<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________________ to ______________________
Commission File Number: 001-13581
NOBLE INTERNATIONAL, LTD.
(Exact name of registrant as specified in its charter)
Michigan 38-3139487
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
33 Bloomfield Hills Parkway, Suite 155, Bloomfield Hills, Michigan 48304
(Address of principal executive offices)
(Zip Code)
(248) 433-3093
----------------------------------------------------
(Registrant's telephone number, including area code)
- --------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No [ ]
The number of shares of the registrant's common stock, no par value,
outstanding as of March 31, 1998 was 7,156,825.
<PAGE> 2
NOBLE INTERNATIONAL, LTD.
FORM 10-Q INDEX
This report contains "forward looking statements" within the meaning of Section
27A of the Securities Act of 1933 and is subject to the safe harbor created by
that section. Statements regarding future operating performance, new programs
expected to be launched and other future prospects and developments are based
upon current expectations and involve certain risks and uncertainties that could
cause actual results and developments to differ materially. Potential risks and
uncertainties include such factors as demand for the company's products,
pricing, the company's growth strategy, including its ability to consummate and
successfully integrate future acquisitions, industry cyclicality and
seasonality, the company's ability to continuously improve production
technologies, activities of competitors and other risks detailed in the
company's Annual Report on Form 10-K for the year ended December 31, 1997 and
other filings with the Securities and Exchange Commission.
<TABLE>
<CAPTION>
PART I - FINANCIAL INFORMATION Page
<S> <C>
Item 1. Financial Statements
Consolidated Balance Sheets as of March 31, 1998
(unaudited) and December 31, 1997............................................. 3
Consolidated Statements of Earnings (unaudited) for the
Three Month Periods Ended March 31, 1998 and 1997............................. 4
Consolidated Statements of Cash Flows (unaudited) for the
Three Month Periods Ended March 31, 1998 and 1997............................. 5
Notes to Consolidated Interim Financial Statements............................ 6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations...................................................... 7
Item 3. Quantitative and Qualitative Disclosures About Market Risk.................. 8
PART II - OTHER INFORMATION
Item 1. Legal Proceedings........................................................... 9
Item 2. Changes in Securities and Use of Proceeds................................... 9
Item 3. Defaults Upon Senior Securities............................................. 9
Item 4. Submission of Matters to a Vote of Security Holders......................... 9
Item 5. Other Information........................................................... 9
Item 6. Exhibits and Reports on Form 8-K............................................ 9
</TABLE>
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PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
NOBLE INTERNATIONAL, LTD.
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
ASSETS 1997 1998
------------ ------------
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 2,352,814 $ 1,976,242
Accounts receivable, trade 11,507,622 12,385,245
Inventories 5,276,420 4,903,891
Prepaid expenses and other assets 290,832 634,058
Deferred income taxes 158,000 176,000
------------ ------------
Total Current Assets 19,585,688 20,075,436
PROPERTY, PLANT AND EQUIPMENT, NET 20,891,089 25,814,327
OTHER ASSETS
Goodwill 24,822,746 23,557,329
Covenants not to compete 1,383,333 1,335,659
Sundry 418,305 122,707
------------ ------------
26,624,384 25,015,695
------------ ------------
$ 67,101,161 $ 70,905,458
============ ============
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
LIABILITIES AND EQUITY 1997 1998
------------ ------------
<S> <C> <C>
CURRENT LIABILITIES
Current maturities of long-term debt $ 717,285 $ 676,481
Current maturities of notes payable -
related parties 2,386,792 1,886,792
Current maturities of capital lease obligations 74,891 42,723
Accounts payable 7,055,130 11,254,102
Accrued liabilities 3,495,552 2,621,843
Income taxes payable 291,848 482,848
------------ ------------
Total Current Liabilities 14,021,498 16,964,789
LONG-TERM DEBT, EXCLUDING CURRENT MATURITIES 13,766,144 13,449,600
NOTES PAYABLE - RELATED PARTIES,
EXCLUDING CURRENT MATURITIES 10,286,281 10,644,282
CAPITAL LEASE OBLIGATIONS,
EXCLUDING CURRENT MATURITIES 183,150 156,472
DEFERRED INCOME TAXES 384,000 384,000
PREFERRED STOCK OF SUBSIDIARY 850,000 812,500
SHAREHOLDERS' EQUITY
Preferred stock, $100 par value, 10% cumulative
authorized 150,000 shares -- --
Common stock, no par value, authorized
20,000,000 shares, issued and outstanding
7,160,168 and 7,156,825 shares in 1997
and 1998, respectively 27,344,242 27,337,798
Retained earnings 265,846 1,190,957
Equity adjustment from foreign currency translation -- (34,940)
------------ ------------
27,610,088 28,493,815
------------ ------------
$ 67,101,161 $ 70,905,458
------------ ------------
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
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NOBLE INTERNATIONAL, LTD.
CONSOLIDATED STATEMENTS OF EARNINGS
(UNAUDITED)
<TABLE>
<CAPTION>
MARCH 31,
-----------------------------------
1997 1998
------------ ------------
<S> <C> <C>
Net sales $ 5,070,241 $ 17,434,395
Cost of goods sold 3,295,079 12,667,532
------------ ------------
Gross profit 1,775,162 4,766,863
Selling, general and administrative expenses 1,073,877 2,973,856
------------ ------------
Operating profit 701,285 1,793,007
Other income (expense)
Equity in earnings of unconsolidated subsidiary 26,592 --
Interest income 732 --
Interest expense (228,597) (380,926)
Sundry, net 13,213 26,030
------------ ------------
Earnings before income taxes 513,225 1,438,111
Income tax expense 189,165 513,000
------------ ------------
Net earnings $ 324,060 $ 925,111
============ ============
Basic and diluted earnings per common share $ 0.08 $ 0.13
============ ============
Weighted average number of shares outstanding 3,860,160 7,159,091
============ ============
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
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<PAGE> 5
NOBLE INTERNATIONAL, LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
MARCH 31,
---------------------------------
1997 1998
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings $ 324,060 $ 925,111
Adjustments to reconcile net earnings to
net cash provided by operations
Depreciation of property, plant and equipment 82,327 592,274
Amortization of goodwill 66,268 366,654
Deferred income taxes 18,900 (18,000)
Equity in loss of unconsolidated subsidiary (26,592) --
Changes in operating assets and liabilities
Increase in accounts receivable (1,253,549) (868,651)
Decrease in inventories 260,378 353,979
Increase in prepaid expenses (198,109) (324,332)
Decrease (increase) in other assets (44,437) 1,239,836
Increase in accounts payable 41,487 4,196,482
Increase (decrease) in accrued liabilities 120,717 (685,868)
----------- -----------
Net cash (used in) provided by operating activities (608,550) 5,777,485
CASH FLOWS FROM INVESTING ACTIVITIES
Purchases of property, plant and equipment (102,398) (5,500,380)
----------- -----------
Net cash used in investing activities (102,398) (5,500,380)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from notes payable - related parties 13,147 --
Repayments of notes payable - related parties -- (142,000)
Capital lease payments -- (59,324)
Redemption of preferred stock of subsidiary -- (37,500)
Payments on long-term debt (109,333) (166,739)
Sale/purchase of company stock -- (6,444)
Net proceeds from note payable to bank 767,935 (190,609)
----------- -----------
Net cash (used in) provided by financing activities 671,749 (602,616)
----------- -----------
Effect of exchange rate changes on cash -- (51,061)
----------- -----------
Net decrease in cash (39,199) (376,572)
----------- -----------
Cash at beginning of period 471,412 2,352,814
----------- -----------
=========== ===========
Cash at end of period 432,213 1,976,242
=========== ===========
SUPPLEMENTAL CASH FLOW DISCLOSURE
Cash paid for:
Interest $ 202,314 $ 314,988
=========== ===========
Taxes $ -- $ 340,000
=========== ===========
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
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<PAGE> 6
NOBLE INTERNATIONAL, LTD.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS
NOTE A -- BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. Accordingly, the financial statements do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all adjustments
have been included and all adjustments considered necessary for a fair
presentation have been included and such adjustments are of a normal recurring
nature.
