SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934*
SERVICE SYSTEMS INTERNATIONAL, LTD.
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(Name of Issuer)
Common Stock, par value $0.001 per share
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(Title of Class of Securities)
81760P 10 4
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(CUSIP Number)
Janice C. Hartman, Esq. Stephen P. Stanczak, Esq.
Kirkpatrick & Lockhart LLP c/o United States Filter Corporation
Henry W. Oliver Building 40-004 Cook Street
535 Smithfield Street Palm Desert, CA 92211
Pittsburgh, PA 15222 (760) 341-8126
(412) 355-6500
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
September 1, 2001
-----------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), Rule 13d-1(f) or Rule 13d-1(g), check the
following box [__].
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Rule 13d-7 for other parties
to whom copies are to be sent.
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* The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not
be deemed to be "filed" for the purpose of Section 18 of the Securties Exchange
Act of 1934 or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
CUSIP No. 81760P 10 4 13D Page 2 of 48
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1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Vivendi Universal S.A.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [__]
(b) [__]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
[__]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
France
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7 SOLE VOTING POWER
None
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NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED 8,105,000
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BY EACH 9 SOLE DISPOSITIVE POWER
REPORTING PERSON WITH None
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10 SHARED DISPOSITIVE POWER
8,105,000
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,105,000
[ ]
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
24.8% (based upon 24,532,583 shares outstanding as of August 10, 2001
according to Service Systems International, Ltd.'s Quarterly Report on
Form 10-QSB for the Quarter Ended June 30, 2001)
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14 TYPE OF REPORTING PERSON*
CO
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CUSIP No. 81760P 10 4 13D Page 3 of 48
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1 NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
U.S. Filter/Wallace & Tiernan, Inc.
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [__]
(b) [__]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS
IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e)
[__]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7 SOLE VOTING POWER
None
----------------------------------------
NUMBER OF SHARES 8 SHARED VOTING POWER
BENEFICIALLY OWNED 8,105,000
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BY EACH 9 SOLE DISPOSITIVE POWER
REPORTING PERSON WITH None
----------------------------------------
10 SHARED DISPOSITIVE POWER
8,105,000
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
8,105,000
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES*
[ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
24.8% (based upon 24,532,583 shares outstanding as of August 10, 2001
according to Service Systems International, Ltd.'s Quarterly Report on
Form 10-QSB for the Quarter Ended June 30, 2001)
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14 TYPE OF REPORTING PERSON*
CO
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CUSIP No. 81760P 10 4 13D Page 4 of 48
This Statement on Schedule 13D (this "Statement") relates to the
shares of common stock, par value $0.001 per share, of Service Systems
International, Ltd., a Nevada corporation (the "Issuer"), issuable upon exercise
of warrants granted by the Issuer to U.S. Filter/Wallace & Tiernan, Inc., a
Delaware corporation and indirect subsidiary of Vivendi Universal S.A., a
societe anonyme organized under the laws of France.
Item 1. Security and Issuer.
This statement relates to the common stock, par value $0.001 per
share, of the Issuer (the "Common Stock"). The address of the principal
executive offices of the Issuer is 11-202 Burbridge Street, Coquitlam, British
Columbia, Canada V3K 7B2.
Item 2. Identity and Background.
(a) The names of the persons filing this Statement are
Vivendi Universal S.A., a societe anonyme organized under the laws of France
("Vivendi Universal"), and U.S. Filter/Wallace & Tiernan, Inc., a Delaware
corporation ("WT" and, together with Vivendi Universal, the "Filing Persons").
WT is a wholly owned subsidiary of U.S. Filter Wastewater Group,
Inc., a Delaware corporation ("Wastewater"). Wastewater is a wholly owned
subsidiary of United States Filter Corporation, a Delaware corporation ("US
Filter"), which is a wholly owned subsidiary of Vivendi North America
Operations, Inc., a Delaware corporation ("Operations"). Operations is a wholly
owned subsidiary of Vivendi Environnement S.A., a French corporation
("Environment"). Vivendi Universal holds 100% of the outstanding stock of
Environment.
(b) The address of the principal office and principal
business of Vivendi Universal is 42 avenue de Friedland, 75380 Paris, Cedex 08,
France. The address of the principal office and principal business of
Environment is 36-38 avenue Kleber, 75799 Paris, Cedex 16, France. The address
of the principal office and principal business of WT is 1901 West Garden Road,
Vineland, New Jersey 08360. The address of the principal office and principal
business of Wastewater is 181 Thorn Hill Road, Warrendale, Pennsylvania 15086.
The address of the principal office and principal business of US Filter is
40-004 Cook Street, Palm Desert, California 92211. The address of the principal
office and principal business of Operations is 800 Third Avenue, 38th Floor, New
York, New York 10022.
(c) Vivendi Universal is a company engaged in the media,
communications and environmental services businesses. Set forth in Schedule A
hereto, and incorporated herein by reference, is the name, residence or business
addresses and present principal occupation or employment and the name, principal
business and address of any corporation or other organization in which such
employment is conducted, of each of the executive officers and directors of
Vivendi Universal.
WT is a company engaged in chlorinization systems. Set forth in
Schedule B hereto, and incorporated herein by reference, is the name, residence
or business addresses and present principal occupation or employment and the
name, principal business and address of any corporation or other organization in
which such employment is conducted, of each of the executive officers and
directors of WT.
Wastewater is a company engaged in wastewater treatment systems.
US Filter is a company engaged in water and wastewater treatment and systems
operation. Operations is a holding company.
Environment provides environmental services worldwide, including
water and wastewater treatment, waste management, energy services and facilities
management, and transportation systems management.
CUSIP No. 81760P 10 4 13D Page 5 of 48
(d) During the last five years, neither Vivendi
Universal nor, to the best of Vivendi Universal's knowledge, any person named in
Schedule A has been convicted in criminal proceedings (excluding traffic
violations or similar misdemeanors).
During the last five years, neither WT nor, to the best of
WT's knowledge, any person named in Schedule B has been convicted in criminal
proceedings (excluding traffic violations or similar misdemeanors).
During the last five years, neither Wastewater nor, to the
best of Wasterwater's knowledge, any of the directors or executive officers of
Wastewater have been convicted in criminal proceedings (excluding traffic
violations or similar misdemeanors).
During the last five years, neither US Filter nor, to the best
of US Filter's knowledge, any of the directors or executive officers of US
Filter have been convicted in criminal proceedings (excluding traffic violations
or similar misdemeanors).
During the last five years, neither Operations nor, to the
best of Operations' knowledge, any of the directors or executive officers of
Operations have been convicted in criminal proceedings (excluding traffic
violations or similar misdemeanors).
During the last five years, neither Environment nor, to the
best of Environment's knowledge, any of the supervisory board members or
executive officers of Environment have been convicted in criminal proceedings
(excluding traffic violations or similar misdemeanors).
(e) During the last five years, neither Vivendi Universal
nor, to the best of Vivendi Universal's knowledge, any person named in Schedule
A was a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
During the last five years, neither WT nor, to the best of
WT's knowledge, any person named in Schedule B was a party to a civil proceeding
of a judicial or administrative body of competent jurisdiction and as a result
of such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation with respect to
such laws.
During the last five years, neither Wastewater nor, to the
best of Wasterwater's knowledge, any of the directors or executive officers of
Wastewater was a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such proceeding was or is
subject to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
During the last five years, neither US Filter nor, to the best
of US Filter's knowledge, any of the directors or executive officers of US
Filter was a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
During the last five years, neither Operations nor, to the
best of Operations' knowledge, any of the directors or executive officers of
Operations was a party to a civil proceeding of a judicial or administrative
body of competent jurisdiction and as a result of such proceeding was or is
subject to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
CUSIP No. 81760P 10 4 13D Page 6 of 48
During the last five years, neither Environment nor, to the
best of Environment's knowledge, any of the supervisory board members or
executive officers of Environment was a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and as a result of
such proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to, federal
or state securities laws or finding any violation with respect to such laws.
(f) The citizenship of each executive officer and
director of Vivendi Universal is set forth in Schedule A hereto and incorporated
herein by reference. The citizenship of each executive officer and director of
WT is set forth in Schedule B hereto and incorporated herein by reference.
Item 3. Source and Amount of Funds or Other Consideration.
On January 25, 2001, the Issuer and its wholly owned
subsidiary, UV Systems Technology, Inc., a British Columbia company ("UV
Systems"), entered into a Strategic Alliance Agreement (the "Strategic Alliance
Agreement") and related agreements with WT. In general, the Strategic Alliance
Agreement provided that WT would market, offer and sell the Issuer's
UltraGuard(R) ultraviolet disinfection systems, including aftermarket components
and spare parts, on an exclusive basis for ten years throughout a territory
consisting of North America, Central America (including the Caribbean Zone) and
South America. In connection with the execution of the Strategic Alliance
Agreement, the Issuer granted three stock purchase warrants to WT for an
aggregate of 3,000,000 shares of Common Stock (the "Original Warrants"), as
follows: 1,000,000 shares at an exercise price equal to the lower of $.97 per
share or the fair market value of the Common Stock on April 25, 2001; 1,000,000
shares at an exercise price of $1.00 per share; and 1,000,000 shares at an
exercise price of $2.00 per share. The Original Warrants were exercisable from
time to time from October 3, 2002 up to and including October 3, 2010.
On June 1, 2001, the Issuer and UV Systems entered into a
letter agreement (the "Letter Agreement") with WT to facilitate the performance
of certain contracts that were in effect before the execution of the Strategic
Alliance Agreement. Pursuant to the Letter Agreement, the Original Warrants were
amended to reduce the exercise price to $.24 per share for all 3,000,000 shares,
and to provide that all Original Warrants would become exercisable on October
31, 2001. In addition, the Issuer granted to WT additional stock purchase
warrants (the "Additional Warrants") for an aggregate of 5,000,000 shares of
Common Stock (the "Target Level Shares")(subject to adjustment as provided
below), assuming that WT provides certain specified procurement assistance
services ("Procurement Assistance Services") for an aggregate purchase price (as
measured by invoice price) of $785,000 (the "Target Level"). The number of
actual shares for which Additional Warrants will be exercisable will be in the
same proportion as the aggregate purchase price for the actual transactions that
constitute Procurement Assistance Services bears to the Target Level. If WT
provides less than the Target Level of Procurement Assistance Services, the
actual number of shares will be proportionately lower than 5,000,000, and if WT
provides more than the Target Level of Procurement Assistance Services, the
actual number of shares will be proportionately higher than 5,000,000. The
Additional Warrants have an exercise price of $0.24 per share and first become
exercisable on October 31, 2001. As of the date of this filing, WT has provided
Procurement Assistance Services of approximately $801,425. As a result, as of
the date of this filing the number of shares of Common Stock issuable upon
exercise of the Additional Warrants is 5,105,000. Assuming that the Additional
Warrants are exercisable for no more than 5,105,000 shares of Common Stock,
exercise of all Original Warrants and all Additional Warrants would result in
Vivendi Universal and its subsidiaries beneficially owning 8,105,000 shares of
Common Stock, or approximately 24.8% of the outstanding shares of Common Stock
(calculated in accordance with Rule 13d-3 promulgated under the Securities
Exchange Act of 1934 (the "Exchange Act")).
Item 4. Purpose of Transaction.
None of the Filing Persons has any present intention to
exercise or to dispose of the Original Warrants or the Additional Warrants, or
to acquire additional shares of Common Stock other than pursuant to the terms of
the Strategic Alliance Agreement (as amended by the Letter Agreement). Vivendi
Universal intends to review its investment position in the Issuer periodically
and, depending on such review, market conditions and share prices, the Issuer's
business, prospects and future developments and applicable legal requirements,
Vivendi Universal may (i) cause WT to exercise part or all of the Original
Warrants and Additional Warrants, and may cause WT to dispose of some or all of
the shares of Common Stock acquired upon any such exercise, or (ii) acquire
(either
CUSIP No. 81760P 10 4 13D Page 7 of 48
directly or through a subsidiary) shares of Common Stock from time to time in
the open market or in negotiated transactions or both. Except as described
above, none of the Filing Persons has any present plans or proposals that may be
related to or would result in:
(a) The acquisition by any person of additional
securities of the Issuer, or the disposition of securities of the Issuer;
(b) An extraordinary corporate transaction, such as
a merger, reorganization or liquidation, involving the Issuer or any of its
subsidiaries;
(c) A sale or transfer of a material amount of assets of
the Issuer or any of its subsidiaries;
(d) Any change in the present board of directors or
management of the Issuer, including any plans or proposals to change the number
or term of directors or to fill any existing vacancies on the board;
(e) Any material change in the present capitalization or
dividend policy of the issuer;
(f) Any other material change in the Issuer's business or
corporate structure;
(g) Changes in the Issuer's charter, bylaws or
instruments corresponding thereto or other actions which may impede the
acquisition of control of the Issuer by any person;
(h) A class of securities of the Issuer being delisted
from a national securities exchange or to cease to be authorized to be quoted in
an inter-dealer quotation system of a registered national securities
association;
(i) A class of equity securities of the Issuer becoming
eligible for termination of registration pursuant to Section 12(g)(4) of the
Exchange Act; or
(j) Any action similar to any of those enumerated above.
