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EXHIBIT 3.25
RIGHT OF FIRST REFUSAL AGREEMENT
THIS AGREEMENT made the 1st day of December, 1998,
BETWEEN:
VICTOR FRADKIN,
of the City of Richmond Hill, in the Regional Municipality of York
(hereinafter called "Victor"),
RHYS QUIN,
of the City of Toronto
(hereinafter called "Rhys"),
LAUDERDALE CAPITAL CORP.,
a corporation incorporated under the laws of the Province of Ontario
of the City of Toronto (hereinafter called "Lenco"),
LARRY HOFFMAN,
of the City of Toronto
(hereinafter called "Larry")
(Victor, Rhys, Lenco and Larry being hereinafter collectively called
the "Vendors")
OF THE FIRST PART,
- and -
INTERNATIONAL MENU SOLUTIONS INC.,
a corporation incorporated under the laws of the Province of
Ontario, (hereinafter called the "Purchaser")
OF THE SECOND PART,
- and -
INTERNATIONAL MENU SOLUTIONS CORPORATION,
a corporation incorporated under the laws of the State of Nevada,
(hereinafter called "IMSC")
OF THE THIRD PART,
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RECITALS:
A. The Vendors, the Purchaser and IMSC have entered into a Share Purchase
Agreement dated November 30. 1998 (the "Purchase Agreement") with respect
to the acquisition of all of the issued and outstanding shares in the
capital of Transcontinental Gourmet Foods Inc. and 59% of the issued and
outstanding shares in the capital of Norbakco Ltd.
B. As part of the purchase price for such acquisition, the Purchaser has
issued to the Vendors Class B Special Shares, Class C Special Shares and
Class D Special Shares in the capital of the Purchaser (collectively, the
"IMSI Special Shares") which IMSI Special Shares are exchangeable for
common shares in the capital of IMSC (the "IMSC Common Shares") on the
terms and conditions set forth in the Purchase Agreement and the articles
of IMSI.
C. The Purchase Agreement provides for the issuance of Class N shares in the
capital of IMSC (the "Class N Shares") to the Vendors on the terms and
conditions set forth therein.
D. The IMSI Special Shares, the IMSC Common Shares and the Class N Shares and
any shares or securities into which such shares may be converted or
changed or which result from a consolidation, subdivision,
reclassification or redesignation of such shares, any shares or securities
which are received on such shares as a stock dividend or distribution
payable in shares or securities of the Purchaser or IMSC, any shares
received on the exercise of any option, warrant or other similar right
received on such shares and any shares or securities which may be received
by the parties hereto on such shares as a result of an amalgamation,
merger, arrangement or other reorganization of or including the Purchaser
or IMSC, and where the context permits, includes any instrument of the
Purchaser or IMSC that is convertible into shares or evidences the right
to acquire shares are collectively referred to herein as the "Subject
Shares".
E. It is a condition of the Purchase Agreement that the Vendors enter into
this Right of First Refusal Agreement with the Purchaser on the terms and
conditions set forth herein.
NOW THEREFORE in consideration of the sum of $10.00 and other good and valuable
consideration (the receipt and sufficiency of which is hereby acknowledged by
the parties hereto) the parties agree as follows:
1. Definition of Transfer
For the purposes of this Right of First Refusal Agreement, "Transfer" includes
any sale, exchange, assignment, gift, bequest, disposition, mortgage, charge,
pledge, encumbrance, grant of security interest or other arrangement by which
possession, legal title or beneficial ownership passes from one person to
another, or to the same person in a different capacity, whether or not voluntary
and whether or not for value, and any agreement to effect any of the foregoing
but shall not include any Transfer:
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(a) to any member of the transferring Vendor's Family and such transferee
enters into such agreement as the Purchaser may reasonably require to
evidence that the transferee shall be bound by the provisions of this
Agreement provided that the transferor shall not be released from its
obligations hereunder;
(b) by way of mortgage, charge, pledge, grant of security interest or other
encumbrance provided that such encumbrancer acknowledges that its rights
are subject to the terms and conditions hereof; or
(c) which constitutes a Transfer by virtue of the exchange of any IMSI Special
Shares, for IMSC Common Shares pursuant to the exercise of the rights
attaching to such IMSI Special Shares in the Purchase Agreement or the
articles of IMSI.
For purposes hereof, members of any particular Vendor's Family shall mean such
Vendor's (and in the case of Lenco, Len Shiffman's) spouse, issue, any
corporation all of the shares of which are owned by any one or more of such
persons, and any trust the beneficiaries of which include any one or more of
such persons and a majority of the trustees of which consists of such persons.