Results for interim periods should not be considered indicative of results for a
full year. The year-end consolidated balance sheet was derived from audited
financial statements, but does not include all disclosures required by generally
accepted accounting principles. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's annual report on Form 10-K for the year ended December 31, 1997.
NOTE B -- INVENTORIES
Inventories at December 31, 1997 and March 31, 1998 consisted of the following:
<TABLE>
<CAPTION>
DECEMBER 31, MARCH 31,
1997 1998
---------- ----------
<S> <C> <C>
Raw materials and purchased parts $1,116,708 $1,171,122
Work in process 383,069 441,665
Finished goods 2,765,339 2,598,313
Unbilled customer tooling 1,011,304 692,791
---------- ----------
$5,276,420 $4,903,891
---------- ----------
</TABLE>
NOTE C -- ADOPTION OF NEW ACCOUNTING STANDARDS
On January 1, 1998, the Corporation adopted Financial Accounting Standards
Board (the "FASB") issued Statement No. 130, "Reporting of Comprehensive
Income" ("SFAS 130"), which establishes standards for reporting and display of
comprehensive income and its components (revenues, expense, gains and losses)
in a full set of financial statements. This statement also requires that all
items that are required to be recognized under accounting standards as
components of comprehensive income be reported in a financial statement that is
displayed with the same prominence as other financial statements.
Consolidated statements of comprehensive income for each of the three months
ended March 31, 1998 and 1997 have been omitted as comprehensive income does
not differ materially from net earnings as reported.
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<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
RESULTS OF OPERATIONS
Net Sales. Net sales for the three months ended March 31, 1998 increased
243.9% to $17.43 million from $5.07 million for the comparable quarter of 1997.
The increase in sales is due to the acquisitions of Utilase, Inc. ("Utilase")
and Noble Metal Products, Inc. ("NMP") after the first quarter of 1997. Utilase
contributed sales of $6.98 million and NMP contributed sales of $6.18 million to
the Company 1998's first quarter net sales. Net sales from continuing operations
decreased by approximately $0.80 million in the first quarter of 1998 compared
to 1997 due to a significant level of tooling sales for new programs included in
net sales in the prior year and the loss of a customer at the Company's Vassar
Industries subsidiary.
Cost of Goods Sold. Cost of goods sold increased 284.4% to $12.67
million for the three months ended March 31, 1998 from $3.30 million for the
comparable quarter of 1997. As a percent of net sales, cost of goods sold
increased to 72.7% from 65.0% primarily due to the inclusion in the current year
period of NMP, which had significantly higher cost of goods sold as a percent of
net sales than the Company's continuing operations.
Gross Profit. The Company's gross profit increased by 168.5% to $4.77
million for the three months ended March 31, 1998 from $1.78 million for the
comparable quarter of the prior year.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased by 176.9% for the three months ended March 31,
1998 as compared to the three months ended March 31, 1997, due to the
acquisitions of Utilase and NMP, the addition of new executive personnel to
support the Company's expanded operations and the costs of maintaining the
Company's public status following its November 1997 initial public offering.
Notwithstanding the increased level of expenses, selling, general and
administrative expenses actually decreased as a percentage of net sales from 21%
for the first quarter of 1997 to 17% for the first quarter of 1998 as a result
of the increased volume of sales generated in the current year period.
Operating Profit. Operating profit increased 155.7% to $1.79 million for
the three months ended March 31, 1998 from $0.70 million for the three months
ended March 31, 1997.
Interest Expense. Interest expense increased 66.6% to $0.38 million for
the three months ended March 31, 1998 from $0.23 million for the comparable
quarter of the prior year, primarily due to the financing obtained to support
increased sales as well as the financing of the Utilase and NMP acquisitions.
Net Earnings. Net earnings increased by $0.61 million to $0.93 million
for the three months ended March 31, 1998 from $0.32 million for the three
months ended March 31, 1997, primarily due to the acquisitions of Utilase and
NMP.
LIQUIDITY AND CAPITAL RESOURCES
The Company's cash requirements have historically been satisfied through
a combination of cash flow from operations, equipment financing, bank financing
and loans from shareholders. The Company's working capital needs and capital
equipment requirements have increased as a result of the growth of the Company
and are expected to continue to increase as a result of anticipated growth in
laser welded blanks, glovebox latch, and assembly operations. The anticipated
increase in required working capital and capital equipment requirements, are
expected to be met from the cash flow from operations, equipment financing and
revolving credit borrowings. As of March 31, 1998, the Company had working
capital of approximately $3.11 million.
The Company generated cash flow from operations of $5.78 million for the
three months ended March 31, 1998. Cash flow from operating activities in the
period was primarily the result of net earnings, depreciation and amortization,
and changes in working capital due primarily to unpaid obligations on capital
asset projects in progress at Utilase. The Company used cash in investing
activities of $5.50 million for the
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<PAGE> 8
quarter ended March 31, 1998. Cash used in investing activities was primarily
for the purchase of property, plant and equipment for Utilase. The Company used
$0.60 million in cash flow from financing activities for the three months ended
March 31, 1998. The financing activities for the period consisted primarily of
payments on debt obligations.