Item 5. Interest in Securities of the Issuer.
(a) As of September 1, 2001, Vivendi Universal and WT may
be deemed to be the beneficial owner of 8,105,000 shares of Common Stock,
constituting approximately 24.8% of the outstanding shares of Common Stock
(based upon 24,532,583 shares outstanding as of August 10, 2001 according to
Service Systems International, Ltd.'s Quarterly Report on Form 10-QSB for the
Quarter Ended June 30, 2001). The shares of Common Stock reported as
beneficially owned herein include the 3,000,000 shares of Common Stock issuable
upon exercise of the Original Warrant and the 5,105,000 shares of Common Stock
issuable as of the date hereof upon exercise of the Additional Warrants. As
described above, the number of shares of Common Stock issuable upon exercise of
the Additional Warrants is equal to the proportion of 5,000,000 that the actual
dollar value of Procurement Assistance Services provided by WT bears to the
Target Level. Such number may be higher than the 5,105,000 shares of Common
Stock reported as beneficially owned herein if WT provides additional
Procurement Assistance Services after the date hereof. To the best of Vivendi
Universal's knowledge, no person named in Schedule A owns or has any right to
acquire, directly or indirectly, any shares of Common Stock. To the best of WT's
knowledge, no person named in Schedule B owns or has any right to acquire,
directly or indirectly, any shares of Common Stock.
By virtue of their direct or indirect ownership interests in
WT, each of US Filter, Operations, Wastewater and Environment may be deemed to
beneficially own the shares of Common Stock reported herein as being
beneficially owned by WT.
(b) Vivendi Universal, WT, Wastewater, US Filter, Operations
and Environment have the shared power to vote or direct the disposition of the
8,105,000 shares of Common Stock reported herein as being beneficially owned by
the Filing Persons.
CUSIP No. 81760P 10 4 13D Page 8 of 48
(c) Except for the issuance of the Original Warrants
(as amended by the Letter Agreement) and the Additional Warrants, none of (i)
Vivendi Universal, (ii) to the best of Vivendi Universal's knowledge, any person
named in Schedule A, (iii) WT, (iv) to the best of WT's knowledge, any person
named in Schedule B, (v) US Filter, (vi) Operations, (vii) Wastewater or (viii)
Environment has, in the past sixty (60) days, effected any transactions in the
Common Stock.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings, or Relationships with
Respect to Securities of the Issuer.
Other than as described in Items 3, 4, and 5 and except as set
forth below, neither Vivendi Universal nor WT, nor, to the knowledge of Vivendi
Universal and WT, any person named in Item 2 of this Schedule 13D, has any
contracts, arrangements, understandings, or relationships (legal or otherwise)
with any person with respect to any securities of the Issuer, including but not
limited to any contract, arrangement, understanding or relationship concerning
the transfer or the voting of any such securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls, guarantees of profits,
division of profits or loss, or the giving or withholding of proxies.
The Strategic Alliance Agreement provides that on January 25
of each year during the term thereof (each, an "Anniversary Date"), the Issuer
shall issue to WT an additional warrant to purchase shares of Common Stock
(each, a "Subsequent Warrant"). The exercise price per share reflected in each
Subsequent Warrant shall be the fair market value of the shares as of the
relevant Anniversary Date. The number of shares for which a Subsequent Warrant
shall be exercisable shall be the sum of (a) 50,000 shares, provided that WT
booked or otherwise significantly influenced at least $1,000,000 of orders for
UltraGuard(R) Systems ("Systems") during the 12 month period ending immediately
prior to the relevant Anniversary Date, plus (b) 500 shares for each $10,000 of
orders for Systems (rounded to the nearest $10,000) that WT booked or otherwise
significantly influenced in excess of $1,000,000 during such 12 month period.
In connection with the Strategic Alliance Agreement, WT and
the Issuer entered into a Registration Rights Agreement (the "Registration
Rights Agreement") that provided for the registration of the Common Stock
underlying the Original Warrants and each Subsequent Warrant. In general, the
Registration Rights Agreement entitles WT to demand registrations (two
"long-form" registrations and, if available, short form registrations at
specified intervals) and "piggyback" registration for the shares issuable upon
exercise of the Original Warrants and each Subsequent Warrant. The Letter
Agreement extended the registration rights granted under the Registration Rights
Agreement to the shares issuable upon exercise of the Additional Warrants.
Also in connection with the Strategic Alliance Agreement, WT
entered into agreements (the "Shareholder Agreements") with each of Kenneth R.
Fielding and John R. Gaetz (each, a "Shareholder") with respect to the shares of
Common Stock owned from time to time by such Shareholder. In general, prior to
the sale of any shares by either Shareholder, the Shareholder must notify WT of
the number of shares for sale by such Shareholder and, if WT desires, the
Shareholder must engage in exclusive discussions with WT for a period not to
exceed 20 days for the purpose of attempting to determine a price per share for
and other terms and conditions related to a possible purchase of such shares by
WT. Under certain conditions, at the option of WT the Shareholder must sell such
shares to WT upon the same terms and conditions proposed by a third party
offeror or on terms and conditions specified by such Shareholder in his notice
of intended sale.
CUSIP No. 81760P 10 4 13D Page 9 of 48
Item 7. Material to be Filed as Exhibits.
1. Joint Filing Agreement (filed herewith).
2. Special Power of Attorney of Vivendi Universal S.A. (filed herewith).
3. Strategic Alliance Agreement dated January 25, 2001
(incorporated by reference to Exhibit 10(xvi) to the Form 8-K of the
Issuer filed on February 27, 2001).
4. Letter Agreement dated June 1, 2001 (incorporated by reference to
Exhibit 10(xvii) to the Form 8-K of the Issuer filed on June 18,
2001).
5. Form of Stock Purchase Warrant (filed herewith).
6. Schedule to Stock Purchase Warrant (filed herewith).
7. Registration Rights Agreement dated January 25, 2001 (filed
herewith).
8. Shareholder Offer Agreement dated January 25, 2001 (filed herewith).
9. Shareholder Offer Agreement dated January 25, 2001 (filed herewith).
CUSIP No. 81760P 10 4 13D Page 10 of 48
SCHEDULE A
(a) Set forth below is the name, business address, principal occupation or
employment and citizenship of each director and executive officer of
Vivendi Universal. Unless otherwise indicated, the business address of each
person listed below is 42 avenue de Friedland, 75380 Paris, Cedex 08,
France.
Name and Principal Occupation or
Business Address Employment and Business Address Citizenship
---------------- ------------------------------- -----------
Jean-Marie Messier Chairman and CEO of Vivendi Universal France
Edgar Bronfman, Jr. Executive Vice Chairman of Vivendi Universal U.S.
Eric Licoys Co-COO of Vivendi Universal France
Pierre Lescure Chairman and CEO of CANAL+, France
Chairman of the Executive
Board of Groupe CANAL+ Group
and Co-COO of Vivendi Universal
Bernard Arnault Chairman and CEO of LVMH France
30, avenue Hoche
75008 Paris, France
Jean-Louis Beffa Chairman and CEO of Compagnie de France
Saint-Gobain
Les Miroirs
92096 La Defense Cedex
27, France
Edgar M. Bronfman Former Chairman of the Board of Seagram U.S.
Richard H. Brown Chairman and CEO of Electronic Data U.S.
Systems Corporation
5400 Legacy Drive
Plano, Texas 75024-3199
Jean-Marc Espalioux Chairman of the Executive Board of Accor France
Tour Maine Montparnasse
33, avenue du Maine
75755 Paris Cedex
15, France
Philippe Foriel-Destezet Chairman and CEO of Adecco France
52, rue de la Bienfaisance
75008 Paris, France
Jacques Friedmann Retired Chairman of the Supervisory France
Board of AXA-UAP
(Chairman from 1993-2000)
80, avenue de Breteuil
75007 Paris, France
CUSIP No. 81760P 10 4 13D Page 11 of 48
Name and Principal Occupation or
Business Address Employment and Business Address Citizenship
---------------- ------------------------------- -----------
Esther Koplowitz Chairman and Member of the Board of Spain
Directors of Fomento de
Construcciones y Contratas
Torre Picasso
Plaza Pablo Ruiz Picasso
28020 Madrid, Spain
Mario-Josee Kravis Senior Fellow, Hudson Institute Inc. U.S.
c/o 625 Park Avenue
New York, New York 10021
Henri Lachmann Chairman and CEO of Schneider France
Electric
43-45, boulevard F. Roosevelt,
92500 Rueil-Malmaison, France
Samuel Minzberg President Canada
of Claridge Inc.
1170 Peel Street
Montreal, Quebec H3B 4P2
Simon Murray Chairman of Simon Murray & Associates U.K.
Princes House-2nd Floor
38, Jermyn Street
London SW1Y 6DT
Serge Tchuruk Chairman and CEO of Alcatel France
54, rue de la Boetie
75008 Paris, France
Rene Thomas Honorary Chairman and Director of France
Banque Nationale de
Paris-PARIBAS
16, boulevard des Italiens
75009 Paris, France
Marc Vienot Honorary Chairman and Director of France
Societe Generale
Tour Societe Generale
92972 Paris La Defense
Cedex, France
CUSIP No. 81760P 10 4 13D Page 12 of 48
SCHEDULE B
(a) Set forth below is the name, business address, principal occupation or
employment and citizenship of each director and executive officer of WT.
Unless otherwise indicated, the business address of each person listed
below is 40-004 Cook Street, Palm Dessert, CA 92211.
Name and Principal Occupation or
Business Address Employment and Business Address Citizenship
---------------- ------------------------------- -----------
Frank R. Firsching President and Director U.S.
Deborah M. Newell Vice President, Secretary and Director U.S.
181 Thorn Hill Road
Warrendale, PA 15086
Rajesh P. Patel Vice President, Controller and Director U.S.
2118 Greenspring Drive
Timonium, MD 21093
David Spyker Vice President U.S.
2155 112th Ave
Holland, MI 49424
Gerald Rogers Vice President U.S.
301 W. Military Road
Rothschild, WI 54474
W. Christopher Chisholm Vice President U.S.
Joseph Millen Vice President U.S.
1901 West Garden Rd
Vineland, NJ 08360
Dean J. Smith Vice President U.S.
23 Altawood Lane
Sandy, UT 84092
Robert E. Joyce, Jr. Vice President U.S.
181 Thorn Hill Road
Warrendale, PA 15086
Eugene D. Walls Vice President and Assistant Treasurer U.S.
181 Thorn Hill Road
Warrendale, PA 15086
Frederick W. Noble, Jr. Vice President U.S.
Stephen P. Stanczak Vice President and Assistant Secretary U.S.
Joy M. Gaetano Vice President U.S.
James W. Dierker Vice President and Treasurer U.S.
CUSIP No. 81760P 10 4 13D Page 13 of 48
SIGNATURE
---------
After reasonable 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.
Dated: September 7, 2001
VIVENDI UNIVERSAL S.A.
By /s/ Stephen P. Stanczak
-------------------------------------
Name: Stephen P. Stanczak
Attorney-in-Fact
U.S. FILTER/WALLACE & TIERNAN, INC.
By /s/ Stephen P. Stanczak
-------------------------------------
Name: Stephen P. Stanczak
Title: Vice President
CUSIP No. 81760P 10 4 13D Page 14 of 48
EXHIBIT 1
JOINT FILING AGREEMENT
----------------------
In accordance with Rule 13d-1(f) promulgated under the
Securities Exchange Act of 1934, as amended, the undersigned hereby agree to the
joint filing with all other Filing Persons (as such term is defined in the
Schedule 13D referred to below) on behalf of each of them of a statement on
Schedule 13D (including amendments thereto) with respect to the Common Stock,
par value $.001 per share (the "Shares"), of Service Systems International,
Ltd., a Nevada corporation, and that this Agreement may be included as an
Exhibit to such joint filing. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument.
IN WITNESS WHEREOF, the undersigned hereby execute this
Agreement as of the 1st day of September, 2001.
VIVENDI UNIVERSAL S.A.
By /s/ Gilbert Klajnman
---------------------------------------
Name: Gilbert Klajnman
Title: Directeur Juridique -
Senior Vice President, Legal Affairs
U.S. FILTER/WALLACE & TIERNAN, INC.
By /s/ Stephen P. Stanczak
---------------------------------------
Name: Stephen P. Stanczak
Title: Vice President
CUSIP No. 81760P 10 4 13D Page 15 of 48
EXHIBIT 2
SPECIAL POWER OF ATTORNEY
KNOW MEN ALL BY THESE PRESENTS, that Vivendi Universal S.A., the undersigned a
societe anonyme organized under the laws of France, does hereby make, constitute
and appoint Stephen P. Stanczak and James W. Dierker, and each of them singly,
its true and lawful attorney in fact for the undersigned and in its name and
place and stead, to sign, execute and deliver to the Securities and Exchange
Commission on behalf of the undersigned any and all forms required under Section
13 or Section 16 of the Securities Exchange Act of 1934, as amended, or any of
the rules or regulations promulgated thereunder, as a result of the undersigned
holding any securities of Service Systems International, Ltd., a Nevada
corporation, such appointment to continue for so long as the undersigned shall
continue to be subject to the reporting requirements under said Section 13 or
Section 16 as a result of being, or having been, a holder of any of the
securities of Service Systems International, Ltd.