2. Restriction on Transfer
Each of the Vendors covenants that he or it, as applicable, will not Transfer
any of the Subject Shares beneficially owned or controlled by him or it, as
applicable, except in accordance with the terms of this Right of First Refusal
Agreement, or except with the prior written consent of the Purchaser and IMSC. A
purported Transfer of any Subject Shares in violation of this Right of First
Refusal Agreement will not be valid and the Purchaser or IMSC, as applicable,
will not register, nor permit any transfer agent to register, any such Shares on
the securities register of the Purchaser or IMSC, as applicable. The provisions
of the immediately preceding sentence are in addition to, and not in lieu of,
any other remedies to enforce the provisions of this Right of First Refusal
Agreement.
3. Notice of Intent to Sell
Subject to section 7 below, if the Vendors wish to effect a Transfer of any of
the Subject Shares owned by such Vendor, such Vendor (the "Offeror") shall first
offer to sell such shares (the "Offered Shares") to IMSI and IMSC (the
"Offerees"), such offer (the "Offer") to be made by notice in writing given by
the Offeror specifying the price and other terms, if any, upon which the Offeror
will sell the Offered Shares (the "Selling Notice"). The Offerees shall then
have a period of 15 days following receipt (or deemed receipt) of the Selling
Notice to accept the Offer by notice in writing to the Offeror given within such
15 day period. The Offerees shall be entitled to assign their right to purchase
the Offered Shares to any person designated by them (the "Designated Purchaser")
in writing provided that any such designation shall not release IMSI and IMSC
from their obligation to purchase if the Designated Purchaser fails to complete
the purchase.
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4. Terms of Purchase
If the Offer is accepted by either of IMSI or IMSC (the "Offeree") within the
required time period, then such acceptance shall constitute a binding agreement
pursuant to which the Offeror has agreed to sell and the Offeree or the
Designated Purchaser (the "Purchaser"), as applicable, has agreed to purchase
the Purchased Shares upon the terms and conditions contained in the Selling
Notice. The closing will take place at the offices of IMSI in Toronto, Ontario
at 2:00 p.m., Toronto time, on the date which is fifteen (15) days after the
date on which the Offer is accepted by the Offeree unless such date in not a
business day in both Toronto, Ontario and Nevada (a "Business Day") in which
case the closing will occur on the next Business Day.
5. Right of First Refusal
If the Offerees reject or fail to accept the Offer within the required time,
then the Offeror will be entitled to try to solicit an offer to purchase the
Purchased Shares on the terms and conditions contained in the Offer. If the
Offeror solicits an offer to purchase the Purchased Shares on the terms
contained in the Offer, the Offeror will give the Offerees written notice of the
offer and the Offerees shall then have a period of 3 Business Days following
receipt (or deemed receipt) of such notice to accept the Offer, to be accepted
by notice in writing to the Offeror given within such 3 Business Day period. If
the Offerees accept such Offer within the required time period, then such
acceptance shall constitute a binding agreement pursuant to which the Offeror
has agreed to sell and the offeree or the Designated Purchaser, as applicable,
has agreed to purchase the Purchased Shares upon the terms and conditions
contained in the Offer. The closing will take place at the offices of IMSI in
Toronto, Ontario at 2:00 p.m., Toronto time, on the date which is two (2) days
after the date on which the Offer is accepted by the Offeree unless such date in
not a Business Day in which case the closing will occur on the next Business
Day. If the Offerees fail to accept the Offer within the required time, then,
subject to section 6 hereof, the Offeror will be entitled to sell the Purchased
Shares on the terms and conditions contained in the Offer to the third party
from which it has solicited the offer to purchase the Purchased Shares. Before
consenting (if such consent is required) to the transfer of the Purchased Shares
the board of directors of the Purchaser and/or IMSC, as applicable, will be
entitled to require proof that the sale took place on the terms contained in the
Offer and the directors of the Purchaser and/or IMSC, as applicable, will refuse
to permit the recording of the transfer of any of the Purchased Shares which may
have been sold otherwise than in accordance with the provisions of the this
Right of First Refusal Agreement.
6. Completion Within 90 Days
If a sale of the Purchased Shares pursuant to the Offer is not completed in
accordance with this Agreement within ninety (90) days from the giving of the
Selling Notice to the Offerees, no sale of the Purchased Shares will be made
without the Offeror again complying with the terms of this Article.
7. Exempt Transfers
Notwithstanding anything contained herein, each of the Vendors shall be entitled
to sell 80,000 IMSC Common Shares in each calendar year without being required
to comply with sections 3, 4 and 5 hereof but subject to the following:
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(a) no more than 20,000 IMSC Common Shares (per Vendor) shall be sold in each
quarter; and
(b) the selling Vendor shall provide written notice of each such sale to IMSC
and IMSI and IMSC and IMSI shall have 3 Business Days from receipt of
deemed receipt of such notice to arrange for an orderly cross of such
shares being sold provided that once notice is given, no subsequent notice
need be given in respect of the shares specified in the notice of the sale
of such shares does occur within such 3 Business Days.