The Company maintains a $35 million secured revolving line of credit
facility (the "Line of Credit") with Comerica Bank ("Comerica") which expires in
December 2000. The Line of Credit may be utilized for general corporate
purposes, including working capital and acquisition financing, and provides the
Company with borrowing options for advances under the facility of either a
"Eurocurrency Rate" (Comerica's Eurodollar rate as adjusted for reserves and
other regulatory requirements) or a "Base Rate" (the higher of Comerica's prime
rate or the federal funds rate plus 200 basis points), plus an applicable margin
(ranging from 0% to 2.25%) based upon the Company's ratio of funded debt to
EBITDA (earnings before interest expense, income taxes, depreciation and
amortization expense). Advances under the facility during the quarter ended
March 31, 1998 bore interest at the rate of 7.5% per annum. The Line of Credit
is subject to customary financial and other covenants including, but not limited
to, limitations on payment of dividends, limitations on consolidations, mergers,
and sales of assets, and bank approval on acquisitions over $20 million. The
Company is in compliance with the terms of the Line of Credit.
The liquidity provided by the Company's existing credit facilities,
combined with cash flow from operations is expected to be sufficient to meet the
Company's currently anticipated working capital and capital expenditure needs
for at least 12 months. There can be no assurance, however, that such funds will
not be expended prior thereto due to changes in economic conditions or other
unforeseen circumstances, requiring the Company to obtain additional financing
prior to the end of such 12-month period. In addition, the Company intends to
pursue, as part of its business strategy, future growth through opportunistic
acquisitions of assets or companies, which acquisitions may involve the
expenditure of significant funds. Depending upon the nature, size and timing of
future acquisitions, the Company may be required to obtain additional debt or
equity financing in connection with such future acquisitions. There can be no
assurance, however, that additional financing will be available to the Company,
when and if needed, on acceptable terms or at all.
YEAR 2000 COMPLIANCE
Many currently installed computer systems and software products are
coded to accept only two digit entries in the date code field. These date code
fields will need to accept four digit entries to distinguish 21st century dates
from 20th century dates. As a result, in less than two years, computer systems
and software used by many companies will need to be upgraded to comply with such
"Year 2000" requirements. The Company believes that its internal systems are
either already Year 2000 compliant or can be upgraded without significant
expenditures.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Inapplicable.
-8-
<PAGE> 9
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
Inapplicable.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
Inapplicable
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
Inapplicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Inapplicable.
ITEM 5. OTHER INFORMATION.
Effective March 31, 1998, the Company effected a realignment of its
seven operating subsidiaries in order to provide greater integration of
operations. The Company contributed all of the capital stock of Utilase
Production Process, Inc. ("UPP"), Utilase, Inc. ("Utilase") and Noble Metal
Products, Inc. ("NMP") to Noble Metal Technologies, Inc. ("NMT"), a newly formed
wholly-owned subsidiary of the Company. The Company contributed all of the
capital stock of Cass River Coatings, Inc. dba Vassar Industries ("Vassar"),
Monroe Engineering Products, Inc. ("Monroe"), Prestolock International, Ltd.
("Prestolock") and Skandy Corp. ("Skandy") to Noble Components & Systems, Inc.
("NCS"), a newly formed wholly-owned subsidiary of the Company. The Company
plans to conduct its metal processing and production operations through UPP,
Utilase and NMP, as wholly-owned subsidiaries of NMT. The Company plans to
conduct its component and systems business through Vassar, Monroe, Prestolock
and Skandy, as wholly-owned subsidiaries of NCS.
On March 2, 1998, the Company redeemed 3,343 shares of Common Stock for
$6,444 from a former employee pursuant to the terms of a shareholders agreement
providing for the repurchase of shares upon termination of employment based upon
a book value formula.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits and Index of Exhibits
2.2 Stock Exchange Agreement by and among Noble Metal Technologies,
Inc., Noble International, Ltd., Utilase, Inc., Noble Metal
Products, Inc. and Utilase Production Process, Inc. effective as
of March 31, 1998
2.3 Stock Exchange Agreement by and among Noble Components &
Systems, Inc., Noble International, Ltd., Prestolock
International, Ltd., Cass River Coatings, Inc. d/b/a Vassar
Industries, Monroe Engineering Products, Inc. and Skandy Corp.
effective as of March 31, 1998
27.1 Financial Data Schedule
(b) Reports on Form 8-K
The registrant filed a Current Report on Form 8-K on January 6, 1998
reporting the establishment of a new credit facility and the redemption
of 38,000 shares of Series A Preferred Stock and 64,838 shares of Common
Stock.
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<PAGE> 10
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
NOBLE INTERNATIONAL, LTD.
Dated: May 12, 1998 By: /s/ Richard V. Balgenorth
--------------------------------
Richard V. Balgenorth,
Chief Financial Officer and
Vice President-Corp. Development
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<PAGE> 1
EXHIBIT 2.2
STOCK EXCHANGE AGREEMENT
by and among
NOBLE METAL TECHNOLOGIES, INC.
and
NOBLE INTERNATIONAL, LTD.
and
UTILASE, INC., NOBLE METAL PRODUCTS, INC.
and UTILASE PRODUCTION PROCESS, INC.
EFFECTIVE AS OF
March 31, 1998
<PAGE> 2
STOCK EXCHANGE AGREEMENT
------------------------
THIS STOCK EXCHANGE AGREEMENT (the "Agreement") is made and entered into
effective as of March 31, 1998, by and between NOBLE METAL TECHNOLOGIES, INC., a
Michigan corporation ("NMT"), NOBLE INTERNATIONAL, LTD., a Michigan corporation
("NIL"), UTILASE, INC., a Michigan corporation ("Utilase") and NOBLE METAL
PRODUCTS, INC. a Michigan corporation ("NMP") and UTILASE PRODUCTION PROCESS,
INC. ("UPP").