Each of said attorneys in fact is hereby authorized and designated, among other
things, to file any and all Schedules 13D, and any amendments thereto or
restatements thereof, and any and all forms 3, 4 and 5 with the Securities and
Exchange Commission on behalf of the undersigned.
This power revokes any other special power preciously granted with respect to
the matters described herein. Any person dealing with either of said attorneys
may rely without inquiry on the continuing validity of this power unless he has
noticed that is has been revoked by the undersigned.
IN WITNESS WHEREOF, as an authorized representative of Vivendi Universal S.A., I
have hereunto set my hand and seal this 24th day of August, 2001.
VIVENDI UNIVERSAL S.A.
By /s/ Gilbert Klajnman
---------------------------------------
Name: Gilbert Klajnman
Title: Directeur Juridique -
Senior Vice President, Legal Affairs
CUSIP No. 81760P 10 4 13D Page 16 of 48
EXHIBIT 5
FORM OF STOCK PURCHASE WARRANT
------------------------------
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES
LAWS OF ANY STATE. THEY MAY NOT BE SOLD, OFFERED FOR SALE,
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER
SAID ACT OR LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED, OR IN CONTRAVENTION OF THE TERMS OF THIS
INSTRUMENT.
THE TRANSFERABILITY OF THIS WARRANT IS RESTRICTED.
SEE SECTION 5.
SERVICE SYSTEMS INTERNATIONAL, LTD.
STOCK PURCHASE WARRANT
Date Of Issuance: _________ __, 2000_ Certificate No.______
FOR VALUE RECEIVED, Service Systems International, Ltd., a Nevada corporation
(the "COMPANY"), hereby grants to U.S. Filter/Wallace & Tiernan, Inc., a
Delaware corporation ("WT"), or its assigns (WT and/or any Person or Persons to
whom WT or an assignee of WT has assigned this Warrant pursuant to Section 5
hereof being hereinafter referred to as the "HOLDER") the right to purchase from
the Company ________________ Warrant Shares at a price of $.024 per Warrant
Share (the "EXERCISE PRICE"). This Warrant is one of the "Warrants" referred to
in that certain Strategic Alliance Agreement dated as of January 25, 2001 by and
between WT and the Company (the "STRATEGIC ALLIANCE AGREEMENT"). Certain
capitalized terms used herein are defined in Section 3 hereof. Other capitalized
terms used in this Warrant but not defined herein shall have the meanings set
forth in the Strategic Alliance Agreement.
The amount and kind of securities obtainable pursuant to the rights granted
hereunder and the purchase price for such securities are subject to adjustment
pursuant to the provisions contained in this Warrant.
This Warrant is subject to the following provisions:
Section 1. EXERCISE OF WARRANT.
-------------------
A. EXERCISE PERIOD. The Holder may first exercise, in whole or in
----------------
part, the purchase rights represented by this Warrant on October 31, 2001 and
shall be permitted to exercises the purchase rights up to and including the
tenth anniversary of the Date of Issuance (the "EXERCISE PERIOD"); provided,
that solely in the event of a Termination for Convenience of the Agreement by
WT, the Exercise Period shall end on the second anniversary of the effective
date of such Termination for Convenience.
B. EXERCISE PROCEDURE.
------------------
1. This Warrant shall be deemed to have been exercised when
the Company has received all of the following items (the "Exercise
Time"):
CUSIP No. 81760P 10 4 13D Page 17 of 48
(a) a completed Exercise Agreement, as described in
Section C below (an "EXERCISE AGREEMENT"), executed by the
Person exercising all or part of the purchase rights
represented by this Warrant;
(b) this Warrant;
(c) if this Warrant is not registered in the name of
the Holder, an Assignment or Assignments in the form set forth
in Exhibit II hereto evidencing the assignment of this Warrant
to the Holder, in which case the Holder shall have complied
with the provisions set forth in Section 5 hereof; and
(d) at the option of the Company, either (1) a
certified check drawn on a United States bank payable to the
Company or (2) confirmed receipt of a wire transfer to an
account designated by the Company, in either case in an amount
equal to the product of the Exercise Price multiplied by the
number of Warrant Shares being purchased upon such exercise
(the "Aggregate Exercise Price") .
2. Certificates for Warrant Shares purchased upon exercise of
this Warrant promptly shall be delivered by the Company to the Holder
after the date of the Exercise Time. Unless this Warrant has expired or
all of the purchase rights represented hereby have been exercised, the
Company shall prepare a new Warrant, substantially identical hereto,
representing the rights formerly represented by this Warrant which have
not expired or been exercised and promptly shall deliver such new
Warrant to the Person designated for delivery in the Exercise
Agreement. The certificates for Warrant Shares shall bear a legend
substantially similar to the following:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES
LAWS OF ANY STATE. THEY MAY NOT BE SOLD, OFFERED FOR SALE,
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER
SAID ACT OR LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED."
3. The Warrant Shares issuable upon the exercise of this
Warrant shall be deemed to have been issued to the Holder at the
Exercise Time, and the Holder shall be deemed for all purposes to have
become the record holder of such Warrant Shares at the Exercise Time.
4. The issuance of Warrant Shares upon exercise of this
Warrant shall be made without charge to the Holder for any issuance tax
in respect thereof or other cost incurred by the Company in connection
with such exercise and the related issuance of Warrant Shares. Each
Warrant Share issuable upon exercise of this Warrant shall, upon
payment of the Exercise Price therefor, be free from all taxes and
liens.
5. The Company shall not close its books against the transfer
of this Warrant or of any Warrant Shares in any manner which
effectively prohibits the timely exercise of this Warrant. The Company
shall from time to time take all such action as may be necessary to
assure that the Warrant Shares acquirable upon exercise of this Warrant
will at all times be duly authorized, and when acquired pursuant to the
terms of this Warrant and upon payment of the Exercise Price, will be
fully paid and non assessable.
6. At Holder's expense, the Company shall assist and
cooperate with any Holder required to make any governmental flings or
obtain any governmental approvals prior to or in connection with any
exercise of this Warrant (provided, however, any filings required to
be made by the Company shall be made at the Company's expense).
CUSIP No. 81760P 10 4 13D Page 18 of 48
7. Notwithstanding any other provision hereof, if an exercise
of any portion of this Warrant is to be made in connection with a
Change of Control of the Company, the exercise of any portion of this
Warrant may, at the election of the Holder hereof, be conditioned upon
the consummation of such transaction in which case such exercise shall
not be deemed to be effective until the consummation of such
transaction.
8. The Company shall at all times reserve and keep available
out of its authorized but unissued Shares solely for the purpose of
issuance upon the exercise of the Warrants, such number of Warrant
Shares as are issuable upon the exercise of all outstanding Warrants.
The Company shall take such action as may be within its control to
assure that all such Warrant Shares be so issued in accordance with the
terms of this Agreement and without violation of any applicable law or
governmental regulation or any requirements of any domestic securities
exchange or market system upon which the Warrant Shares may be listed
or traded (except for official notice of issuance which shall be
immediately delivered by the Company upon each such issuance). The
Company shall not take any action which would cause the number of
authorized but unissued Warrant Shares to be less than the number of
such Shares required to be reserved hereunder for issuance upon
exercise of the Warrant.
9. If the Warrant Shares issuable by reason of exercise of
this Warrant are convertible into or exchangeable for any other Shares
or securities of the Company, the Company shall, at the exercising
Holder's option and upon surrender of this Warrant by such Holder as
provided above together with any notice, statement or payment required
to effect such conversion or exchange of Warrant Shares, deliver to
such Holder (or as otherwise specified by such Holder) a certificate or
certificates representing the Shares or securities or, if
uncertificated, other evidence of ownership of such Shares or
securities into which the Warrant Shares issuable by reason of such
conversion are convertible or exchangeable, registered in such name or
names and in such denomination or denominations as such Holder has
specified.
10. Each Warrant Share issuable by reason of the exercise of
this Warrant will be deemed to have been issued in the state of Nevada.
C. EXERCISE AGREEMENT. Upon any exercise of this Warrant, the
------------------
Exercise Agreement shall be substantially in the form set forth in Exhibit I
hereto, except that if the Warrant Shares are not to be issued in the name of
the Person in whose name this Warrant is registered, the Exercise Agreement
shall also state the name of the Person to whom the Warrant Shares are to be
issued, and if the number of Warrant Shares to be issued does not include all
the Warrant Shares purchasable hereunder, it shall also state the name of the
Person to whom a new. Warrant for the unexercised portion of the rights
hereunder is to be delivered.
Section 2. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES. In order
-------------------------------------------------
to prevent dilution of the rights granted under this Warrant, the Exercise Price
shall be subject to adjustment from time to time as provided in this Section 2,
and the number of Warrant Shares obtainable upon exercise of this Warrant shall
be subject to adjustment from time to time as provided in this Section 2.
A. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES UPON ISSUANCE OF
SHARES.
------------------------------------------------------------------
1. If and whenever on or after the Date of Issuance first
written above the Company issues or sells any Shares for a
consideration per share less than the Exercise Price of the Shares
determined as of the date of such issue or sale, then immediately upon
such issue or sale the Exercise Price shall be adjusted and such
adjusted Exercise Price shall be determined by multiplying the Exercise
Price in effect immediately prior to such issue or sale by a fraction,
the numerator of which shall be the number of Shares outstanding
immediately prior to such issuance or sale plus the number of Shares
which the aggregate net consideration to be received, or deemed to be
received, by the Company for the total number of Shares so issued or
sold would purchase at the Exercise Price then in effect, and the
denominator of which shall be the number of Shares outstanding
immediately prior to such issuance or sale plus the number of Shares so
issued or sold. An example of the adjustment of the Exercise Price
pursuant to this Section 2.A.1 is attached as Schedule 2.A.1.
CUSIP No. 81760P 10 4 13D Page 19 of 48
2. Upon each such adjustment of the Exercise Price hereunder,
the number of Warrant Shares issuable upon exercise of this Warrant
shall be adjusted by multiplying the Exercise Price in effect
immediately prior to such adjustment by the number of Warrant Shares
acquirable upon exercise of this-Warrant immediately prior to such
adjustment and dividing the product thereof by the Exercise Price
resulting from such adjustment, provided, in no case, shall the
aggregate number of Warrant Shares issuable upon exercise of this
Warrant, when added to the total number of Warrant Shares issued under
all other Warrants granted under the Strategic Alliance Agreement,
exceed twenty percent (20%) of the issued and outstanding shares of the
Company at the date of exercise.
3. Notwithstanding the foregoing, there shall be no
adjustment to the Exercise Price or the number of Warrant Shares
issuable upon exercise of this Warrant with respect to the following:
(a) the issuance of Shares upon exercise of any of the Warrants
granted under the Strategic Alliance Agreement; (b) the issuance of
not to exceed 7,191,796 Shares in the aggregate (as such number is
proportionately adjusted to reflect any subdivision or combination of
shares) to (i) directors, officers, employees, consultants or advisors
of the Company pursuant to stock option or other equity incentive
plans in effect immediately prior to the date of the Strategic
Alliance Agreement, or (ii) John Gaetz under the warrants for
1,487,718 shares issued to him in exchange for stock options for an
equal number of shares; (c) the issuance of not to exceed 14,726,937
Shares in the aggregate (as such number is proportionately adjusted to
reflect any subdivision or combination of shares) to (i) the holders
of the Company's warrants outstanding immediately prior to the date of
the Strategic Alliance Agreement, (ii) John Gaetz, Kenneth Fielding or
Peter Colak (other than pursuant to clause (b) above), or (iii) to
purchasers of units offered by the Company in the private placement
ongoing at the date of the Strategic Alliance Agreement (the "Private
Placement"), upon the purchasers' exercise of warrants acquired as
part of the units offered in the Private Placement; or (d) the
issuance of not to exceed 1,000,000 Shares directly to purchasers of
units offered in the Private Placement, it being understood that the
Private Placement shall not include any subsequent securities offering
by the Company, whether similar or dissimilar to the Private
Placement.
4. CALCULATION OF CONSIDERATION RECEIVED. If any Shares are
--------------------------------------
issued or sold or deemed to have been issued or sold for cash, the
consideration received therefor shall be deemed to be the net amount
received by the Company therefor. In case any Shares are issued or sold
for a consideration other than cash, the amount of the consideration
other than cash received by the Company shall be the fair market value
of such consideration, except where such consideration consists of
securities, in which case the amount of consideration received by the
Company shall be the Market Price thereof as of the date of receipt. In
case any Shares are issued to the owners of the non-surviving entity in
connection with any merger in which the Company is the surviving entity
the amount of consideration therefor shall be deemed to be the fair
market value of such portion of the net assets and business of the
non-surviving entity as is attributable to such Shares, as the case may
be. The fair market value of any consideration other than cash or
securities shall be determined in good faith by the Board of Directors
of the Company.
