________________
Secretary
EMPLOYEE
[SEAL]
__________________________________
Ronald Bogh
Employment Agreement for Ronald Bogh signature page
page 3 of 3
<PAGE>
<PAGE>
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT, dated as of the _______ day of ________
1999, by and between RB RUBBER PRODUCTS, INC. (hereinafter referred to
as "Employer" and which, together with its parent company, Dash Multi-
Corp, Inc., and any other subsidiaries of Dash Multi-Corp, Inc., are
called the "Company" herein) and PAUL GILSON (hereinafter referred to as
"Employee").
WHEREAS, The Company is desirous of having Employee employed by
Employer in an executive capacity and Employee wishes to be employed by
Employer in such capacity;
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth, the parties hereto mutually agree as follows:
1. EMPLOYMENT. Employer hereby employs Employee in an
----------
executive capacity, and Employee hereby accepts such
employment and agrees to perform for Employer the duties
described herein, faithfully, diligently and to the best of
his ability. Employee will be employed to act as the Chief
Operating Officer and Senior Vice President for Employer.
2. TERM OF EMPLOYMENT. Employee's employment hereunder shall
------------------
become effective on the _____ day of _______________ 1999
and shall have a term of four (4) years. All employment
under this Agreement shall be subject to the Termination
provisions of Paragraph 9 hereunder.
3. DUTIES. Employee agrees to devote his time and attention to
------
the business and affairs of Employer and to use his best
efforts to promote the interests of Employer as directed by
the Employer, with direction from or as assigned by the
Company. Employee agrees to carry out such duties as
required to perform his job, assigned or directed by
Employer or Company, or mutually agreed on between Employee,
Employer or Company.
4. COMPENSATION.
------------
(a) Employer will pay Employee for services rendered hereunder
as Chief Operating Officer and Senior Vice President with a
compensation at the rate of: (i) Year One, one hundred
fourteen thousand dollars and no cents ($114,00.00) per
annum; (ii) Year Two, one hundred twenty thousand dollars
and no cents ($120,000.00) per annum; Year Three, one
hundred twenty-six thousand dollars and no cents
($126,000.00) per annum; Year Four, one hundred thirty-two
thousand dollars and no cents ($132,000.00) payable in equal
monthly installments, at the end of each month.
(b) The compensation rate described in Section 4(a) may be
increased at the sole discretion of the Employer, as
directed by Company.
(c) In addition to the compensation in Section 4(a) of this
Agreement, Employer will continue with lease payments on
1998 Lincoln Navigator for Employee use, and reimbursement
of all expenses in connection with the use of the
aforementioned vehicle. In return, Employee agrees to
comply with all policies and procedures of the Employer for
use of said vehicle and expenses. Upon the lease expiration
Employee will be furnished a company vehicle comparable to
and under the same policies and procedures as the Company.
Employer reserves the right to purchase the aforementioned
vehicle and provide same to Employee as an Employer owned
vehicle.
<PAGE>
<PAGE>
(d) Payments to Employee pursuant to this Agreement shall be
subject to any applicable Federal, State and Local
withholdings.
5. BENEFITS. During the term of this Agreement, Employer shall
--------
furnish to Employee:
(a) Medical and Health Care Coverage as provided to the
employees of the Employer under the terms and conditions of
those Plans as they currently exist, or may exist during the
term of this Agreement.
(b) Life Insurance as provided to the employees of the Employer
under the terms and conditions of those Plans as they
currently exist or may exist during the term of this
Agreement.
(c) Current Life Insurance Policy with The Guardian Life
Insurance Company under policy number 3909092, will continue
in force under their current terms and conditions of that
Plan as it currently exist.
(d) Employer as directed by the Company has the right to
terminate life insurance policy 3909094 issued by The
Guardian Life Insurance Company, upon thirty (30) day
written Notice to Employee. Prior to the expiration of this
thirty (30) day notice period, Employee has option of
assuming the ownership and premium payment for the
aforementioned life insurance policy.
(e) Terms and Conditions of any and all benefits now provided or
may be provided are at the sole discretion of the Employer
as directed by the Company. The Employer, with the consent
and direction of the Company, maintains the right to modify,
add to, or terminate these programs at any time.
