-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AoHv4mPXjQF+JXm42pDuaIldE0FPC3HH6YpvmbeD9RPeNmQji/BIBKlOry3G//U5 Z1BJ8/t/rTezXODZgqtqWg== 0000904896-04-000054.txt : 20040830 0000904896-04-000054.hdr.sgml : 20040830 20040830131615 ACCESSION NUMBER: 0000904896-04-000054 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20040825 ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20040830 DATE AS OF CHANGE: 20040830 FILER: COMPANY DATA: COMPANY CONFORMED NAME: N-VIRO INTERNATIONAL CORP CENTRAL INDEX KEY: 0000904896 STANDARD INDUSTRIAL CLASSIFICATION: PATENT OWNERS & LESSORS [6794] IRS NUMBER: 341741211 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21802 FILM NUMBER: 041004689 BUSINESS ADDRESS: STREET 1: 3450 W CENTRAL AVE STREET 2: STE 328 CITY: TOLEDO STATE: OH ZIP: 43606 BUSINESS PHONE: 4195356374 MAIL ADDRESS: STREET 1: 3450 WEST CENTRAL AVENUE SUITE 328 CITY: TOLEDO STATE: OH ZIP: 43606 8-K 1 doc1.txt EFFECTIVE AUGUST 23RD, 2004 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): AUGUST 25, 2004 N-VIRO INTERNATIONAL CORPORATION (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) DELAWARE 0-21802 34-1741211 (STATE OR OTHER JURISDICTION OF (COMMISSION FILE NUMBER) INCORPORATION OR ORGANIZATION (IRS EMPLOYER IDENTIFICATION NO.) 3450 W. CENTRAL AVENUE, SUITE 328 TOLEDO, OHIO 43606 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE) REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (419) 535-6374 Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 8.01 - Other Events N-Viro International Corporation announced on August 27, 2004 it had been notified by the Delaware Chancery Court (the "Court") on August 25, 2004 that a date of October 14, 2004 has been set to hold a hearing on the Company's proposed settlement of a derivative action filed June 11, 2003 by Strategic Asset Management, Inc., and to enter judgment on the settlement terms. The Scheduling Order and Notice of Settlement Hearing have also been attached to this filing as Exhibits 10.1 and 10.2, respectively. Item 9.01 - Financial Statements and Exhibits (c) Exhibits Exhibit No. Description 10.1 Delaware Chancery Court Scheduling Order 10.2 Delaware Chancery Court Notice of Settlement Hearing 99.1 News Release Regarding Settlement Hearing SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. N-VIRO INTERNATIONAL CORPORATION Dated: August 30, 2004 By:/s/ James K. McHugh James K. McHugh Chief Financial Officer EX-10.1 2 doc2.txt Exhibit 10.1 - ----------- GRANTED IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE IN AND FOR NEW CASTLE COUNTY STRATEGIC ASSET MANAGEMENT, INC., derivatively and on behalf of N-VIRO INTERNATIONAL CORPORATION, a C.A. No.: 20360 Delaware Corporation, Plaintiffs, v. J. PATRICK NICHOLSON, MICHAEL NICHOLSON, TERRY J. LOGAN, BOBBY B. CARROLL, PHILLIP LEVIN, DANIEL J. HASLINGER and B.K. WESLEY COPELAND, Defendants, and N-VIRO INTERNATIONAL CORPORATION, a Delaware Corporation, Nominal Defendant. SCHEDULING ORDER ---------------- The parties have informed the Court that they have reached a proposed settlement of this matter. The parties have submitted to the Court a proposed Notice of Settlement to Shareholders ("the Notice"), which describes this matter and the proposed settlement. The Court finds that the Notice gives shareholders fair notice of this matter and the proposed terms of settlement, and the Court has signed the Notice. Accordingly, it is agreed between the parties that: On October 14, 2004 at 10:00 a.m., the Court shall hold a hearing on the proposed settlement, at which time all objections to the proposed settlement will be considered. Within seven days of the execution of this Order, N-Viro shall mail the Notice to its shareholders as of August 25, 2004.