B. SUBDIVISION OR COMBINATION OF SHARES. If the Company at any time
-------------------------------------
subdivides (by any split, dividend, recapitalization or otherwise) one or more
classes of its outstanding Shares into a greater number of units, the Exercise
Price in effect immediately prior to such subdivision shall be proportionately
reduced and the number of Warrant Shares issuable upon exercise of this Warrant
shall be proportionately increased. If the Company at any time combines (by
reverse split or otherwise) one or more classes of its outstanding Shares into a
smaller number of Shares, the Exercise Price in effect immediately prior to such
combination shall be proportionately increased and the number of Warrant Shares
issuable upon exercise of this Warrant shall be proportionately decreased.
C. REORGANIZATION, RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE.
------------------------------------------------------------------
Any recapitalization, reorganization, reclassification, consolidation,
amalgamation, merger, sale of all or substantially all of the Company's assets
or other transaction, which in each case is effected in such a way that the
holders of Shares are entitled to receive (either directly or upon subsequent
liquidation) stock, securities, other equity interests or assets with respect to
or in exchange for Shares, is referred to herein as an "ORGANIC CHANGE." Prior
to the consummation of any Organic Change, the Company shall make appropriate
provision to ensure that each of the Holders shall thereafter have the right to
acquire and receive, in lieu of or addition to (as the case may be) the Warrant
Shares immediately theretofore acquirable and receivable upon the exercise of
such Holder's Warrant, such stock,
CUSIP No. 81760P 10 4 13D Page 20 of 48
securities, other equity interests or assets as may be issued or payable with
respect to or in exchange for the number of Warrant Shares immediately
theretofore acquirable and receivable upon exercise of such Holder's Warrant had
such Organic Change not taken place. In any such case, the Company shall make
appropriate provision with respect to such Holder's rights and interests under
the Warrants to ensure that all of the provisions of the Warrants which remain
pertinent in light of the Organic Change shall thereafter continue to be
applicable to such Holders. The Company shall not effect any such consolidation,
amalgamation, merger or sale, unless prior to the consummation thereof, the
successor entity (if other than the Company) resulting from consolidation,
amalgamation or merger or the entity purchasing such assets expressly assumes by
written instrument the obligation to deliver to each such Holder such stock,
securities, equity interests or assets as, in accordance with the foregoing
provisions, such Holder may be entitled to acquire.
D. NO AVOIDANCE. In the event the Company shall enter into any
------------
transaction for the purpose of avoiding the provisions of this SECTION 2, the
benefits provided by such provisions shall nevertheless apply and be preserved.
E. NOTICES
-------
1. Immediately upon any adjustment of the Exercise Price, the
Company shall give written notice thereof to the Holder, setting forth
in reasonable detail and certifying the calculation of such adjustment.
2. The Company shall give written notice to the Holder at
least 10 days prior to the date on which the Company closes its books
or fixes a record date (a) with respect to any dividend or distribution
upon the Shares, or (b) for determining rights to vote with respect to
any Organic Change, dissolution or liquidation.
3. The Company shall also give written notice to the Holder
at least 10 days prior to the date on which any Organic Change,
dissolution or liquidation shall take place.
Section 3. DEFINITIONS. The following terms have the meanings set
-----------
forth below:
"MARKET PRICE" means as to any security (other than the Warrants) the average of
the closing prices of a share or unit thereof on the New York Stock Exchange
Composite Tape or the NASDAQ National Market, whichever is applicable (as
reported in the Wall Street Journal) on each of the 10 trading days immediately
preceding the date of determination; or if the security is not traded on such
exchange or national market system, the average of the closing prices for a
share or unit thereof on the NASDAQ Small Cap Market, or if the security is not
then traded on any such market, the OTC Bulletin Board, on each of such 10
trading days; or if the security is not then traded on any such market, the fair
market value per share or unit as determined in good faith by the Board of
Directors of the Company.
"SECURITIES ACT" means the Securities Act of 1933, or any successor federal
---------------
statute, and the rules and regulations of the Securities and Exchange Commission
thereunder, all as the same shall be in effect at the time.
"SECURITIES AND EXCHANGE COMMISSION" or "COMMISSION" refers to the Securities
------------------------------------ ----------
and Exchange Commission or any other federal agency then administering the
Securities Act.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934 or any
-------------------------
successor federal statute, and the rules and regulations of the Securities and
Exchange Commission thereunder, all as the same shall be in effect at the time.
"SHARES" means shares of the Company's Common Stock, $.001 par value.
------
"WARRANT SHARES" means the Shares issuable upon exercise of this Warrant;
---------------
provided that if there is a change such that the securities issuable upon
exercise of the Warrants are issued by an entity other than the Company or there
is a change in the type or class of securities so issuable, then each "Warrant
Share" shall mean one share of the security
CUSIP No. 81760P 10 4 13D Page 21 of 48
issuable upon exercise of the Warrants if such security is issuable in shares,
or shall mean the smallest unit in which such security is issuable if such
security is not issuable in shares.
Section 4. NO RIGHTS AS A STOCKHOLDER. Until the exercise of this
--------------------------
Warrant, the Holder shall not have or exercise any rights by virtue hereof as a
stockholder of the Company.
Section 5. WARRANT TRANSFERABLE. Subject to the transfer conditions
---------------------
referred to in this Section 5, this Warrant and all rights hereunder are
transferable, in whole or in part, without charge to the Holder, upon surrender
of this Warrant with a properly executed Assignment (in the form of EXHIBIT II
hereto) at the principal office of the Company; provided, that during the Term
of the Strategic Alliance Agreement, the Holder may transfer this Warrant only
to one or more of its Affiliates.
A. If, at the time of any transfer or exchange (other than a transfer
or exchange not involving a change in the beneficial ownership of this Warrant
or Warrant Shares) of a Warrant or Warrant Shares, such Warrant or Warrant
Shares shall not be registered under the Securities Act, the Company may
require, as a condition of allowing such transfer or exchange, that the Holder
or transferee of such Warrant or Warrant Shares, as the case may be, furnish to
the Company an opinion of counsel reasonably acceptable to the Company or a "no
action" or similar letter from the Securities and Exchange Commission to the
effect that such transfer or exchange maybe made without registration under the
Securities Act. In the case of such transfer or exchange, the Company may
require a written statement that such Warrant or Warrant Shares, as the case may
be, are being acquired for investment and not with a view to or in connection
with the distribution thereof. The certificates evidencing the Warrant Shares
issued on the exercise of the Warrants shall, if such Warrant Shares are being
sold or transferred without registration under the Securities Act, bear an
appropriate legend to the effect that the Warrant Shares evidenced by such
certificates have not been so registered and their transfer is restricted.
B. The Company shall make and file with the Commission in a timely
manner all reports and other documents as may be required of it under Section
13(a) or 15(d) of the Exchange Act. The Holder shall make and file with the
Commission in a timely manner all reports and other documents as may be required
of it under Section 13(d) or 16(a) of the Exchange Act.
C. The Company shall furnish to a Holder and/or prospective purchaser
of Warrants or Warrant Shares designated by such Holder, forthwith upon request,
(1) a written statement by the Company as to its compliance with the reporting
requirements of Rule 144 under the Securities Act, and (2) a copy of the most
recent annual or quarterly report of the Company.
Section 6. WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS. This
----------------------------------------------------
Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for new Warrants of like tenor representing in
the aggregate the purchase rights hereunder, and each of such new Warrants shall
represent such portion of such rights as is designated by the Holder at the time
of such surrender. The date the Company initially issues this Warrant shall be
deemed to be the "Date of Issuance" hereof regardless of the number of times new
certificates representing the unexpired and unexercised rights formerly
represented by this Warrant shall be issued. All Warrants representing portions
of the rights hereunder are referred to herein as the "Warrants."
Section 7. REPLACEMENT. Upon receipt of evidence reasonably
-----------
satisfactory to the Company (an affidavit of the Holder generally shall be
satisfactory, provided in the case of mutilation the mutilated certificate shall
be returned to the Company) of the ownership and the loss, theft, destruction or
mutilation of any certificate evidencing this Warrant, and in the case of any
such loss, theft or destruction, upon receipt of indemnity reasonably
satisfactory to the Company, the Company shall (at the Holder's expense) execute
and deliver, in lieu thereof, a new certificate of like kind representing the
same rights represented by such lost, stolen, destroyed or mutilated certificate
and dated the date of such lost, stolen, destroyed or mutilated certificate, and
shall cancel the original certificate.
Section 8. NOTICES. All notices hereunder shall be in writing and shall
-------
be deemed duly given upon the date of first attempted delivery if it is sent by
registered or certified mail, return receipt requested, postage prepaid, and
addressed to the intended recipient, in the case of the Company, at its
principal executive offices, and
CUSIP No. 81760P 10 4 13D Page 22 of 48
in, in the case of the Holder of this Warrant, at such Holder's address as it
appears in the records of the Company (unless otherwise indicated by any such
Holder). The Company or the Holder of this Warrant may send any notice hereunder
to the intended recipient at the address referred to, above using any other
means (`including personal delivery, expedited courier, messenger service,
telecopy, ordinary mail or electronic mail), but no such notice shall be deemed
to have been duly given unless and until it actually is received by the intended
recipient.
Section 9. GOVERNING LAW. This Warrant shall be governed by and
--------------
construed in accordance with the domestic laws of the State of Nevada without
giving effect to any choice or conflict of law provision or rule (whether of the
State of Nevada or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Nevada.
Section 10. SECURITIES LAW. Notwithstanding anything herein to the
---------------
contrary, the rights and obligations of the Company and the Holder arising under
or in connection with this Warrant shall be subject to the Securities Act and
other applicable securities law and regulation.
CUSIP No. 81760P 10 4 13D Page 23 of 48
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed and
attested by its duly authorized officers under its corporate seal and to be
dated the Date of Issuance hereof.
SERVICE SYSTEMS INTERNATIONAL, LTD.
By
---------------------------------
Its
--------------------------------
Attest:
--------------------------------
Secretary
CUSIP No. 81760P 10 4 13D Page 24 of 48
EXHIBIT I
EXERCISE AGREEMENT
To: Dated:
The undersigned, pursuant to the provisions set forth in the attached Warrant
(Certificate No.____), hereby agrees to subscribe for the purchase of the
Warrant Shares covered by such Warrant and makes payment herewith in full
therefor at the price per unit provided by such Warrant, and represents and
warrants to the Company that:
A. The undersigned is aware that no United States or Canadian federal,
state or provincial agency has made any finding or determination as to the
fairness for public investment, nor any recommendation or endorsement, of the
Warrant Shares, and the Warrant Shares have not been registered under the
Securities Act of 1933 (the "1933 Act"), or the securities laws of Canada or any
state or province.
B. The undersigned, either alone or with his, her or . its purchaser
representative, is able to evaluate the risks involved in any investment in the
Warrant Shares, and has sufficient knowledge and experience in financial and
business matters in general, and investments in particular, to be fully capable
of evaluating the merits and risks of an investment in the Warrant Shares.
C. The undersigned has had an opportunity to and has asked questions,
received answers and otherwise been fully informed with respect the Company, the
Warrant Shares and the business of the Company, and has obtained all the
information concerning these matters which the undersigned desires. The
financial condition of the undersigned is such that he, she or it has adequate
means of providing for current needs and future contingencies. The undersigned
is under no present or contemplated need to liquidate ~ any portion of the
Warrant Shares to satisfy any existing or contemplated undertaking, need or
indebtedness. The undersigned is able to bear the economic risk of any
investment in the Warrant Shares, including the possible complete loss of the
investment and possible inability to sell or transfer the Warrant Shares for an
indefinite period of time.
D. The undersigned is acquiring the Warrant Shares for his, her or its
own account for investment only and not with a view to, or for sale in
connection with, the distribution thereof, and is not participating directly or
indirectly in a distribution of the Warrant Shares, or in the underwriting of
any such distribution of the Warrant Shares, nor will the undersigned act in any
way that would constitute him, her or it an underwriter, within the meaning of
the 1933 Act, of the Warrant Shares.
E. The undersigned acknowledges that the Warrant Shares are "restricted
securities" as that term is described in Rule 144 of the United States
Securities and Exchange Commission.