6. BONUS. Company to provide a "Base Return Plan" patterned after
-----
that of the other Company subsidiaries.
7. EXPENSES. Employer will reimburse Employee for all reasonable
--------
expenses properly incurred by Employee in furtherance of or in
connection with the business of Employer upon submission of such
vouchers, received or other evidence as mayreasonably be required
by Employer or Company.
8. CONFIDENTIALITY AGREEMENT.
-------------------------
On or before _____ day of ________________ 1999, Employee will
duly execute a mutually agreed upon Confidentiality Agreement
between the Employee and Employer (attached Addendum A). Both
Employee and Employer agree that said Confidentiality Agreement
when executed shall stand alone, and shall be performed in
accordance with its own terms and provisions, and that the
obligations of Employee under said Confidentiality Agreement shall
not be affected in any way by the termination of this Agreement.
9. TERMINATION. Upon furnishing of notice to the Employee, the
-----------
Employer at the direction of the Company may terminate the
employment of the Employee for cause, as determined by the
Employer or Company at their discretion, at any time during the
Employment period by reason of the Employee's (i) neglect of his
duties hereunder, (ii) breach of or negligence with respect to his
obligations under this Agreement, (iii) engaging in misconduct
deemed inconsistent with the Employer's best interest, (iv) the
Employee's commission of an act constituting common law fraud or a
felony, or (v) the entering a plea of nolo contendere to a charge
of a felony or a misdemeanor involving moral turpitude.
To the extent Employee challenges the determination of cause, the
Employee's exclusive remedy shall be submission of the challenge
to arbitration. In the event of arbitration a list of five (5)
arbitrators would be requested from the American Arbitration
Association. A name shall be
<PAGE>
<PAGE>
struck from the list, with the Employee striking first, until one
name remains, who then shall be the arbitrator. If the Employee
prevails in the challenge, Employer shall pay the arbitrator's fee
and expenses. Otherwise, the arbitrator's fee and expenses shall
be shared equally.
10. MODIFICATION AND CONSTRUCTION. This Agreement embodies the entire
-----------------------------
Agreement between the parties and there have not been and are no
agreements, representations or warranties between the parties
other than those set forth or provided for herein. The paragraph
headings in this Agreement are inserted for convenience only.
This Agreement shall not be changed or modified in whole or in
part except by a supplemental written agreement signed by both
parties. The failure by any party to insist upon strict
compliance by the other party with respect to any of the terms or
conditions hereof shall not be deemed a waiver of any such term or
condition, nor shall any waiver or relinquishment of any right or
power hereunder, at one or more times, be deemed a waiver or
relinquishment of such right or power at any other time or times.
This Agreement shall be governed and construed by the laws of the
State of Missouri, without reference to choice of law principles.
11 POLICIES. Employee agrees to comply with all current policies and
--------
procedures of the Employer that exist for the employees of the
Employer or may exist for the employees of the Employer during the
term of this Agreement. Employee further agrees to comply with
all policies and procedures as directed or assigned by Company
during the term of this Agreement.
12. SEVERABILITY. The invalidity or un-enforceability of a particular
------------
provision of this Agreement shall not affect the other provisions
hereof, and this Agreement shall be enforced in all respects to
the fullest extent permitted by applicable law.
13. ASSIGNMENT, BENEFIT AND BINDING EFFECT. This Agreement shall not
--------------------------------------
be assignable by RB Rubber Products except that Dash may assign
this Agreement to any of its subsidiaries, whether current or
hereafter acquired or formed, and upon such assignment all of the
rights and obligations of RB Rubber Products shall inure to the
benefit of and be binding upon such subsidiary in place of RB
Rubber Products, which shall thereupon be released therefrom.
This Agreement shall inure to the benefit of and be binding upon
RB Rubber Products, its successors and assigns, and Employee, his
heirs, legal representatives and assigns.
* * * * * * * * * * * * * * *
RB RUBBER PRODUCTS, INC.