7A. Termination
Notwithstanding anything contained elsewhere in this Agreement, the
restrictions on Transfer contained in section 2 hereof and the provisions in
section 3, 4, 5, 6 and 7 hereof in consequence thereof shall cease and be of no
further force or effect if Michael Steele and/or any member of Michael Steele's
Family directly or indirectly no longer owns at least 100,000 common stock in
the capital of IMSC (directly or through/in combination with the ownership of
Class X Shares in the capital of the Purchaser). For purposes hereof, members of
Michael Steele's Family shall mean, Michael Steele's spouse, issue, any
corporation which is controlled by any one or more of such persons, and any
trust the beneficiaries of which include any one or more of such persons and a
majority of the trustees of which consists of such persons.
8. Further Assurances
Each party to this Right of First Refusal Agreement covenants and agrees that,
from time to time subsequent to the date hereof, it will at the request and
expense of the requesting party, execute and deliver all such documents,
including, without limitation, all such additional conveyance, transfers,
consents and other assurances and do all such other acts and things as any other
party hereto, acting reasonably, may from time to request be executed or done in
order to better evidence or perfect or effectuate any provision of this Right of
First Refusal Agreement or of any agreement or other document executed pursuant
to this Right of First Refusal Agreement or any of the respective obligations
intended to be created hereby or thereby.
9. Notices
(a) Any notice or other communication required or permitted to be given
hereunder shall be in writing and shall be delivered in person, transmitted by
telecopy or similar means of recorded electronic communication or sent by
registered mail, charges prepaid, addressed as follows:
(i) if to the Vendors:
Victor
623 Canville Road
Richmond Hill, Ontario
L4C 6E5
Telecopier No.:(905) 669-0699
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Rhys
275 Kennedy Road
Scarborough, Ontario
M1M3P6
Telecopier No.:(905) 669-0699
Lenco
24 Lauderdale Drive
Toronto, Ontario
M2L 2A9
Telecopier No.:(416) 962-0037
Larry
51 Abbotsford Road
Gormley, Ontario
L0H 1G0
Telecopier No.:(905) 669-0699
with a copy to Stephen Witten:
Minden, Gross, Grafstein & Greenstein
600 - 111 Richmond Street West
Toronto, Ontario
M5H 2H5
Telecopier No.:(416) 864-9223
(ii) if to the Purchaser:
International Menu Solutions Inc.
172 King Street
Toronto, Ontario
M5A 1J3
Attention: Michael A. Steele
Telecopier No.:(416) 366-6368
with a copy to:
McCarter Grespan Robson Beynon
675 Riverbend Drive
Kitchener, Ontario
N2K 3S3
Attention: Thomas D. Beynon, Q.C.
Telecopier No.:(519) 742-1841
(b) Any such notice or other communication shall be deemed to have been given
and received on the day on which it was delivered or transmitted (or, if such
day is not a Business Day, on the next following Business Day) or, if mailed, on
the third Business Day following the date of mailing; provided, however, that if
at the time of mailing or within three Business Days thereafter there is or
occurs a labour dispute or other event that might reasonably be expected to
disrupt the delivery of documents by mail, any notice or other communication
hereunder shall be delivered or transmitted by means of recorded electronic
communication as aforesaid.
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(c) Any party may at any time change its address for service from time to time
by giving notice to the other parties in accordance with this section 9.
10. Time of Essence
Time shall be of the essence hereof.
11. Governing Law
This agreement and any agreement to purchase and sell resulting therefrom shall
be construed by and governed in accordance with the laws of the Province of
Ontario.
12. Assignment
The parties shall not assign their rights in this Agreement without the prior
written consent of the Purchaser or IMSI.
13. Enurement
This Agreement shall enure to the benefit of and be binding upon the parties
hereto and their respective heirs, executors, administrators, personal
representatives, successors and permitted assigns.
14. Counterparts
This Agreement may be executed in counterparts, each of which shall constitute
an original and all of which taken together shall constitute one and the same
instrument.
IN WITNESS WHEREOF this Agreement has been executed by the parties.
/s/ Victor Fradkin
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Witness Victor Fradkin
/s/ Rhys Quin
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Witness Rhys Quin
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/s/ Larry Hoffman
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Witness Larry Hoffman
LAUDERDALE CAPITAL CORP.
Per:
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Title: President
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INTERNATIONAL MENU SOLUTIONS
INC.
Per:
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Title: President
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INTERNATIONAL MENU SOLUTIONS
CORPORATION
Per:
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Title: President
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