F. The undersigned will not transfer or sell the Warrant Shares in the
absence of registration under the 1933 Act or an exemption therefrom. In the
absence of registration under the 1933 Act, before any proposed sale, pledge,
gift or other transfer, for value or otherwise, of any or all of the Warrant
Shares or any interest or interests therein (a "Transfer"), the undersigned will
give written notice to Company describing the Transfer in detail, accompanied by
an opinion, reasonably satisfactory in form and substance to Company's counsel,
of the undersigned's counsel, to the effect that the proposed Transfer may be
conducted without violation of Section 5 of the 1933 Act or pursuant to an
exemption from registration under the 1933 Act, the availability of which is to
be established to the satisfaction of Company. The undersigned understands that
the Company will make, or will advise the transfer agent of the Shares to make,
stop transfer notations on its records relating to the Warrant Shares and the
certificate representing the Warrant Shares, when issued, will have the
following legend imprinted or typed on their face:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR .THE SECURITIES
LAWS OF ANY STATE. THEY MAY NOT BE SOLD, OFFERED FOR SALE,
TRANSFERRED, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES UNDER
SAID ACT OR LAWS OR AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION IS NOT
REQUIRED, OR IN CONTRAVENTION OF
CUSIP No. 81760P 10 4 13D Page 25 of 48
THE TERMS OF AN EXERCISE AGREEMENT BETWEEN THE CORPORATION
AND THE PERSON(S) WHOSE NAME(S) APPEAR(S) ON THIS
CERTIFICATE AS REGISTERED HOLDER, A COPY OF WHICH IS ON ME
AT THE OFFICE OF THE CORPORATION."
Signature
---------------------------------
Address
-----------------------------------
CUSIP No. 81760P 10 4 13D Page 26 of 48
EXHIBIT II
ASSIGNMENT
----------
FOR VALUE RECEIVED, ______________________ hereby sells, assigns and transfers
all of the rights of the undersigned under the attached Warrant (Certificate No.
______) with respect to the number of Warrant Shares covered thereby set forth
below, unto:
NAMES OF ASSIGNEE ADDRESS NO. OF SHARES
----------------- ------- -------------
Dated: Signature
--------------------------------------
--------------------------------------
Witness
--------------------------------------
CUSIP No. 81760P 10 4 13D Page 27 of 48
SCHEDULE 2.A.1
EXAMPLE OF EXERCISE PRICE ADJUSTMENT
ASSUMPTIONS:
-----------
Exercise Price = $1.00 per share
Warrant Shares = 1,000,000 shares
Total Shares outstanding = 20,000,000 shares
Additional Shares issued and sold by Company =1,000,000 shares
Sale .price of additional Shares = $0.90 per share
Net consideration received by Company = $900,000
Number of Shares net consideration would purchase at Exercise Price =
$900,000 / $1.00 = 900,000 shares
EXERCISE PRICE ADJUSTMENT:
-------------------------
$1.00 x [(20,000,000 + 900,000) / (20,000,000 + 1,000,000)] = $.9952381
ADJUSTMENT IN NUMBER OF WARRANT SHARES
--------------------------------------
(1.00 x 1,000,000) / .9952381= 1,004,785 shares
CUSIP No. 81760P 10 4 13D Page 28 of 48
EXHIBIT 6
SCHEDULE TO FORM OF STOCK PURCHASE WARRANT
WARRANT SHARES DATE OF ISSUANCE EXERCISE PRICE
1,000,000 October 3, 2000 $.24
1,000,000 October 3, 2000 $.24
1,000,000 October 3, 2000 $.24
5,105,000 June 1, 2001 $.24
CUSIP No. 81760P 10 4 13D Page 29 of 48
EXHIBIT 7
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "AGREEMENT") is made as of January 25,
2001 by and between Service Systems International, Ltd., a Nevada corporation
(the "Company"), and U.S. Filter/Wallace & Tiernan, Inc., a Delaware corporation
("WT").
Pursuant to a Strategic Alliance Agreement (the "STRATEGIC ALLIANCE AGREEMENT")
dated as of the date hereof by and between the Company and WT, WT will receive
on the date hereof and from time to time hereafter warrants (the "WARRANTS") to
acquire shares of common stock of the Company, $.001 par value per share
("COMMON STOCK"). In order to induce WT to enter into the Strategic Alliance
Agreement, the Company has agreed to provide the registration rights set forth
in this Agreement. The execution and delivery of this Agreement is a condition
to the effectiveness of the Strategic Alliance Agreement. Capitalized terms used
and not otherwise defined herein shall have the meanings assigned thereto in the
Strategic Alliance Agreement. In consideration of the premises and the mutual
promises herein contained, the parties hereto agree as follows:
1. DEMAND REGISTRATIONS.
(a) REQUESTS FOR REGISTRATION. The holders of a majority, but not less
than the Requisite Amount (as defined in SECTION 9), of Registrable Securities
(as defined in SECTION 9) may request registration under the Securities Act (as
defined in SECTION 9) of all or part, but not less than the Requisite Amount, of
their Registrable Securities on Form S-1 or any similar long-form registration
(a "LONG-FORM REGISTRATION") or, if available, on Form S-3 or any similar
short-form registration (a "SHORT-FORM REGISTRATION"). All registrations of the
type that may be requested pursuant to this SECTION 1(a) are referred to herein
as "DEMAND REGISTRATIONS." Each request for a Demand Registration shall specify
the approximate number of Registrable Securities requested to be registered and
the anticipated per share price range for such offering. Within 10 days after
receipt of any request for a Demand Registration, the Company shall give written
notice of such requested registration to all other holders of Registrable
Securities and, subject to SECTION 1(e) below, shall include in such
registration all Registrable Securities with respect to which the Company has
received written requests for inclusion therein within 15 days after the receipt
of the Company's notice by such holders.
(b) UNDERWRITTEN REGISTRATIONS. Registrations may, but need not, be
underwritten.
(c) NUMBER OF LONG-FORM REGISTRATIONS. The Company shall be obligated
to register Registrable Shares pursuant to a Long-Form Registration on two
occasions only; provided that (i) at least the Requisite Amount of Registrable
Securities is to be registered on each occasion; (ii) the Company shall be
obligated to register Registrable Securities pursuant to a Long-Form
Registration no more frequently than once in any period of 12 consecutive
months; and (iii) a registration shall not constitute a Long-Form Registration
unless the holders of Registrable Securities are able to register at least 90%
of the Registrable Securities requested to be included in such registration.
(d) SHORT-FORM REGISTRATIONS. Demand Registrations shall be Short-Form
Registrations whenever the Company is permitted to use any applicable short
form. The Company shall use reasonable best efforts to make Short-Form
Registrations available for the sale of Registrable Securities, PROVIDED, THAT:
(i) AT LEAST THE REQUISITE AMOUNT OF REGISTRABLE SECURITIES is to be registered
on each occasion; (ii) the Company shall be obligated to register Registrable
Securities pursuant to a Short-Form Registration no more frequently than once in
any period of 18 consecutive months; (iii) a registration shall not constitute a
Short-Form Registration unless the holders of Registrable Securities are able to
register at least 90% of the Registrable Securities requested to be included in
such registration; and (iv) if a Short-Form Registration is an underwritten
offering and any of the Registrable Securities requested to be included in such
registration are not included by operation of the provisions of SECTION 1(e),
then the next occasion on which Company shall be obligated to register
Registrable Securities pursuant to a Short-Form Registration may, at the option
of the holders of Registrable Securities, occur as soon as 12 months rather than
18 months thereafter.
CUSIP No. 81760P 10 4 13D Page 30 of 48
(e) PRIORITY ON DEMAND REGISTRATIONS. If a Demand Registration is an
underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Registrable Securities and other
securities, if any, requested to be included in such offering exceeds the number
of Registrable Securities and other securities, if any, which can be sold
therein without adversely affecting the marketability of the offering, the
Company shall include in such registration, prior to the inclusion of any
securities which are not Registrable Securities, the number of Registrable
Securities requested to be included which in the opinion of such underwriters
may be sold without adversely affecting the marketability of the offering, pro
rata among the respective holders thereof on the basis of the number of shares
of Registrable Securities that each holder had requested to be included in such
registration.
(f) POSTPONEMENT OF DEMAND REGISTRATIONS. The Company may postpone once
for up to 120 days the filing or the effectiveness of a registration statement
for a Demand Registration if the board of directors of the Company determines in
good faith that such Demand Registration would reasonably be expected to have a
material adverse effect on the Company; PROVIDED, HOWEVER, that the Company
shall notify the holders of the Registrable Securities of any such postponement
within 30 days of the Demand Registration request and PROVIDED FURTHER, that, in
such event, the holders of Registrable Securities initially requesting such
Demand Registration shall be entitled to withdraw such request by notice given
within 30 days of the Company's notice and, if such request is withdrawn, such
Demand Registration shall not constitute a Demand Registration permitted
hereunder.
(g) NON-EXERCISE OF WARRANTS. Notwithstanding anything in this
Agreement to the contrary, if holders of Warrants who have requested a Demand
Registration of the Common Stock issuable upon exercise of those Warrants fail
to exercise those Warrants and, as a result, either (i) the Demand Registration
is abandoned or withdrawn or (ii) 90% of the Registrable Securities requested to
be included in such Demand Registration are not included, then, either (x) the
holders requesting the registration promptly shall reimburse the Company for all
Registration Expenses paid or incurred by the Company, whereupon the Company
shall not be deemed to have effected a Demand Registration, or (y) the Company
shall be deemed to have effected a Demand Registration.
2. PIGGYBACK REGISTRATIONS.
(a) RIGHT TO PIGGYBACK. Subject to Sections 2(b) and 2(c), whenever the
Company proposes to register (other than pursuant to (i) a Demand Registration
in the case of a non-underwritten offering requested by holders of the Company's
securities other than holders of Registrable Securities, or (ii) a registration
on Form S-4 or Form S-8 or any successor or similar forms) any of its securities
under the Securities Act, whether or not for sale for its own account, and the
registration form to be used may be used for the registration of Registrable
Securities, the Company shall give written notice to all holders of Registrable
Securities of its intention to effect such a registration not later than 20 days
prior to the filing of the registration statement therefor pursuant to the
Securities Act. The Company shall include in such registration all Registrable
Securities (but only if constituting at least the Requisite Amount) with respect
to which the Company has received written requests for inclusion therein within
15 days after the receipt of the Company's notice. All registrations requested
pursuant to this SECTION 2(a) are referred to herein as "PIGGYBACK
REGISTRATIONS."
(b) PRIORITY ON PRIMARY REGISTRATIONS. If a Piggyback Registration is
an underwritten primary registration on behalf of the Company, and the managing
underwriters advise the Company in writing (with a copy to each party hereto
requesting registration of Registrable Securities) that in their opinion the
number of securities requested to be included in such registration exceeds the
number which can be sold in such offering without adversely affecting the
marketability of such offering, the Company shall include in such registration
(i) first, the securities the Company proposes to sell, (ii) second, the
Registrable Securities requested to be included in such registration, pro rata
among such holders on the basis of the number of shares that each holder has
requested to be included in such registration and (iii) third, other securities
requested to be included in such registration, pro rata among such holders on
the basis of the number of shares that each holder has requested to be included
in such registration.
CUSIP No. 81760P 10 4 13D Page 31 of 48
(c) PRIORITY ON SECONDARY REGISTRATIONS. Subject to SECTION 2(b), if a
Piggyback Registration is an underwritten secondary registration on behalf of
holders of the Company's securities other than holders of Registrable
Securities, and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering without
adversely affecting the marketability of the offering, the Company shall include
in such registration (i) first, the securities requested to be included therein
by the holders requesting such registration (other than holders who are
directors or executive officers of the Company or who own beneficially (within
the meaning of Rule 13d-3 under the Securities Exchange Act) more than five
percent of the Company's equity securities), pro rata among such holders on the
basis of the number of shares that each holder has requested to be included in
such registration, (ii) second, the Registrable Securities requested to be
included in such registration, pro rata among the holders on the basis of the
number of shares that each holder has requested to be included in such
registration, and (iii) third, other securities requested to be included in such
registration, pro rata among the holders of such other securities.
(d) OTHER REGISTRATIONS. If the Company has previously filed a
registration statement with respect to Registrable Securities pursuant to
SECTION 1 or pursuant to this SECTION 2, and if such previous registration has
not been withdrawn or abandoned, the Company shall not file or cause to be
effected any other registration of any of its equity securities, or securities
convertible or exchangeable into or exercisable for its equity securities, under
the Securities Act (except on Form S-4 or Form S-8 or any successor form),
whether on its own behalf or at the request of any holder or holders of such
securities, until a period of at least 120 days has elapsed from the effective
date under the Securities Act of such previous registration.
3. HOLDBACK AGREEMENTS.
(a) Each holder of Registrable Securities agrees not to effect any
public sale or distribution (including sales pursuant to Rule 144) of equity
securities of the Company, or any securities convertible into or exchangeable
into or exercisable for such securities, during the five days prior to, and
during the 180-day period beginning on, the effective date of any underwritten
registration (except, in each case, as part of such underwritten registration),
unless the underwriters managing the registered public offering otherwise agree.