ATTEST:
BY:_______________________________
_______________________________
Secretary
EMPLOYEE
[SEAL]
________________________________
Paul Gilson
Employment Agreement for Paul Gilson signature page
page 3of 3
<PAGE>
<PAGE>
ADDENDUM A
RB RUBBER PRODUCTS, INC.
CONFIDENTIALITY AGREEMENT
In consideration of my employment or continued employment in any
capacity by RB Rubber Products, Inc. (which together with any
subsidiaries of Dash Multi-Corp are called the "Company" herein) and in
consideration of the salary, wages or other compensation paid for my
services in the course of such employment, I agree:
(A) To communicate promptly to the Company all inventions,
discoveries and improvements (whether or not they are patentable)
conceived or reduced to practice by me, solely or in collaboration with
others, from the time of entering the Company's employ until I leave,
(1) which are useful in the business, work or investigations of the
Company, or (2) which result from or are suggested by any work which I
may do for or on behalf of the Company. If an application for patent
for any such invention, discovery or improvement be made by me within
six (6) months after I leave the Company's employ, such invention,
discovery or improvement shall be presumed to have been conceived during
the period of my employment.
(B) To assist the Company during and subsequent to such
employment in every proper way (without charge to the Company but at its
expense) to obtain patents or otherwise protect such inventions,
discoveries and improvements in any and all countries against
appropriation by others; all such inventions, discoveries and
improvements (whether patented or not) and any patents that may issue
thereon to be the sole and exclusive property of the Company and being
hereby assigned thereto; and for the purpose of this clause to execute
and do all such documents, acts and things as the Company may deem
necessary or desirable.
(C) To make and maintain adequate and current written records of
all such inventions, discoveries and improvements, in the form of notes,
sketches, drawings, or reports relating thereto, which records shall be
and remain the property of and available to the Company at all times.
(D) Except as the Company may otherwise consent in writing not
to disclose or to discuss with others outside the Company at any time
(except as my company duties may require) during my employment, any
information, knowledge or data of a confidential nature I may receive
during the course of my employment relating to the Company's and/or the
Company's customers' business procedures, formulae, methods, machines,
manufactures, compositions, inventions, discoveries, improvements or
other matters of a confidential nature. (The aforesaid term
"confidential" is used in its ordinary sense and does not refer to any
governmental security classification.)
<PAGE>
<PAGE>
(E) To notify the Company in writing before I make any
disclosure or perform or cause to be performed any work for or on behalf
of the Company which appears to threaten conflict with:
(1) rights I claim in any invention, discovery, or improvement -
(a) made by me or others prior to my employment, or
(b) otherwise outside the scope of this agreement
(2) rights of others arising out of obligations incurred by me -
(a) prior to this agreement, or
(b) otherwise outside the scope of this agreement
In the event of my failure to give notice under the circumstances
specified in (1) of the foregoing, the Company may assume that no such
conflicting invention, discovery or improvement exists, and I agree that
I will make no claim with respect thereto.
(F) During and after termination (for any reason) of my
employment with the Company, for a period of one (1) year from the time
my employment with the Company ceases, I will maintain the
confidentiality of trade secrets, customer lists, technical data and
other information not in the public domain obtained from or made
available to me by the Company and/or customers and/or suppliers of the
Company in the course of my employment by the Company; and I will not
utilize such information for my individual gain or benefit.
Furthermore, I agree to indemnify and hold harmless the Company against
any legal liability or damages suffered by it as a result of my breach
of this clause or clause (D) above.
(G) During and after termination (for any reason) of my
employment with the Company, I will not, whether through any individual,
firm or corporation, or otherwise, become engaged in the development,
sales, marketing or management for any individual, firm, or corporation
engaged in the development, manufacture or sales of products similar to
those developed, manufactured, or sold by the Company for a period of
one (1) year from the time my employment with the Company ceases.
(H) I acknowledge that (a) the separate and distinct promises in
this Agreement are reasonable and necessary in order to protect the
Company's legitimate business interest; (b) any violation would result
in irreparable injury to the Company; and (c) the enforcement of a
remedy by way of injunction would not prevent me from earning a living.