WHEREAS, NMT desires to issue and exchange with NIL and NMT desires to
exchange and acquire from NIL the Common Shares (as hereinafter defined) on the
terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the covenants and agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
EXCHANGE OF COMMON SHARES
1.01 EXCHANGE OF COMMON SHARES. Subject to the terms and conditions
hereof, NIL shall acquire from NMT and NMT shall issue to NIL Ten Thousand
(10,000) of NMT's common stock (the "NMT Shares") on the date hereof in exchange
for One Thousand Fifty Three (1,053) common shares of Utilase, Inc. (the
"Utilase Shares"), Three Thousand Five Hundred Eighty Two (3,582) common shares
of NMP (the "NMP Shares") and Five Thousand (5,000) common shares of Utilase
Production Process, Inc. (the "UPP Shares") which represent all of the issued
and outstanding capital stock of Utilase, NMP and UPP (collectively the "Common
Shares").
1.02 PAYMENT AND DELIVERY. Upon the execution and delivery of this
Agreement by NMT and NIL, or as soon thereafter as practically possible, NMT
will deliver to NIL individual certificates representing the NMT Shares,
registered in the name of NIL and NIL shall deliver to NMT the Utilase Shares,
NMP Shares and the UPP Shares.
1.03 INTERNAL REVENUE CODE SECTION 368. It is the intent of the parties
hereto that the exchange described herein shall qualify as a tax free exchange
pursuant to IRC ss.368(a)(1)(B).
1.04 CLOSING AND CLOSING DATE. The closing of the transactions
contemplated by this Agreement ("Closing") shall take place at 10:00 a.m., local
time, on March 31, 1998 ("Closing Date") at the offices of NMT, or at such other
time, place and date as shall be mutually agreed on by NMT and Shareholder and
shall be effective as of March 31, 1998.
1
<PAGE> 3
ARTICLE II
REPRESENTATIONS OF NOBLE METAL TECHNOLOGIES, INC.
NMT represents and warrants as follows:
2.01 AUTHORIZATION. It has the full capacity, power and authority to
execute, deliver and perform its obligations under this Agreement and it has
taken all necessary corporate action to authorize the execution, delivery and
performance of its obligations hereunder and to consummate the transactions
contemplated hereby.
2.02 AUTHORIZED AND OUTSTANDING CAPITAL STOCK. The authorized capital
stock of NMT consists of Fifty Thousand (50,000) shares of common stock none of
which has been issued or pledged.
2.03 BINDING OBLIGATIONS. This Agreement, when executed and delivered by
the parties, will be its legally valid and binding obligation, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
2.04 INVESTMENT INTENT. It is acquiring the Common Shares for its own
account for investment purposes only and the Common Shares are not being
purchased with a view towards resale or distribution; and it is able to bear the
economic risk of ownership of the Common Shares for an indefinite period of time
and has no present or foreseeable need to dispose of any portion of its
investment in Utilase, NMP and/or UPP and is aware that it will be unable to
readily liquidate his investment in Utilase, NMP and/or UPP.
2.05 NO CONFLICT. The execution, delivery and performance by it of this
Agreement and the consummation of the transactions contemplated hereby does not
and will not: (I) violate any provisions of law applicable to it; (ii) result in
or require the creation or imposition of any lien upon any of its properties or
assets.
ARTICLE III
REPRESENTATIONS OF NOBLE INTERNATIONAL, LTD.
NIL represents and warrants as follows:
3.01 AUTHORIZATION. It has the full legal capacity, power and authority
to execute, deliver and perform its obligations under this Agreement. NIL is the
lawful record owner of the Common Shares, and the same are and shall be
delivered to NMT free and clear of all pledges, security interests, options,
liens, encumbrances and claims or rights of every kind therein or thereto,
except such claim from Comerica Bank granted pursuant to an Amended and Restated
Loan Agreement dated December 30, 1997 and the delivery of such Common Shares to
NMT pursuant to the provisions of this Agreement will transfer lawful, valid,
marketable title thereto.
3.02 BINDING OBLIGATION. This Agreement, when executed and delivered by
the parties, will be its legally valid and binding obligation, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
2
<PAGE> 4
3.03 NO CONFLICT. The execution, delivery and performance by it of this
Agreement and the consummation of the transactions contemplated hereby does not
and will not: (i) violate any provisions of law applicable to it; (ii) conflict
with, result in a breach of or constitute (with due notice or lapse of time or
both) a default under any of his contractual obligations; (iii) result in or
require the creation or imposition of any lien upon any of its property or
assets; or (iv) require any approval or consent of any person.
3.04 INVESTMENT INTENT. It is acquiring the NMT Shares for its own
account for investment purposes only and the NMT Shares are not being purchased
with a view towards resale or distribution; and it is able to bear the economic
risk of ownership of the NMT Shares for an indefinite period of time and has no
present or foreseeable need to dispose of any portion of its investment in NMT
and is aware that it will be unable to readily liquidate his investment in NMT.
ARTICLE IV
REPRESENTATIONS OF UTILASE, NMP AND UPP
Utilase, NMP and UPP represent and warrant as follows:
4.01 AUTHORIZATION. They have the full capacity, power and authority to
execute, deliver and perform their obligations under this Agreement and they
have taken all necessary corporate action to authorize the execution, delivery
and performance of their obligations hereunder and to consummate the
transactions contemplated hereby.
4.02 AUTHORIZED AND OUTSTANDING CAPITAL STOCK. The authorized capital
stock of Utilase consists of Fifty Thousand (50,000) shares of common stock; NMP
consists of Sixty Thousand (60,000) shares of common stock and UPP consists of
Sixty Thousand (60,000) shares of common stock. NIL is the record owner of Three
Thousand Five Hundred Eighty-Two (3,582) shares of Utilase; One Thousand
Fifty-Three (1,053) shares of NMP and Five Thousand (5,000) shares of UPP, which
represents all of the issued and outstanding shares of the capital stock of
Utilase, NMP and UPP, which have been validly issued, are fully paid and
non-assessable.
4.03 BINDING OBLIGATIONS. This Agreement, when executed and delivered by
the parties, will be its legally valid and binding obligation, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
4.04 NO CONFLICT. The execution, delivery and performance by it of this
Agreement and the consummation of the transactions contemplated hereby does not
and will not: (i) violate any provisions of law applicable to it; (ii) conflict
with, result in a breach of or constitute (with due notice or lapse of time or
both) a default under any of its contractual obligations; (iii) result in or
require the creation or imposition of any lien upon any of its properties or
assets; or (iv) require any approval or consent of any person under any
contractual obligations, except for such approvals or consents as have been
obtained or which it shall make all reasonable efforts to obtain.
