Ajax, Ontario-based Environmental Waste International Inc. (EWI) has signed a memorandum of understanding (MOU) with TRD Instum Ltd. (TRD), a publicly traded Israeli company, to form jointly-owned companies with the exclusive rights to EWI’s patented reverse polymerization (RP) technology in Israel and certain European countries.
The MOU will remain in effect until the signing of a final agreement, no later than May 30, 2008.
The terms of the MOU require TRD to place an order for a TR1500 on EWI’s standard terms and conditions upon the signing of the agreement. The TR1500 is based on EWI’s RP process that reduces tires to carbon black, oil, steel and non-condensable gases. The agreement will include specific performance requirements for TRD to retain exclusive rights in Israel and the designated European countries. This TR 1500 installation would be a showpiece for entering the European and Middle Eastern markets.
TRD has placed an initial deposit of $180,000 in trust to be released upon the signing of the agreement. If TRD and EWI do not complete the Agreement then 75 per cent of the deposit will be returned to TRD with EWI retaining the remaining 25 per cent, half as an investment in EWI common shares and half as compensation.
Upon signing the agreement, EWI and TRD will each receive two options to purchase up to 20 per cent ownership in the other. The first is a 10 per cent option priced at a 50 per cent premium to each company’s share trading price the day before the MOU was signed. The second 10 per cent option will be priced at the ten day closing average price of the common shares prior to the first anniversary of the agreement. Each option will be valid for one year; the options will run consecutively based on the agreement signing date.
EWI has designed systems for the sterilization of medical and animal waste, liquid waste and food waste as well as the breakdown of several other organic materials including tires. EWI continues to work on designs for other processors.