In the event the Company incurs expenses to retain attorneys to enforce
this Agreement, I promise to pay all costs, court costs, fees and
expenses of enforcement, including actual attorneys fees, whether or not
litigation be commenced.
(I) It is the intention of the parties to restrict my activities
only to the extent necessary for the protection of the Company's
legitimate business interest. If any one or more of the promises
contained in this Agreement shall for any reason be held to be
excessively broad as to time,
<PAGE>
<PAGE>
activity or subject, it shall be construed by limiting and reducing it
so as to be enforceable to the extent compatible with the applicable
law.
(J) The Company's failure to exercise any of its rights in the
event I breach any of the separate and distinct promises in this
Agreement shall not be construed as a waiver of such breach or prevent
the Company from later enforcing strict compliance with any and all
promises in this Agreement.
(K) In the event any one or more provisions contained in this
Agreement or any application shall be invalid, illegal, or unenforceable
in any respect, the validity, legality or enforceability of the
remaining provisions of this Agreement and any other application shall
not in any way be affected or impaired.
(L) This Agreement is binding upon and shall benefit the
Company, its successors and assigns, and my heirs, executors,
administrators and legal representatives.
(M) The Agreement contains the parties' complete understanding,
and there are no other agreements, oral or written, pertaining to the
subject matter of this Agreement. Any amendments to this Agreement must
be in writing and signed by the parties.
(N) In order to preserve the Company's rights under this
Agreement, the Company may advise any third party with whom I may
consider, establish, or contract a relationship, the existence of this
Agreement and its terms, and the Company shall have no liability for
doing so.
(O) By providing me with this Agreement, the company does not
guarantee or otherwise alter my at-will employment status. I am
otherwise free to voluntarily resign from employment and the Company
continues to maintain the complete right to terminate this employment
relationship, without notice and without recourse; however, the terms of
this Agreement will apply after such termination, as applicable.
(P) The laws of the State of Missouri shall apply as to the
application and interpretation of this document. The Company and I
submit exclusively to the jurisdiction of the courts of St. Louis
County, State of Missouri for the purpose of deciding any questions,
disputes, causes, whether for injunctive relief or otherwise, arising
under this Agreement, and the Secretary of State of the State of
Missouri is hereby designated as my agent for service of process for any
actions commenced under or to enforce this Agreement in the courts of
St. Louis County, State of Missouri, provided that a copy of such notice
shall be mailed to me at my last known address.
(Q) ACKNOWLEDGEMENT. BY SIGNING THIS AGREEMENT, I ACKNOWLEDGE
---------------
THAT I HAVE READ IT, THAT I UNDERSTAND AND INTEND TO FULFILL EACH AND
EVERY ONE OF THE PROMISES IN THIS AGREEMENT, THAT I UNDERSTAND THIS IS A
LEGALLY BINDING AGREEMENT, AND THAT I HAVE RECEIVED A COPY OF THIS
AGREEMENT.
<PAGE>
<PAGE>
The parties have executed this Agreement as of _______________,
1999.
_______________________________
(Employee's Signature)
__________________________________ By:___________________________
WITNESS "The Company"
______/______/______
DATE
<PAGE>
<PAGE>
LETTER OF AGREEMENT
THIS LETTER OF AGREEMENT, dated as of the ______ day of
____________ 1999, by and between RB RUBBER PRODUCTS, INC. (hereinafter
referred to as "RB" and which, together with its parent company, Dash
Multi-Corp, Inc., and any other subsidiaries of Dash Multi-Corp, Inc.,
are called the "Company" herein) and DOUGLAS NELSON (hereinafter
referred to as "NELSON").
WHEREAS, The Company is desirous of having Nelson enter into a
Letter of Agreement with RB and Nelson wishes to enter into said
Agreement with RB;
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth, the parties hereto mutually agree as follows:
1. CONFIDENTIALITY AGREEMENT.
-------------------------
On or before _____day of ___________________ 1999, Nelson will
duly execute the Confidentiality Agreement between himself
and RB (attached Addendum A). Both Nelson and RB agree that
said Confidentiality Agreement when executed shall stand
alone, and shall be performed in accordance with its own
terms and provisions, and that the obligations of Nelson
under said Confidentiality Agreement shall not be affected in
any way by the termination of this Agreement.