(b) The Company agrees (i) not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable into or exercisable for such securities, during the five days prior
to, and during the 180-day period beginning on, the effective date of any
underwritten registration (except as part of such underwritten registration or
pursuant to registrations on Form S-4 or Form S-8 or any successor form), unless
the underwriters managing the registered public offering otherwise agree, and
(ii) to cause each director and executive officer of the Company, and, to the
extent the Company is able after using its reasonable best efforts, each holder
of its Common Stock whose securities are included in such an underwritten
registration, and, to the extent the Company is able after using its reasonable
best efforts, each holder of its Common Stock or any securities convertible into
or exchangeable into or exercisable for Common Stock, purchased from the Company
at any time after the date of this Agreement (other than in a registered public
offering, or pursuant to the Company's employee stock plans by persons who are
not directors or officers of the Company) to agree not to effect any public sale
or distribution (including sales pursuant to Rule 144) of any such securities
during such period (except as part of such underwritten registration, if
otherwise permitted), unless the underwriters managing the registered public
offering otherwise agree.
4. REGISTRATION PROCEDURES. Whenever the holders of Registrable
Securities have requested that any Registrable Securities be registered pursuant
to this Agreement, the Company shall use its best efforts to effect the
registration of such Registrable Securities in accordance with the intended
method of disposition thereof, and pursuant thereto the Company will as
expeditiously as possible:
(a) prepare and file with the Securities and Exchange Commission a
registration statement with respect to such Registrable Securities and
thereafter use its best efforts to cause such registration statement to become
effective; provided that before filing a registration statement or prospectus or
any amendments or supplements thereto, the Company will furnish to the counsel
selected by the holders of a majority of the Registrable Securities covered by
such registration statement copies of all such documents proposed to be filed
reasonably in advance of the filing thereof, which documents will be subject to
the reasonable and timely review of such counsel;
CUSIP No. 81760P 10 4 13D Page 32 of 48
(b) prepare and file with the Securities and Exchange Commission such
amendments and supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such registration
statement effective for a period of either (i) 120 days (subject to extension
pursuant to SECTION 7(b)) or, if such registration statement relates to an
underwritten offering, such longer period as in the opinion of counsel for the
underwriters a prospectus is required by law to be delivered in connection with
sales of Registrable Securities by an underwriter or dealer or (ii) such shorter
period as will terminate when all of the securities covered by such registration
statement have been disposed of in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such registration
statement (but in any event not before the expiration of any longer period
required under the Securities Act);
(c) furnish to each seller of Registrable Securities such number of
copies of such registration statement, each amendment and supplement thereto,
the prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as such seller may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such seller;
(d) use its best efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such jurisdictions
within the United States as any seller reasonably requests; PROVIDED, HOWEVER,
that the Company shall not be required to (i) qualify generally to do business
in any jurisdiction where it would not otherwise be required to qualify but for
this subparagraph, (ii) subject itself to taxation in any such jurisdiction, or
(iii) consent to general service of process in any such jurisdiction where it is
not then so subject;
(e) notify each seller of such Registrable Securities, at any time when
a prospectus relating thereto is required to be delivered under the Securities
Act, upon discovery that, or upon the discovery of the happening of any event as
a result of which, the prospectus included in such registration statement
contains an untrue statement of a material fact or omits any material fact
necessary to make the statements therein not misleading in light of the
circumstances under which they were made, and, at the request of any such
seller, the Company shall prepare and furnish to such seller a reasonable number
of copies of a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus will
not contain an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading in light of the
circumstances under which they were made;
(f) cause all such Registrable Securities to be listed or included on
each securities exchange or over the counter market on which securities of the
same class issued by the Company are then listed or traded, if any;
(g) during the time that such registration statement is being prepared,
make reasonably available for inspection by any seller of Registrable
Securities, any underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other agent retained by
any such seller or underwriter, financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors, employees and independent accountants to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement;
(h) otherwise use its best efforts to comply with all applicable rules
and regulations of the Securities and Exchange Commission, and make available to
its security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least twelve months beginning with the first day of
the Company's first full calendar quarter after the effective date of the
registration statement, which earnings statement will satisfy the provisions of
Section 11 (a) of the Securities Act and Rule 158 thereunder;
(i) permit any holder of Registrable Securities which holder might
reasonably be deemed to be an underwriter or a controlling person of the
Company, at its own expense, to participate in the preparation of such
registration statement and to propose the insertion therein of material,
furnished to the Company in writing, which in the reasonable judgment of such
holder and its counsel should be included;
(j) in the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification
CUSIP No. 81760P 10 4 13D Page 33 of 48
of any Common Stock included in such registration statement for sale in any
jurisdiction, the Company will use its reasonable best efforts promptly to
obtain the withdrawal of such order;
(k) if reasonably available, obtain a comfort letter, dated the
effective date of such registration statement (and, if such registration
includes an underwritten public offering, dated the date of the closing under
the underwriting agreement), signed by the Company's independent public
accountants in customary form and covering such matters of the type customarily
covered by comfort letters as the holders of a majority of the Registrable
Securities being sold reasonably request; and
(l) provide a legal opinion of the Company's outside counsel addressed
to each holder (in form or substance reasonably satisfactory to each such holder
and its counsel) of Registrable Securities included in such registration, dated
the effective date of such registration statement (and, if such registration
includes an underwritten public offering, dated the date of the closing under
the underwriting agreement), with respect to the registration statement, each
amendment and supplement thereto, the prospectus included therein (including the
preliminary prospectus) and such other documents relating thereto in customary
form and covering such matters of the type customarily covered by legal opinions
of such nature.
5. REGISTRATION EXPENSES.
(a) Except to the extent otherwise specifically provided herein, all
expenses incident to the Company's performance of or compliance with this
Agreement, including, without limitation, all registration and filing fees, fees
and expenses of compliance with securities or blue sky laws, printing expenses,
messenger and delivery expenses, and fees and disbursements of counsel for the
Company and all independent certified public accountants, underwriters
(including underwriting discounts and commissions other than those with respect
to the Registrable Securities) and other persons retained by the Company (all
such expenses being herein referred to as "Registration Expenses"), shall be
borne solely by the Company except for underwriting discounts and commissions
with respect to Registrable Securities which shall be borne by the holders of
Registrable Securities.
(b) In connection with each Long-Form Registration, Short-Form
Registration and each Piggyback Registration, the Company shall reimburse the
holders of Registrable Securities covered by such registration for the
reasonable fees and disbursements of one counsel chosen by the holders of a
majority of the Registrable Securities.
(c) To the extent that Registration Expenses are not required to be
paid by the Company, each holder of securities included in any registration
hereunder shall pay those Registration Expenses allocable to the registration of
such holder's securities so included, and any Registration Expenses not so
allocable shall be borne by all sellers of securities included in such
registration in proportion to the aggregate selling price of the securities to
be so registered.
6. INDEMNIFICATION.
(a) The Company agrees to indemnify and hold harmless, to the extent
permitted by law, each holder of Registrable Securities, its officers and
directors and each person who controls such holder (within the meaning of the
Securities Act) against any and all losses, claims, damages, liabilities, joint
or several, to which such holder or any such director or officer or controlling
person may become subject under the Securities Act or otherwise, to the extent
that such losses, claims, damages or liabilities (or actions or proceedings,
whether commenced or threatened, in respect thereof) arise out of or are based
upon (i) any untrue or alleged untrue statement of material fact contained (A)
in any registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or (B) in any application or other
document or communication (in this SECTION 6 collectively called an
"application") executed by or on behalf of the Company or based upon written
information furnished by or on behalf of the Company filed in any jurisdiction
in order to qualify any securities covered by such registration statement under
the "blue sky" or securities laws thereof, or (ii) any omission or alleged
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, and the Company will reimburse such
holder and each such director, officer and controlling person for any legal or
any other expenses incurred by them in connection with investigating or
defending any such loss, claim, liability, action or proceeding; PROVIDED,
HOWEVER, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage,
CUSIP No. 81760P 10 4 13D Page 34 of 48
liability (or action or proceeding in respect thereof) or expense arises out of
or is based upon an untrue statement or omission made in such registration
statement, any such prospectus or preliminary prospectus or any amendment
thereof or supplement thereto, or in any application, in reliance upon, and in
conformity with a request made by a holder pursuant to Section 4(i), written
information furnished to the Company by a holder for use therein or by a
holder's failure to deliver a copy of the prospectus or any amendments thereof
or supplements thereto after the Company has furnished such holder with a
sufficient number of copies of the same. In connection with an underwritten
offering, the Company shall indemnify such underwriters, their officers and
directors and each person who controls such underwriters (within the meaning of
the Securities Act) to the same extent as provided above with respect to the
indemnification of the holders of Registrable Securities.
(b) In connection with any registration statement in which a holder of
Registrable Securities is participating, each such holder shall furnish to the
Company in writing such information and affidavits as the Company reasonably
requests for use in connection with any such registration statement or
prospectus and, to the extent permitted by law, will indemnify and hold harmless
the Company, its directors and officers and each other person who controls the
Company (within the meaning of the Securities Act) against any losses, claims,
damages or liabilities to which the Company or any such director or officer or
controlling person may become subject under the Securities Act or otherwise, to
the extent that such losses, claims, damages or liabilities (or actions or
proceedings, whether commenced or threatened, in respect thereof) result from
(i) any untrue statement of a material fact contained in the registration
statement, prospectus or preliminary prospectus or any amendment thereof or
supplement thereto or in any application or (ii) any omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only to the extent that such untrue statement or omission is
made in such registration statement, any such prospectus or preliminary
prospectus or any amendment thereof or supplement thereto, or in any
application, in reliance upon and in conformity with written information, or
omissions therefrom, furnished to the Company by such holder expressly for use
therein; PROVIDED, HOWEVER, that the obligation to indemnify shall be individual
to each holder and shall be limited to the net amount of proceeds received by
such holder from the sale of Registrable Securities pursuant to such
registration statement.
(c) Any person entitled to indemnification hereunder shall (i) give
prompt written notice to the indemnifying party of any claim with respect to
which it seeks indemnification and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed, the
indemnifying party shall not be subject to any liability for any settlement made
by the indemnified party without its consent (but such consent will not be
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim shall not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.
(d) The indemnification provided for under this Agreement shall remain
in full force and effect regardless of any investigation made by or on behalf of
the indemnified party or any officer, director or controlling person of such
indemnified party and shall survive the transfer of securities. The indemnifying
party shall make such provisions, as are reasonably requested by any indemnified
party, for contribution to such party in the event the indemnifying party's
indemnification is unavailable for any reason.
7. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS.
(a) No person may participate in any registration hereunder which is
underwritten unless such person (i) agrees to sell such person's securities on
the basis provided in any underwriting arrangements approved by the person or
persons entitled hereunder to approve such arrangements (including, without
limitation, pursuant to the terms of any over-allotment or "green shoe" option
requested by the managing underwriters, except that no holder of Registrable
Securities shall be required to sell more than the number of Registrable
Securities that such holder has requested the Company to include in any
registration) and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements; provided that no
holder of Registrable Securities included in any underwritten
CUSIP No. 81760P 10 4 13D Page 35 of 48
registration shall be required to make any representations or warranties to the
Company or the underwriters other than representations and warranties regarding
such holder, such holders ownership of the Registrable Securities and such
holder's intended method of distribution.
(b) Each person that is participating in any Registration hereunder
agrees that, upon receipt of any notice from the Company of the happening of any
event of the kind described in SECTION 4(e) above, such person shall forthwith
discontinue the disposition of its Registrable Securities pursuant to the
registration statement until such person's receipt of the copies of a
supplemented or amended prospectus as contemplated by such SECTION 4(e). In the
event the Company shall give any such notice, the applicable time period
mentioned in SECTION 4(b) during which a Registration Statement is to remain
effective will be extended by the number of days during the period from and
including the date of the giving of such notice pursuant to this SECTION 7(b) to
and including the date when each seller and underwriter of a Registrable
Security covered by such registration statement has received the copies of the
supplemented or amended prospectus contemplated by SECTION 4(e).
8. CURRENT PUBLIC INFORMATION. The Company will at all times file all
reports required to be filed by it under the Securities Act and the Securities
Exchange Act (as defined in Section 9) and the rules and regulations adopted by
the Securities and Exchange Commission thereunder.
9. DEFINITIONS.
"REGISTRABLE SECURITIES" means (i) any Common Stock issued or issuable upon the
exercise of Warrants that are exercisable within 90 days after a registration
request, and (ii) any Common Stock issued or issuable directly or indirectly
with respect to the securities referred to in clause (i) by way of stock
dividend, stock conversion or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation or other reorganization. For
purposes of this Agreement, a person shall be deemed to be the holder of
Registrable Securities whenever such person has the right to acquire directly or
indirectly such Registrable Securities (upon conversion or exercise, in
connection with a transfer of securities or otherwise, but disregarding any
restrictions or limitations upon the exercise of such right), whether or not
such acquisition has actually been effected. As to any particular shares
constituting Registrable Securities, such shares shall cease to be Registrable
Securities when they have been (x) effectively registered under the Securities
Act, or (y) sold pursuant to Rule 144 (or any similar provision then in force)
under the Securities Act.
"REQUISITE AMOUNT" means, with respect to Registrable Securities, the lesser of
(i) 1,000,000 shares of Common Stock or (ii) the remaining shares of Common
Stock as to which WT or its transferee is the holder.