SNYDER & ASSOCIATES, P.A.. . SAUL EWING LLP /s/ Bayard J. Snyder . . . . /s/ Michael F. Bonkowski Bayard J. Snyder, Esquire. . Michael F. Bonkowski, Esquire DE#175 . . . . . . . . . . . DE #2219 300 Delaware Ave., Ste. 1014 222 Delaware Ave., Ste. 1200 P.O. Box 90. . . . . . . . . P.O. Box 1266 Wilmington, DE 19899 . . . . Wilmington, DE 19899 (302)-657-8300 (302)-421-6863 Attorney for Plaintiff . . . Attorney for All Defendants - ---------------------------- -----------------------------
SO ORDERED THIS _____ day of August 2004. The Honorable John W. Noble Vice Chancellor Court: DE Court of Chancery Judge: John Noble LexisNexis File & Serve Reviewed Filing ID: 4097692 Date: 8/25/2004 Case Number: 20360 Case Name: Strategic Asset Management Inc et al vs N Viro International Corp /s/ Judge John Noble EX-10.2 3 doc3.txt Exhibit 10.2 ------------ IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE IN AND FOR NEW CASTLE COUNTY STRATEGIC ASSET MANAGEMENT, INC., derivatively and on behalf of N-VIRO INTERNATIONAL CORPORATION, a : C.A. No.: 20360 Delaware Corporation, Plaintiffs, v. J. PATRICK NICHOLSON, MICHAEL NICHOLSON, TERRY J. LOGAN, BOBBY B. CARROLL, PHILLIP LEVIN, DANIEL J. HASLINGER, B.K. WESLEY COPELAND, Defendants, and N-VIRO INTERNATIONAL CORPORATION, a Delaware Corporation, Nominal Defendant. NOTICE OF SETTLEMENT HEARING ---------------------------- To the Shareholders of N-Viro International Corporation as of August 25, 2004: Introduction ------------ You are receiving this legal notice because you are a shareholder of N-Viro International Corporation ("N-Viro"). N-Viro and certain of its directors (at the time of the suit) were sued by Strategic Asset Management, Inc. ("SAMI") in the Delaware State Chancery Court (the "Court") for New Castle County (Case No. 20360) (the "Lawsuit"). SAMI brought the Lawsuit as what is called a derivative lawsuit, which we will describe further below. The directors it sued were Bobby Carroll, B.K. Wesley Copeland, Daniel Haslinger, Phillip Levin, Terry Logan, J. Patrick Nicholson and Michael Nicholson. (We shall refer below to the directors other than J. Patrick Nicholson as the "Settling Directors.") N-Viro seeks to settle the Lawsuit. Because it is a derivative suit, shareholders are entitled to object to the settlement terms if they wish to do so. The judge of the Lawsuit (who is referred to as a Vice-Chancellor) has ordered that this notice be sent to you to explain the proposed settlement terms (the "Settlement Terms") and your rights to object to the Settlement Terms if you wish to do so. Last November, N-Viro sent you a summary (the "Summary") of a proposed settlement agreement (the "Initial Proposed Settlement") that was submitted to the Vice-Chancellor for review. The Summary also reviewed in detail the events leading up to the Lawsuit and the Lawsuit's allegations. If you would like another copy of the Summary, please contact James McHugh at N-Viro (419-535-6374 or jmchugh@nviro.com) to request one. ----------------- The Vice-Chancellor indicated that he would not approve the Initial Proposed Settlement for specific reasons. The parties then renegotiated based on the Vice Chancellor's reasons, and reached a new proposed settlement agreement (the "Settlement Agreement"). This document describes the renegotiated agreement being submitted for the Vice-Chancellor's approval. On October 14, 2004 at 10:00 a.m., at the New Castle County Courthouse, 500 North King Street, Wilmington, Delaware 19801, the Vice-Chancellor will hold a hearing (the "Hearing") to decide whether he should approve the Settlement Agreement as fair, reasonable and adequate, and to enter judgment based on the Settlement Terms. This Notice is not based in any way on the Vice-Chancellor's opinions related to the Lawsuit. The parties prepared this notice and it should not be understood in any way as reflecting the Vice-Chancellor's opinions as to the merits of the claims or defenses of any party to the Lawsuit. Proposed Settlement Agreement ----------------------------- A copy of the Settlement Agreement is available from the Court's Lawsuit file. We summarize its major points in this section. N-Viro shall reimburse SAMI its direct Lawsuit attorneys fees and costs, which it calculates as $164,000. In exchange for the payment, all parties will execute mutual releases and SAMI will dismiss the Lawsuit with prejudice. The Vice-Chancellor must approve the Settlement Agreement as a condition to its becoming effective. The Parties' Positions on the Settlement Agreement -------------------------------------------------- SAMI believes it achieved its desired result, with direct benefit to all shareholders, by N-Viro's terminating its original consulting agreement with J. Patrick Nicholson; J. Patrick Nicholson's releasing all claims under all prior employment agreements; J. Patrick Nicholson's releasing all claims to an annual pension; N-Viro's securing reimbursements from J. Patrick Nicholson; and entering into a new, limited consulting agreement with J. Patrick Nicholson. SAMI believes it is entitled to reimbursement of its actual attorney's fees and costs for the benefits that N-Viro recognized as a result of SAMI's efforts. N-Viro and the Settling Directors believe that SAMI did not need to bring the Lawsuit, and that the Board had appointed