2. CONSIDERATION. In consideration of Nelson's execution of the
-------------
Confidentiality Agreement, RB agrees to provide, for a
maximum term of four (4) years effective from the _____ day
of _______________ 1999, the following:
(a) RB will reimburse Nelson for the cost of COBRA
medical coverage for such time he is so eligible.
(b) Upon the conclusion of COBRA eligibility, RB will
reimburse Nelson for the cost of a personal Medical Insurance
Plan, not to exceed thirteen hundred fifty dollars ($1350.00)
per month.
(c) Current Life Insurance Policies under policy numbers
3326663, 3340175, 3363012, and 3388093, will continue in
force under their current terms and conditions.
(d) Payments by RB pursuant to this Agreement shall be
subject to any applicable Federal, State and Local
withholdings.
3. MODIFICATION AND CONSTRUCTION. This Agreement embodies the
-----------------------------
entire Agreement between the parties and there have not been and
are no agreements, representations or warranties between the
parties other than those set forth or provided for herein.
The paragraph headings in this Agreement are inserted for
convenience only. This Agreement shall not be changed or
modified in whole or in part except by a supplemental written
agreement signed by both parties. The failure by any party
to insist upon strict compliance by the other party with
respect to any of the terms or conditions hereof shall not be
deemed a waiver of any such term or condition, nor shall any
waiver or relinquishment of any right or power hereunder, at
one or more times, be deemed a waiver or relinquishment of
such right or power at any other time or times. This
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Agreement shall be governed and construed by the laws of the
State of Missouri, without reference to choice of law
principles.
4. SEVERABILITY. The invalidity or un-enforceability of a
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particular provision of this Agreement shall not affect the
other provisions hereof, and this Agreement shall be enforced
in all respects to the fullest extent permitted by applicable
law.
5. ASSIGNMENT, BENEFIT AND BINDING EFFECT. This Agreement shall
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not be assignable by RB Rubber Products except that Dash may
assign this Agreement to any of its subsidiaries, whether
current or hereafter acquired or formed, and upon such
assignment all of the rights and obligations of RB Rubber
Products shall inure to the benefit of and be binding upon
such subsidiary in place of RB Rubber Products, which shall
thereupon be released therefrom.
* * * * * * * * * * * * * * * * * * * * * * * *
RB RUBBER PRODUCTS, INC.
ATTEST:
BY:____________________________
_______________________________
Secretary
NELSON
[SEAL]
_______________________________
Douglas Nelson
Letter of Agreement for Douglas Nelson signature page
page 2 of 2
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ADDENDUM A
RB RUBBER PRODUCTS, INC.
CONFIDENTIALITY AND NON-COMPETE AGREEMENT
THIS CONFIDENTIALITY AND NON-COMPETE AGREEMENT (hereinafter
"Agreement"), is made and entered into this __ day of ________, 1999, by
and between RB RUBBER PRODUCTS, INC., together with its affiliates,
subsidiaries, and predecessors and successors in interest, including
Dash Multi-Corp and its subsidiaries (hereinafter collectively referred
to as the "Company"), and ______________________________ (hereinafter
"Nelson").
WHEREAS, the Company desires to keep confidential and secret all
confidential, proprietary and trade secret information regarding its
operations, and insofar as Nelson understands the business necessity of
keeping such information confidential and secret and recognizes the
proprietary nature of such information;
NOW, THEREFORE, in consideration of the Company's act of a Letter
of Agreement and/or other good and valuable consideration, the receipt
and sufficiency of which is specifically acknowledged by Nelson, and the
mutual covenants and promises herein set forth, the parties agree as
follows:
1. CONFIDENTIALITY AGREEMENT.
(A) Effective immediately and for the maximum term allowed under
the law, Nelson shall hold in strictest confidence and shall not ever
directly or indirectly disclose, communicate or otherwise reveal to any
person, firm, corporation, partnership, agency, commission, institution
or other entity, without the express prior written authorization of the
Chairman and Chief Executive Officer of the Company, any confidential or
proprietary information relating to any business of the Company, or any
trade secret held by the Company, that is not a matter of public
knowledge. Nelson further agrees to indemnify and hold harmless the
Company against any legal liability or damages suffered by it as a
result of Nelson's breach of this provision.