"RULE 144" means Rule 144 adopted by the Securities and Exchange Commission
under the Securities Act, as such rule may be in effect from time to time.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"SHARES" means the $0.001 par value common stock of the Company.
10. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Company will not hereafter enter
into any agreement with respect to its securities which is inconsistent with or
violates the rights granted to the holders of Registrable Securities in this
Agreement.
(b) REMEDIES. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party hereto will have the right to injunctive relief, in
addition to all of its other rights and remedies at law or in equity, to enforce
the provisions of this Agreement.
CUSIP No. 81760P 10 4 13D Page 36 of 48
(c) AMENDMENTS AND WAIVERS. Except as otherwise provided herein, the
provisions of this Agreement may be amended or waived only upon the prior
written consent of the Company and the holders of a majority of the Registrable
Securities.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, inure
to the benefit of and be enforceable by the parties hereto and their respective
successors and assigns. In addition, and whether or not any express assignment
shall have been made, the provisions of this Agreement which are for the benefit
of the holders of any Registrable Securities as such will be for the benefit of
and enforceable by any subsequent holder of any Registrable Securities.
(e) SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts taken together shall constitute one and the
same Agreement.
(g) DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement
are inserted for convenience only and do not constitute a part of this
Agreement.
(h) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Delaware without giving effect
to any choice or conflict of law provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware.
Each of the parties agrees that any legal action commenced by either party to
this Agreement shall be brought in either the United States District Court in
and for the District of Delaware or the Chancery Court in and for New Castle
County, Delaware and consents to the personal jurisdiction of such courts in any
such action over the parties. If, contrary to the provisions of this Section
10(h), either party commences any legal action involving this Agreement or the
transactions contemplated by this Agreement in any forum other than either of
those specified above, the other party shall be entitled to the dismissal of
such action based upon the agreement of the parties contained in this Section
10(h).
(i) NOTICES. All notices, requests, demands, claims and other
communications hereunder shall be in writing. Any notice, request, demand, claim
or other communication hereunder shall be deemed duly given if (and then on the
date of first attempted delivery) it is sent by registered or certified mail,
return receipt requested, postage prepaid, and addressed to the intended
recipient as set forth below:
IF TO WT: COPY TO:
---------- --------
U.S. Filter/Wallace & Tiernan, Inc. United States Filter Corporation
1901 West Garden Road 181 Thorn Hill Road
Vineland, N.J. 08360 Warrendale, PA 15086
Attn: Executive Vice President Attn: Associate General Counsel
Fax: (856) 507-9347 Fax: (724) 772-1420
IF TO THE COMPANY: COPY TO:
------------------- --------
Service Systems International, Ltd. Alison K. Schuler, Esq.
2800 Ingleton Avenue Schuler, Messersmith, Daly
Burnaby, B.C. & Lansdowne
Canada V5C 6G7 4300 San Mateo, NE
Attn: President Suite B380
Fax: (604) 451-1072 Albuquerque, NM 87110
Fax: (505) 872-0900
CUSIP No. 81760P 10 4 13D Page 37 of 48
Either party may send any notice, request, demand, claim or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service,
telecopy, ordinary mail or electronic mail), but no such notice, request,
demand, claim or other communication shall be deemed to have been duly given
unless and until it actually is received by the intended recipient. Either party
may change the address to which notices, requests, demands, claims and other
communications hereunder are to be delivered by giving the other party notice in
the manner herein set forth.
* * * * *
CUSIP No. 81760P 10 4 13D Page 38 of 48
IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement
as of the date first written above.
SERVICE SYSTEMS INTERNATIONAL, LTD.
By:
-------------------------------
Its:
------------------------------
U.S. FILTER/WALLACE & TIERNAN, INC.
By:
--------------------------------
Its:
-------------------------------
CUSIP No. 81760P 10 4 13D Page 39 of 48
EXHIBIT 8
SHAREHOLDER OFFER AGREEMENT
THIS SHAREHOLDER OFFER AGREEMENT (the "AGREEMENT") is made as of January 25,
2001 by and between Kenneth R. Fielding (the "SHAREHOLDER") and U.S.
Filter/Wallace & Tiernan, Inc., a Delaware corporation ("WT").
In order to induce WT to enter into that certain Strategic Alliance Agreement
dated as of the date hereof (the "STRATEGIC ALLIANCE AGREEMENT") by and between
WT and Service Systems International, Ltd., a Nevada corporation the "COMPANY"),
the Shareholder has agreed to provide to WT the offer rights set forth in this
Agreement with respect to shares of the Company's Common Stock, $.001 par value
(the "COMMON STOCK"), owned from time to time by the Shareholder. The execution
and delivery of this Agreement is a condition to the effectiveness of the
Strategic Alliance Agreement. Capitalized terms used and not otherwise defined
herein shall have the meanings assigned thereto in the Strategic Alliance
Agreement. The parties hereto agree as follows:
1. RIGHT TO MAKE AN OFFER TO PURCHASE SHAREHOLDER SHARES
(a) In the event that either the Shareholder or an Affiliate of the
Shareholder other than the Company (in any such case, the "OFFEROR") wishes to
sell all or any portion of the shares of Common Stock of the Company then owned
beneficially or of record by the Shareholder (the "SHAREHOLDER SHARES") to any
person or entity other than (i) an Affiliate of the Shareholder other than the
Company, (ii) each other Shareholder of the Company who has executed and
delivered to WT an agreement substantially similar to this Agreement, or (iii)
the Shareholder's spouse or child or a fiduciary for the benefit of his spouse
or child or any of them, the Shareholder shall first, and prior to soliciting or
otherwise seeking indications of interest from any third parties with respect to
the purchase of the Shareholder Shares or offering the Shareholder Shares for
sale through a securities broker, dealer or market maker, notify WT (the
"OFFEREE") in writing (the "NOTICE OF INTENDED SALE") of the number of
Shareholder Shares for sale by the Offeror (the "OFFERED SHARES") and, if the
Offeror has received an unsolicited offer from a third party to buy the Offered
Shares which the Offeror otherwise intends to accept ("Acceptable Third Party
Offer"), the material proposed terms and conditions thereof.
(b) The Offeror shall engage in exclusive discussions with the Offeree,
if the latter so desires, for a period not to exceed 20 days from the date of
receipt by the Offeree of the Notice of Intended Sale, for the purpose of
attempting to determine a price per share for and other terms and conditions
related to a possible purchase and sale of the Offered Shares. Not later than
the end of such 20 day period, the Offeree shall notify the Offeror in writing
either (i) of its offer (the "Offer") to buy the Offered Shares, which offer
shall state a specified or formula price per share (the "Offeree Proposed
Price"), and other purchase terms and conditions ("Offeree Proposed Terms"), or
(ii) that the Offeree does not wish to purchase any of the Offered Shares.
(c)
(i) If the Notice of Intended Sale refers to an Acceptable
Third Party Offer and discloses the material terms and conditions thereof, and
the Offer reflects an unconditional agreement by the Offeree to purchase all of
the offered Shares for the price and upon such disclosed material terms and
conditions set forth in the Acceptable Third Party offer, then the Offeror shall
sell and the Offeree shall purchase the Offered Shares strictly for such price
and upon such terms. If the Notice of Intended Sale does not refer to an
Acceptable Third Party Offer, but does specify an acceptable price and
acceptable terms and conditions, and the Offer reflects an unconditional
agreement by the Offeree to purchase all of the offered Shares for the price and
upon the terms and conditions set forth in the Notice of Intended Sale, then the
Offeror shall sell and the Offeree shall purchase the Offered Shares strictly
for such price and upon such terms and conditions. If the Offeror otherwise
wishes in his discretion to sell the Offered Shares to the Offeree at the
Offeree Proposed Price and upon the Offeree Proposed Terms, then within 10 days
after the receipt by the Offeror of the Offer, the Offeror shall notify the
Offeree of his
CUSIP No. 81760P 10 4 13D Page 40 of 48
acceptance thereof, whereupon the Offeror shall sell and the Offeree shall
purchase the Offered Shares for such price and upon such terms
(ii) If the Offeror is not obligated to sell pursuant to
Section 1(c)(i), then the Offeror shall be free, for a period of 90 days after
the date of receipt by the Offeror of the notice required by paragraph 1(b)(i)
or 1(b)(ii), to consummate a sale of the Offered Shares to any Person, provided,
however, if the Notice of Intended Sale referred to in Section 1(a) above
specified an acceptable purchase price and other acceptable purchase terms and
conditions, then such sale shall be at a price equal to or greater than any
acceptable purchase price contained in the Notice of Intended Sale referred to
in Section 1(a) above and strictly upon such other purchase terms and conditions
as set forth in the Notice of Intended Sale. To the extent that a sale is not
consummated by the Offeror within the periods contemplated by this subparagraph
(ii), without any fault on the part of the Offeree, the offered shares shall
thereafter again be subject to the provisions of this Section 1.
(d) Notwithstanding any provision hereof to the contrary, the
Shareholder shall be free to sell Shareholder Shares pursuant to the provisions
of Rule 144 adopted by the Securities and Exchange Commission under the
Securities Act of 1933, as amended, as such rule may be in effect from time to
time.
2. TERM. This Agreement shall be in effect for a term commencing on the
Commencement Date of the Strategic Alliance Agreement and ending at the end of
the Term of the Strategic Alliance Agreement. Notwithstanding the foregoing,
this Agreement shall remain in effect with respect to any Shareholder Shares
that were the subject (or were required to be the subject) of a Notice of
Intended Sale prior to the termination hereof, until such time as all of the
provisions of Section 1 of this Agreement have been complied with as to such
Shareholder Shares.
3. REPRESENTATIONS OF THE SHAREHOLDER. The Shareholder represents and
warrants to WT that the statements contained in this Section 3 are correct and
complete as of the date of this Agreement and will be correct and complete as of
the date of any Notice of Intended Sale, any notice of an Offeree Proposed Price
or any notice of a Revised Offeree Proposed Price hereunder.
(a) This Agreement constitutes the valid and legally binding obligation
of the Shareholder, enforceable in accordance with its terms and conditions.
(b) Neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will (i) violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge or other restriction of any government, governmental agency or
court to which the Shareholder is subject, or (ii) conflict with, result in a
breach of, constitute a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify or cancel, or require any
notice under any agreement, contract, instrument or other arrangement to which
the Shareholder is a party, by which the Shareholder is bound or to which the
Shareholder is subject.
4. Representations of WT. WT represents and warrants to the Shareholder
that the statements contained in this Section 4 are correct and complete as of
the date of this Agreement and will be correct and complete as of the date of
any Notice of Intended Sale, any notice of an Offeree Proposed Price, or any
notice of a Revised Offeree Proposed Price hereunder.
(a) WT is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation.
(b) WT is duly authorized to conduct business and is in good standing
under the laws of each jurisdiction where such qualification is required. WT has
full power and authority and all licenses, permits and authorizations necessary
to carry on the business in which it is engaged and in which it presently
proposes to engage and to own and use the properties owned and used by it.
CUSIP No. 81760P 10 4 13D Page 41 of 48
(c) WT has full power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. Without limiting the
generality of the foregoing, the Board of Directors of WT has duly authorized
the execution, delivery and performance of this Agreement by WT. This Agreement
constitutes the valid and legally binding obligation of WT, enforceable in
accordance with its terms and conditions.
(d) Neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge or other restriction of any government, governmental agency or
court to which WT is subject or any provision of its charter or bylaws, or
conflict with, result in a breach of, constitute a default under, result in the
acceleration of, create in any party the right to accelerate, terminate, modify
or cancel, or require any notice under any agreement, contract, lease, license,
instrument or other arrangement to which WT is a party or by which it is bound
or to which any of its assets is subject.
5. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Shareholder will not hereafter
enter into any agreement with respect to the Company's securities owned by the
Shareholder, which is inconsistent with or violates the rights granted to WT in
this Agreement.
(b) REMEDIES. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party hereto will have the right to injunctive relief, in
addition to all of its other rights and remedies at law or in equity, to enforce
the provisions of this Agreement.
(c) AMENDMENTS AND WAIVERS. Except as otherwise provided herein, the
provisions of this Agreement may be amended or waived only upon the prior
written consent of the parties hereto.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns.
(e) SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts taken together shall constitute one and the
same Agreement.
(g) DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement
are inserted for convenience only and do not constitute a part of this
Agreement.
(h) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Delaware without giving effect
to any choice or conflict of law provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware. Each of the parties agrees
that any legal action commenced by either party to this Agreement shall be
brought in either the United States District Court in and for the District of
Delaware or the Chancery Court in and for New Castle County, Delaware and
consents to the personal jurisdiction of such courts in any such action over the
parties. If, contrary to the provisions of this Section 5(h), either party
commences any legal action involving this Agreement or the transactions
contemplated by this Agreement in any forum other than either of those specified
above, the other party shall be entitled to the dismissal of such action based
upon the agreement of the parties contained in this Section 5(h).