4.05 FINANCIAL STATEMENTS. The balance sheet of Utilase, NMP and UPP as
of December 31, 1997 and the related statements of income, changes in
stockholders's equity and cash
3
<PAGE> 5
flows for the twelve (12) month period then ended, together with the notes
thereto, and the reviewed financial statements of Utilase, NMP and UPP for the
period ending December 31, 1997 (the "Financial Statements") are in accordance
with the books and records of Utilase, NMP and UPP, present fairly the financial
position and the results of the operations, changes in stockholders' equity and
cash flow of Utilase, NMP and UPP for the period then ending, and have been
prepared in conformity with generally accepted accounting principles
consistently applied with the prior periods except as may otherwise by indicated
in the notes thereto.
4.06 UNREPORTED AND CONTINGENT LIABILITIES. Except as expressly set
forth in the Financial Statements, and except as otherwise incurred by Utilase,
NMP and UPP in the ordinary course of their business, Utilase, NMP and UPP have
no obligations or liabilities, whether accrued, absolute, fixed, known or
unknown, contingent or otherwise, existing, arising out of or relating to any
transaction entered into, or state of facts existing, on or prior to the date of
this Agreement. For purposes of this Section, the phrase "in the ordinary course
of business" shall not include liabilities arising out of breach or contract,
breach of warranty, tort infringement or any violation of law, including, but
not limited to, health, safety and Environmental laws. Utilase, NMP and UPP are
not directly or indirectly liable upon or with respect to, or obligated in any
way to provide funds in respect of, or to guarantee or assume any indebtedness
or obligation of any person or entity.
4
<PAGE> 6
ARTICLE V
AFFIRMATIVE COVENANTS OF NOBLE METAL TECHNOLOGIES, INC.
From and after the date hereof, so long as any of the NMT Shares remain
outstanding, NMT shall perform and comply with, and shall cause each of its
Subsidiaries to perform and comply with, all covenants in this Article V
applicable to such Person as follows:
5.01 FINANCIAL STATEMENTS AND OTHER REPORTS. NMT will maintain, and
cause each of its subsidiaries to maintain, a system of accounting established
and administered in accordance with sound business practices to permit
preparation of financial statements in conformity with GAAP. NMT will deliver to
each holder of the NMT Shares, with reasonable promptness, such business or
financial information and data with respect to NMT or any subsidiary as from
time to time may be reasonably requested by any holder of the NMT Shares.
5.02 INSPECTION. NMT shall permit any authorized representative(s)
designated by any holder of the NMT Shares to visit and inspect any of the
properties of NMT or any of its subsidiaries, including its and their financial
and accounting records, and to make copies and take extracts therefrom, and to
discuss its and their affairs, finances and business with its and their officers
and independent certified public accountants, at such reasonable times during
normal business hours and as often as may be reasonably requested.
ARTICLE VI
MISCELLANEOUS
6.01 EXPENSES. NMT shall pay its costs, fees and expenses incurred by it
in connection with the negotiation, review, documentation, preparation and
closing of this Agreement. Shareholder shall pay all costs, fees and expenses
incurred by them in connection with the negotiation, review, documentation,
preparation and closing of this Agreement.
6.02 SURVIVAL. All representations, warranties, agreements and covenants
contained herein shall survive the execution and delivery of this Agreement, and
the purchase of the NMT Shares contemplated hereby and any disposition thereof,
notwithstanding any investigation made at any time by any of the parties hereto.
6.03 REMEDIES. Each holder of any of the NMT Shares will be entitled to
enforce its rights under this Agreement specifically and to exercise all other
rights existing in its favor. Money damages may not be an adequate remedy for
any breach of the provisions of this Agreement and, accordingly, the parties may
apply to any court of law or equity of competent jurisdiction (as contemplated
by Section 6.05) for specific performance and/or injunctive relief in order to
enforce or prevent any violation of the provisions of this Agreement.
6.04 NOTICES. Any notice, request, claim, demand or other communication
to be given or delivered under or by reason of the provisions of this Agreement
will be in writing and will be deemed to have been given when delivered
personally or mailed by certified or registered mail, return receipt requested,
and postage prepaid, to the recipient. Such notices, demands and other
communication will be sent as follows:
5
<PAGE> 7
(i) To Noble: Michael C. Azar, Esq.
33 Bloomfield Hills Parkway, Suite 155
Bloomfield Hills, Michigan 48304-2944
(ii) To NMT: Michael C. Azar, Esq.
33 Bloomfield Hills Parkway, Suite 155
Bloomfield Hills, Michigan 48304-2944
or, in either of the foregoing cases to such other address as such party may
hereafter specify for such purpose by notice to the other party referred to
above.
6.05 CONSENT TO JURISDICTION. NMT and Shareholder hereby consent to the
jurisdiction of any state or federal court located within the state of Michigan
and irrevocably agree that all actions or proceedings relating to this agreement
shall be litigated in such courts. NMT and Shareholder waive any objection which
it or they may have based on improper venue or forum non conveniens to the
conduct of any proceeding in any such court and waive personal service of any
and all process upon it and them and consent that all such service of process be
made by mail or messenger directed to it or them at the addresses set forth in
section 6.04 and that service so made shall be deemed to be completed upon the
earlier of actual receipt or three (3) days after the same shall have been
posted to the party's address set forth in section 6.04. Nothing contained in
this section 6.05 shall affect the right of any party to serve legal process in
any other manner permitted by law.
6.06 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, all of
the terms and provisions of this Agreement shall be binding upon, shall inure to
the benefit of and shall be enforceable by the respective successors and assigns
provided that this Agreement shall not be assignable by any party without the
prior written consent of the others, other than by operation of law.
6.07 AMENDMENTS AND WAIVERS. Except as otherwise provided herein, any
provision of this Agreement may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by NMT and the holders of a
majority of the then outstanding NMT Shares issued and sold hereunder. Except as
otherwise provided in this Agreement, any failure of either of the parties to
comply with any obligation, covenant, agreement or condition herein may be
waived by the party entitled to the benefits thereof only by a written
instrument signed by the party granting such waiver, but such waiver or failure
to insist upon strict compliance with such obligation, covenant, agreement or
condition shall not operate as a waiver of, or estoppel with respect to, any
subsequent or other failure.
6.08 ENTIRE AGREEMENT. This Agreement shall constitute the entire
agreement of the parties with respect to the subject matter hereof and supersede
all other understandings, oral or written, with respect to the subject matter
hereof.
6.09 GOVERNING LAW. This agreement shall be governed by and construed in
accordance with the internal laws of the state of Michigan. Without regard to
conflicts of laws principles.