(B) Confidential or proprietary information includes, but is not
limited to: (1) former, existing or future products, procedures,
discoveries, developments, drawings, blueprints, tracings, sketches,
designs, plans, layouts, specifications, models, strategies, inventions,
improvements, techniques, processes, formulas, know-how, computer
hardware, software and data, and any other trade secrets or methods of
operation; (2) all financial information of any kind including budgets,
projections, licenses, purchasing agreements; prices, fees, costs,
forecasts or unpublished financial statements; (3) customer information
of any kind including names, contacts, sales, contracts, schedules or
agreements; (4) advertising and marketing information of any kind
including plans, strategies, and customer, supplier, or competitor
lists; (5) pending or completed acquisitions of any company, division,
product line or other business
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unit; (6) business procedures, practices or information of any kind
including pay, benefits, compensation, personnel policies, manuals,
formulae, methods, machines, manufactures, compositions, inventions,
discoveries, improvements, writings, guides notes and any all other
memoranda, including without limitation any and all written information
which may be or has been furnished to Nelson or which may be prepared or
designed by Nelson in connection with his relationship with the Company;
and (7) any other information designated by the Company as confidential
or proprietary in nature.
(C) The term "trade secret" means information including a
formula, pattern, compilation, program, device, method or technique or
process that: (1) derives independent economic value, actual or
potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use and (2) is the subject of efforts that
are reasonable under the circumstances to maintain its secrecy. Such
confidential or proprietary information has been created, discovered, or
developed by or has been otherwise become known to the Company, or is
information in which property rights have been assigned or otherwise
conveyed to the Company.
(D) The Company and Nelson specifically agree and acknowledge
that any and all confidential information or trade secrets provided by
the Company or otherwise obtained by Nelson is unique and commercially
sensitive in nature, represents, in many instances, advanced and state
of the art technology, and has been developed over time and reflects a
substantial investment by the Company. Nelson further acknowledges that
confidential or proprietary information and trade secrets provided by
the Company is not a matter of public or general knowledge in the
industry and that the Company derives economic value (whether actual or
potential) from such information. Nelson acknowledges the Company has
maintained substantial secrecy concerning the confidential or
proprietary information and trade secrets and that, absent disclosure by
the Company to Nelson, who could not otherwise have readily ascertained
by proper means, and/or have acquired knowledge of such confidential or
proprietary information and trade secrets.
2. DISCLOSURE AND PROPERTY RIGHTS AGREEMENT
(A) Effective immediately and for and during the term of
Nelson's Letter of Agreement with the Company, Nelson agrees to promptly
and fully disclose in writing to the Company all works and property,
including but not limited to all intellectual properties and all
confidential, proprietary, or trade secret information (as defined in
Paragraph 1 above), including inventions, discoveries and improvements
(whether or not they are patentable) which are conceived, made,
developed, written, reduced to practice, contributed to or prepared by
Nelson during or related to in any manner whatsoever, Nelson's Letter of
Agreement period with the Company or which result from or are suggested
by any work Nelson may do in connection with his Letter of Agreement
with the Company, without exception, all of such works and property
hereinafter referred to as "Works and Property". If an application for
patent for any such invention, discovery or improvement be made by
Nelson within six (6) months after Nelson left the Company's employ,
such invention, discovery or improvement shall be presumed to have been
conceived during the period of Nelson's employment with the Company.
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(B) Nelson specifically acknowledges and agrees that pursuant to
Sections 101 and 201 of the United States Copyright law, all Works and
Property shall be "works made for hire" and all rights in such Works and
Property shall belong entirely and exclusively to the Company forever,
and the Company may make any use or nonuse of such Works and Property
throughout the world without any further obligation to Nelson.