an Independent Committee that had been proceeding properly. They deny that they breached any fiduciary duties or that they acted improperly in any way. Nonetheless, they believe it is in N-Viro's best interests to settle the matter under the Settlement Agreement's terms to avoid the expense of further litigation and to resolve the dispute through mutual releases. J. Patrick Nicholson, a Defendant and Non-Settling Director, believes that SAMI brought this case to advance its own interests as opposed to N-Viro's interests. He urges the Court to disapprove the proposed settlement and not to approve N-Viro's paying any of SAMI's costs. Objections ---------- Any N-Viro shareholder who objects to the Settlement Agreement may appear in person or by counsel at the Hearing and present any relevant evidence or argument. If you want to be heard, you must, no later than ten days before the Hearing, file with the Register in Chancery, New Castle County Courthouse, 500 North King Street, Wilmington, Delaware 19801 (i) a notice of your intention to appear the Hearing; (ii) a statement of your objections to the Settlement Agreement; and (iii) an explanation of the reasons for your objections along with any documents that you want the Vice-Chancellor to consider. At the same time you file these documents with the Register in Chancery, you must also mail them to the following attorneys, each of whom represents parties to the Lawsuit, and to J. Patrick Nicholson: Peter R. Silverman, Esq. Shumaker, Loop & Kendrick, LLP 1000 Jackson Toledo, Ohio 43624-1573 Counsel for N-Viro International Corp. and the Settling Directors Richard C. Fox, Esq. Fox Law Offices, P.A. P.O. Box 1097 Pecos, New Mexico 87552 Counsel for Strategic Asset Management, Inc. J. Patrick Nicholson. 2025 Richmond Road Toledo, OH 43607 Unless the Vice-Chancellor directs otherwise, no one may object to approval of the Settlement Agreement nor may appear at the Hearing in any capacity, unless they file their notice of intention to appear as described above. If you fail to file such a notice, you will be deemed to have waived your objections and you may not raise them in this or any other matter. Effect of Non-Approval ---------------------- If the Vice-Chancellor does not approve the Settlement Agreement, or the Vice-Chancellor approves the Settlement Agreement and such approval is reversed or modified on appeal, the Settlement Agreement shall be treated as if it had not been made and had not been submitted to the Court. The Lawsuit would continue to proceed as if the parties had not entered into the Settlement Agreement and submitted it to the Court. Request to Brokers and Other Nominees ------------------------------------- Brokerage firms, banks and other persons or entities who are record holders of shares of N-Viro common stock, but who do not hold that stock as beneficial owners, should send this notice promptly to the beneficial holders. If you need additional copies of this notice, you may send exact duplicate copies to beneficial holders. This Notice is only a Summary ---------------------------- The descriptions in this notice have been a summary. You may seek further information by reviewing the Complaint, the Initial Proposed Agreement or the Settlement Agreement, filed with the Register in Chancery, which you may examine during regular business hours at the offices of the Register in Chancery, New Castle County Courthouse, 500 North King Street, Wilmington, Delaware 19801 BY ORDER OF THE COURT: /s/ Diane Dempski - ------------------- Register in Chancery August __ 2004 EX-99.1 4 doc4.txt Exhibit 99.1 ------------ NEWS RELEASE FOR IMMEDIATE RELEASE For More Information Contact: Phil Levin., Chairman & CEO (419) 535-6374 N-VIRO ANNOUNCES NOTICE OF SETTLEMENT HEARING Toledo, Ohio, August 27, 2004 - N-Viro International Corp. (OTC Bulletin Board: NVIC.OB) announced today it has been notified by the Delaware Chancery Court on August 25, 2004 that a date of October 14, 2004 has been set to hold a hearing on the Company's proposed settlement of a derivative action filed June 11, 2003 by Strategic Asset Management, Inc., and to enter judgment on the settlement terms. A Notice of Settlement Hearing and the Scheduling Order will be mailed within seven days to all stockholders of record on August 25, 2004. N-Viro International Corporation develops and licenses its technology to municipalities and private companies. N-Viro's patented processes use lime and/or mineral-rich, combustion byproducts to treat, pasteurize, immobilize and convert wastewater sludge and other bio-organic wastes into biomineral agricultural and soil-enrichment products with real market value. More information about N-Viro International can be obtained by contacting the office or on the Internet at www.nviro.com or by e-mail inquiry to info@nviro.com. The Company cautions that words used in this document such as "expects," "anticipates," "believes" and "may," as well as similar words and expressions used herein, identify and refer to statements describing events that may or may not occur in the future. These forward-looking statements and the matters to which they refer are subject to considerable uncertainty that may cause actual results to be materially different from those described herein. -30- -----END PRIVACY-ENHANCED MESSAGE-----