6
<PAGE> 8
6.10 SEVERABILITY. Whenever possible, each provision of this Agreement
will 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 invalid, illegal or
unenforceable under any applicable law in any jurisdiction, such provision will
be ineffective only to the extent of such invalidity, illegality or
unenforceability in such jurisdiction, without invalidating the remainder of
this Agreement in such jurisdiction or any provision hereof in any other
jurisdiction.
6.11 HEADINGS. The Section and Subsection headings of the Articles
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
6.12 COUNTERPARTS; EFFECTIVENESS. This Agreement and any amendments,
waivers, consents or supplements may be executed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. This Agreement shall become
effective upon the execution of a counterpart hereof by each of the parties
hereto.
6.13 RIGHTS AND REMEDIES CUMULATIVE. Except as otherwise provided
herein, the rights and remedies herein provided shall be cumulative and not
exclusive of any other rights or remedies provided by law or otherwise.
IN WITNESS WHEREOF, the parties have duly executed this Agreement
effective as of the date first above written.
NOBLE INTERNATIONAL, LTD. NOBLE METAL TECHNOLOGIES, INC.
/s/ Lloyd P. Jones, III /s/ Lloyd P. Jones, III
- ------------------------------------ ------------------------------------
By: Lloyd P. Jones, III By: Lloyd P. Jones, III
Its: President Its: President
UTILASE, INC. NOBLE METAL PRODUCTS, INC.
/s/ Christopher L. Morin /s/ James Kopek
- ------------------------------------ ------------------------------------
By: Christopher L. Morin By: James Kopek
Its: Chief Executive Officer Its: President
UTILASE PRODUCTION
PROCESS, INC.
/s/ James Kopek
- ------------------------------------
By: James Kopek
Its: President
7
<PAGE> 1
EXHIBIT 2.3
STOCK EXCHANGE AGREEMENT
by and among
NOBLE COMPONENTS & SYSTEMS, INC.
and
NOBLE INTERNATIONAL, LTD.
and
PRESTOLOCK INTERNATIONAL, LTD.,
CASS RIVER COATINGS, INC. d/b/a VASSAR INDUSTRIES,
MONROE ENGINEERING PRODUCTS, INC. AND SKANDY CORP.
EFFECTIVE AS OF
March 31, 1998
<PAGE> 2
STOCK EXCHANGE AGREEMENT
------------------------
THIS STOCK EXCHANGE AGREEMENT (the "Agreement") is made and entered into
effective as of March 31, 1998, by and between NOBLE COMPONENTS & SYSTEMS, INC.,
a Michigan corporation ("NCS"), NOBLE INTERNATIONAL, LTD., a Michigan
corporation ("NIL"), PRESTOLOCK INTERNATIONAL, LTD., a Michigan corporation
("Prestolock"), CASS RIVER COATINGS, INC. d/b/a VASSAR INDUSTRIES, a Michigan
corporation ("Vassar"), MONROE ENGINEERING PRODUCTS, INC., a Michigan
corporation ("Monroe") and SKANDY CORP., a Michigan corporation ("Skandy").
WHEREAS, NCS desires to issue and exchange with NIL and NIL desires to
exchange and acquire from NCS the Common Shares (as hereinafter defined) on the
terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the covenants and agreements set
forth herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
ARTICLE I
EXCHANGE OF COMMON SHARES
1.01 EXCHANGE OF COMMON SHARES. Subject to the terms and conditions
hereof, NIL shall acquire from NCS and NCS shall issue to NIL, Fifteen Thousand
(15,000) shares of NCS's common stock (the "NCS Shares") on the date hereof in
exchange for Thirty Nine Thousand Nine Hundred Fifty Six (39,956) common shares
of Prestolock; Thirty Thousand (30,000) common shares of Vassar; One Thousand
Eight Hundred Fifty (1,850) common shares of Monroe and Five Thousand (5,000)
common shares of Skandy, which represent all of the issued and outstanding
capital stock of Prestolock, Vassar, Monroe and Skandy (collectively the "Common
Shares").
1.02 PAYMENT AND DELIVERY. Upon the execution and delivery of this
Agreement by NCS and NIL, or as soon thereafter as practically possible, NCS
will deliver to NIL individual certificates representing the NCS Shares,
registered in the name of NIL and NIL shall deliver to NCS the Common Shares.
1.03 INTERNAL REVENUE CODE SECTION 368. It is the intent of the parties
hereto that the exchange described herein shall qualify as a tax free exchange
pursuant to IRC ss.368(a)(1)(B).
1.04 CLOSING AND CLOSING DATE. The closing of the transactions
contemplated by this Agreement ("Closing") shall take place at 10:00 a.m., local
time, on March 31, 1998 ("Closing Date") at the offices of NIL, or at such other
time, place and date as shall be mutually agreed on by NCS and NIL and shall be
effective as of March 31, 1998.
1
<PAGE> 3
ARTICLE II
REPRESENTATIONS OF NOBLE COMPONENTS & SYSTEMS, INC.
NCS represents and warrants as follows:
2.01 AUTHORIZATION. It has the full capacity, power and authority to
execute, deliver and perform its obligations under this Agreement and it has
taken all necessary corporate action to authorize the execution, delivery and
performance of its obligations hereunder and to consummate the transactions
contemplated hereby.
2.02 AUTHORIZED AND OUTSTANDING CAPITAL STOCK. The authorized capital
stock of NCS consists of Fifty Thousand (50,000) shares of common stock none of
which has been issued or pledged.
2.03 BINDING OBLIGATIONS. This Agreement, when executed and delivered by
the parties, will be its legally valid and binding obligation, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
2.04 INVESTMENT INTENT. It is acquiring the Common Shares for its own
account for investment purposes only and the Common Shares are not being
purchased with a view towards resale or distribution; and it is able to bear the
economic risk of ownership of the Common Shares for an indefinite period of time
and has no present or foreseeable need to dispose of any portion of its
investment in Prestolock, Vassar, Monroe and/or Skandy and is aware that it will
be unable to readily liquidate its investment in Prestolock, Vassar, Monroe
and/or Skandy
.
2.05 NO CONFLICT. The execution, delivery and performance by it of this
Agreement and the consummation of the transactions contemplated hereby does not
and will not: (i) violate any provisions of law applicable to it; (ii) result in
or require the creation or imposition of any lien upon any of its properties or
assets.
ARTICLE III
REPRESENTATIONS OF NOBLE INTERNATIONAL, LTD.