(C) Nelson further agrees that all Works and Property shall
unconditionally be, become and remain the sole and exclusive property of
the Corporation forever, and Nelson hereby grants and assigns forever to
the Corporation all rights whatsoever that Nelson might have therein,
and the Company may make any use or non use of such Works and Property
throughout the world without any further obligation to Nelson.
Accordingly, Nelson will promptly execute, acknowledge and deliver all
applications, oaths, declaration, and further documents and will provide
such additional assistance as the Company may deem necessary or
desirable to evidence the Company's title to such Works and Property.
(D) Nelson agrees to assist the Company during and subsequent to
the term of the Letter of Agreement in every proper way (without charge
to the Company but at its expense) to obtain patents or otherwise
protect such Works and Property in any and all countries against
appropriation by others; all such Works and Property (whether patented
or not) and any patents that may issue thereon to be the sole and
exclusive property of the Company and being hereby assigned thereto; and
for the purpose of this provision to execute and do all such documents,
acts and things as the Company may deem necessary or desirable.
(E) Nelson agrees to make and maintain adequate and current
written records of all such Works and Property, in the form of notes,
sketches, drawings, or reports relating thereto, which records shall be
and remain the property of and available to the Company at all times.
(F) Nelson agrees to notify the Company in writing before making
any disclosures or performing or causing to be performed any work for or
on behalf of the Company which appears to threaten conflict with: (1)
rights Nelson claims in any Works and Property made by Nelson or others
prior to Nelson's employment or otherwise outside the scope of this
Agreement; or (2) rights of others arising out of obligations incurred
by Nelson prior to execution of this Agreement or otherwise outside the
scope of this Agreement. In the event of Nelson's failure to give
notice under Paragraph 2.(F)(1), the Company may assume that no such
conflicting Works and Property exists, and Nelson agrees he shall make
no claim with respect thereto.
(G) In performing duties or services for the Company regarding
Works and Property, Nelson will not knowingly infringe upon the rights,
including but not limited to patent, copyright, trade secret or other
proprietary rights, of any third party whatsoever.
(H) Only the Chairman and Chief Executive Officer of the Company
shall have the power and authority to change or modify the terms and
provisions of this Paragraph, and such
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change or modification must be reduced to writing and signed both by
Nelson and the Chairman and Chief Executive Officer of the Company in
order to be enforceable.
3. NONCOMPETITION AGREEMENT.
(A) Effective immediately and for and during the term of
Nelson's Letter of Agreement with the Company and for one (1) year
thereafter, Nelson shall not, directly or indirectly, whether as a
partner, investor, employee, consultant, creditor, shareholder or
otherwise, assist, provide services to, promote, participate or engage
in any activity with any other business competitive with the Company,
which includes any individual, firm or entity engaged in the
development, manufacture or sales of products similar to those
developed, manufactured or sold by the Company. Ownership of stock in a
publicly traded company not exceeding two percent (2%) shall not
constitute a violation of this Paragraph.
(B) Nelson agrees immediately to inform and disclose to the
Company any attempt by any person from any organization to involve
Nelson in a competing business. Nelson shall also refrain from
recruiting, hiring, or by any other attempts, directly or by assisting
others, inducing any employee of the Company to leave the employment of
the Company for purposes of competing with the Company. Nelson further
acknowledges that such employees of the Company may be similarly bound
by other agreements and that Nelson shall not induce or attempt to
induce, either directly or indirectly, a breach of the duties owed by
such employees to the Company.
(C) Nelson will not directly or indirectly, unfairly compete
with the Company by diverting or attempting to divert current, former or
potential customers of the Company, or by seeking to induce or
encouraging such customers to modify or not renew their business
relationship with the Company.