CUSIP No. 81760P 10 4 13D Page 42 of 48
(i) NOTICES. All notices, demands or other communications to be given
or delivered under or by reason of the provisions of this Agreement will be in
writing and will be personally delivered, received by certified mail, return
receipt requested, or sent by guaranteed overnight courier service. Notices will
be deemed to have been given hereunder (i) when delivered personally or (ii) on
the date of first attempted delivery on a business day within the jurisdiction
where delivery is attempted after deposit with a reputable overnight delivery
service.
Such notices, demands and other communications will be sent to WT and the
Company at the addresses indicated below:
IF TO THE SHAREHOLDER:
---------------------
c/o Service Systems International, Ltd.
2800 Ingleton Avenue
Burnaby, B.C.
Canada V5C 6G7
Fax: (604) 451-1072
IF TO WT:
--------
U.S. Filter/Wallace & Tiernan, Inc.
1901 West Garden Road
Vineland, N.J. 08360
Attention: Executive Vice President
Fax: (856) 507-9347
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
(j) SECURITIES LAW. Notwithstanding anything herein to the contrary,
the rights and obligations of any persons arising under or in connection with
this Agreement shall be subject to the Securities Act of 1933 and other
applicable securities law and regulation.
* * * * *
CUSIP No. 81760P 10 4 13D Page 43 of 48
IN WITNESS WHEREOF, the parties have executed this Shareholder Offer Agreement
as of the date first written above.
--------------------------------------
--------------------------------------
Printed Name of Shareholder
U.S. FILTER/WALLACE & TIERNAN, INC.
By:
-----------------------------------
Its:
----------------------------------
CUSIP No. 81760P 10 4 13D Page 44 of 48
EXHIBIT 9
SHAREHOLDER OFFER AGREEMENT
THIS SHAREHOLDER OFFER AGREEMENT (the "AGREEMENT") is made as of January 25,
2001 by and between John R. Gaetz (the "SHAREHOLDER") and U.S. Filter/Wallace &
Tiernan, Inc., a Delaware corporation ("WT").
In order to induce WT to enter into that certain Strategic Alliance Agreement
dated as of the date hereof (the "STRATEGIC ALLIANCE AGREEMENT") by and between
WT and Service Systems International, Ltd., a Nevada corporation (the
"COMPANY"), the Shareholder has agreed to provide to WT the offer rights set
forth in this Agreement with respect to shares of the Company's Common Stock,
$.001 par value (the "COMMON STOCK"), owned from time to time by the
Shareholder. The execution and delivery of this Agreement is a condition to the
effectiveness of the Strategic Alliance Agreement. Capitalized terms used and
not otherwise defined herein shall have the meanings assigned thereto in the
Strategic Alliance Agreement. The parties hereto agree as follows:
1. RIGHT TO MAKE AN OFFER TO PURCHASE SHAREHOLDER SHARES
(a) In the event that either the Shareholder or an Affiliate of the
Shareholder other than the Company (in any such case, the "OFFEROR") wishes to
sell all or any portion of the shares of Common Stock of the Company then owned
beneficially or of record by the Shareholder (the "SHAREHOLDER SHARES") to any
person or entity other than (i) an Affiliate of the Shareholder other than the
Company, (ii) each other Shareholder of the Company who has executed and
delivered to WT an agreement substantially similar to this Agreement, (iii) the
Shareholder's spouse or child or a fiduciary for the benefit of his spouse or
child or any of them, or (iv) pursuant to the terms of that stock pledge dated
July 13, 2000 given by Shareholder to LRG Construction Ltd. by whose terms
300,000 shares of the Common Stock of the Company have been pledged, the
Shareholder shall first, and prior to soliciting or otherwise seeking
indications of interest from any third parties with respect to the purchase of
the Shareholder Shares or offering the Shareholder Shares for sale through a
securities broker, dealer or market maker, notify WT (the "OFFEREE") in writing
(the "NOTICE OF INTENDED SALE") of the number of Shareholder Shares for sale by
the Offeror (the "OFFERED SHARES") and, if the Offeror has received an
unsolicited offer from a third party to buy the Offered Shares which the Offeror
otherwise intends to accept ("Acceptable Third Party Offer"), the material
proposed terms and conditions thereof.
(b) The Offeror shall engage in exclusive discussions with the Offeree,
if the latter so desires, for a period not to exceed 20 days from the date of
receipt by the Offeree of the Notice of Intended Sale, for the purpose of
attempting to determine a price per share for and other terms and conditions
related to a possible purchase and sale of the Offered Shares. Not later than
the end of such 20 day period, the Offeree shall notify the Offeror in writing
either (i) of its offer (the "OFFER") to buy the Offered Shares, which offer
shall state a specified or formula price per share (the "Offeree Proposed
Price"), and other purchase terms and conditions ("OFFEREE PROPOSED Terms"), or
(ii) that the Offeree does not wish to purchase any of the Offered Shares.
(c)
(i) If the Notice of Intended Sale refers to an Acceptable
Third Party Offer and discloses the material terms and conditions thereof, and
the Offer reflects an unconditional agreement by the Offeree to purchase all of
the Offered Shares for the price and upon such disclosed material terms and
conditions set forth in the Acceptable Third Party Offer, then the Offeror shall
sell and the Offeree shall purchase the Offered Shares strictly for such price
and upon such terms. If the Notice of Intended Sale does not refer to an
Acceptable Third Party Offer, but does specify an acceptable price and
acceptable terms and conditions, and the Offer reflects an unconditional
agreement by the Offeree to purchase all of the Offered Shares for the price and
upon the terms and conditions set forth in the Notice of Intended Sale, then the
Offeror shall sell and the Offeree shall purchase the Offered Shares strictly
for such price and upon such terms and conditions. If the Offeror otherwise
wishes in his
CUSIP No. 81760P 10 4 13D Page 45 of 48
discretion to sell the Offered Shares to the Offeree at the Offeree Proposed
Price and upon the Offeree Proposed Terms, then within 10 days after the receipt
by the Offeror of the Offer, the Offeror shall notify the Offeree of his
acceptance thereof, whereupon the Offeror shall sell and the Offeree shall
purchase the Offered Shares for such price and upon such terms
(ii) If the Offeror is not obligated to sell pursuant to
Section 1(c)(i), then the Offeror shall be free, for a period of 90 days after
the date of receipt by the Offeror of the notice required by paragraph 1(b)(i)
or 1(b)(ii), to consummate a sale of the Offered Shares to any Person, PROVIDED,
HOWEVER, if the Notice of Intended Sale referred to in Section 1(a) above
specified an acceptable purchase price and other acceptable purchase terms and
conditions, then such sale shall be at a price equal to or greater than any
acceptable purchase price contained in the Notice of Intended Sale referred to
in Section 1(a) above and strictly upon such other purchase terms and conditions
as set forth in the Notice of Intended Sale. To the extent that a sale is not
consummated by the Offeror within the periods contemplated by this subparagraph
(ii), without any fault on the part of the Offeree, the Offered Shares shall
thereafter again be subject to the provisions of this Section 1.
(d) Notwithstanding any provision hereof to the contrary, the
Shareholder shall be free to sell Shareholder Shares pursuant to the provisions
of Rule 144 adopted by the Securities and Exchange Commission under the
Securities Act of 1933, as amended, as such rule may be in effect from time to
time.
2. TERM. This Agreement shall be in effect for a term commencing on
the Commencement Date of the Strategic Alliance Agreement and ending at the end
of the Term of the Strategic Alliance Agreement. Notwithstanding the foregoing,
this Agreement shall remain in effect with respect to any Shareholder Shares
that were the subject (or were required to be the subject) of a Notice of
Intended Sale prior to the termination hereof, until such time as all of the
provisions of Section 1 of this Agreement have been complied with as to such
Shareholder Shares.
3. REPRESENTATIONS OF THE SHAREHOLDER. The Shareholder represents
and warrants to WT that the statements contained in this Section 3 are correct
and complete as of the date of this Agreement and will be correct and complete
as of the date of any Notice of Intended Sale, any notice of an Offeree Proposed
Price or any notice of a Revised Offeree Proposed Price hereunder.
(a) This Agreement constitutes the valid and legally binding obligation
of the Shareholder, enforceable in accordance with its terms and conditions.
(b) Neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will (i) violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge or other restriction of any government, governmental agency or
court to which the Shareholder is subject, or (ii) conflict with, result in a
breach of, constitute a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify or cancel, or require any
notice under any agreement, contract, instrument or other arrangement to which
the Shareholder is a party, by which the Shareholder is bound or to which the
Shareholder is subject.
4. REPRESENTATIONS OF WT. WT represents and warrants to the
Shareholder that the statements contained in this Section 4 are correct and
complete as of the date of this Agreement and will be correct and complete as of
the date of any Notice of Intended Sale, any notice of an Offeree Proposed
Price, or any notice of a Revised Offeree Proposed Price hereunder.
(a) WT is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation.
(b) WT is duly authorized to conduct business and is in good standing
under the laws of each jurisdiction where such qualification is required. WT has
full power and authority and all licenses, permits and authorizations necessary
to carry on the business in which it is engaged and in which it presently
proposes to engage and to own and use the properties owned and used by it.
CUSIP No. 81760P 10 4 13D Page 46 of 48
(c) WT has full power and authority to execute and deliver this
Agreement and to perform its obligations hereunder. Without limiting the
generality of the foregoing, the Board of Directors of WT has duly authorized
the execution, delivery and performance of this Agreement by WT. This Agreement
constitutes the valid and legally binding obligation of WT, enforceable in
accordance with its terms and conditions.
(d) Neither the execution and the delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, will violate any
constitution, statute, regulation, rule, injunction, judgment, order, decree,
ruling, charge or other restriction of any government, governmental agency or
court to which WT is subject or any provision of its charter or bylaws, or
conflict with, result in a breach of, constitute a default under, result in the
acceleration of, create in any party the right to accelerate, terminate, modify
or cancel, or require any notice under any agreement, contract, lease, license,
instrument or other arrangement to which WT is a party or by which it is bound
or to which any of its assets is subject.
5. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Shareholder will not hereafter
enter into any agreement with respect to the Company's securities owned by the
Shareholder, which is inconsistent with or violates the rights granted to WT in
this Agreement.
(b) REMEDIES. The parties hereto agree and acknowledge that money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement and that any party hereto will have the right to injunctive relief, in
addition to all of its other rights and remedies at law or in equity, to enforce
the provisions of this Agreement.
(c) AMENDMENTS AND WAIVERS. Except as otherwise provided herein, the
provisions of this Agreement may be amended or waived only upon the prior
written consent of the parties hereto.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon,
inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns.
(e) SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which need not contain the signatures of more than one
party, but all such counterparts taken together shall constitute one and the
same Agreement.
(g) DESCRIPTIVE HEADINGS. The descriptive headings of this Agreement
are inserted for convenience only and do not constitute a part of this
Agreement.
(h) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the domestic laws of the State of Delaware without giving effect
to any choice or conflict of law provision or rule (whether of the State of
Delaware or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Delaware. Each of the parties agrees
that any legal action commenced by either party to this Agreement shall be
brought in either the United States District Court in and for the District of
Delaware or the Chancery Court in and for New Castle County, Delaware and
consents to the personal jurisdiction of such courts in any such action over the
parties. If, contrary to the provisions of this Section 5(h), either party
commences any legal action involving this Agreement or the transactions
contemplated by this Agreement in any forum other than either of those specified
above, the other party shall be entitled to the dismissal of such action based
upon the agreement of the parties contained in this Section 5(h).
CUSIP No. 81760P 10 4 13D Page 47 of 48
(i) NOTICES. All notices, demands or other communications to be given
or delivered under or by reason of the provisions of this Agreement will be in
writing and will be personally delivered, received by certified mail, return
receipt requested, or sent by guaranteed overnight courier service. Notices will
be deemed to have been given hereunder (i) when delivered personally or (ii) on
the date of first attempted delivery on a business day within the jurisdiction
where delivery is attempted after deposit with a reputable overnight delivery
service. Such notices, demands and other communications will be sent to WT and
the Company at the addresses indicated below:
IF TO THE SHAREHOLDER:
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c/o Service Systems International, Ltd.
2800 Ingleton Avenue
Burnaby, B.C.
Canada V5C 6G7
Fax: (604) 451-1072
IF TO WT:
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U.S. Filter/Wallace & Tiernan, Inc.
1901 West Garden Road
Vineland, N.J. 08360
Attention: Executive Vice President
Fax: (856) 507-9347
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
(j) SECURITIES LAW. Notwithstanding anything herein to the contrary,
the rights and obligations of any persons arising under or in connection with
this Agreement shall be subject to the Securities Act of 1933 and other
applicable securities law and regulation.
* * * * *
CUSIP No. 81760P 10 4 13D Page 48 of 48
IN WITNESS WHEREOF, the parties have executed this Shareholder Offer Agreement
as of the date first written above.
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Printed Name of Shareholder
U.S. FILTER/WALLACE & TIERNAN, INC.
By:
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Its:
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