NIL represents and warrants as follows:
3.01 AUTHORIZATION. It has the full legal capacity, power and authority
to execute, deliver and perform its obligations under this Agreement. NIL is the
lawful record owner of the Common Shares, and the same are and shall be
delivered to NCS free and clear of all pledges, security interests, options,
liens, encumbrances and claims or rights of every kind therein or thereto,
except such claim from Comerica Bank granted pursuant to an Amended and Restated
Loan Agreement dated December 30, 1997 and the delivery of such Common Shares to
NCS pursuant to the provisions of this Agreement will transfer lawful, valid,
marketable title thereto.
2
<PAGE> 4
3.02 BINDING OBLIGATION. This Agreement, when executed and delivered by
the parties, will be its legally valid and binding obligation, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
3.03 NO CONFLICT. The execution, delivery and performance by it of this
Agreement and the consummation of the transactions contemplated hereby does not
and will not: (i) violate any provisions of law applicable to it; (ii) conflict
with, result in a breach of or constitute (with due notice or lapse of time or
both) a default under any of its contractual obligations; (iii) result in or
require the creation or imposition of any lien upon any of his property or
assets; or (iv) require any approval or consent of any Person.
3.04 INVESTMENT INTENT. It is acquiring the NCS Shares for its own
account for investment purposes only and the NCS Shares are not being purchased
with a view towards resale or distribution; and it is able to bear the economic
risk of ownership of the NCS Shares for an indefinite period of time and has no
present or foreseeable need to dispose of any portion of its investment in NCS
and is aware that it will be unable to readily liquidate its investment in NCS.
3
<PAGE> 5
ARTICLE IV
REPRESENTATIONS OF PRESTOLOCK, VASSAR, MONROE AND SKANDY
Prestolock, Vassar, Monroe and Skandy represents and warrants as
follows:
4.01 AUTHORIZATION. They have the full capacity, power and authority to
execute, deliver and perform their obligations under this Agreement and they
have taken all necessary corporate action to authorize the execution, delivery
and performance of their obligations hereunder and to consummate the
transactions contemplated hereby.
4.02 AUTHORIZED AND OUTSTANDING CAPITAL STOCK. The authorized capital
stock of Prestolock consists of Sixty Thousand (60,000) shares of common stock;
the authorized capital stock of Vassar consists of Fifty Thousand (50,000)
shares of common stock; the authorized capital stock of Monroe consists of Fifty
Thousand (50,000) shares of common stock and the authorized capital stock of
Skandy consists of Fifty Thousand (50,000) shares of common stock. NIL is the
record owner of Thirty Nine Thousand Nine Hundred Fifty Six (39,956) shares of
Prestolock; Thirty Thousand (30,000) shares of Vassar; One Thousand Eight
Hundred Fifty (1,850) shares of Monroe and Five Thousand (5,000) shares of
Skandy, which represents all of the issues and outstanding shares of the capital
stock of Prestolock, Vassar, Monroe and Skandy, which have been validly issued,
are fully paid and non-assessable.
4.03 BINDING OBLIGATIONS. This Agreement, when executed and delivered by
the parties, will be its legally valid and binding obligation, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and by general principles of
equity.
4.04 NO CONFLICT. The execution, delivery and performance by it of this
Agreement and the consummation of the transactions contemplated hereby does not
and will not: (i) violate any provisions of law applicable to it; (ii) conflict
with, result in a breach of or constitute (with due notice or lapse of time or
both) a default under any of its contractual obligations; (iii) result in or
require the creation or imposition of any lien upon any of its properties or
assets; or (iv) require any approval or consent of any person under any
contractual obligations, except for such approvals or consents as have been
obtained or which it shall make all reasonable efforts to obtain.
4.05 FINANCIAL STATEMENTS. The balance sheet of Prestolock, Vassar,
Monroe and Skandy as of December 31, 1997 and the related statements of income,
changes in stockholders's equity and cash flows for the twelve (12) month period
then ended, together with the notes thereto, and the reviewed financial
statement of Prestolock, Vassar, Monroe and Skandy for the period ending
December 31, 1997 (the "Financial Statements") are in accordance with the books
and records of Prestolock, Vassar, Monroe and Skandy, present fairly the
financial position and the results of the operations, changes in stockholders'
equity and cash flow of Prestolock, Vassar, Monroe and Skandy for the period
then ending, and have been prepared in conformity with generally accepted
accounting principles consistently applied with the prior periods except as may
otherwise by indicated in the notes thereto.
4
<PAGE> 6
4.06 UNREPORTED AND CONTINGENT LIABILITIES. Except as expressly set
forth in the Financial Statements, and except as otherwise incurred by
Prestolock, Vassar, Monroe and Skandy in the ordinary course of their business,
Prestolock, Vassar, Monroe and Skandy have no obligations or liabilities,
whether accrued, absolute, fixed, known or unknown, contingent or otherwise,
existing, arising out of or relating to any transaction entered into, or state
of facts existing, on or prior to the date of this Agreement. For purposes of
this Section, the phrase "in the ordinary course of business" shall not include
liabilities arising out of breach or contract, breach of warranty, tort
infringement or any violation of law, including, but not limited to, health,
safety and Environmental laws. Prestolock, Vassar, Monroe and Skandy are not
directly or indirectly liable upon or with respect to, or obligated in any way
to provide funds in respect of, or to guarantee or assume any indebtedness or
obligation of any person or entity.
ARTICLE V
AFFIRMATIVE COVENANTS OF NCS
From and after the date hereof, so long as any of the NCS Shares remain
outstanding, NCS shall perform and comply with, and shall cause each of its
Subsidiaries to perform and comply with, all covenants in this Article V
applicable to such Person as follows:
5.01 FINANCIAL STATEMENTS AND OTHER REPORTS. NCS will maintain, and
cause each of its subsidiaries to maintain, a system of accounting established
and administered in accordance with sound business practices to permit
preparation of financial statements in conformity with GAAP. NCS will deliver to
each holder of the NCS Shares, with reasonable promptness, such business or
financial information and data with respect to NCS or any subsidiary as from
time to time may be reasonably requested by any holder of the NCS Shares.
5.02 INSPECTION. NCS shall permit any authorized representative(s)
designated by any holder of the NCS Shares to visit and inspect any of the
properties of NCS or any of its subsidiaries, including its and their financial
and accounting records, and to make copies and take extracts therefrom, and to
discuss its and their affairs, finances and business with its and their officers
and independent certified public accountants, at such reasonable times during
normal business hours and as often as may be reasonably requested.
ARTICLE VI
MISCELLANEOUS
6.01 EXPENSES. NCS shall pay its costs, fees and expenses incurred by it
in connection with the negotiation, review, documentation, preparation and
closing of this Agreement. NIL shall pay all costs, fees and expenses incurred
by them in connection with the negotiation, review, documentation, preparation
and closing of this Agreement.