(D) Nelson acknowledges and agrees that (a) the separate and
distinct promises in this Agreement are reasonable and necessary in
order to protect the Company's legitimate business interest; (b) any
violation would result in irreparable injury to the Company and that the
damages which will be suffered by the Company by a breach of any term or
provision of this Paragraph may be continuing, irreparable and difficult
or impossible to ascertain in money or money's worth; and (c) the
enforcement of a remedy by way of injunction would not prevent Nelson
from earning a living. Consequently, in addition to any action at law
for damages, Nelson agrees the Company may have equitable relief
including, but not limited to, specific performance, temporary
restraining order, preliminary, permanent or mandatory injunction
against any breach. In the event the Company incurs expenses to retain
attorneys to enforce this Agreement, Nelson further agrees to pay all
attorney's fees, costs and expenses incurred by the Company, whether or
not litigation be commenced.
(E) Nelson also acknowledges and agrees that any violation of
the terms of this Paragraph shall automatically toll, suspend and extend
the period of his pledged obligation set forth herein for the period of
time that the violation continues. Nelson hereby acknowledges that the
limitations in this Paragraph as to time and geographical scope are fair
and reasonable.
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4. NON-WAIVER. The failure in one or more instances of the Company
to insist upon performance of any of the terms or conditions of this
Agreement, to exercise any right or privilege herein conferred, or the
waiver by the Company of any breach of any of the terms or conditions of
this Agreement, shall not be construed as a subsequent waiver by the
Company of any breach of any of the terms, conditions, rights or
privileges, but the same shall continue and remain in full force and
effect as if no such forbearance or waiver had occurred. No waiver
shall be valid unless in writing and signed by the party against whom it
is sought to be enforced.
5. RIGHT OF CONTACT. In order to preserve the Company's rights under
this Agreement, the Company may advise any third party which Nelson may
consider, establish or contract a relationship, the existence of this
Agreement and its terms, and the Company shall have no liability for
doing so.
6. ENTIRE AGREEMENT. This Agreement reflects the entire Agreement
between Nelson and the Company regarding all matters covered herein. No
change or modification of this Agreement shall be valid unless the same
is in writing and signed by both parties hereto. Nelson understands
that no manager, agent, or other representative of the Company, other
than the Chairman and Chief Executive Officer, has any authority
whatsoever to modify the terms of this Agreement on behalf of the
Company.
7. SUCCESSION. This Agreement is binding upon and shall benefit the
Company, its successors and assigns, and Nelson's heirs, executors,
administrators, legal representative, successors and assigns.
8. CONSTRUCTION. This Agreement shall be governed by and construed
and interpreted according to the laws of the state of Missouri, without
reference to choice of law principles. The parties submit to the
exclusive jurisdiction of the courts of St. Louis County, Missouri for
the purpose of deciding any questions, disputes, causes, whether for
injunctive relief or otherwise, arising under this Agreement.
9. SAVINGS CLAUSE. Nothing contained in this Agreement shall be
construed to require the commission of any act contrary to law or to be
contrary to law, and wherever there is any conflict between any
provision of this Agreement and any present or future statute, law,
government regulation or ordinance contrary to which the parties have no
legal right to contract, the latter shall prevail, but in such event,
the provisions of this Agreement affected shall be curtailed and
restricted only to the extent necessary to bring them within legal
requirements. Further, if any one or more of the promises contained in
this Agreement shall for any reason be held to be excessively broad as
to time, activity or subject, it shall be construed by limiting and
reducing it so as to be enforceable to the extent compatible with
applicable law.
10. NOTICES. All notices, requests and demands, hereinafter called
"Notice" shall be in writing, shall be given by registered or certified
mail, return receipt requested, and shall be
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effective only upon receipt. Unless either party furnishes a Notice of
address other than that referenced herein, all Notices shall be
addressed as follows:
If to the Company:
If to Nelson:
11. ACKNOWLEDGMENT AND CERTIFICATION. Nelson acknowledges and
certifies by signature below that Nelson has read this Agreement
consisting of eleven (11) numbered paragraphs and five (5) pages; Nelson
fully understands the meaning and intent of this document and consents
to the terms of the Agreement; Nelson has received a copy of this
Agreement and that Nelson is voluntarily executing this Agreement of
Nelson's own free will.
Dated this __th day of ___________, 1999.
_______________________________ __________________________________
Nelson's Signature For RB Rubber Products, Inc.
_______________________________ __________________________________
Nelson's Printed Name Title
_______________________________
Witness