6.02 SURVIVAL. All representations, warranties, agreements and covenants
contained herein shall survive the execution and delivery of this Agreement, and
the purchase of the NCS Shares contemplated hereby and any disposition thereof,
notwithstanding any investigation made at any time by any of the parties hereto.
5
<PAGE> 7
6.03 REMEDIES. Each holder of any of the NCS Shares will be entitled to
enforce its rights under this Agreement specifically and to exercise all other
rights existing in its favor. Money damages may not be an adequate remedy for
any breach of the provisions of this Agreement and, accordingly, the parties may
apply to any court of law or equity of competent jurisdiction (as contemplated
by Section 6.05) for specific performance and/or injunctive relief in order to
enforce or prevent any violation of the provisions of this Agreement.
6.04 NOTICES. Any notice, request, claim, demand or other communication
to be given or delivered under or by reason of the provisions of this Agreement
will be in writing and will be deemed to have been given when delivered
personally or mailed by certified or registered mail, return receipt requested,
and postage prepaid, to the recipient. Such notices, demands and other
communication will be sent as follows:
(i) To Noble: Michael C. Azar, Esq.
33 Bloomfield Hills Parkway, Suite 155
Bloomfield Hills, Michigan 48304-2944
(ii) If to NCS: Michael C. Azar, Esq.
33 Bloomfield Hills Parkway, Suite 155
Bloomfield Hills, Michigan 48304-2944
or, in either of the foregoing cases to such other address as such party may
hereafter specify for such purpose by notice to the other party referred to
above.
6.05 CONSENT TO JURISDICTION. NCS and NIL hereby consent to the
jurisdiction of any state or federal court located within the state of Michigan
and irrevocably agree that all actions or proceedings relating to this agreement
shall be litigated in such courts. NCS and NIL waive any objection which it or
they may have based on improper venue or forum non conveniens to the conduct of
any proceeding in any such court and waive personal service of any and all
process upon it and them and consent that all such service of process be made by
mail or messenger directed to it or them at the addresses set forth in section
6.04 and that service so made shall be deemed to be completed upon the earlier
of actual receipt or three (3) days after the same shall have been posted to the
party's address set forth in section 6.04 Nothing contained in this section 6.05
shall affect the right of any party to serve legal process in any other manner
permitted by law.
6.06 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein, all of
the terms and provisions of this Agreement shall be binding upon, shall inure to
the benefit of and shall be enforceable by the respective successors and assigns
provided that this Agreement shall not be assignable by any party without the
prior written consent of the others, other than by operation of law.
6.07 AMENDMENTS AND WAIVERS. Except as otherwise provided herein, any
provision of this Agreement may be amended or waived if, but only if, such
amendment or waiver is in writing and is signed by NCS and the holders of a
majority of the then outstanding NCS Shares issued and sold hereunder. Except as
otherwise provided in this Agreement, any failure of either of the parties to
comply with any obligation, covenant, agreement or condition herein may be
waived by the party entitled to the benefits thereof only by a written
instrument signed by the party granting such waiver, but such waiver or failure
to insist upon strict compliance with such obligation, covenant, agreement or
condition shall not operate as a waiver of, or estoppel with respect to, any
subsequent or other failure.
6
<PAGE> 8
6.08 ENTIRE AGREEMENT. This Agreement shall constitute the entire
agreement of the parties with respect to the subject matter hereof and supersede
all other understandings, oral or written, with respect to the subject matter
hereof.
6.09 GOVERNING LAW. This agreement shall be governed by and construed in
accordance with the internal laws of the state of Michigan. Without regard to
conflicts of laws principles.
6.10 SEVERABILITY. Whenever possible, each provision of this Agreement
will 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 invalid, illegal or
unenforceable under any applicable law in any jurisdiction, such provision will
be ineffective only to the extent of such invalidity, illegality or
unenforceability in such jurisdiction, without invalidating the remainder of
this Agreement in such jurisdiction or any provision hereof in any other
jurisdiction.
6.11 HEADINGS. The Section and Subsection headings of the Articles
contained in this Agreement are for reference purposes only and shall not affect
the meaning or interpretation of this Agreement.
6.12 COUNTERPARTS; EFFECTIVENESS. This Agreement and any amendments,
waivers, consents or supplements may be executed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. This Agreement shall become
effective upon the execution of a counterpart hereof by each of the parties
hereto.
6.13 RIGHTS AND REMEDIES CUMULATIVE. Except as otherwise provided
herein, the rights and remedies herein provided shall be cumulative and not
exclusive of any other rights or remedies provided by law or otherwise.
IN WITNESS WHEREOF, the parties have duly executed this Agreement
effective as of the date first above written.
NOBLE COMPONENTS
NOBLE INTERNATIONAL, LTD. & SYSTEMS, INC.
/s/ Lloyd P. Jones, III /s/ Christopher L. Morin
- ----------------------------------- -------------------------------------
By: Lloyd P. Jones, III By: Christopher L. Morin
Its: President Its: President
MONROE ENGINEERING PRESTOLOCK
PRODUCTS, INC. INTERNATIONAL, LTD.
/s/ Robert J. Skandalaris /s/ Christopher L. Morin
- ----------------------------------- -------------------------------------
By: Robert J. Skandalaris By: Christopher L. Morin
Its: Chief Executive Officer Its: President
CASS RIVER COATINGS, INC. D/B/A
VASSAR INDUSTRIES SKANDY CORP.
/s/ Christopher L. Morin /s/ Robert Koltvedt
- ----------------------------------- -------------------------------------
By: Christopher L. Morin By: Robert Koltvedt
Its: Chief Executive Officer Its: President
7
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR THE THREE MONTHS
ENDED MARCH 31, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
INTERIM FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 1,976
<SECURITIES> 0
<RECEIVABLES> 12,385
<ALLOWANCES> 0
<INVENTORY> 4,904
<CURRENT-ASSETS> 20,075
<PP&E> 25,814
<DEPRECIATION> 0
<TOTAL-ASSETS> 70,905
<CURRENT-LIABILITIES> 16,964
<BONDS> 0
813
0
<COMMON> 27,338
<OTHER-SE> 1,191
<TOTAL-LIABILITY-AND-EQUITY> 70,905
<SALES> 17,434
<TOTAL-REVENUES> 17,434
<CGS> 12,668
<TOTAL-COSTS> 12,668
<OTHER-EXPENSES> 2,974
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 380
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